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The 13th edition of the biggest automobile exhibition in the country, the NADA Auto Show, concluded on September 16, with a record Rs 5 billion worth of trans­actions. Taking part in this extrava­ganza were more than 70 automobile importers, dealers, distributors, and manufacturers spread over around 135 big and small stalls at Bhrikuti­mandap in Kathmandu. The six-day expo, jointly organized by the Nepal Automobiles Dealers Association (NADA) and the Global Exposition and Management Services, show­cased the latest two- and four-wheel­ers under the same roof. Making their presence felt at the event were major automobile brands such as Honda, Jeep, Mahin­dra, Isuzu, KIA, Ford, Hyundai, Tata Motors, Toyota, Hyundai, Renault, Nissan TVS, Bajaj, Royal Enfield, NIU, Miyama, and Vespa, to name a few. Besides new vehicles, there were also stalls for spare-parts, tires, lubricants, garage equipment, bat­tery, and other auto accessories.

Although the total number of vis­itors (65,000) this year was not a significant increase from last year’s (62,000), the transaction amount this year doubled from last year’s Rs 2.2 billion. The sales at the NADA 2017 had been partly affected by a liquidity crisis, with commercial banks tightening hire-purchase loans. But with increased liquidity, sales this year soared.

“There are many other factors behind the increase in sales,” says Krishna Prasad Dulal, vice-president of NADA. “First, this time Nepali consumers showed more interest in purchasing bigger and more expen­sive crossovers and SUVs compared to smaller passenger cars. Also, their purchasing power seems to have increased and a culture of changing and upgrading cars has been estab­lished.” Dulal explains that in terms of quantity, sales of smaller hatch­backs and sedans are higher but in terms of revenues, crossovers and SUVs contributed significantly more to the total pot of Rs 5 billion.

“Our streets are becoming less maneuverable for smaller cars with low ground clearance and the SUVs have also become more affordable due to high competition,” says Dulal. “Take the Jeep for example, a new entrant in the Nepali market that nonetheless notched up satisfactory sales in the NADA week.”

As for the consumers, their expec­tation of reduced import taxes and excise duties did not come true this fiscal too. In fact, the government increased taxes on both two- and four-wheelers. Says Saurav Nepal, an automobile enthusiast and journal­ist, “As always, NADA succeeded in creating an extravagant affair, show­casing a wide range of automobiles. I was particularly impressed by the new electric vehicles, Jeep SUVs and Harley Davidson motorcycles that were on display. But unfortunately taxes make them unaffordable.”

The electric vehicles launched this year have managed to attract many consumers, as was evident at the NADA Auto Show, Dulal explains. But there is still a state of confusion among both the buyers and sellers about their future. The facilities for recharging and repairing electric automobiles are poor at the moment and as most EVs coming into Nepal are from branded companies, their costs are relatively high.

“Currently, the best option is to import relatively cheaper EVs from China. But the perception of Chinese products is not good,” says Dulal. “The other option is for the govern­ment to promote EVs by reducing taxes and facilitating the use of elec­tric vehicles” 

Jagdamba Motors launches TVS NTORQ 125  

 Jagdamba Motors, the authorized distributors of TVS two-wheelers and three-wheelers in Nepal, has launched its 125cc ‘connected scooter’ TVSN­TORQ 125 at the National Automobile Dealers Association (NADA) Auto Show 2018 being held in Kathmandu. The introductory price of the TVSN­TORQ is Rs 224,900.

Designed for the youth, TVS NTORQ 125 has been developed based on the TVS Racing pedigree and comes with the state-of-the-art CVTi-REVV 3 Valve engine. The scooter also marks the launch of an exclusive technology platform—TVS SmartXon­nect*—making it a connected scooter.

Khalti, Tootle partner for bike hailing service in Nepal  

Nepal’s two homegrown startups, Khalti Digital Wallet and Tootle, have signed an agreement to make the bike hailing service easier. This partner­ship will enable Tootle customers to top-up their Tootle balance via Khalti Digital Wallet and make payment for Tootle ride even more convenient. Amit Agrawal, Director of Khalti, and Sixit Bhatta, Co-founder and CEO of Tootle, signed the MoU to this effect on September 11.

 For an economy saddled with a huge trade deficit (that bal­looned to Rs 1,161 billion in the last fiscal), any new production activ­ity at home is welcome news. With the continuous drainage of human resources to other countries, Nepal’s manufacturing has suffered, contrib­uting to import dependency for the smallest of consumer goods—includ­ing pencils. This is not to suggest there is pau­city of enterprising entrepreneurs in Nepal. Take the 29-year-old Nirmal Dahal. A resident of Damak, Jhapa, Dahal employs over a dozen workers in his native city. In the process he is helping reduce the monopoly of foreign products in Nepali markets. Not just that. He is protecting the environment too. He is doing all this via his Sagarmatha Pencil Udhyog.

