A Swiss delegation comprising 15 members visited to Nepal from November 7 to 9. The delegation’s mission was to discover business opportunities in Nepal for Swiss companies. The visiting members represented ten different Swiss companies such as Ferring Pharmaceuticals, Roche Diagnostics, Zürcher Kantonalbank, Lufthansa Group, Hilti, PIN Lombardi, Gherzi, Victorinox and 2000 Watt Smart Cities. The New Business Age talked to representatives from three of those businesses- Alok Dev of Ferring Pharmaceuticals, George Ettiyil of Lufthansa and Marco Ruggiero of PINI Group on a wide range of issues including future investments in Nepal. Excerpts :
WE ALREADY HAVE A COMMERCIAL PRESENCE IN NEPAL
You are a part of the Swiss business delegation to Nepal. What is the purpose of your visit?
In Ferring Pharmaceuticals, we have an initiative which is called the Safe Birth Project. Our major focus is preventing maternal death in low and low-middle-income countries. Nepal is one of the countries with high maternal postpartum haemorrhage. With the World Health Organisation and another organisation, MSD for Mothers, we have developed a very low-cost innovation called heat-stable carbetocin. So this drug has the potential to reduce maternal deaths. And this has been approved for the prevention of postpartum haemorrhage. Nepal is one of the countries where every day three to five women die while giving birth. If you convert this number, annually 1,200 to 1,500 women die while giving birth. So as part of our obligation to the World Health Organisation, we are obligated to offer this product on a no-profit basis to all low and low-middle-income countries.
Nepal is one of the low-income countries as per the World Bank. So I'm here to talk to the government, World Health Organisation and other stakeholders, societies etc. My effort will be on putting this drug into the healthcare system so that it is available in all the public sector hospitals and it can help reduce the maternal death rate because currently, the maternal mortality rate is 186 per 1000. As per the commitment of the Nepal government, it has to come down to 70 per 1,000 by 2030. To reduce the ratio from 186 to 70, you need some innovation like this, which is approved by the World Health Organisation and is being used by all the countries where maternal mortality is high. This drug was approved last year by the World Health Organisation. It has been approved in 12 countries including India. So today we had a very wonderful meeting with the Health Minister.
We met the health secretary. We also held meetings with WHO and civil society. In South Asia, Nepal and Pakistan have high maternal mortality. Pakistan’s ratio is 186. Last week, Pakistan approved this drug. Now Nepal is the only country, apart from Indonesia, where maternal mortality is very high still to approve this drug.
So I was here with the purpose to communicate to the government that now this intervention is available which is approved by the World Health Organisation, which is included in the essential medical list by the World Health Organisation. And this is the only drug with WHO pre-qualification. So this purpose is very important for me because the drug is getting into the registration process. The Swiss Embassy in Kathmandu facilitated all our meetings with the stakeholders.
What was the response of the private sector involved in supply chain management?
This project only focuses on the public sector. We are not focused on the private sector because it is the public sector where the major issues are. Because most of the deliveries are happening in the public sector. We work with the governments in all the countries so that this intervention is available where this is needed.
So your products and services are not available in Nepal now?
No, not in Nepal because it is not registered yet. We are hoping to get the registration. We are hoping to get it done in the next 90 days because our product is pre-qualified by the WHO. If a product is WHO pre-qualified, they go through the complete documentation process themselves. This way the registration becomes very fast. So we hope that in 90 days all the formalities will be completed.
What other possibilities can we expect from Ferring in Nepal? How likely are you to set up operations here or open a representative office?
We already have a commercial presence in Nepal. We have a distributor here who is making our five products available in the market. These drugs are used for infertility treatment. This is being overseen by our India office at present.
How were your meetings with stakeholders? Will you be doing something as you wait for the registration process to complete?
All the meetings with the stakeholders were good. Ministry officials, stakeholders and doctors from the public sector are very hopeful that this drug has the potential to make a difference in Nepal and they have also given a roadmap. Like what should we do so that this drug is quickly implemented into the healthcare system? We got a lot of good insights and guidance in terms of how we move in this market. Some of the meetings with the stakeholders also helped us in understanding the challenges and opportunities in this country.
You are already present in India. Do you have plans to open an office in Nepal?
Yes. Currently, we did not feel the requirement to have an office in Nepal given our business volume. But as the volume goes up, as we add more new products, there is a possibility in the future. Looking at the usage and the requirements at present, this is being covered from India - from New Delhi and Kolkata. But in the future, as we progress in this market, as I understand from the meetings in the last two days, the opportunities are opening up. Our products fit very well into this segment because it helps infertile couples to have babies. A significant amount of the Nepali population is young, so I think our products fit into that segment to address the issues of the current generation like late marriages, infertility and changes in lifestyle etc.
