More than 600 participants from 40 countries will participate in the Investment Summit to be held in Kathmandu from Friday. Nepal Investment Board (NIB) has prepared a list of 77 projects (50 public and 27 private) to be presented at the Summit. Some of the bills have also been passed to ease the process of foreign direct investment (FDI) in Nepal. The summit will be a platform for the investors to know about investment prospective, potential returns and many more. It will be a platform for Nepal to clearly communicate Nepal’s priorities with the delegates and show them in which particular areas they can invest in Nepal. Nepal at the moment is in dire need of foreign investment. We are implementing the federal system and need more infrastructure developments, which won’t be possible without foreign investment coming into Nepal. Thus our single message to the investors coming to Nepal to participate in this mega-event would be: Invest in Nepal. This is the right time.
However, we must not forget that holding investment summit alone won’t be enough to attract foreign firms and businesses to come to Nepal and invest. We are competing with up and coming economies in South and South East Asia for investments. These countries in the region have done a series of regulatory reforms aimed at attracting investments. In India, for example, there is even inter-state competition to attract foreign investors. Foreign investors have to be convinced that Nepal is a better choice. Our geo-location, access to market and relatively cheap labor force are some excellent selling points. Besides, foreigners willing to invest in Nepal complain of red tape in our bureaucracy. They complain that our process is too complicated and long. A recent study says that one needs at least 32-38 signatures from different departments and ministries to bring one foreign worker to Nepal. And Nepal Rastra Bank doesn’t make it easy for foreign companies to repatriate their profit from Nepal.
In this context, the main agenda of the government during the summit should be to explain and assure potential foreign investors that recent bills passed by the parliament will further ease FDI in the country. Often, government ministers tend to overemphasize political stability and project it as main success. It is true that stability means a lot in facilitating policy change and creating enabling environment for investment but it does not necessarily help in bring more investment. Investors today need specific information backed by data and statistics. They want to know how new laws and regulations have made investment process easier. They want to know how exactly their investment will be safe and rewarding. Thus the government needs to clearly communicate these issues with the investors. It should tell them how they will benefit from the largest markets of Asia: China and India. It also needs to explain that businesses have no security risk. We need to communicate with them that Nepal today is a lot more different than it was a couple of years back. Load-shedding has become a history and many of the labor-related issues have been sorted out. On their part, foreign investors also need to stop viewing Nepal from old lens: that politics here is unstable, there is power cut and labor problems and so on. These could be a starting point for us to begin attracting investors to Nepal. In an interview with us (see the interview on page 7), Finance Minister Yubaraj Khatiwada has expressed great optimism of making the summit instrumental to bringing foreign investments. We hope this optimism will translate into reality.