Amidst recent announcement of the fiscal policy, popularly known as the ‘budget,’ for the fiscal year 2070/71 B.S., the expectations from the fresh budget and optimisms concerning the entire socio-economic shift in the hearts of the Nepalese citizens, though lately, has surged significantly. Being associated with the Nepalese financial industry, it is always great to witness something positive and vibrant potential maneuver that could uplift the outreach of the financial eco-system. Announcement by the latest budget to regulate the Nepalese commodity market under the supervision of Securities Board of Nepal (SEBON) has been one recent blissful instance.    

Now, let’s examine some of the potential opportunities given by this budget that the participants of the Nepalese commodity arena could en-cash and magnify upon. Firstly, as the government has focused to promote the Nepalese agro industry via facilitating export subsidies, capital-seed assistance in plant installation (drier, processor et cetera) and providing loans in nominal rates, to name some, the scope of the commodity market in the days ahead is assumed to be huge, visibly, if operationalized and optimized effectively. Further, as agro-based products like coffee, cardamom, lentils and other related crops/grains have been put into the priority sector, channelization of these products in the commodity sphere and the completion of value chain in the market, i.e., consumers and producers, with transparent and fair price discovery is vital.

With the government of Nepal already set to promote the derivative based market in Nepal, now it’s time for all the stakeholders, directly or indirectly related to the commodity market, to start working upon to develop all the pre-requisites required the full fledged operations of the commodity market. For instance, exchanges could initiate initial discussions with the co-operatives, dealing with agro-processing, concerning the channeling of the physical market via the exchange’s trading platform. Similarly, responsible government authorities could start to co-ordinate with the appropriate private and public authorities to establish required standardized warehouses, a pre-requisite of exchanges and precaution during crises, to go for contracts with the possibilities of physical deliveries, satisfying all the requirements of the delivery contracts. Beyond these factors, other potential and essential components of the commodity market eco-system like, banking, insurance, brokers, dealers of different commodities, transportation authority, indemnity funds, et cetera, should now be the actively participating stakeholders of the Nepalese commodity arena.

At this epoch of Nepalese commodity market, after a long and painful waiting, the budget 2070/71 has given a tremendous sigh of relief to the entire Nepalese financial arena, especially to the commodity market. Now, it is the execution part that could actually shape the direction and magnitude of this form of market in the coming days. Only proper implementation of the sought aspirations by the budget, concerning the Nepalese commodity market in streamlining the major variables responsible for the future of the market, primarily the regulatory body, as proposed SEBON, could practically result a better market place for the entire Nepalese commodity eco-system.