Why there is no foreign investment in Nepal
Bikas Thapa in Annapurna Post, 5 February
The Nepal government is holding an investment summit in March to woo foreign investors in infrastructure projects. At a time when international interest in investing in Nepal is diminishing, the summit does seem ill-timed. NCP chairman Pushpa Kamal Dahal’s statement about Venezuela has just put America’s proposed $500 million Millennium Challenge Corporation aid for connectivity in jeopardy.
There is no point organising an investment summit without policy and legal reforms. Commitments foir millions of dollars were made even during previous investment summits, but the money was never forthcoming because of red tape and bureaucracy.
Besides, officials are not clear about where they want investments. We need investments not just in agriculture, tourism, hydropower and construction, but in almost every sector. Goods manufactured from imported raw material are not competitive, do not add value, and do not create adequate jobs.
Foreign investors need permission from the Department of Industry and the Central Bank, but it is next to impossible to get this without dispensing bribes to bureaucrats. Recently, the contractor for the Melamchi water supply project could not finish its work because of extortion. The much-delayed project has now been pushed further back. The Prime Minister and Minister for Water Supply are not trying to resolve the issue. The secretary in the Ministry demanded a cut for arbitration compensation before releasing the money which is why the project is stuck.
With such high profile corruption how can Nepal expect foreign investment?