Kathmandu, October 15
The government has prepared Due Diligence Audit (DDA) reports for five of the seven industries that have been closed for a long time. The Ministry of Finance said the reports for the other two are still pending.
“As mentioned in the budget speech, DDA work on the assets and liabilities of seven enterprises is under way. Reports for five of them have been received, while the valuation of the assets and liabilities of Butwal Dhago Karkhana and Nepal Orind Magnesite Pvt. Ltd. is ongoing,” the ministry said in a written reply sent to the Federal Parliament Secretariat.
The ministry said that once the DDA reports are in, the government will study them, select a suitable public-private partnership model and manage the investment.
The government has begun the process of reopening seven large state-owned industries, closed for a long time, under a public-private partnership model. The DDA reports have been prepared as part of this process.
As the first phase, the Ministry of Finance has started detailed audits and valuations of all seven industries.
The seven industries are Gorkhakali Rubber Udhyog, Janakpur Cigarette Factory, Butwal Dhago Karkhana, Nepal Metal Company, Nepal Orind Magnesite, Hetauda Textile Industry and Udayapur Cement Industry.
House of Representatives member Nischal Rai had asked the ministry a question. He pointed out that on one hand the Finance Ministry tells investors the private sector is the engine of the economy, while on the other Prime Minister Balendra Shah keeps posting on Facebook that state-owned industries are starting to run one after another.
The Parliament Secretariat had forwarded Rai’s written question to the Finance Ministry.
In its reply, the ministry recalled that it had released Rs 3.3 million for running the Hetauda industry.
Rai had also asked, “Is the government about to return the country to the model of state-run industry, which had failed worldwide even before 1990?”
In response, the Finance Ministry said, “Since the government needs to take the initiative to bring industries that have been closed for a long time back into operation, some work had to be done in the initial phase.”
The reply also said that the annual budget for fiscal year 2026/27 adopted a policy of increasing capital in some public enterprises and disinvesting shares in others to strengthen them.
The same reply states that DDA reports are ready for five of the seven closed industries and pending for two.
The ministry also replied on the budget release to Hetauda Textile Industry. It said the government had released Rs 3.3 million to repair the long-closed industry’s basic infrastructure and machinery and to begin trial production.
Some machines at the factory have now started trial production.
“After this trial, a suitable model will be selected for its reopening after considering various models,” the Finance Ministry said.
According to the ministry, the government remains firm in its belief that the private sector is the engine of the country’s economy.
“Even when state-owned industries are reopened, it will be done in collaboration with the private sector,” the reply states. “State-owned industries will be managed sustainably in collaboration with the private sector, and private industries will get additional markets through backward and forward linkages. The private sector itself will benefit from this.”
The ministry added that Nepal’s economic policy is clearly laid out in the constitution. The government is working in line with the Directive Principles of the State, which call for sustainable economic development through the participation of the public, private and cooperative sectors, transforming the national economy into a prosperous one.
“The government’s main goal is to develop a production-oriented economy,” the ministry said. “By reforming such enterprises, the private sector has been put in the front seat. There should be no confusion about this.”
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