<img width="1692" height="1171" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b399c7e80680e045964jpeg.jpg" alt=""/>Capacity and WillpowerThere are immense opportunities waiting for investment to uplift the living standard of 30 million honest and hardworking people. The Government is stable and remains fully committed to protecting investments with assured profit.Nepal must prosper and it can prosper. The vision for development has found place in over 75 viable projects in different sectors that will be presented to participants during the course of the Summit.Read also:<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/editorial/invest-in-investment/" target="_blank" rel="noopener">Invest in investment</a>, Editorial<a href="https://www.nepalitimes.com/here-now/maze/" target="_blank" rel="noopener">Maze</a><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b3c9c7e80680e045965jpeg.jpg" alt="" width="211" height="182">The promulgation of the democratic and progressive constitution in 2015 and successful holding of elections of all three tiers of the federal setup has effectively ended the protracted political transition, and has fostered a sense of high optimism in Nepali people. An optimism that the long-cherished dream of socio-economic transformation can now become a reality. An optimism that country’s development is possible in this generation, and that [the slogan] ‘Prosperous Nepal, Happy Nepali’ is not a far-fetched fantasy but an attainable vision.The democratically elected government has both capacity and willpower to steer the development process. The constitution is flexible to accommodate the genuine aspirations of the entire Nepali people. [The Government] has been able to bring a force that until recently remained outside into constitutional fold. In Nepal, there is no place for violence. Any attempt to disrupt law and order will be firmly and resolutely dealt with as per law.Read also: <a href="https://www.nepalitimes.com/here-now/nepal-has-to-curb-corruption-before-wooing-investors/" target="_blank" rel="noopener">Nepal has to curb corruption before wooing investors</a>, Ramesh Kumar<a href="https://www.nepalitimes.com/here-now/overseas-nepalis-are-not-impressed/" target="_blank" rel="noopener">Overseas Nepalis are not impressed</a>, Sewa Bhattaraihttps://www.youtube.com/watch?v=6rHbBYRhWKINepal has had a history of success in political change and failure in institutionalising it. Now the things have changed. We have institutionalised the achievements and brought stability.Political stability, which is the key prerequisite to economic growth, is absolutely fulfilled now.Together with political stability policy consistency is ensured. Legal, institutional and procedural reforms that were long overdue has gained speed. The past one-year has been the base year for policy and legal reform. Many new laws have been drafted translating the provisions of the new constitution into legal and institutional framework. The new framework hasalso created conducive environment for foreign direct investment, among others.Economic TransformationPolitical transformation alone cannot be enough and sustainable without economic transformation.If we could successfully steer country’s historic political transformation, there is no reason why we cannot do the same in the economic realm. The central task before us is to undertake rapid economic transformation, and the immediate goal is to graduate from Least Developed Country status and the medium term goal is to become a middle-income country and achieve the Sustainable Development Goals by 2030. Read also:<a href="https://www.nepalitimes.com/latest/nepal-inc/">Nepal Inc.</a>, Suman Joshi<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/" target="_blank" rel="noopener">How Nepal can invest in improving the investment climate</a>, Anil Chitrakar <figure><img width="1199" height="828" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b3d9c7e80680e045966jpeg.jpg" alt=""><figcaption>PM KP Oli inaugurates the Investment Summit at Hotel Soaltee, Kathmandu, on Friday. Photo: World Bank Nepal / Twitter</figcaption></figure>To realize this, we need to attain double-digit growth over the next years. A tentative estimation by the National Planning Commission is that the country would require an investment of over 98 trillion Nepali rupees (about USD 88billion) over the next five years. Domestic resources alone will not be sufficient to meet this requirement, and there is a need for huge investment.The economic policy and its orientation is explicitly spelled out in the Constitution which is premised on the realisation that growth and prosperity is possible only through partnership between and development of public, private and cooperative sectors.Good Governance and Rule of LawInvestment requires transparent and responsive governance and rule of law. With elected representatives in all levels of our federal set up, governance attributes are improving. There is already healthy competition among the provinces and local governments on incentivising investment and getting more of it.[The Government] has absolutely zero tolerance on corruption. Good governance is essential for economic development and prosperity. We are committed to promote free and fair competition among private sector stakeholders. We have taken firm stand against cartels and syndicates.     Read also: <a href="https://www.nepalitimes.com/here-now/a-roller-coaster-ride/">A roller coaster ride</a>, Shyamal Shrestha<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/opinion/early-investors-didnt-sell-nepal-short/" target="_blank" rel="noopener">Early investors didn't sell Nepal Short</a>, Lisa Choegyal In the past few months substantial progress has been made in improving the investment climate in the country. A sound regulatory framework has been established with the enactment of two key legislations: the Foreign Investment and Technology Transfer Act; and the Public-Private Partnership and Investment Act. The latter provides one-stop service for any foreign investment of over NPR 6 billion or a hydropower project of over 200 MW capacity.The Foreign Investment and Technology Transfer Actensures national treatment for any foreign investment. An automatic route system has been introduced to keep the foreign direct investment related processes simple and predictable, and repatriation is guaranteed on the earning or equity.Nepal has recently implemented a universal, contribution-based social security scheme that will have a transformative impact on the country’s socio-economic landscape. The scheme, which covers medicare facilities, safe motherhood, and accidental and old-age security of workers, does not only buttress the foundation of a welfare society but also ensure better and healthier industrial relations, which will contribute to conducive environment for investors.Read also: <a href="https://www.nepalitimes.com/opinion/climate-risk-to-hydropower-investment/">Climate risk to hydropower investment</a>, Ajaya DixitThe reform drive has gone well beyond this regulatory framework, and is marked by the strengthening of institutions, building capacity, streamlining and simplifying processes and procedures.Statutory provisions pertaining to land acquisition, company registration, environmental assessment and infrastructure development have been relaxed and simplified. Online registration and payment systems will soon be upgraded to full automation.Nepal will actively pursue bilateral investment protection agreement with friendly countries that will further ensure protection for foreign investment. Negotiations will be conducted with interested countries to avoid double taxation so as to provide further incentives.The next reform cycle will involve policies and comprehensive legislation in the field of intellectual property rights commensurate with Nepal’s rights and obligation under various multilateral instruments.Economic policyNepal is one of the most flexible countries when it comes to economic policy and welcoming foreign investment. All sectors, barring a narrow box of sensitive areas, are open for foreign investment. And, 100 percent investment is allowed in almost all areas. There is attractive incentive package in terms of corporate taxation, import duties and export facilitation. Tax rates are predictable and tax holidays are guaranteed by law for those industries that meet established criteria.Nepal has a huge demographic dividend with about 57 percent of population representing the working-age group. The labour cost is competitive and low, and there is a good pool of English-speaking population specially amongst the youngsters. Policies and programmes have been developed to enable Nepali youth to be multi-skilled. Qualified and skilled manpower is available at reasonable cost locally, to make will make your investment less costly.Sound macroeconomic indicators have been maintained, hence investing in Nepal is risk free.An independent judiciary, capable of adjudicating industrial and investment related disputes on a fast-track basis, has been the mainstay of our legal system.InfrastructureBuilding infrastructure is the Government’s priority and the commitment is well reflected in the progress made in the sector of vital infrastructure. Almost round-the-clock electricity supply has been guaranteed for industries and the country will soon witness a power surplus. Road connections within the country and cross-border connectivity have improved substantially. The strategic Kathmandu-Terai Fast Track that was just a dream a few years back is now becoming a reality.   