Also keeping financially healthy in a lockdown

Post pandemic the government must expedite the foreign investment process to show that Nepal is back in business

As we face an unprecedented and precarious pandemic that has caused uncertainty to the entire global economy, Nepal’s own response to it will determine at what velocity our economy will hit the ground. We need to brace ourselves for a very hard landing.

All businesses have been severely disrupted by the COVID-19 lockdown. As private equity investors, our first task has been to assess the nature of the problem that they face and provide solutions.

The effect of this contagion has not just been sector-specific, but has affected the entire value chain. In Nepal this problem is compounded as we are heavily import dependent, which has created severe disruption in intermediate (raw) materials and components for production.

All sectors of the economy are facing limitations. The tourism and hospitality industry has suffered immensely due to cancellations of visitor arrivals, local restaurants have had to close down due to lack of business. Agriculture will be next to be affected due to the lack of fertilisers and other inputs. As the lockdown is extended, the state of the economy will progressively deteriorate.

The foremost factor for a private equity is investor like us in a crisis like this is to ensure the management of impact on the work force. Human resource must be well taken care of and all our partner companies have preventive measure against this virus.

Secondly, we assess the financial health of the companies. Our advisory role is to give oversight on what they should do to alleviate the problem. It is no surprise that all are in a stage of cash shortage for working capital and debt repayment compounded by receivables that seem improbable of getting paid on time.

We impress upon them to consolidate their accounts, manage expenses prudently and cut costs. Management of operational risk is very important at this juncture — this is not the time for bottom line expectations but to ensure top line sustainability.

Depending on the gravity of the state of their balance sheets, we support them to acquire bridge gap funding or, in the long run, increase our equity portion. The companies that are in a better situation have been active in providing philanthropic activities to the community.

Whether it is providing free lunches to the police and health workers or building and providing swab collecting booths for safety of medical workers at hospitals or setting up a call center that provides access to doctor services have all been pro bono activities in this hour of need. We encourage such endeavors and also provide linkages between the companies in our portfolio.

Never has private equity impact funds been more relevant than now. Patient risk capital with a hand holding mechanism that provides diffusion of knowledge along with the much needed capital is what private equity has been doing in Nepal for the past five years.

For a foreign direct investor (FDI), we are restricted due to the time taken by the government agencies for approval, which can take as long as 3 to 6 months. There are capital increment requests for investments that have been waiting for over 18 months for FDI approval.

Businesses will not have that long a gestation period if they are strapped for cash. Therefore, the government needs to put in place a mechanism to expedite onward investments or top ups for these companies to move forward. Furthermore, this will also help the weak situation of the balance of payment of the country.

Millions of dollars are awaiting approval at this moment. Post lockdown, this will be an opportunity for the government to show its sincerity towards foreign investors by expediting the process and demonstrating that FDI is an important component to Nepal’s development  showcasing that we are open for business in action rather than words.

Siddhant Pandey is Chairman and CEO of Business Oxygen Pvt Ltd (BO2).

Source : Nepali Times

Philanthropy in the time of pandemic

The coronavirus pandemic has also brought out the best in institutions and individuals helping those in need during the lockdown

At Health at Home  the phone lines open at 7am ever day. Within minutes the calls start coming in. Five volunteer doctors are online to take the average 500 calls a day from people all over the country concerned about coronavirus symptoms.

Dalle Momo, the dumpling company, prepares 250 meals a day at its central kitchen at Ratopul and distributes them to security personnel enforcing the lockdown at intersections across Kathmandu, to frontline health workers at the Sukraraj Tropical and Infectious Disease Hospital in Teku, and homeless people in the Valley.

Zonta Club of Kathmandu also prepares food packages and has partnered with several NGOs to distribute daily 1,000 meals to daily-wage earners who are out of jobs. Each packet includes basic food items like rice, lentil, salt, sugar, tea, and oil.

The private sector and non-profit organisations have all been stepping up their activities to help security forces, health workers and daily-wage workers since the nation-wide lockdown began on 24 March.

Bishal Dhakal, founder of Health at Home,  says he started the call-in service since people across the country — especially those in rural areas with no direct access to doctors, decided to set up a telephone triage service so that people can get a free counseling from medical professionals about their symptoms. Health at Home partnered with Ncell so that the incoming calls can be free.

At a time when public concern about the pandemic is high  the service has not only been a way for people to talk to doctors about their symptoms, but also a source of reassurance.

“It has become like a counselling platform,” Dhakal says of the telephone triage. “This has been a support network for people in that it has helped with people dealing with the anxiety and stress that they might be feeling during this time.”

The call-in service helps screen potential COVID-19 patients for testing and take the pressure off of hospitals as they tend to get overcrowded with patients suspecting they have the coronavirus, which in turn increases the risk of infections spreading more widely.

Staff at Dalle Momo prepare meal for distribution.

Photos by Alok Yonjan

Subhash Gauchan, co-founder of Dalle Momo, says his company began providing meals with the intention of using its remaining stock of raw material to feed whomever they could instead of letting it go to waste. But then it evolved into something bigger.

“A lot of people have come forward and asked how they could help,” Gauchan told Nepali Times over the phone. “They have been stepping up to provide fresh vegetables, which is what we need the most. So, we decided that we would continue doing this for as long as we are able.”

Although Nepal seems to have been spared from a more aggressive spread of the coronavirus so far,  Nepalis are set to be significantly affected financially by the pandemic, with daily-wage workers bearing the brunt of the economic fallout. Non-profits like the Zonta Club of Kathmandu have been reaching out to daily wage workers affected by the lockdown.

Zonta’s Kamal Kesari Tuladhar says people have constantly been reaching out to offer help and that they were able to raise Rs1.5 million in 2 days. “My initial target was 300 food packages, but the response has been so overwhelming that we are distributing 1,000. As long as the help keeps coming, we will continue this, because people need it.”

Siddhant Pandey, CEO of the private equity company Business Oxygen,  says private sector philanthropy is more important than ever in these unprecedented times. But some companies that have tried to gain widespread publicity from their ‘corporate social responsibility’ have been trolled in social media for seeking promotion mileage rather than genuinely helping.

But Pandey says that while some companies might be stepping up their philanthropic efforts  for publicity, it does encourage others to come forward and to provide help as well.

“At this point, we need to think rationally,” says Pandey. “Providing urgent food, services and information and medical equipment is the need of the hour right now.”


Source: Nepali Time