Friday, March 3, 2017

Investors intend to pour $13.52 billion into Nepal

After the assurance from all the political parties that they are committed to protect the investment in Nepal, investors – both foreign and domestic – have shown keen interest in investing in Nepal. They signed letters of intent (LoI) for investing a total of $13.52 billion, (around Rs 1,400 billion) at the concluding ceremony of the Nepal Investment Summit 2017 today.
The intended investment amounts to more than half of the country’s GDP structure of $22.49 billion and also exceeds the budget ceiling of Rs 1,156.04 billion fixed by the National Planning Commission (NPC) for the next fiscal year 2017-18.
Amongst the interested investors, China has signed LoI worth $8.3 billion, which is more than half the total intended investment. Apart from some six foreign investors, domestic investors have also signed LoI worth $11.5 million, making for a total of 16 investing organisations.
According to industry minister Nabindra Raj Joshi, Bangladeshi investors have signed LoI worth $ 2.4 billion, whereas Japanese and UK investors showed interest in making investments worth $1 billion. Likewise, investors from Sri Lanka and India have shown keen interest in investing $ 500 million and $ 317 million, respectively, he added.
The investors have shown interest in sectors like hydropower, hotels, metro rail, airlines, tunnels, tourism, energy, agriculture, infrastructure, mines and the financial sector, amongst others, he said, adding that they have signed the LoI, which means they want to invest in various profit-generating sectors in Nepal.
However, Joshi said that in order to convert their interest into commitment, an investment-friendly environment is needed in the country and guaranteed returns from the investment. He also voiced commitment to protecting the investments.
"The summit is the beginning of glorious days ahead and the economic development of the country," he said, adding that the country is on its way to transforming itself from a Least Developed Country (LDC) to a developing country. "The investments promised will certainly help push economic growth."
 Minister Joshi requested the foreign investors to invest freely in Nepal as all Nepali politicians have committed themselves to supporting the economic development of the country. "Nepal needs stable policy no matter how unstable the political situation."
He also said that within the next decade no Nepali youth need to go to foreign countries for employment as investments will generate enough employment in the country.
Foreign investment started to flow into the country after the first Investment Summit held back in 1992, as the government then started opening up sectors for foreign investment. According to the Department of Industry (DoI), some 3,678 projects with foreign investment have been registered as of last fiscal year. The department's data also show that these projects worth investments totalling Rs 358,707.80 million in costs have generated an estimated 217,681 jobs in the country. In the 25 years since a liberal economic policy was adopted, there has been a 40-fold increase in foreign investment projects from 93 in 1990 to 3,678 in the last fiscal year, according to the department.
Of the total number of companies in the country, more than 100 as of today have transactions worth over Rs 1 billion, according to the Large Taxpayers' Office (LTO). "Some of the foreign investment companies including Ncell, Sipradi and Surya Nepal are among the large companies with transactions from Rs 10 billion to over Rs 20 billion a year, according to the LTO data.
State Minister for Industry Kanchan Chandra Bade, on the occasion, said that the government would reform all the existing policies and laws and make them business- and environment-friendly.
Likewise, chief executive officer of Investment Board of Nepal (IBN) Maha Prasad Adhikari said a number of committees had been formed to review the commitments and outcomes of the summit. "These committees will constantly follow up to materialise the outcomes of the summit and turn all investment pledges into reality,” he added.

Company (Country) – Sectors – Letter of Intent amount
Ashok Steel Industries Pvt Ltd (India) – Investment Bank, Solar, Steel Plant – $300m Plus
China Machinery Engineering Corporation (China) – Hydropower, Hospital, Kathmandu Metro (line 1 & 2) – $3bn Plus
China State Construction & Engineer Co (CSCEC) (China) – Airport, Highway, Tunnel – $2bn Plus
CTCE Group (China) – Water Suppy, Hydropower, Railways, Road, Tunnel – $1bn
Everest Chamber of Commerce & Industries (India) – Tourism – $10m
Frontier Power Ltd, London (UK) – Energy, Agriculture, Infrastructure – $1bn
Himadri Food Pvt Ltd (Pran - RFL Group) (Bangaladesh) – Food & Construction – $2.4bn
Himali Distillery Pvt Ltd (Nepal) – Pulp & Paper – $10m Plus
Medicare Environmental Management Pvt Ltd (India) – Industrial & Biomedical – $7m Plus
Radiance Renewable Technologies (Srilanka) – Hydropower, Solar, Wind – $500m Plus
RN Group of Companies (Nepal) – Constrcution & Manufacturing – $50k plus
Sichuan Baoxing Country Wonping Mining Co Ltd (China) – Mining & Minerals – $100m Plus
Sichuan Wanping Energy Science & Technology Co Ltd (China) – Hydropower, Smart Grid, Financial – $1bn Plus
Somudyak Kansai Form, Mahottari (Nepal) – Agriculture – $1m
The Kansai Electric Power Co Inc (Japan) – Hydropower (100 to 1000 MW) – $1bn Plus
Wuling Power Corporation Ltd (China) – Hydropower (Tamakoshi 3) – $1.2bn
Total – $13.52bn

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