KATHMANDU: Finance Secretary Ghanashyam Upadhyay has expressed concern over the private sector’s limited role in innovation in the automobile sector.
Speaking during the ‘Innovative Mobility for Economic Development’ session in the NADA Auto Dialogue organized recently by the by the NADA Automobile Association in Kathmandu, Upadhyay said since the Nepali private sector is largely focused on importing and selling finished vehicles for quick profit, there’s little involvement in local production or innovation. “Given the government’s limited resources, we cannot achieve true innovation in mobility without meaningful participation from the private sector,” he added.
Since banks are investing heavily in the EV sector, it is time to assess the potential risks, particularly around loan defaults
He assured that the government is open to implementing constructive suggestions from the private sector and is willing to collaborate on driving innovation forward.
Another speaker, Nepal Bankers’ Association (NBA) President, Santosh Koirala, said that both the government and the Nepal Rastra Bank (NRB) should bring friendly policies regarding electric vehicles financing. “Since banks are investing heavily in the EV sector, it is time to assess the potential risks, particularly around loan defaults,” Koirala said.
Just like we have seen in the past with real estate and stock market booms, the EV sector is now attracting speculative investment. Vehicles are flooding the market without sufficient oversight.
According to Koirala, the development and promotion of the EV sector will not be possible without bank support. “While EVs have low operating costs, battery replacement could pose a major financial burden in the future. If batteries fail within a few years-while loans stretch over seven years-borrowers might struggle to repay,” he added.
Koirala also suggested stricter criteria for EV distributors. “Just like we have seen in the past with real estate and stock market booms, the EV sector is now attracting speculative investment. Vehicles are flooding the market without sufficient oversight,” he said. “Consumers should be made aware of issues such as battery management, availability of charging stations, battery replacement costs, the need for technical manpower for repairs and importance, and brand value.”