You have done a lot of surveys in Nepal. How equipped are our hospitals to reduce maternal mortality rate?
We have specialised products which are used by infertility clinics and gynaecologists who are into the IVF business. There are a couple of good infertility centres in Nepal and as the demand goes up, more such centres will come up. This is what we have seen in India and all the emerging markets. About 15% of the population of married couples have infertility issues. We see a great opportunity here and are looking forward to adding more new products to this market.
Do you want to add anything else?
We are very keen to help the government to reduce the maternal mortality rate because that remains at the top of the agenda. In this part of the region, Nepal is one of the countries with very high maternal mortality rates. Every day three to five women die while giving birth. It is also very high on the government's agenda. The government also wants to reduce maternal death. We have come up with a world-class solution which is recommended by the World Health Organization. So now we need to work together with the government and make this available to all the healthcare systems. It is a not-for-profit initiative for us. The WHO approved the product one year ago, and in the past 12 months, 12 countries have already adopted this product.
THERE SEEMS TO BE GOOD BUSINESS OPPORTUNITIES IN NEPAL
What was the purpose of this visit?
I think the purpose is very much captured in the name of the trip. It's called a fact-finding mission. So my honest and sincere intention was to find facts about Nepal. It's my first visit to Nepal. I've come here to see it and to listen to the people of Nepal and to listen to various stakeholders that are relevant for our kind of business.I'm very glad that the Swiss Embassy and Swiss Global Enterprise arranged this trip and the meetings with various stakeholders - Ministry of Culture, Tourism and Civil Aviation, Civil Aviation Authority of Nepal (CAAN), Swiss Embassy and Nepal-German Chamber of Commerce. We met some very young but very successful Nepalese entrepreneurs. Likewise, we met with the World Bank officials. I think we had a very interesting spectrum of stakeholders who know Nepal and who could tell us more about it.
What were your first impressions about Nepal?
I must start by telling you how I felt when I landed here. I felt it's a very, very clean place. It’s very pleasant. In South Asia, it's sometimes difficult to find a clean city. Kathmandu came across as very clean. People are very disciplined. No honking. People are very considerate of each other. So my first impression was that the people of Nepal are very friendly and considerate people. They have a civic sense, and I think they want to make their nation really successful. This is the impression that I had. Even today, I was on the top floor of our hotel and I was looking onto the roofs of Nepal. It looked picturesque. People's roofs also are well-maintained. They don't think that the roof is not seen by anybody. My first impression is that this country has got a very sound civic sense. I think the population seems to have a sense of purpose in making this country an incredibly successful country. And from what I hear, Nepali is growing in the post-federalism period. Businesses are growing and the country’s import dependency is shifting. Nepal is now able to produce things here which it earlier needed to import. There seems to be a good opportunity for businesses to come to Nepal, and help create employment and also whatever Nepal needs in order to make this country really good. This is the impression that I've got.
Seeing the name of your company in the list of delegates, people in Nepal are expecting that an European airline is finally planning to operate flights to Nepal. How hopeful are you?
As I said earlier it’s a fact-finding mission. I can’t say yes or no now. I still need more data. So I've been telling the stakeholders that I need to get the data first. Because data is what we base our impressions on. We need to understand on what purpose people flying out of Nepal are travelling to Europe or North America. For inbound, I guess it’s tourism and the data is also easily available. But what is more interesting to know where Nepalis are travelling out. So what I understand is that most of the Nepalis are travelling to the Gulf region. I think for job purposes. This seems to be where 90% of the international travel seems to be happening. I am assuming there seems to be sufficient travel to Europe or North America, but I need the data. Then we will have to start with some presence here. We don't have a presence here yet. So that would be the first step.
At least we should have a presence over here. This is one thing that I would like to do. But we haven't started yet. Once we have done that, then the trade will let us know what is possible out of here. They're the experts, they know how Nepalis people travel. Depending on what the market is capable of delivering and what the trade tells me, then we can look at various options. One option is to find a good partner in Nepal that actually will do some kind of partnership with us. The partner brings the Nepali travellers to one point where there is a Lufthansa Group air transport, be it SwissAir, Lufthansa, Austrian, any. And it can be anywhere in the region which is feasible also for Nepali travellers. The other option, of course, is always to have a direct flight. But I think it's too early to say anything like that.
