Nepal’s stock exchange is state-owned and, since 2007, decisionmaking by the government has been slow. Without government permission, the exchange’s employees cannot dispose of old equipment, or introduce new technology.
The NEPSE uses an electronic trading system, but is one of the last in the world to settle trades manually, with brokers exchanging paper receipts and certificates at the end of trading.
“We sent a proposal to the government five years ago to privatize the exchange,” NEPSE deputy manager Shambhu Panta said. “There has been no response... There is no stable government. No decisions are taken.”
The NEPSE’s 50 registered brokers trade an average of US$1.5 million a day, up from about US$700,000 last year.
This reflects Nepal’s economic potential and hopes that the elections will bring stability, Panta said.
The benchmark index touched a record 1,175 points in 2008, but bottomed out at 292 last year after the country’s first constituent assembly collapsed. It has since recovered to 541.
“When people think the politicians will agree on a constitution, the index rises,” Panta said. “When the politicians fight, it falls.”
On that basis, the market might be heading lower. No party is expected to emerge strong enough from the elections to resolve a fight over how much power to give local governments.
In a sign of the volatility leading up to the vote, gunmen on a motorcycle shot a candidate on Friday last week. The man died on Thursday.
Billionaire Chaudhary worries that Maoist splinter groups threatening protests will clash with troops or scare off voters, undermining the election’s legitimacy.
Nepal’s most successful capitalist is already dabbling in politics via a long association with the Communist Party of Nepal (Unified Marxist Leninist), which is these days seen as a center-left party. He was a member of the constituent assembly until it collapsed last year and said he will campaign for the party in these elections.
“I’m a political animal, I’m very much part of it,” he said.
Chaudhary offered Pakistani Prime Minister Nawaz Sharif and former Thai prime minister Thaksin Shinawatra as examples of businessmen-turned-politicians.
“It’s going to be a very important decision for me. I would not like to wear two hats, I’d have to completely give up my current position and current role and involvement in business and then I’d have to work 100 percent full time with the single objective of transforming this country economically,” he said.