Finance Minister Bishnu Paudel presented the yearly budget plan for fiscal year 2021/22 on Saturday. The Oli government targeted young businesses in the country with two major announcements this year: an income tax exemption for the next five years and a seed capital loan of up to Rs 2.5 million at a 1% interest rate using their business proposal as collateral.
In addition, Rs 1 billion has been set aside to establish a challenge fund in order to encourage foreign investment in Nepali startups and to facilitate policies. The startup community, on the other hand, does not appear to be very enthusiastic, casting more doubt on its effectiveness. In addition, many business entrepreneurs are perplexed by the application procedure and requirements.
The budget announcement has not pleased Saugat Basnet, the founder of Sikumna. Every year, the yearly budget is published, and funds are distributed to all sectors, he says, adding that it is frustrating to see just half of the projects or works done effectively at the end of the fiscal year.
“The question remains on its implementation,” Basnet asserts. If the government can successfully implement this, it will undoubtedly be highly useful to us and a good step forward for companies like ours.”
“It is a good step,” says Suraj Raj Pandey, a co-founder of Fibro, “but it is not the first time that the budget has been so promising.”
An announcement is less essential to him than execution. “In the context of Nepal, that appears to be highly improbable. However, I am hopeful that this will be implemented, as SMEs and startups are in desperate need of assistance as a result of the Covid-19 crisis.”
Niraj Khanal, a startup enabler, agrees with Pandey and adds that money of various sizes and titles, such as challenge funds and seed capital loans, have been granted in prior budget plans as well. “It isn’t something new. As a result, there is skepticism about its execution, as there has be
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Promises of the new budget: Nepal’s startups ‘neither believe in nor expect help from govt’