September 9: The Investment Board Nepal has set a target to attract investment of US$10 billion over the next five years.
The board revealed its strategic plan on Wednesday (September 8) stating that they have set a target of approving investment worth US$ 10 billion in the next five years. Out of the total investment, the board intends to manage US$ 6 billion for projects run under Public-Private-Partnership (PPP).
Prime Minister Sher Bahadur Deuba, who is also the chairman of the board, unveiled the strategic plan during the 10th anniversary of the board. Addressing the function, PM Deuba said that the total annual average investment of Rs 558 billion would not be enough to achieve the sustainable development goals. The new strategic plan is expected to help create at least 100,000 jobs and contribute to the creation of an environment for investment promotion.
The strategic plan has adopted five important goals to develop the board as an excellent center of public-private partnership. The plan also calls for making Nepal an attractive destination for investment to attain economic prosperity. The four pillars of the strategic plan include project development and management, investment promotion, institutional development and coordination, as well as cooperation and partnership.
Speaking on the occasion, Deuba said that at a time when COVID-19 pandemic has created an unfavorable investment environment, the board is doing a remarkable work to attract investment during such difficult circumstances.
Stating that the government needs to include the private sector in the national priority projects, he said that the concept of PPP should be taken forward because investment form private sector is necessary for national pride projects.
Finance Minister Janardan Sharma, during the ceremony, said that the board should now take a step forward and reach out to investors with suitable investment projects.
He stressed on the need to involve the local people in the investment modality of public-private partnership.
“Another 'P' that stands for people should be added to the PPP model. Failure to involve the people affected by the projects will hamper the construction process and increase the cost of the project. Therefore, the ‘Three-P’ model of investment should be changed to ‘Four Ps’.”
Stating that the relatively cheap labor force and immense natural resources available in Nepal are the main assets that the country has, Minister Sharma stressed on the need for the board to act as a catalyst to accelerate the journey of development and prosperity.
Minister for Energy, Water Resources and Irrigation Pampha Bhusal acknowledged the board as the main body responsible for public-private partnership management in Nepal and added that cooperation is necessary to attract investment from the private sector.
Chief Executive Officer of the board Sushil Bhatta said that the board has prepared a list of projects to accelerate infrastructure development, which will ensure returns for investors and also meet the needs of the country.
He said that the Investment Board is getting stronger in project development, implementation and facilitation for investors after a decade of experience.
Speaking on the occasion, Liu Su Hong, Managing Director of Hongsi Holding Group China, a Chinese company, said that they have started cement production in Nepal by investing around Rs 40 billion. According to him, Chinese company Hongsi Holding Group wants to invest more in Nepal. He informed that they have moved ahead to develop the second phase of Hongsi Holding and Dang Cement project in collaboration with SH Investment Limited of Nepal.
833 Billion Investment approved in 10 years
Investment Board Nepal has approved investment of Rs 833 billion in one decade since its establishment. The board was established in 2068 BS to raise investment in large projects through PPP model.
During the decade, the board has approved 27 different projects and signed Memorandum of Understanding (MoU) to move forward seven major projects. Similarly, it has organised two investment conferences.
During this period, the Hongsi Shivam Cement Factory, a China-Nepal joint venture worth USD 360 million (Rs 43.20 billion) facilitated by the IBN, has come into operation under the big project. Its daily production capacity is 6,000 tons.
China-Nepal joint venture Hwasin Cement Narayani worth USD 140 million is being prepared for operation. Its daily production capacity is 3,000 tons. The board has informed that there is a Project Development Agreement (PDA) for the 900 MW Arun III with an estimated cost of Rs 144 billion and the 900 MW Upper Karnali Hydropower Project with an estimated cost of Rs 116 billion.
Forty percent of the construction work of Arun III, a joint venture between India and Nepal, has been completed and the project aims to generate electricity by 2023.