Nepal’s Special Economic Zones have both infrastructure and other amenitiesto set up industries. One such SEZ is already in operation while several others are being developed in different parts of the country. The Special Economic Zone Authority Act has been revised recently to improve conditions for investment and operation of industries. With Nepal having established a federal system of governance, the aim is to undertake a balanced development approach so that all the provinces get fair opportunities for the development of their industrial base with foreign investment. Guided by this spirit, the Government has decided to establish at least one industrial estate in each province. Likewise, with a view to promoting small and medium-size enterprises, one industrial village each will be established at the local level.Location and ConnectivityInvestors know better than others, about the importance of location.Nepal’s strategic location between the world's two largest markets with increasing purchasing power, China and India, serves as a compelling incentive for investment. Nepal enjoys access to both markets on preferential terms.With India, Nepal has duty free arrangements for most of its products, both primary and industrial goods, while China has granted a significant number of tariff lines duty free access to its market. Beyond the neighbourhood, export from Nepal is entitled to various kinds of duty-free and preferential schemes put in operation for the group of least developed countries. The size of the domestic market is also expanding along with the growth of middle class and the people’s purchasing power. The connectivity disadvantage Nepal has had is gradually dissipating because of the efforts at connectivity diversification as well as support from our friendly neighbours. Road, rail, waterways, airways and transmission-ways are covered within the framework of multi-dimensional connectivity network with both neighbours.Port access has improved, with Nepal having started utilising the Vizag Port of India for its trade and transit two years ago. Availability of a modern alternative port has helped reduce hassles at the crowded Kolkata/Haldia port. The Digital Tracking and Transshipment Systems introduced recently has eased the transportation process. A new transit route through use of inland waterways is under progress, which will connect landlocked Nepal to the sea. Transit procedures are being simplified through the use of modern technology and this will surely reduce the cost of business. Nepal ahs signed a Transport Transit Agreement with China and a Protocol to the Agreement will be signed soon. This will enable Nepal also to use Chinese territory and port facilities for its international trade and transit.Hydropower, Tourism and AgricultureWhen it comes to investment, hydropower could be a prime choice (for investors). There are other potential areas: agriculture, manufacturing, tourism, infrastructure, information technologies, mines and minerals, to name a few.The Government’s target is to generate 3000MW power in three years, 5000MW in five years and 15,000MW in ten years. While domestic consumption will gradually increase with the rapidindustrialization drive, the prospect of regional electricity market is also coming to fruition with a positive initiative recently taken by India.Work is also being done on the infrastructure foundation of cross border transmission lines. A robust master plan for such transmission line requirement is already at hand, which will guide our future course of action. The recently concluded MoU on the BIMSTEC Grid Interconnection has opened up the possibility for cross-border power trade in BIMSTEC region. Meanwhile, Nepal and Bangladesh have also signed the MoU on Power Trade.These developments make Nepal’s hydropower more and more investment-worthy. Converting water into wealth is, therefore, a not-to-be missed opportunity.Tourism is another important sector for investment. Nepal has matchless natural beauty and incredible cultural treasures.  Natural and cultural diversity make Nepal a tourist paradise round the year. 2020 is being celebrated as the Visit Nepal Year, and the intention is to attract more than 2 million tourists a year.  Nepal seeks investment for upgrading tourism infrastructure, including hotels and resorts.Agriculture has huge potentials for development. As Nepal moves from subsistence level to a commercial agriculture through modernisation, huge investment will be required. Nepal wants to enhance productivity of agriculture while reducing people’s dependence on it.  Given Nepal’s topography and climatic setting, Nepal can develop organic farming system with products of high export potential.National ConsensusThe government is not only stable with two-third majority in the Parliament, it is also has clear vision and objective for the development of the country. In devising economic policy, the Government is not moving alone. The private sector has been taken on board as an indispensable partner in the journey to economic transformation.The development agenda and foreign investment enjoy national consensus in Nepal. All political forces in the Parliament stand together to invite and encourage foreign investment.Nepal is ready for business and investment. We welcome your investment. Feel secure and seize the moment.  Your investmentwill be protected and your profit will be guaranteed. We do not want any further delay in our journey towards prosperity. Speedy and comprehensive development is the only option and the call of the hour.END

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“Investing in Nepal is risk free”

<figure><img width="1400" height="933" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b269c7e80680e04595cjpeg.jpg" alt=""/><figcaption>On Thursday, a worker puts up the registration desk as part of preparations for the Investment Summit at Hotel Soaltee, Kathmandu. Photos: Bikram Rai</figcaption></figure>After adopting a liberal free-market policy, passing the first <a href="https://archive.nepalitimes.com/regular-columns/Comment/making-nepal-fdi-friendly,853" target="_blank" rel="noopener">Foreign Direct Investment</a> (FDI) Act in 1992, despite the end of the conflict, and after many ups and downs, FDI never really picked up. Why?By 1994, some 1,180 new factories were registered and in the four years between 1992-1996,  foreign investment commitments increased 10-fold. But the Maoist war started, foreign investors were directly targeted, many closed shop and left, and those who stayed did not expand. <img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b299c7e80680e04595djpeg.jpg" alt="" width="211" height="182">Read also:<a href="https://www.nepalitimes.com/here-now/maze/" target="_blank" rel="noopener">Maze</a><a href="https://www.nepalitimes.com/editorial/invest-in-investment/" target="_blank" rel="noopener">Invest in investment</a>, Editorial Today, more than a decade after the decade-long war, Nepal has political stability but the economy remains stagnant. Nepal received less than $167 million worth of FDI in the first seven months of the new government assuming office – one-third of the amount received during the same period last year. There was a mere $400 million worth of FDI in the last five years.  In the World Bank’s Ease of Doing Business List of 2018, Nepal dropped five spots to 110th position among 190 countries. The Bank cites administrative hassles, a complicated tax system and structural problems as major impediments to investment.“If we do not change ad hoc regulations at all levels and reduce red tape, it will be foolish to expect more <a href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/" target="_blank" rel="noopener">foreign investment</a>,” says FNCCI vice-chair Umesh Lal Shrestha. Former vice-chair of the National Planning Commission Dipendra Bahadur Chettri adds that while the laws and regulations have changed for the better, the proof of the pudding is in the implementation. The bureaucracy is still investment unfriendly.Read also: <a href="https://www.nepalitimes.com/latest/nepal-inc/" target="_blank" rel="noopener">Nepal, Inc.</a>, Suman Joshi<a href="https://www.nepalitimes.com/?p=23951&amp;preview=true" target="_blank" rel="noopener">A roller coaster ride</a>, Shyamal K Shrestha <figure><img width="1780" height="1244" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b2a9c7e80680e04595ejpeg.jpg" alt=""><figcaption> </figcaption></figure>Added to it is a pervasive rent-seeking culture among policy makers and civil servants at every level. It is common knowledge that government secretaries do not issue licenses unless they get a kickback. The Melamchi Water Supply Project is <a href="https://www.nepalitimes.com/from-the-nepali-press/melamchi-delayed-by-government-extortion/" target="_blank" rel="noopener">stuck in its final stages</a> because the contractors refused to pay off the secretary. Officials of the <a href="https://www.nepalitimes.com/here-now/how-they-kept-nepal-in-the-dark-ages/" target="_blank" rel="noopener">Nepal Electricity Authority</a> (NEA) in collusion with private cement companies, shut off power to state-owned Udaypur Cement.