September 10: The foreign investment reserve of Nepal has increased by 8.5 percent by the end of the Fiscal Year 2076/77. This was revealed by a survey report on foreign direct investment, 2076/77, released by Nepal Rastra Bank on September 9.
By mid-July of the review year, Nepal received Rs 198.52 billion foreign investment. Before that, FDI inflow stood at Rs 182.91 billion in FY 2075/76. In the fiscal year 2074/75, foreign investment received was more than Rs 200 billion.
Besides investing the amount, the investors are also taking back profit from their shares. However, they have been reinvesting the dividends
Taking all of them into account, foreign investment equivalent to Rs 198.52 billion has been maintained as of mid-July 2077 BS.
The share of paid-up capital in the foreign investment maintained till the review period was 54.4 percent. Similarly, the share of reinvestment (reserve) made through dividends is 33.8 percent.
Similarly, the share of foreign investment in the form of loans is 11.8 percent, according to the survey report. On the basis of amount, the foreign investment received by Nepal can be classified into Rs 108.07 billion in paid-up capital, Rs 67.07 billion in reserves and Rs 23.37 billion in loan.
India has the largest share of foreign investment. India's share of foreign investment reserves is 31.5 percent. China is second as of mid-July 2077, with a share of 15.6 percent.
St. Kitts and Nevis are in third place with 7.7 percent share. Foreign investment of 52 countries has been maintained in Nepal as of the review period.
Nepal received Rs. 62.45 billion from India, Rs. 30.97 billion from China, and Rs 15.27 billion from St. Kitts and Nevis. Similarly, Rs. 12.93 billion from Ireland and Rs. 12.43 billion from Singapore were received as foreign direct investment.
Executive Director of Nepal Rastra Bank Dr. Prakash Kumar Shrestha said that the foreign investment reserves were satisfactory till the review period. The year 2076/77 is the year directly affected by the Covid-19. "Foreign investment reserves have increased during that period," he said.
Of the foreign direct investment in Nepal, 56 percent is in the industrial sector. Similarly, 43.9 percent of investment has been maintained in the service sector. Under the service sector, 27.3 percent has been maintained in banks and financial institutions, and insurance companies.
NRB has been studying the regional status of such foreign investment by collecting the necessary data. The Department of Economic Research has been conducting on-site surveys on foreign direct investment, especially with the aim of assisting in the formulation of necessary policies.