Domestic investment will encourage FDI

NOV 12 -

• Hari Bhakta Sharma, Senior Vice-president, Confederation of Nepalese Industries

Infrastructure has received top priority from the government, the private sector and the donors in recent years? What is the main reason behind all the stakeholders focusing on the sector?

The private sector has long been insisting on increased focus on infrastructure development as poor infrastructure has hit Nepali industries hard. The country is facing many infrastructure bottlenecks. As the general people also felt the impact of load-shedding, the pressure mounted on the government and the donors to focus on infrastructure.

The government has taken this deficiency seriously, and so have donors. During the conflict period, investment in infrastructure dropped significantly. Now, both the private sector and the government have realised they should take the lead to eliminate the infrastructure bottlenecks.

The private sector’s investment in infrastructure has remained very low. How can investors be attracted towards this sector?

Yes, the private sector’s investment in infrastructure is just 0.66 percent, among the lowest in South Asia. Policy reforms and confidence building measures from the government and the political class are needed to attract the private sector’s investment. There should be a feeling among the investors that their investment is secure. Good examples set in other countries may be helpful for us. That’s why we are organising the infrastructure summit.

Land acquisition has continued to remain a big problem. How can this be addressed?

Land acquisition and the local residents’ obstruction to infrastructure projects are among the issues the government should deal at the national level. As the private sector cannot take risk as much as the government can do.

What are the areas of infrastructure in which investment is possible on a larger scale?

All the thematic areas that we have chosen for discussion, including transport, tourism, energy, agriculture and urban infrastructure, have immense investment potential.

Foreign investors are seemed to have more concerned about the political situation. How important is it to have a new constitution as soon as possible?

Obviously, the promulgation of the new constitution is very important for convincing foreign investors to invest in Nepal. But we cannot also stay idle, citing the absence of the constitution. If Nepali investors start investing, it will encourage foreigners to put their money here. Nowhere in the world, where domestic investment is low, foreign investment has come on a larger scale. Political parties should be serious towards nation building, and they should realise that it is their duty to give a new constitution to the nation.

Source: The Kathmandu Post