Govt officials woo foreign investors
KATHMANDU, MAR 25 -
Government officials endeavoured to convince potential foreign investors that their investments in Nepal would be safe besides allaying fears about the country’s laws at the Nepal Business Conclave 2014 jointly organised by the Federation of Nepalese Chambers of Comm-erce and Industry (FNCCI) and Nepal government.
Speaking at the meet on Monday, Industry Minister Karna Bahadur Thapa promised investment security for investors like in other countries in the world. Similarly, other government officials presented Nepal as a good investment destination due to its bio-diversity and proximity to India and China.
Prospective investors expressed concern at a number of Nepali laws and land acquisition issues for infrastructure projects. Participants from various countries including Malaysia and China are taking part in the two-day event organised by the FNCCI.
Minister Thapa said that he was ready to address any concern of entrepreneurs and that it was the government’s priority to create employment in the country. He presented Nepal as a country where large profits can be made with a small investment. Government officials including Industry Secretary Krishna Gyawali, Commerce Secretary Madhav Regmi and Nepal Rastra Bank Governor Yubaraj Khatiwada explained why Nepal was an attractive investment destination. Gyawali highlighted various provisions in the different laws and policies aimed at promoting foreign investment in the country, like the Industrial Enterprises Act 1992 and Foreign Investment and Technology Transfer Act.
Ameding Acts to incentivise investors
“We have also been trying to introduce a new Industrial Enterprise Act, Foreign Investment and Technology Transfer Act, Special Economic Zone Act and others to update them as per the changed context,” he said. “They will further incentivize foreign investors.”
His presentation on labour unrest in Nepal pointed out that the problem was severe at one time but that it had cooled down. “Labour militancy and lack of skilled labour have been twin problems for the country,” he said. Secretary Regmi said that there were advantages to investing in Nepal as it could become a trade corridor linking India and China, two huge markets having a population of more than 1 billion each.
“Our legal provisions are investor-friendly and our bio-diversity and improved political situation following the Constituent Assembly election offer the perfect opportunity for investors to pour money into Nepal,” he said.
Nepali officials presented Nepal as a good investment destination due to its strategic location between the giant markets of India and China, bio-diversity and low labour costs while foreign investors were eager to find out about problems of land acquisition and other issues.
Governor Khatiwada said that Nepal continued with its reform measures irrespective of the political parties in government and that had conveyed a clear message that it was the country’s commitment.
“Huge markets of India and China next door, low-cost labour, dependable banking services and an easier foreign exchange regime are advantages for investing in Nepal,” he said.
However, Khatiwada and other Nepali officials admitted that the issue of land acquisition had been somewhat problematic and that they were ready to address it. Khatiwada asked lawmakers to create legislation that would allow the state to acquire land for important economic projects.
Opt for joint-ventures
Chiefs of multinational companies working in Nepal advi-sed foreign investors to go for joint-ventures while setting up business es in Nepal. Chief executive officer of Standard Chartered Bank Nepal Joseph Silvanus urged foreign investors to go ahead with joint venture projects in Nepal instead of going solo as domestic partners would help in dealing with non-market internal dynamics.
“In fact, there is no high market risk in Nepal, but non-market risks exist,” he said. He added that access to finance in Nepal was relatively cheaper, banks have liquidity and were ready to offer credit. “Another advantage of investing in Nepal is that you can create your own market here without massive competition,” he said.
Similarly, Srikanth Srinivasamadhavan, managing director of Uniliver Nepal, stressed the need to improve infrastructure including roads, protect intellectual property rights and incentivize local manufacturers to stimulate local consumption.
Comparative advantages in IT
In his presentation, Kantipur Digital Corp Chief Operating Officer Sambhav Sirohiya discussed comparative advantages of investing in Information Technology (IT) sector in Nepal.
With more than 5,000 IT graduates produced in the country every year, Sirohiya stressed that there is no dearth of high-skilled human resources for the IT sector. “These resources have not yet been fully tapped into. This is one of the reasons why you should invest in the IT sector in Nepal,” said Sirohiya.
The other advantage Nepal has, according to Sirohiya, is the availability of cheap human resources. “Compared to the Silicon Valley and India, with $1 million investment in Nepal, you can have 166 engineers working for your company full time every month,” he said.
According to Sirohiya, a Nepali company provides mobile financial services to MNCs such as West-ern Union, BICS, IDT, QTELL, MPAY.
“Hollywood Giants such as Disney and Pixar have been outsourcing their animation and visual effects to companies based in Nepal,” he added.
Source: The Kathmandu Post
