Banking News – The Nepal Dairy Association has welcomed the Monetary Policy for Fiscal Year 2083/84, stating that it gives due priority to agriculture, livestock, dairy, and other agriculture-based industries.

According to the association, the policy includes provisions to promote credit flow to productive sectors, improve access to concessional financing, expand lending to small and medium-sized enterprises (SMEs), and support the agricultural value chain, food processing, cold storage facilities, warehouse infrastructure, and import-substitution industries.

The association noted that the dairy sector plays a vital role in Nepal’s agricultural economy, food security, rural employment, and the livelihoods of millions of farming households. It welcomed the policy’s emphasis on expanding credit to productive sectors, encouraging investment in agriculture and dairy industries, facilitating loan rescheduling and restructuring, expanding digital financial services, and promoting green investment.

However, the association stressed that the success of the monetary policy will depend on its effective implementation.

It pointed out that the dairy industry is currently facing several challenges, including a decline in raw milk production, rising production costs, a shrinking market, shortages of working capital, and increasing banking debt.

The association urged the authorities to recognize the dairy industry as a productive and essential sector by ensuring concessional interest rate loans, easier access to working capital, and the effective implementation of refinancing and loan restructuring facilities to support the industry’s sustainable growth.