With the slogan of making Nepal a lucrative destination for investment, the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), in association with the government, is organizing a three-day Nepal Economic Summit 2014 from February 24. According to FNCCI, the main organiser of the event, the Summit will be a milestone for policy changes to attract foreign investment, both domestic and foreign, in three key sectors of Nepal – agriculture, tourism and energy. Economists and some businessmen, however, say that ‘attracting foreign investment’ has been one of the overused phrases over the years. “Luring foreign investment has now become rhetorical,” agreed economist and former National Planning Commission Vice Chairman Deependra Bahadur Kshetry.
The government should ensure investment friendly environment for the Foreign Direct Investment (FDI), he told The Corporate. The most important aspect to lure FDI is taking investors into confidence, Kshetry added. “China is not a liberal economy. Yet, why is foreign investment inflow high in china? Because the country has investment friendly environment and it has succeeded to win confidence of investors.”
The event is aimed at seeking all possible solution on how we can make Nepal a lucrative destination for investment globally and can remove hurdles that prevail at present, director general at FNCCI Dr Hemanta Dawadi said. The summit will be followed by abusiness conclave in March this year. FNCCI will be inviting potential investors to this conclave for discussing investment possibilities, Dawadi informed.
Economist Prithvi Raj Ligal, on the other hand, said that the hurdles have already been identified. All we need is sincere commitments from concerned stakeholders for addressing existing hurdles and to foster an environment favourable for investment, he added. Political instability, security issues, poor infrastructure and frequent labour unrest in the nation among others are some of the core issues that pose serious challenge to attract foreign investment, he opined.
Questioning the very objective of organizing of such meets while identified bottlenecks remain unaddressed, he said that the government should focus its efforts to address problems also, instead of solely focusing on repeatedly organizing summit after summit. “Gathering world’s renowned business figures is a good initiative. But repeating the same actions on the same line will be useless. Its time to address the identified bottlenecks while establishing business contacts simultaneously,” Ligal said. The organizers, on the other hand, claim the summit will be a groundbreaking event. FNCCI President Suraj Vaidya said the Summit aims solely to create a platform where business leaders, experts, high level political leaders and international delegates will search for a common ground that will help make Nepal an attractive destination for local as well as foreign investors.
“Nepal has tremendous investment potentials in agriculture, tourism and energy sectors. However, there are policy hurdles and there is a lack of investment-friendly environment. The Summit will look for ways to tackle such problems,” said Vaidya.
The FNCCI has already prepared a list of 27 projects that are concidered ‘quite feasible’ for investment. Vaidya said the Summit will try to attract FDI in these projects. “The Summit will help explore investment possibilities for these 27 projects whose total cost has been estimated at Rs 300 billion,” said Vaidya.
Economists, successful entrepreneurs and experts in agriculture, tourism and clean energy from the USA, the UK, India, China, Japan, Malaysia, Singapore, Bangladesh, Sri Lanka, Australia, Germany and Thailand, among others, will be attending this Summit, which will be inaugurated by Prime Minister Sushil Koirala.
Japan International Cooperation Agency (JICA), World Bank and its private sector arm International Finance Corporation, Asian Development Bank, UK Government’s Department for International Development (DFID), German Society for International Cooperation (GIZ) and Nepal Tourism Board are the partners of the Summit. Similarly, Samriddhi, The Prosperity Foundation, is the knowledge partner of the event.
FDI in Seven Months
Foreign direct investment (FDI) in Nepal has reached Rs 18.9 billion during the first seven months of the current fiscal year. At a programme organised at the Prime Minister’s Office on February 16, officials said that 135 FDI projects have been approved during the period. The country received Rs 19.94 billion FDI in fiscal year 2012/13 and Rs 7.14 billion in the previous fiscal year.