Nepal is on the EU's air flight safety list. Your visit is being seen as an indication that Nepal will be removed from the list. Anything on that?
It’s a pure government-to-government decision. I am here because I need to know my neighbour and it's part of my regional responsibility. So, I cannot comment positively or negatively on what is happening between the Nepali government and the European Union (EU) authorities.
Why do you think European airlines are not trying to fly to Nepal?
When we were still last flying to Nepal, it was in the early 90s. In the early 90s, all of our airlines were government-run airlines. When you're a nationalised airline, profitability is not a concern. There is no owner or shareholder or anybody bothering you. It's the government. If the government says, fly, you fly. But in the early 2000s, we had to become privatised because we were making losses for our governments and we were very close to bankruptcy. Lufthansa was, for example, very close to bankruptcy. So I think privatisation in the 90s, plus probably also the struggles that Nepal went through in the mid-90s. I think that brought a stop to the operation then. No effort was probably made at that time for the restart. Privatisation changes airlines. And when airlines are privatised, the whole national aviation system changes. It actually becomes competitive, it becomes innovative, and it starts focusing a lot on innovation and competitiveness. So I think we went through a very long stretch of really becoming one of the best airlines in the world. That was only possible through privatisation. And now that the south Asian region is growing, Nepal is growing. We have started relooking which other places in the world Lufthansa Group should have a presence in some form.
You might have got the opportunity to discuss your plans with your prospective Nepali counterparts. How has been their response so far?
I have not discussed any plans yet. I asked for the data from everybody I met. We will be able to take further steps only after studying the data. We need to understand what Nepal is about in terms of figures, in terms of quantities, and economies of scale.
What about the possibility of Lufthansa Group taking over the management of Nepali airlines? Is there any agenda or anything?
I think our group has a strategy of consolidation. But the focus is on consolidation around our own home - Germany, Switzerland, Austria and Belgium. This is because we feel at home in our home country. We know how to do business there. Doing some business in Nepal may not be that easy from Frankfurt. But what I hear, there's a rumour that one of our sister companies Lufthansa Consulting is offering management consultancy services to Nepal. But I have no information on that.
Is there anything that you want to add before concluding?
Lufthansa and Lufthansa Group have been known to help emerging countries with their aviation issues, with our own experiences, with our knowledge, and with our competencies. Lufthansa Group will always be open to help, to provide knowledge, to provide assistance, and to provide competence etc.
WE ARE ALREADY SUPERVISING THE CONSTRUCTION OF SOME NEPALI PROJECTS
Could you please tell us what Pini Group does?
Pini Group is a company which was founded about 70 years ago and has been doing business since then in the construction engineering consulting industry. We are very specialised in the infrastructure field, especially in the underground works field. So we are basically in tunnelling. We design and do construction supervision of tunnels.
What potentials have you seen in Nepal for your company?
We just started a collaboration with the Department of Roads on the Siddhababa Tunnel which is going to be built in the Lumbini Province. The construction works next year. We are supporting the review of the design and the construction supervision of these works.
Are you looking to set up your office in Nepal?
This is something we are starting to consider. Because along with the Siddhababa Tunnel, we just got a new project - Budhi Ganga Hydropower Project. But we won’t be opening an office here immediately because we have a branch office in New Delhi. So, we are already quite close to Nepal. We have a point of entry which is closer than Switzerland and I think it's something which we are considering for the next future.
Nepal is increasingly focusing on infrastructure development and some of them have underground components as well. So are you working in some of them?
We are interested in entering into other infrastructure projects. For this reason, we held a dedicated meeting with the Department of Roads. We were informed about the upcoming projects of next year. They told us that there are three tunnel projects which are going to be tendered next year. We are very interested in participating in these projects.
You might have already made some interactions with some of your prospective partners here and government agencies in Nepal. So how was the outcome?
The interactions were very good. We had a very general overview of all the situations and they were very open to answer all our questions. I think now the first step is done. What we have to do in the future is to get back to them in order to discuss a bit more in detail about the concrete opportunities. Because the meetings we had were more like introductory sessions. But the meetings have established a good path to continue with the collaboration with them.
Is this your first visit to Nepal?
This is my second one. I was here already for the Siddhababa project.
What is your impression of Nepal?
Nepal is a very nice country. There's a lot of nature. I found the people very welcoming and very kind to foreign people. Nepal is quite similar to Switzerland in terms of nature. All the new political structure Nepal has with the three tiers of governments is also very similar to what Switzerland has. I think there are a lot of similarities between the two countries.