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Submitted by Aurelien on

David. Thanks for your comments. The challenge, we think, comes from the fact that promoting growth and creating jobs (particularly in manufacturing) is harder given the magnitude of remittances (and their impact on the RER) than if Nepal were starting from a clean slate. Therefore what we need is growth policies that take into account - both leveraging their positive effects and mitigating their negative impact – massive inflows of private transfers. For instance it was illuminating that when the Rupee recently depreciated (following the Indian currency) the main worry in policy circles was how to prop up the value of the rupee (rather than how to leverage the competitiveness incentive).