Minister for Finance is instructed to ensure that state-owned companies make a profit

Finance Minister Janardhan Sharma has directed the authorities concerned to intervene at the policy level to ensure that a loss-making public corporation owned by the State makes a profit.

The Financial Sector Management and Coordination of Corporates Division in the Finance Ministry on Wednesday directed the Finance Minister, “Draw up a detailed plan to deal with the problem of bailing out loss-making public corporations. Also a plan and policy that will enable such distressed corporations to reach a profitable position.”

Madhu Kumar Marasini, Secretary, Ministry of Finance, spoke on the need to modernise and reform ailing state-owned enterprises. Out of 44 state corporations, 24 have made profits while the remaining 18 have been loss-making.

Marasini said that the government had invested more than Rs 600 billion but, much to the chagrin of the government and the public, these corporations had failed to provide jobs to more than 30,000 people.

Such corporations are accountable to the government because they do not make profits but impose additional responsibilities on the government, Marasini said, adding that even those corporations that have been privatised to make profits are making losses.

He also insisted on political and legal reforms of such corporations.

Giving details about the status of the corporations, Divisional Chief Dirgaraj Mainali said Nepal Oil Corporation, Nepal Electricity Authority, Nepal Telecommunications Company Limited, Nepal Banijya Bank Limited and Agricultural Development Bank, among others, have made profits.

Of the 44 public corporations, 10 were in the industrial sector, nine in the commercial sector, nine in the financial sector, five in the social sector and ten in the service sector.