“How do you expect businesses to come to Nepal when the first thing officials ask for in an investment meeting is their share?” asks Shrestha.Bureaucrats compete fiercely for lucrative positions in the Industry Registration and Licensing Section, the Foreign Investment and Technology Transfer Division, and Office of Company Registrar because that is where they can shake down investors.Read also:<a href="https://www.nepalitimes.com/latest/two-experts-on-nepals-investment-climate/" target="_blank" rel="noopener">Nepal’s investment climate</a><a href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/" target="_blank" rel="noopener">How Nepal can invest in improving the investment climate</a>, Anil ChitrakarNepal is also seeking to graduate from its Least Developed Country status to Developing Country status by 2030, but that is unlikely, without achieving the UN’s Sustainable Development Goals, which in turn will require an annual foreign investment flow worth $15 billion because experts say national resources alone will not suffice. <img width="1400" height="339" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b2d9c7e80680e04595fjpeg.jpg" alt="">A sluggish bureaucracy and corruption, however, have sent the wrong message to the outside world. <a href="https://archive.nepalitimes.com/article/nation/Melamchi-water-not-enough-for-everyone,3899" target="_blank" rel="noopener">Large projects like Melamchi</a> are perennially stuck; the 216MW hydropower project on the Trisuli is yet to begin, eight years after the Korean South East Power Company began work, having already invested Rs6 billion. In contrast, a 102MW hydropower project started four years ago by the same Korean consortium in Pakistan is nearing completion.General Manager Giriraj Adhikari says: “We are ready to go ahead with the project but officials are taking their time to decide on hedge fund issues. When will that be? No one knows.”Read also: <a href="https://www.nepalitimes.com/?p=23930&amp;preview=true" target="_blank" rel="noopener">Overseas Nepalis not impressed</a>, Sewa BhattaraiThe worst precedents were set by the Norwegian company SN Power pulling out of the 650MW Tamakosi III project in 2013 because of the lack of political will on the part of the government, and Australia’s SMEC gave up on the $1.5 billion West Seti Project after trying for 15 years. China’s Three Gorges also withdrew from West Seti due to lack of agreement on a power purchase.The Finnish company <a href="https://www.nepalitimes.com/banner/what-will-nepal-do-with-its-e-waste/" target="_blank" rel="noopener">Nepwaste had a proposal to solve Kathmandu’s waste problem</a> and generate electricity with an incinerator project, but is reluctant to advance, first because senior politicians wanted a cut and then because Kathmandu Municipality asked the Finns to deposit the total annual salary of all its workers in its bank account to begin.Eighteen other large projects involving Chinese and Nepali contractors are in trouble after a Chinese government-owned insurance company reported uncertainty about return on investment in Nepal. Nepal has no policy yet on sovereign guarantee.  Other foreign investors are frustrated by the government’s failure to provide basic infrastructure like roads, power and water. Without a transmission line, Chinese-backed Hongsi Cement is using a 25MW diesel generator.Read also: <a href="https://www.nepalitimes.com/opinion/early-investors-didnt-sell-nepal-short/" target="_blank" rel="noopener">Early investors didn’t sell Nepal short</a>, Lisa Choegyal<a href="https://www.nepalitimes.com/?p=23904&amp;preview=true" target="_blank" rel="noopener">Napoli Nepali</a>, Kunda Dixit <img width="750" height="738" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b2f9c7e80680e045960jpeg.jpg" alt="">It is not just the government that is working at cross-purposes to create obstacles for foreign investors, Nepal’s protection-minded private sector is equally to blame. Nepal’s cement cartel tried its best to stop Hongsi from setting up its plant, and was only successful after allying with Shivam. Another Chinese cement company Hwasin is setting up a plant, but only after partnering with industrialist Suraj Vaidya.When news surfaced that India’s Amul wanted to invest in Nepal, Nepal’s dairy industry was up in arms and lobbied their case in Parliament. Dairy and agro-industries are therefore in the FITTA negative list.When India’s biscuit company Britannia announced plans to expand in Nepal, Pashupati Biscuit openly lobbied against it. The tourism industry has been adversely affected by domestic companies who want to keep the foreigners out. Experts say foreign investment is not just about money, but bringing in state-of-the-art technical knowhow, skills and quality control. This is most evident in the cement industry where domestic manufacturers have been selling customers sub-standard cement by keeping foreign companies out. Some investors have even faced violent threats. In 2001, Nepal Telecom gave a license to Spice Nepal to operate a private telecom service. India’s Modi group that owned majority share of the company backed out when its representative was threatened with kidnapping. The Koreans involved in Himalayas Spring Water’s Ontop brand in Rasuwa pulled out after its executive was beaten up by the same Maoists who are in government now.Many middlemen and former government officials are also sitting on lucrative hydropower projects and mineral mines hoping to cash big on licenses.Read also: <a href="https://www.nepalitimes.com/opinion/climate-risk-to-hydropower-investment/" target="_blank" rel="noopener">Climate risk to hydropower investment</a>, Ajaya DixitDespite the risks, foreign investors still find <a href="https://www.nepalitimes.com/opinion/climate-risk-to-hydropower-investment/" target="_blank" rel="noopener">Nepal’s hydropower</a> a viable business venture, and more than 60% of the projects on offer at this week’s Investment Summit are in energy. After India and Bangladesh opened their market for electricity imports, Nepal has the opportunity to promote this sector to export surplus electricity after projects meet domestic demand expected to reach 10,000MW by 2030.Hitherto, the main roadblock for investment was political instability. Now that Nepal has a stable and strong government, the climate for growth is much more favourable. But as long as the state is afflicted with a rent-seeking mentality, experts say the best laws will not be enough to attract investors.  <h2>“Nepal is open for business”</h2> <img width="640" height="584" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b319c7e80680e045961jpeg.jpg" alt="">Nepal will use the Investment Summit this week to present projects on 63 categories including hydroelectricity, agriculture, tourism, and infrastructure. Investment Board Nepal CEO Mahaprasad Adhikari (pictured above) speaks to Nepali Times about prospects and challenges. Excerpts:Nepali Times: Some MPs have themselves said investment-related bills were brought for ratification without sufficient debate. What is your take?Mahaprasad Adhikari: Old bills were amended and new bills were registered in Parliament. We were hoping they would create a feasible environment for policy improvement during the Investment Summit. Bills regarding Public-Private Partnership and Foreign Investment and Technology Transfer Act have already been passed, and both were vigorously debated. In fact, the Foreign Investment and Technology Transfer Act was firsts discussed there years ago. If there are any changes, they can always be amended in future.How are the new laws more investment-friendly?There were no laws about public-private partnership (PPP) before. The act creates a legal foundation and provides fundamental tools to advance PPPs. Investors can now have more clarity about the process. Provisions related to transportation and infrastructure help strengthen the public-private partnership through the 'Viability Gap Fund' that enables the government to promote the private sector. The Investment and Technology Transfer Act will help expedite the investment process, increase security, and station a one-point service centre for efficiency. But critics say the new acts instead of strengthening the Investment Board increases the government agencies who need to give approval.The Investment Board has been functioning as a one-window service centre, and served as a bridge between investors and government agencies. The idea is that investors no longer need to visit different government offices once they contact the board. In the longer term, we hope to ensure that all government agencies communicate their decisions online. We are looking to expedite the process, and want investors to expend energy on development rather run around for documentation.We heard the same things at the 2017 Summit, but not much changed. How will this one be any different?This year's summit follows a different model, we are pushing policy improvements, and then present well-researched, attractive proposals to investors. Some of the investments commited in the last summit have arrived while the remaining is in the pipeline. Work and research has already commenced for a fourth of the investments worth Rs375 billion. What are your expectations this time?It is an invaluable opportunity to make international investors aware about Nepal's efforts to create investment-friendly environment. We have studied many projects thoroughly to showcase them at the summit, and that is an outcome by itself. We will also propose private sector projects to international investors. The message is that Nepal is ready and open for business.

