Part of Nepal Economic Growth Agenda (NEGA) 2013, Samriddhi Foundation studied six issues with pervasive effect on Nepal’s growth prospects, one of which was Foreign Investment. Following the release of the reports in mid-2013, the Foundation has been active on advocating for economic growth friendly foreign investment policies and has hosted several discussions on the draft of Foreign Investment and Technology Transfer Act, 2070 proposed in early 2013 and the draft of Foreign Investment Policy (FIP), 2014 proposed in early 2014.
Samriddhi has hosted Mr. Rameshwore Khanal (Former Finance Secretary), Mr. Purushottam Ojha (Former Secretary, Ministry of Commerce) and Mr. Madhukar SJB Rana (Former Finance Minister), Dr. Biswambher Pyakuryal (Professor of Economics, TU). Mr. Krishna Gyanwali (Secretary, Ministry of Industry) and several other policymakers and stakeholders in a number of forums to help highlight the following issues:
- Concern over the current draft’s concentration on big industries and investments
- Provision of minimum thresholds as a negative factor that discourages smaller scale investment (especially those kind that are predominantly coming into IT and Tourism industry of Nepal)
- Institutional structure proposed by the policy being complex and adding on to the bureaucratic hurdles in getting FI.
- Sectors which could benefit from open competition and foreign investment including retail and real estate business also being on the ‘Negative list’
- Minimum requirements placed on a sector specific basis
- ‘Nationalization Clause’ present by the current draft
Following the facilitation of a number of public discussions by Samriddhi on the issue raising the mentioned concern, the act and policy were both reconsidered by the government.
More on the discourse over the latest legislation for Foreign Investment on our blog…