Mismatches in Fiscal and Monetary Management

The Unnayan Onneshan, an independent multidisciplinary think-tank, reveals that the gross domestic product (GDP) in the current fiscal year is likely to experience a decelerating rate for the third time in a row from those of the preceding years.

The research organisation’s half-yearly assessment of the economy, coinciding with the end of the calendar year and the completion of the tenure of the present government, also states that the growth in GDP may fall below the decadal average of six percent due to fiscal

Interest Rate Spread

It is possible to reduce the IRS to some extent by increasing operating efficiency in the banking sector through reducing overhead costs and the proportion of NPL could contribute in reducing IRS and strengthening of capital market could be an alternative mode of mediating private savings, and in this way
it is possible to make the sector more competitive in the medium-to-long run. Moreover, even after following the financial liberalisation thesis for more than decades, wide disparity exists between

FINANCIAL REFORM

Financial liberalisation (FL) refers to the regulation of domestic financial markets and the liberalisation of the capital account. It is generally believed to improve financial sector development, which in turn, will enhance economic growth. The liberalisation process began with the privatisation of state owned enterprises in 1976 in the backdrop of a significant deterioration of the economic condition. Formally, the financial sector reform programme was launched in 1984 with the appointment of the national

Implications of Risk Management and Stress on Fiscal System

Presently, return on equity and return on assets of banking sector are low, which indicate the low profit of the bank and this might be lesser collection of taxes since bank is the number one source of tax under large tax unit of NBR and NBR collects the major portion of revenue from banking sector. In addition, the revenue target might fail to achieve the revenue target since lesser investment is witnessed from lower growth of credit. Gross and/or net non-performing assets or loans (NPA/NPL) are considered as