“The idea came to me when I was working in the stationery department of a bank in Kuwait,” says Dahal. “I saw pencils made from recycled paper there and thought I should try and produce them in my own country.” Dahal returned home in 2017 and after a few months of research launched a small-scale industry.

The goal was not only to make something in Nepal, but also to cre­ate an eco-friendly industry, Dahal says. At present, the Sagarmatha Pencil Udhyog produces an average of 3,000 pencils a day and recycles around 30 tons of waste paper every month. Sagarmatha pencils are cur­rently sold in most eastern districts and they are being marketed in Kath­mandu too. “We have started selling from about 25 different stores in Kathmandu and business is slowly picking up.”

The main competitors for Sagar­matha pencils are established Indian brands that have monopolized the Nepali markets for years. In terms of operations, Sagarmatha still depends on manual labor for 40 percent of its production process, and hence the high production cost. “We are still selling at prices competitive with Indian pencils,” Dahal says. “The idea is not to compete against Indian companies but to create envi­ronment friendly products here and start a change in the country.”

Sagarmatha produces four differ­ent models of pencils at the moment and is planning new products and designs for early 2019. Due to its roots as a small-scale industry, the biggest challenge has been market expansion, Dahal says. “We are a small team and we are selling only on the basis of the orders we get. We have to penetrate new markets to be able to sell more,” he says.

Graphically designed to attract school children as well as other users, Sagarmatha pencils proudly bear the Nepali flag to distinguish them from imported products.

“We are importing millions worth of stationery products every year,” Dahal says. “I hope Sagarmatha Pen­cil Udhyog will help bridge the coun­try’s trade deficit, albeit only a bit. But hopefully other entrepreneurs like me will take note”

 The Nepali rupee this week hit an all-time low against the US dollar (1 USD equaled Rs 115.11 at the time of writing this report). This in turn fueled speculations on the future of the local currency, even as the trade deficit steadily mounted. The Nepal Oil Corporation has already announced a monthly loss of Rs 640 million partly as a result of a dearer dollar.

According to Nepal Rastra Bank, Nepal imported Rs 1.24 trillion worth of goods while exporting only Rs 81.19 billion worth in the last fiscal that ended mid-July. Pegged to the Indian rupee, the Nepali currency is depreciating in tandem with India’s. But while there has been much talk of the doom and gloom from the rapid devaluation of our currency, the upsides to Nepal of a dearer dol­lar have been comparably ignored.

“The increase in dollar rate at the start of the tourist season is good for us,” says Ganesh Bahadur Thapa, the owner of the 2-star Hotel Snowland in Lakeside, Pokhara. “Our rooms are priced in dollar and what little we purchase for our kitchen we can get locally.” Thapa explains that with the US dollar strong, tourism could be one industry that could help sta­bilize the economy.

“The pricier dollar is good for us too,” says the owner of a money exchange in Kathmandu. “People are enthusiastically handing us dol­lars in return for more and more rupees. The higher the volume of the exchange, the higher the com­missions for us.”

Albeit small in size compared to other businesses, the foreign IT-based companies that work from Nepal have been flourishing as well. “I make an average of $500 a month working as a copywriter for international clients. Of late my dollar income has increased,” says Nirman Pradhan, an IT worker in Kathmandu. Pradhan, like most IT professionals in Nepal, uses web-based platforms like Freelancer, Guru, Peopleperhour, Upwork to find international clients. They get paid in dollars that are deposited into their Nepali bank accounts.

Dinesh Karki, who runs an off­shore IT company based in Nepal, believes the country’s trade imbal­ance can be checked by the service sector that earns in foreign curren­cies. “When we talk of exports in Nepal, why do we only mean export of goods? After all, many advanced economies have grown largely on the back of their service industries,” Karki says.

He suggests one way out for Nepal could be a massive upgrade of the service industries. “If only the gov­ernment could see the importance of developing infrastructure and creating a conducive environment for IT professionals, we have enough talent in Nepal to bring plenty of foreign income,” Karki says. “But at the moment the government is far from helpful.”

IT professionals in Nepal have of late been complaining of various restrictions in their work. The gov­ernment has for instance banned trading in cryptocurrencies, a lucra­tive earning opportunity for IT pro­fessionals. The NRB also has strict regulations on international credit cards for Nepalis, restricting any form of online payment.

“How do we run our business when we cannot even make online purchases?” Karki asks. “It would be a lot easier for us if the government stopped treating IT professionals as money launderers