Nepal Rastra Bank (NRB) could be required to issue its monetary policy on the first day of every fiscal year under a proposed amendment to the Nepal Rastra Bank Act.

The proposed provision is included in the amendment bill currently being discussed clause by clause by the Finance Committee of the House of Representatives. If approved, NRB would have to publish its annual monetary policy on Shrawan 1, the first day of Nepal's fiscal year.

The Finance Committee decided to include the provision during its meeting on Monday, according to committee chair Dr Krishna Hari Budhathoki.

The committee has also been reviewing proposed changes to several other provisions of the Nepal Rastra Bank Act, including Sections 25 and 41. Discussions have also started on the central bank's authority to take general action against banks and determine whether individuals are eligible to hold positions in the banking sector.

However, Nepal Rastra Bank officials have suggested that certain issues concerning the eligibility and disqualification of banking professionals should instead be addressed through amendments to the Banks and Financial Institutions Act (BAFIA).

Officials from the Ministry of Law have also told the committee that it cannot discuss or amend provisions for which no formal amendment has been proposed.

The proposed change to the monetary policy schedule comes as lawmakers seek to make the timing of the central bank's annual policy announcement more predictable.

Currently, the timing of monetary policy publication can vary depending on the policy process and other developments. Requiring the policy to be issued on Shrawan 1 would establish a fixed annual deadline and align the monetary policy cycle more closely with the beginning of the government's fiscal year.