Nepal has to curb corruption before wooing investors

https://youtu.be/NR6mf_rrRb0Learning from the success of overseas Chinese and Indians investing in their homeland, the Nepal government hurriedly passed two foreign investment related bills recently. But non-resident Nepalis are not impressed.The Public Private Partnership and Investment (PPPIA) Bill was passed by Parliament on 18 March, and the Foreign Investment and Technology Transfer (FITTA) Bill on 22 March, but investors say it does not go far enough in allying their concerns.<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b239c7e80680e04595ajpeg.jpg" alt="" width="211" height="182"/>Read also:<a href="https://www.nepalitimes.com/here-now/maze/" target="_blank" rel="noopener">Maze</a><a href="https://www.nepalitimes.com/editorial/invest-in-investment/" target="_blank" rel="noopener">Invest in investment</a>, Editorial<a href="https://www.nepalitimes.com/?p=23939&amp;preview=true" target="_blank" rel="noopener">Curb corruption before wooing investors</a>, Ramesh KumarNot only do the bills have contradictory provisions with an extended negative list, a minimum limit for investments, and requirements of multiple approvals, experts say they do not address the central concern of transparency, policy continuity and rule of law.FITTA has extended the negative list (sectors in which foreign investment is prohibited) to include agriculture, horticulture, and dairy, sectors which many overseas Nepalis are eager to modernise and create jobs back home.Read also: <a href="https://www.nepalitimes.com/latest/nepal-inc/" target="_blank" rel="noopener">Nepal, Inc.</a>, Suman Joshi<a href="https://www.nepalitimes.com/?p=23951&amp;preview=true" target="_blank" rel="noopener">A roller coaster ride</a>, Shyamal K Shrestha “When you prohibit so many areas for foreign investment, you are giving the wrong message to investors, especially to non-resident Nepalis. Not only does it render some sectors completely off limits, it also scares investors that their current investments may become off limits in future,” says <a href="https://www.nepalitimes.com/opinion/bottom-up-approach/" target="_blank" rel="noopener">Siddhant Pandey of Business Oxygen</a>. “Investment should be welcomed in all areas so as to help economic growth, technology transfer and to bring Nepal’s human resources up to speed.”The Non-resident Nepali (NRN) Association is concerned about shortcomings in the Acts, and has said so through a document published by its policy research wing Nepal Policy Institute (NPI) which rues the fact that the Acts treat overseas Nepalis, foreign citizens of Nepali origin, and other foreign investors alike.Read also: <a href="https://www.nepalitimes.com/latest/two-experts-on-nepals-investment-climate/" target="_blank" rel="noopener">Nepal’s investment climate</a><a href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/" target="_blank" rel="noopener">How Nepal can invest in improving the investment climate</a>, Anil Chitrakar Says Khagendra Dhakal of NPI: “The government says it needs the negative list to protect small-scale industries, but people of Nepali origins have special emotional ties to Nepal even if they may not have enough capital for large scale investments. NRNs and foreign citizens of Nepali origins should be given the same rights as Nepali citizens.”The NPI report recommends scrapping the negative list and lifting restrictions on foreigners from investing in businesses worth less than $150,000 for overseas Nepalis.“If a business worth $100,000 is employing at least 20 Nepalis and training them in new technology, it should be open to investment for NRNs and foreigners of Nepali origin too,” says Dhakal.However, FITTA authorises the Industry and Investment Promotion Board to approve companies investing Rs5-10 billion, while PPPIA directs companies above Rs6 billion to the Investment Board Nepal (IBN).Read also: <a href="https://www.nepalitimes.com/opinion/early-investors-didnt-sell-nepal-short/" target="_blank" rel="noopener">Early investors didn’t sell Nepal short</a>, Lisa Choegyal<a href="https://www.nepalitimes.com/?p=23904&amp;preview=true" target="_blank" rel="noopener">Napoli Nepali</a>, Kunda Dixit<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b249c7e80680e04595bjpeg.jpg" alt="" width="1000" height="428"><figcaption> </figcaption></figure>Amidst concern that PPPIA concentrates power in the IBN, which does not have much to show for itself, the real question at the Summit this week is whether these hastily-passed bills will remove misgivings of foreigners and NRNs about investing in Nepal.Economist and former Nepali ambassador to the United States Shankar Sharma believes that the law itself is not the problem when it comes to attracting foreign investment, but its execution.“We have good laws but their implementation is weak, which is the real problem,” says Sharma. “There is supposed to be a one-door policy, but in reality investors are made to jump through hoops to register companies or repatriate profits. The process is cumbersome, full of hassles. We need detailed guidelines about how these laws will be simpler and easier to implement.”Former president of NRN association Jiba Lamichhane agrees, stating that though the laws are all right there are other problems. “Overall our laws are quite liberal, but they fail to create a conducive investment climate with extortion, hassles over repatriating profits. If we want to attract investment, we must learn from best practices around the world. African countries attract huge investments from China while we have not been able to do so despite being next door,” he says.Investing in Nepal is more expensive than in other Asian countries due to the lack of skilled manpower and infrastructure, and experts say that without improvements the two bills are not going to make much of a difference.On the positive side, FITTA and PPPIA have eliminated many of the hassles related to registering FDI companies. Investors who needed to get approval from at least five agencies, now need to go to only two.The World Bank’s Nepal Country Manager Faris Hadad-Zervos told Nepali Times: “Nepal is entering a new chapter in its development, and it is not just about one law or policy but a change in the narrative where Nepal has survived several crises and is moving to rebuilding. The actual impact of the bills will depend on regulations to operationalise these laws.”

