With the enactment
of the New Industrial Policy of the 1992, HMG identifies
Foreign investment promotion as an important strategy
for the development and promotion of industrial
activities in Nepal. Important Measures under these
policy reforms include Debureaucratization of Administrative
machinery, trade liberalization, tariff rationalization,
tax reform, financial sector reform with full convertibility
of Nepalese rupees in current account.
POTENTIAL AREAS OF FOREIGN INVESTMENT:
1. Manufacturing Industries:
a. Light engineering industries
b. Manufacture of dry cell battery
c. Video cassette industries
d. Medical instruments and tools
e. Pollution preventing accessories industry
f. Paper
g. Cement
h. Jute
i. Leather products
j. Chemical fertilizers
k. Pesticides and insecticides
l. Aluminum industry
m. Organic fertilizers
2. Tourism industries:
a. Hotel resort
b. Golf courses
c. Air services
d. Hot- air ballooning
e. Cable car complex
f. Amusement parks
3. Agro and forest based industries:
a. Herb Processing
b. Food processing
c. Fruit processing
d. Veg seed processing
e. Mushroom cultivation
f. Dairy
g. Floriculture
h. Sugar
i. Animal feed
4. Energy industry:
a. Hydro power project
b. Solar energy
c. Wind Energy
5. Mineral Based Industries:
a. Cement exploration & production.
b. Petroleum exploration & production.
c. Natural gas exploration & production.
d. Construction materials ( clay , sand , gravel
, boulder ,
Marble, stone) exploration & exploitation.
e. Processing of mica.
f. Exploration & processing of quartz.
g. Glass Production.
6. Service Industry
a. Air freight forwarding services.
b. Sea freight forwarding services.
c. Nursing home.
d. Carpet washing.
e. Domestic air services.
f. Computer software developing
g. Data entry services.
h. Photo scanning and off-set printing
7. Textile and Apparel Industries:
a. Integrated textile mill.
b. Spinning mill.
c. Sericulture and silk production.
INDUSTRIES WHICH HAVE RECEIVED
NATIONAL PRIORITY
1. Agro and forest based industries.
2. Engineering industry (producing agricultural and
industrial machinery).
3. Industries producing fuel saving or pollution control
devices.
4. Solid waste processing industry.
5. Industry that builds and operate Road Bridge, tunnel,
ropeway, flying bridge, trolley bus and tram.
6. Hospital and nursing home (outside Kathmandu valley).
7. industries that produce ayurvedic, homeopathic
, and other traditional medicines as well as walking
aids, waist belt, wheel chair, stretcher, etc. for
the disabled and orthopedic support.
8. Cold storage facilities to store fruits & vegetables.
The government of Nepal reserves the monopoly of
activities economic or otherwise in areas such as
cottage industries, arms & ammunition industries,
atomic energy, real estate business, security printing,
currency & coinage, retail business, travel
& trekking agencies, consulting services etc.
FORMS OF FOREIGN INVESTMENT
Foreign loan
Foreign capital
Reinvestment of foreign investment earning
Patent of foreign products
Use of foreign owned trademarks
Investment in share (equity)
TECHNOLOGY TRANSFER INCLUDES:
Use of any technological right, specialization,
formula,process, technical know - how of foreign
origin.
Use of any trademark of foreign origin.
Use of any foreign technical consultancy, management
& marketing services.
Technology transfer is allowed in all type of
industries
GUARANTEES
Against price control
Against naturalization
Full repatriation of the amount from the sale of
Equity, profits or dividends, and interest on foreign
loans.
Repatriation of the amount received under an agreement
for the transfer of technologies
PROCEDURAL ARRANGMENT & PERMISSION:
Foreign investor wishing to invest
in Nepal as 100 percent ownership in industries or
as joint venture investment are required to make an
application to the department of industry with a detailed
feasibility report .the department of industry evaluates
the project proposed and grant permission for projects
with fixed assets up to 500 million rupees.
In case of projects with fixed assets exceeding 500
millions rupees the department of industry evaluates
the project proposed and submits its recommendation
to the industrial promotion board for approval.
