FDI commitments worth NRP 58 billion in 9 months

KATHMANDU, APRIL 14: Nepal received foreign direct investment (FDI) commitments worth approximately NPR 58 billion in the first nine months of the current fiscal year. Foreign investors pledged a total of NPR 57.97 billion through two channels: NPR 55.07 billion via the Department of Industry’s approval mechanism and NPR 2.89 billion through the automated system. According to the Department, these commitments are spread across 480 industries.

Specifically, the approval-based system accounted for investment commitments in 256 industries, totalling NPR 55.08 billion. Meanwhile, the automated system attracted commitments of NPR 2.89 billion for 224 industries.

During this nine-month period, FDI commitments worth NPR 1.95 billion were also made for 32 industries through Share Purchase Agreements (SPA) and Share Subscription Agreements (SSA). Additionally, Technology Transfer Agreements (TTA) were approved for 51 industries, according to the Department.

The Department further reported that out of the total commitments, 468 were for small-scale industries, 8 for medium-scale, and 4 for large-scale industries. If the committed investments are fully realized, an estimated 12,435 new jobs will be created.

Foreign investors pledge over Rs 13 billion in just one month 

According to the Department of Industry, 53 industries in Nepal received FDI commitments worth NPR 13.31 billion in the month of Chaitra (mid-March to mid-April) alone. Of this total, NPR 13.17 billion was pledged for 23 industries through the approval-based system, while NPR 141.1 million was committed for 30 industries via the automated system.

NoFDI commitments were made through Share Purchase Agreements (SPA) or Share Subscription Agreements (SSA) during this period. However, Technology Transfer Agreements (TTA) were approved for 5 industries. Based on these commitments, an estimated 1,183 new jobs are expected to be generated. All 53 industries receiving investment commitments in Chaitra are categorized as small-scale; there were no commitments for medium or large-scale industries during the month.

Service sector receives the highest FDI commitments

According to the Department, the service sector attracted the highest share of FDI commitments over the nine-month period of the current fiscal year. This indicates strong investor interest in Nepal's service-oriented industries.

Out of the total FDI commitments made during the review period, NPR 34.93 billion was pledged for 63 service sector industries. The tourism sector followed, with the commitments of NPR 18.39 billion across 189 industries.

Meanwhile, the manufacturing sector received FDI commitments of NPR 2.74 billion for 34 industries, and the information technology sector attracted NPR 1.11 billion for 185 industries. The energy sector saw NPR 255 million in commitments, agriculture NPR 761 million, and the infrastructure sector NPR 20 million, according to the Department.

Tourism and IT emerge as top choices for foreign investors

According to the Department, the tourism sector received the highest number of foreign investment commitments during the review period this year. A total of 189 tourism-related industries secured commitments, accounting for 39.37% of all pledged industries. The information technology sector followed closely, with 185 industries receiving commitments—representing 39% of the total.

The service sector attracted commitments from 63 industries (13%), followed by manufacturing with 34 industries (7%), and agriculture with 7 industries (2%).

As per the Department, Nepal has received a total investment commitment of NPR 577.32 billion for 6,878 industries to date. Of this, NPR 11.01 billion was committed through the automated system for 363 industries, while NPR 566.70 billion was committed through the approval-based system for 6,515 industries.

If all these committed investments are realized, an estimated 340,582 jobs will be created.

Rise in business visas as more foreign investors enter Nepal

According to data released by the department, the number of foreign investors applying for business visas in Nepal has increased. In the first nine months of the current fiscal year, 2,555 investors applied for business visa recommendations, compared to 1,720 during the same period last year. In the month of Chaitra alone, 148 investors received business visas.

Similarly, the number of representatives of foreign investors has also grown. In this nine-month period, 297 individuals applied for business representative visas, up from 256 in the previous year. In Chaitra alone, 26 representatives obtained such visas.

Additionally, 777 people applied for dependent visas over the nine-month period, compared to 733 in the same timeframe last year. In Chaitra, 84 dependent visas were issued. Furthermore, 63 individuals were granted visas for advertising purposes and 15 for Technology Transfer Agreements (TTA).

Over NPR 9.49 billion repatriated as royalty

During the review period this fiscal, foreign investors repatriated NPR 9.50 billion in royalties. During the same period last year, the amount repatriated as royalty was NPR 9.01 billion. In Chaitra alone, royalties worth NPR 481.3 million were sent abroad, according to the Department.

Of the total repatriated amount this fiscal year, NPR 1.47 billion was in Nepali currency, USD 9.32 million in American dollars, INR 3.84 billion in Indian rupees, and EUR 61,431 in Euros. Notably, no amount was repatriated as dividends during the first nine months of this fiscal, as per the Department’s statistics.