Overseas Nepalis are not impressed

<figure><img width="1000" height="1500" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b369c7e80680e045962jpeg.jpg" alt=""/><figcaption>Photo: BIKRAM RAI</figcaption></figure>Nepal introduced the Foreign Investment and Technology Transfer Act (FITTA) in 1992, but it lags behind South Asian economies and Least Developed Countries (LDCs) in <a href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/" target="_blank" rel="noopener">attracting Foreign Direct Investment</a> (FDI), and even the investment that comes in is declining.Net FDI inflows in Nepal, which stood at $196 million (0.8% of GDP) in 2017 declined by 14% to $169 million (0.6% of GDP) in 2018. FDI inflows crossed the $1.0 billion threshold in Bangladesh, Pakistan and Sri Lanka. India alone attracted $40 billion FDI in 2017. Bhutan, India and Sri Lanka are ranked above Nepal in Doing Business related indicators.<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b399c7e80680e045963jpeg.jpg" alt="" width="211" height="182">Read also:<a href="https://www.nepalitimes.com/here-now/maze/" target="_blank" rel="noopener">Maze</a><a href="https://www.nepalitimes.com/editorial/invest-in-investment/" target="_blank" rel="noopener">Invest in investment</a>, Editorial <a href="https://www.nepalitimes.com/?p=23939&amp;preview=true" target="_blank" rel="noopener">Curb corruption before wooing investors</a>, Ramesh KumarAs Nepal convenes another Investment Summit in Kathmandu this week, investors will be watching if there is any progress in translating the vision of economic prosperity into concrete reform measures. Reviving the investment climate is vital to taking Nepal's economy on a high growth trajectory for mass job creation, raising per capita income and reducing social inequality.Despite the government declaring Nepal Investment Year 2012/13 and organising an Investment Summit 2017, these campaigns could neither raise FDI levels nor convince investors that it was FDI-friendly. Since 2018, economic growth has rebounded to 6.0%, on average, due to restoration of political stability, improved electricity supply, favorable monsoon and higher tourism arrivals.Read also: <a href="https://www.nepalitimes.com/latest/nepal-inc/" target="_blank" rel="noopener">Nepal, Inc.</a>, Suman Joshi<a href="https://www.nepalitimes.com/latest/two-experts-on-nepals-investment-climate/" target="_blank" rel="noopener">Nepal’s investment climate</a><a href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/" target="_blank" rel="noopener">How Nepal can invest in improving the investment climate</a>, Anil Chitrakar However, poor governance, weak and inadequate infrastructure, and bureaucratic hassles remain deterrents. Nepal ranked 109/140 on the Global Competitiveness Index 2018, 117/163 on the Logistics Performance Index 2018 and 110/190 in Doing Business 2019. FDI created only 243,540 jobs (1.4% of the labor force) up to mid-July 2018: 46% of FDI is in energy, 18% of FDI is in manufacturing, 18% of FDI is in services and 15% of FDI is in tourism. Small and cottage industries and many agricultural sub-sectors are in the negative list to protect domestic producers even though state support has not raised productivity nor export performance.Nepal has also become a net food importer, and imported $247 million worth of rice in 2017, higher than the total $215 million in agricultural exports that year. Similarly, the export performance of agro-based products identified under Nepal Trade Integration Strategy 2016 (large cardamom, ginger, and honey) remain dismal due to supply-side constraints affecting overall productivity.As more than 70% of Nepalis are employed in agriculture, selectively opening some sub-sectors to FDI could raise productivity in both subsistence and cash crops. This would check ballooning imports of food items that contribute to Nepal’s high trade deficit. This will also enable higher value-added production domestically, and enhance supply chains, thus creating strong backward linkages in terms of skilled employment.Read also: <a href="https://www.nepalitimes.com/?p=23930&amp;preview=true" target="_blank" rel="noopener">Overseas Nepalis not impressed</a>, Sewa BhattaraiNepal can take a cue from India’s Consolidated FDI Policy 2017, which allows an automatic entry route into various agricultural sub-sectors up to 100% but bars FDI totally in other farm sub-sectors. Vietnam, with net FDI inflows of $14.1 billion in 2017, does not maintain a negative list of industries but maintains foreign equity caps, mostly in the service sector.A single large infrastructure project such as the export-oriented Arun III Hydroelectric Project will add $1.4 billion to Nepal’s FDI stock. The recently-introduced hedging regulations are likely to mitigate some of foreign exchange risks around FDI and encourage further investment in the energy and infrastructure sectors.New luxury hotels set up by international hotel chains outside the Kathmandu-Chitwan-Pokhara triangle will diversify the tourism sector, which has the potential to create many better jobs and help less developed places in Nepal. The success of the new and amended labour, foreign investment, and industry laws will depend on whether they address risks to investment, allow business flexibility and create a level playing field for both domestic and foreign investors.Read also: <a href="https://www.nepalitimes.com/opinion/early-investors-didnt-sell-nepal-short/" target="_blank" rel="noopener">Early investors didn’t sell Nepal short</a>, Lisa Choegyal<a href="https://www.nepalitimes.com/?p=23904&amp;preview=true" target="_blank" rel="noopener">Napoli Nepali</a>, Kunda DixitOpposition to reforming these laws from various sections of the political class, private sector, and trade unions reveals a deep-seated fear of competition, which is crucial for efficiency and productivity. Investment-related legislations should be regularly reviewed and amended accordingly.Investors are currently required to obtain approvals from a plethora of government agencies. Investment Board Nepal and Department of Industry should be the only one-stop shops for facilitating investment. Security concerns have again risen against the recent spate of violence, including damage to the property of FDI projects.Continuation of the stalled public-private dialogue between the government and the domestic private sector under the platform of Nepal Business Forum could go a long way in tackling investment climate bottlenecks at both the national and sub-national levels. This body can also form a task force to identify reforms related to ease of doing business. Shyamal Shrestha is a member of the Bibeksheel Sajha Party @ShyamalShrestha

A roller coaster ride

<figure><img width="1500" height="1044" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b109c7e80680e045951jpeg.jpg" alt=""/><figcaption>Illustration: BHANU BHATTARAI</figcaption></figure>Let us just say, for the sake of argument, that Nepal has now untangled its politics, formed a Constitution, the war is over and there is political stability. (We know that this is not strictly true, especially since there is a disgruntled faction of the ruling party that is on a <a href="https://www.nepalitimes.com/here-now/its-a-crime-not-to-call-it-terrorism/">violent extortion spree</a> across the land.)Read also: <a href="https://www.nepalitimes.com/here-now/maze/" target="_blank" rel="noopener">Maze</a>But suppose we had sorted out the politics, and we were actually taking a big leap forward towards a ‘prosperous and happy’ nation. Would that finally <a href="https://www.nepalitimes.com/latest/nepal-inc/">convince foreign investors</a> that Nepal is an attractive place to do business because of its sizeable domestic market and prime location between the world’s biggest markets?<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b139c7e80680e045952jpeg.jpg" alt="" width="211" height="182">Not really. Foreign investors would look at lists like the World Bank’s Ease of Doing Business, Forbes Magazine's Best Countries for Business, or the Global Finance magazine's list of Top Countries for Foreign Direct Investment, and see that Nepal scores nowhere near the top 50, or even the top 100 countries.Read also: <a href="https://www.nepalitimes.com/latest/nepal-inc/">Nepal, Inc.