Kathmandu, Aug. 4: Nepal’s private sector has criticised the police raid on the residence of industrialist Benigopal Mundada in Biratnagar, saying heavy-handed investigations without evidence are damaging investor confidence and accelerating capital flight.
The criticism comes even as Prime Minister Balendra Shah and Finance Minister Dr. Swarnim Wagle continue separate consultations with business leaders to encourage private investment.
A large police team searched Mundada’s house in Biratnagar early Monday, acting on what authorities described as “special information.” Officers searched the property for nearly five hours but found no illegal items. Police have not disclosed what they were looking for.
Confederation of Nepalese Industries (CNI) President Birendra Raj Pandey said the state has the right to investigate suspected wrongdoing, but such actions must be conducted in an investment-friendly manner.
“When the prime minister invites investment while law enforcement treats entrepreneurs like criminals, it sends the wrong message,” he said, adding that searches without concrete evidence damage reputations and create fear among investors.
Federation of Nepalese Chambers of Commerce and Industry Vice President Prabal Jung Pandey said reputation is often more valuable than money for businesspeople and warned that years of credibility could be destroyed by a single incident. He also criticised what he described as a gap between the government’s pro-investment rhetoric and its enforcement practices.
Economist Chiranjibi Nepal said the treatment of the private sector, which contributes about 80 per cent of the country’s economy, risks pushing investors to move their capital abroad. He urged the government to ensure policy stability and build investor confidence.
Despite more than Rs 1.3 trillion in loanable funds in the banking system, private sector credit growth has remained around five to six per cent, indicating weak investor confidence. Business groups say many companies have postponed expansion plans, warning that the government’s seven per cent economic growth target will be difficult to achieve without stronger private sector investment.
People’s News Monitoring Service
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