Envoy suggests roadshows in India to attract investment
For Indian companies that are operating here, it’s been a worthwhile experience
— Ranjit Rae, Indian Ambassador to Nepal
Kathmandu, August 10
Indian Ambassador to Nepal Ranjit Rae today urged the government and the private sector to organise roadshows in different parts of India to spread the word about potential investment areas in Nepal among Indian investors.
“It is important that persistent efforts be made to reach out to investors located in various parts of India ... We are ready to extend support in this regard,” Rae told an interaction jointly organised by the Investment Board Nepal (IBN) and Nepal-India Chamber of Commerce and Industry today.
At present, Indians are the largest investors in Nepal. In the last fiscal year alone, Nepal received foreign direct investment (FDI) commitment worth Rs 34.71 billion from India. This contribution made up 51.59 per cent to the total FDI commitment received by the country in that year.
“Many say Nepali market is small and benefits of economies of scale cannot be reaped here. But for Indian companies that are operating here, it’s been a worthwhile experience,” the Indian ambassador said. “These success stories need to be told to further attract Indian investment.”
Nepal needs huge investments in different projects to provide basic public services, enhance living standard of people and put the country on higher trajectory of economic growth.
A recent World Bank report has said that the country will need to invest up to $18 billion in different infrastructure projects by 2020 to avoid possible binding constraint on economic growth.
Of the total amount, up to $7 billion should go to the energy sector, especially development of hydropower projects, followed by up to $5.5 billion in the transport sector, primarily building of roads. Also, up to $2.6 billion needs to be invested in water supply and sanitation, while up to $2.3 billion has to go towards the irrigation sector. Among others, investment of up to $600 million and $500 million is needed for telecom and solid waste management sectors, respectively.
Such huge funding needs cannot be met alone by the government or the domestic private sector. So, there is no alternative to foreign investment.
Acknowledging the need for huge foreign resources to drive the county’s development process, the government is hosting Investment Forum in December. The Forum is expected to bring together investors from various countries.
“We have already formed a facilitation committee to make necessary preparations for the meeting,” informed IBN CEO Radhesh Pant, adding,
“We also need to go out of the country to bring in FDI, as we have not done much to market Nepal abroad.”
In spite of these efforts and intentions, foreign investors complain that the government here has not been able to address issues related to labour, dividend repatriation and intellectual property rights, among others, which have dampened investor sentiment.
“I’ve been here for two years now and I’ve been hearing these issues over and over again. So, (government officials) should show problem-solving attitude,” Rae told the interaction, adding, “This attitude will not only lend support to foreign investors but the entire country and the investment climate here.”