</a>, Suman JoshiJust Google "Nepal" and "<a href="https://www.nepalitimes.com/editorial/bulldozing-democracy-2/">Corruption</a>" and see how low Nepal ranks in the Transparency Index. There is the recent case of the Malaysian telecom investor <a href="https://www.nepalitimes.com/here-now/supreme-court-weighs-in-on-ncell-tax-dispute/">Axiata being forced to pay</a> Rs61 billion in capital gains tax even though it is the buyer, not the seller, that should be liable. In this space we recently recounted the horror story of how senior bureaucrats repeatedly <a href="https://www.nepalitimes.com/from-the-nepali-press/melamchi-delayed-by-government-extortion/">extorted an Italian contractor for kickbacks</a> and forced its personnel to abandon the nearly complete $500 million water supply project when they did not fork out Rs50 million. A Spanish contractor upgrading Kathmandu airport quit after being harassed over payoffs. Other investors have reported being asked for a cut to repatriate profits, and renewing business visas has become an ordeal. <a href="https://www.nepalitimes.com/here-now/nepali-scientist-returns-to-pinpoint-hazards-of-dirty-air/">Kathmandu’s air pollution and poor quality</a> of education are other deterrents for investors.Given such sleazy behaviour, it is surprising there are still foreign companies interested in <a href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/">investing in Nepal</a>. Despite the country’s strategic location, great potential for energy, agriculture and infrastructure projects, the level of foreign direct investment <a href="https://www.nepalitimes.com/from-the-nepali-press/why-there-is-no-foreign-investment-in-nepal/">(FDI) has been dropping rapidly</a>.Read also: <a href="https://www.nepalitimes.com/latest/two-experts-on-nepals-investment-climate/">Nepal’s investment climate</a><a href="https://www.nepalitimes.com/opinion/how-nepal-can-invest-in-improving-the-investment-climate/">How Nepal can invest in improving the investment climate</a>, Anil Chitrakar It rose steeply after the Foreign Investment Act of 1992 and the first Investment Summit a year later. But inflows dried up during the war years as the Maoists targeted domestic industries and foreign investors for extortion, threats and bombings. After the end of the conflict, investment rose sharply again as private hydropower projects got underway. However, there has been only $400 million in <a href="https://archive.nepalitimes.com/regular-columns/Comment/making-nepal-fdi-friendly,853">foreign investment</a> in the past five years, with only $169 million in 2018 since the Nepal Communist Party took office -- a further drop of 15% compared to the previous year.In the meantime, other developing countries in the region, even those governed by communist parties like Vietnam and Laos, have moved up the value chain in garments and manufacturing and are now attracting investments in energy and electronics. India and China have attracted their diaspora to invest in the home country, but Nepal’s laws have failed to meet the demand of overseas Nepalis for special provisions to non-residents.Why is Nepal stuck? It boils down to poor governance, lack of accountability, and no rule of law. Those conditions are linked to political will, a national vision and efficient implementation of policies – all in short supply.This is why, despite being optimistic about Nepal’s long-term future, we are pessimistic in the short-term as the government holds another Investment Summit for the sake of a summit without even beginning to address the root causes. In the run-up to the Summit, the government hurriedly passed FITTA which actually makes it more cumbersome to get approvals, and has added dairy and agro-industries in the negative list to protect domestic businesses. The Public-Private Partnership and Investment Act, although streamlining IBN’s role, does not address the confusion over jurisdiction of federal and provincial governments. The new rules for hedging on dollar-rupee fluctuations are unlikely to reassure foreign investors because they come with so many if’s and but’s.<a href="https://www.nepalitimes.com/here-now/nepal-can-create-a-business-friendly-environment/">Foreign investors</a> are attracted to put money in a country if there are incentives, facilities, transparency, and a guarantee of no bureaucratic harassment. With so much competition in Asia, and especially in the immediate neighbourhood, it is unlikely that many of the 600 potential investors from 38 countries who are in Kathmandu this week will be convinced.It is hard to entice foreign investors to the country when even Nepali businesses are so hesitant to start up a business. We do not need any more speeches; Nepal first needs to improve governance and transparency before another futile attempt to woo investors. <h2>10 years ago this week</h2> Nepal is holding another Investment Summit this week, exactly ten years after Maoist Prime Minister Pushpa Kamal Dahal embarked on a trip to Nordic countries to restore investor confidence after the war. Excerpt from a <a href="http://archive.nepalitimes.com/news.php?id=15725" target="_blank" rel="noopener">page 1 report</a> in the <a href="http://archive.nepalitimes.com/issue/441">issue #444</a> of 27 March – 2 April 2009:Prime Minister Pushpa Kamal Dahal has said his primary mission during his Nordic tour next week will be to encourage foreign investment. However, his hosts will also want to hear just how seriously he is committed to protecting democracy during Nepal’s transition to peace, and they will link his track record to future development assistance. Dahal will probably be able to convince the Norwegians and Finns he is serious about democracy, but he will have a much tougher time with potential investors. “The investment climate doesn’t look good at all,” said one European investor, “and what is worrying is that instead of getting better it is getting worse.”In Oslo, Dahal is set to meet executives from Statkraft, the Norwegian state-owned hydropower company that partly owns SN Power that is investing in the 600MW Tama Kosi III, and will face tough questions about security, legal stability, political and bureaucratic delays.<a href="http://archive.nepalitimes.com/issue/441"><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110811118/636a2b149c7e80680e045953jpeg.jpg" alt="" width="507" height="812"></a>

Invest in investment

India and Pakistan are twins separated at birth. Tensions between them have been at a hair trigger ever since independence and has erupted into full scale conflict at least four times in the past 80 years.
The 22 April terrorist attack in Kashmir that killed 25 Indian tourists and a Nepali citizen, threatens to escalate tension between the two nuclear-armed nations. India has squarely blamed Pakistan for the attacks, and Prime Minister Narendra Modi has given his military “operational freedom” to respond. Pakistan has said it has credible intelligence of an Indian military strike and its officials have promised a “full spectrum” response — a code for a <a href="https://nepalitimes.com/editorial/thinking-the-thinkable">nuclear retaliation</a>.
For Nepal, the killing of its national in the Pahalgam attack comes as another stark reminder that in conflicts from Afghanistan to Iraq, from <a href="https://nepalitimes.com/opinion/how-to-agree-an-armistice-in-ukraine">Ukraine</a> to Israel, <a href="https://nepalitimes.com/news/10-nepalis-from-one-town-fighting-in-ukraine">Nepalis are getting caught in the crossfire</a>. The last time full-scale fighting broke out between <a href="https://nepalitimes.com/opinion/peacemongers-at-india-pakistan-border">India and Pakistan</a> on Kargil in 1999, at least 22<a href="https://nepalitimes.com/here-now/india-s-trial-by-fire-for-soldiers-from-nepal?%27%5C%22="> Nepalis fighting for the Indian Army</a> were killed in action.
Three of Nepal’s immediate neighbours (China, India, Pakistan) have nuclear weapons, and they do not have good relations. With China supplying weapons, <a href="https://nepalitimes.com/editorial/war-and-warming">missile technology</a> and other support to Pakistan, this triangular friction could set off a regional conflagration.&nbsp;
<a href="https://www.nature.com/articles/s43016-022-00573-0" target="_blank">Research at Rutgers University</a> has calculated that even a week-long tactical nuclear exchange between India and Pakistan would throw up so much smoke and debris into the atmosphere that it would block out the sun for years, and lead to a collapse of the <a href="https://nepalitimes.com/news/grow-nourish-sustain-together-world-food-day">global food system</a>. This does not take into account the radioactive fallout that prevailing winds would blow up to <a href="https://nepalitimes.com/here-now/lives-on-the-line-in-the-himalaya">the Himalaya</a>, contaminating glaciers that are the sources of <a href="https://nepalitimes.com/here-now/saving-what-is-left-of-himalayan-rivers">Asia’s main rivers</a>.
The impact of <a href="https://nepalitimes.com/news/climate-breakdown-linked-to-thame-flood">climate breakdown </a>on High Asia was already ringing alarm bells about its <a href="https://nepalitimes.com/news/himalayan-icecap-melting-faster-than-thought">shrinking ice cap</a> reducing the dry season flow of water downstream. Water was going to be the next strategic commodity, geopolitical experts warned, and the next wars in Asia would be over water.
