The Ministry of Industry (MoI)-- the focal ministry for the campaign- has initiated the drafting of new laws and amending some existing laws and policies, and that is expected to encourage foreign investment, which has been slack for the last few years.[break]
The government has announced that it is to observe Nepal Investment Year in 2012 and 2013 to revive industrial growth by inviting more foreign direct investment (FDI).
Shankar Koirala, secretary at the Ministry of Industry (MoI), said the government is to introduce a Nepal Standards Act and an Accreditation Board Act for the first time. Similarly, the MoI is doing homework to introduce an Industrial Enterprises Promotion Policy and is amending the existing Industrial Enterprises Promotion Act.
“We are also amending the Foreign Investment and Technology Transfer Act (FITTA) 1992 to encourage foreign investment in Nepal by ensuring the protection of investment and facilitating business for foreign investors with necessary incentives,” Koirala told Republica.
The government is likewise introducing a new Industrial Property Rights Policy and a related act that would protect the patents, designs and trademarks of industrial enterprises.
However, an Intellectual Property Rights Policy is already in place and a section at MoI is overseeing issues related to intellectual property under the Patent, Design and Trade Mark Act.
In an effort to boost industrial growth by providing facilities to entrepreneurs inside industrial estates, the government has already drafted a Special Economic Zone Bill, which is now waiting the endorsement of parliament.
MoI is also working on strengthening institutional capacity and procedural reform to bring down the cost of doing business in Nepal by introducing a one-window policy for registration of industries and other administrative processes that need to be followed by investors.
The government is working with the International Finance Corporation (IFC) of the World Bank Group to effectively implement the one-window policy as envisaged by existing industrial policy.
“We are preparing to bring all small and cottage industries across the country under the Small and Cottage Industries Development Committee (SCIDC),” said Yam Kumari Khatiwada, joint secretary at MoI. The Department of Cottage and Small Industries (DCSI) and the SCIDC are overseeing the cottage and small industries in 27 and 48 districts respectively.
MoI has also initiated the process of organizing the Nepal Investment Forum-- a conference of foreign investors from different countries-- to discuss the potential areas of investment in Nepal.
Some 50 potential investment projects will be indentified during the proposed forum and foreign investors will be urged to put money into those sectors.
The government had organized such a forum in 1992 which, officials said, was instrumental in luring FDI to Nepal.
The government recently formed a committee led by Secretary Koirala, on which representatives from the private sector are also included as members, to identify potential projects in Nepal.
“We have urged private sector representative bodies including the Federation of Nepalese Chambers of Commerce and Industry and the Confederation of Nepalese Industries (CNI) to recommend viable projects on the basis of need and potential contribution to the economic growth of the country,” said Koirala.
Koirala, however, said persisting power shortage and frequent labor unrest are still challenges in inviting more foreign investment into the country.
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