That water war is already happening. India retaliated to the Kashmir attack by suspending the <a href="https://www.nytimes.com/2025/04/24/world/asia/india-pakistan-indus-waters-treaty.html" target="_blank">Indus Waters Treaty</a> of 1960 mediated by the World Bank that has withstood at least three wars between India and Pakistan. The treaty gives India control over the three eastern tributaries of the Indus (<a href="https://en.wikipedia.org/wiki/Beas_River" target="_blank">Beas</a>, <a href="https://en.wikipedia.org/wiki/Ravi_River" target="_blank">Ravi</a> and <a href="https://en.wikipedia.org/wiki/Sutlej" target="_blank">Sutlej</a>), while Pakistan got water from the Indus and two of its western tributaries (<a href="https://en.wikipedia.org/wiki/Indus_River" target="_blank">Indus</a>, <a href="https://en.wikipedia.org/wiki/Chenab_River" target="_blank">Chenab</a> and <a href="https://en.wikipedia.org/wiki/Jhelum_River" target="_blank">Jhelum</a>.
Pakistan was assured of 70% of the annual flow, and India could use a reasonable amount of water for<a href="https://archive.nepalitimes.com/news.php?id=15231"> irrigation and hydropower</a>. &nbsp;Within days of its threat, India stopped water flowing down to Pakistan from the Chenab river and is reportedly preparing to do the same on the Jhelum.
The sabre-rattling has reached a crescendo. Besides threats and counter-threats there are also symbolic drills, with the Indian Air Force practicing landing on an expressway in Uttar Pradesh by its Rafale, Su-30 and Jaguar fighter jets to demonstrate ‘operational readiness’. In response Pakistan test-fired its Abdali ballistic missile that can carry a nuclear warhead and has a range of 450km.&nbsp;
The danger is that with ultra-nationalist rhetoric and the beating the war drums by both sides, India’s government and Pakistan’s military may have to ‘do something’ to appease domestic public opinion. But any tactical strike, an artillery exchange, or territorial incursion could quickly escalate out of control.
Expecting an Indian retaliation for the Pahalgam killings, Pakistan is using<a href="https://nepalitimes.com/opinion/interfaith-collaboration-for-nuclear-disarmament"> nuclear deterrence </a>and warning of “catastrophic consequences”. The two neighbours came close to a nuclear exchange in 2019 after an attack on the Indian military in Kashmir, and prompt international intervention led by the United States cooled tensions.&nbsp;
This time, the <a href="https://nepalitimes.com/news/trump-shock-wave-hits-nepal">Trump administration</a> is too distracted and not as engaged. Pakistan has denied it was responsible for the terrorist attack and called on Washington to stop a possible Indian retaliation. India and Pakistan have stopped overflights by each other’s airlines, and some international carriers have even stopped flying over Pakistan fearing an air war.
Washington, Beijing, the UN and the EU have all urged restraint. Iran, which has good relations with both India and Pakistan has sent its foreign minister to urge both countries not to go into a tit-for-tat war. Iran has its own nuclear flashpoint to worry about with tensions in Israel, &nbsp;Yemen and Syria.
India and Pakistan both share similar problems of joblessness, <a href="https://nepalitimes.com/here-now/why-nepal-s-poverty-rate-is-stuck">poverty </a>and <a href="https://nepalitimes.com/here-now/climate-change-new-threat-to-nepal-s-rhinos">environmental threats</a>. Neither side needs the threat of a senseless war, and we in the neighbourhood do not need it either.&nbsp;
Kunda Dixit
This Editorial is brought to you by <a href="https://nepalitimes.com/" target="_blank">Nepali Times</a>, in collaboration with <a href="https://inpsjapan.com/en/" target="_blank">INPS Japan</a> and <a href="https://sgi-peace.org/" target="_blank">Soka Gakkai International</a>, in consultative status with UN ECOSOC.

Nukes in the neighbourhood

The streets of Patan are alive this month with lavender jacaranda trees under rain-washed skies as <a href="https://nepalitimes.com/banner/the-red-god-rises-again-in-patan">the chariot of Rato Matsyendranath</a> is pulled across town. This is the festival of the rain god, and inevitably the heavens opened up and pre-monsoon showers pelted the chariot as it started being pulled in Pulchok last week. Thousands of devotees, onlookers and the chariot procession organisers thronged the streets on the first day last week. The rhythmic cymbals and drums exuded a vibrant energy as the enormous four wheels turned and the chariot lurched.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2025051007050_81df97744db16f732a419dc1f1579d235ce3df37642b078f50b83bd4bd026688.jpg" data-media-id="editor_1" data-image-id="2025051007050_81df97744db16f732a419dc1f1579d235ce3df37642b078f50b83bd4bd026688" data-rendition-name="original" width="1000" height="1503" loading="lazy" alt="Divine chariot"> </figure>  The<a href="https://archive.nepalitimes.com/article/Nepali-Times-Buzz/Red-rain-god,3141"> red rain god</a> has Hindu and Buddhist antecedents, alternatively called Bungadya and<a href="https://nepalitimes.com/here-now/kathmandu-s-gravity-defying-chariot-festival"> Karunamaya</a> — reflecting Kathmandu Valley’s syncretic mixture of the two religions.&nbsp; “Bungadya is a profoundly <a href="https://nepalitimes.com/opinion/12-full-opinion/marketing-the-intangible">intangible form of heritage</a>,” explains heritage expert Monalisa Maharjan. “It embodies traditional knowledge,<a href="https://nepalitimes.com/multimedia/reviving-nepal-s-craft"> artisanal skills passed down through generations</a>. Local communities and specific families have specified roles in being custodians of the heritage, ensuring their survival over the centuries.” There are many legends and stories about this annual tradition. Lichhavi king Narendra Dev is supposed to have brought Rato Matsyendranath from Assam to Kathmandu Valley to convince Guru Gorakhnath to lift a spell that created a two-year drought in Kathmandu.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250510050520_347a9a398f8a9abc4a7fb4e2774fde8264cccbdce8bdab23851ab3f0e73c3e8a.jpg" data-media-id="editor_6" data-image-id="20250510050520_347a9a398f8a9abc4a7fb4e2774fde8264cccbdce8bdab23851ab3f0e73c3e8a" data-rendition-name="original" width="1503" height="1000" loading="lazy" alt="Divine chariot"> </figure>  Matsyendranath was Gorakhnath’s mentor, and upon seeing him, the serpents were released, unleashing the rains. The chariot festival honours the return of this life-giving rain. The deity is seen as an icon for thriving agriculture, t<a href="https://nepalitimes.com/here-now/before-the-next-monsoon">he arrival of monsoon</a> showers, and the welfare of the community. Read also: <a href="https://nepalitimes.com/opinion/the-reign-of-the-god-of-rain">The reign of the god of rain</a>, Vidhu Prakash Kayastha Till this day, the Rato Matsyendranath festival is no ordinary celebration. Patan does not sleep for a month as the chariot is pulled through various neighbourhoods. It unfolds at a state level with the president (formerly the king) attending the climax of the Bhoto Jatra in Jawalakhel later this month.&nbsp; The intergenerational transmission of tradition is unique in the world, and the reason the festival is one of the most vibrant cultural expressions that thrives despite inroads of modernity. The other unique aspect is that it is a transnational festival, binding Patan with Guwahati in the Indian state of Assam.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2025051005058_8bc685ada13045d863b28e3eed91c931da2b510714586af6fd7eb5d1e298a24a.jpg" data-media-id="editor_9" data-image-id="2025051005058_8bc685ada13045d863b28e3eed91c931da2b510714586af6fd7eb5d1e298a24a" data-rendition-name="original" width="1000" height="1503" loading="lazy" alt="Divine chariot"> </figure>  “Unlike Nepal, where the deity commands grandeur and devotion, many in Assam are unaware of Rato Matsyendranath,” says Khagen Sharma of Gauhati University, which convened <a href="https://nepalitimes.com/news/nepal-assam-connection-revived">a symposium in February in Guwahati on the rain god</a>. Attending was a delegation led by Lalitpur Mayor Chiribabu Maharjan, organisers of the festival, and builders of the chariot. After the symposium, a committee was formed to explore and revive the tradition in Assam as well. Although the team had planned to visit Nepal this month, logistical challenges delayed the trip. Still, there are plans to build a Guru Matsyendranath statue in Assam to reestablish regular worship practices in the Guwahati shrine.&nbsp; The vines used to build the chariot in Patan are sourced from the jungles of Assam. But Sharma notes that in recent years unclear regulations have blocked the official import of the vines, although they are still brought to Nepal informally. The <a href="https://archive.nepalitimes.com/article/Nepali-Times-Buzz/makers-of-machhindranath,2204">chariot making</a> has also had a taste of modernisation in recent times. In the past, even a single nail or piece of steel was avoided. But over time, the wooden structure, particularly the shaft between the wheels, has been replaced with bronze. When that too proved unstable, metal clamps were introduced, which have become a pragmatic compromise.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250510050524_b2a819a5791612f14c81d30fc393dbd3f99f0c64b90a9110e8b0855d944bfa93.jpg" data-media-id="editor_12" data-image-id="20250510050524_b2a819a5791612f14c81d30fc393dbd3f99f0c64b90a9110e8b0855d944bfa93" data-rendition-name="original" width="1500" height="998" loading="lazy" alt="Divine chariot"> </figure>  Another welcome change is the focus on safety. Builders climbing the chariot’s tower now wear harnesses and there are efforts in crowd control. The most visible change in recent years has been the involvement of Patan’s enthusiastic youth in the festival — the tradition is now passing to a new generation. Says Matsyendranath expert Vidhu Kayastha: “There is more energy, the young people in red t-shirts this year were very organised, these modern touches aren’t diluting our culture, they’re keeping it alive in new forms.” He adds, “We are <a href="https://nepalitimes.com/here-now/searching-for-a-homeland-away-from-home">reconnecting with our roots</a>, we have more resources, more awareness than ever before. We must not be swept away by western values that may not serve us, and in some ways, cause more harm than good. We must revive our own culture.”&nbsp;

Divine chariot

In 2025, two seemingly disconnected acts of violence shattered the illusion of stability in the region. In March, <a href="https://www.ft.com/content/16f7f947-1e96-4206-9844-891378adc683" target="_blank">militants hijacked a passenger train</a> near the Bolan Pass in Balochistan, executing soldiers in cold blood. A month later, <a href="https://www.nytimes.com/2025/04/22/world/asia/kashmir-terrorist-attack.html" target="_blank">gunmen in Kashmir’s</a> Pahalgam Valley massacred tourists. 
In both Islamabad and New Delhi, <a href="https://www.aljazeera.com/news/2025/4/25/were-cursed-kashmiris-under-attack-across-india-after-pahalgam-killings" target="_blank">the reaction was reflexive:</a> condemn the violence, <a href="https://www.economist.com/asia/2025/04/22/india-and-pakistan-could-come-to-blows-over-kashmir" target="_blank">blame external enemies</a>, declare the situation contained. But South Asia’s leaders are not fighting terrorists alone. They are fighting the consequences of their own betrayals.
Across <a href="https://www.bbc.com/news/world-asia-26272897" target="_blank">Balochistan</a>, <a href="https://www.bbc.com/news/world-south-asia-11693674" target="_blank">Kashmir</a>, <a href="https://www.crisisgroup.org/asia/south-asia/india/346-finding-way-out-festering-conflict-indias-manipur" target="_blank">Manipur</a>, and beyond, decades of <a href="https://www.amnesty.org/en/projects/enforced-disappearance-in-south-asia/" target="_blank">enforced disappearances</a>, broken promises, and brute militarisation have hollowed out the social contracts meant to hold these nations together. The grievances that drove rebellions from the 1940s through the 1990s – demands for dignity, recognition, and political agency – were never meaningfully addressed. They were buried beneath asphalt and propaganda, paved over by development projects and security checkpoints.
States may claim victory. But their victories are mirages, dissolving the moment anyone looks too closely. South Asia’s unfinished wars are not relics of a violent past. They are live ammunition, loaded into the future.
<a href="https://www.theguardian.com/world/2025/mar/24/he-only-wanted-revenge-the-bloody-insurgency-in-balochistan-gaining-lethal-momentum" target="_blank">Balochistan</a> has been at war with Pakistan for most of its modern history. Rich in gas, minerals, and coastline, the province has been plundered for decades under the language of national development. 
Projects like the <a href="https://eastasiaforum.org/2020/11/26/pakistans-three-evils-cpec-and-good-governance/" target="_blank">China-Pakistan Economic Corridor (CPEC)</a> promise progress but deliver exclusion: minerals are mined, ports are secured, but Baloch homes are raided. 
The insurgency endures not because of foreign conspiracies, as Islamabad endlessly insists, but because the Pakistani state remains incapable of seeing its <a href="https://thebalochistanpost.net/2025/01/enforced-disappearances-in-balochistan-in-december-2024-tbp-report/" target="_blank">Baloch citizens</a> as anything other than a security problem to be managed.
In <a href="https://www.forbes.com/sites/ranisingh/2016/07/12/kashmir-in-the-worlds-most-militarized-zone-violence-after-years-of-comparative-calm/" target="_blank">Kashmir</a>, the Indian government claims to have <a href="https://www.nytimes.com/2023/03/08/world/asia/kashmir-village-defense-committees.html" target="_blank">“normalised” the valley</a> after revoking its autonomy in 2019. It <a href="https://www.cfr.org/global-conflict-tracker/conflict/conflict-between-india-and-pakistan" target="_blank">looks a lot like occupation</a>. Soldiers outnumber local leaders, dissent is criminalised, internet shutdowns suffocate public life. Tourism campaigns and investment summits cannot erase a generation raised under curfew and surveillance.
<a href="https://www.bbc.com/news/world-asia-india-66260730" target="_blank">Manipur’s descent into ethnic bloodshed</a> in 2023 exposed another fault line Delhi prefers to ignore. Long-simmering tensions between the Meitei and Kuki communities erupted into violence that shattered any illusions of northeastern integration. The central government’s delayed, politicised response made clear what many Manipuris had always suspected: they are citizens of India only when convenient.
Even the <a href="https://msf.org.au/rohingya-worlds-largest-stateless-population" target="_blank">Rohingya, stateless and exiled from Myanmar</a>, find themselves entangled in South Asia’s ethnonationalist calculus. Fleeing genocide, they are criminalised anew in Bangladesh and India – trapped between the countries that reject them and the memories that refuse to let them go.
South Asia’s states have excelled at suppressing rebellion. But failed at extinguishing the reasons rebellions rise in the first place. And the wars South Asia tries to forget at home have found new life abroad.
Across <a href="https://www.abc.net.au/news/2024-06-17/modis-indian-government-accused-of-spying-silencing-critics/103974414" target="_blank">Canada, Australia, Britain, and the United States</a>, diasporic communities have become memory-keepers and, increasingly, <a href="https://www.business-standard.com/world-news/khalistan-supporters-hold-protest-outside-indian-consulate-in-vancouver-123092600087_1.html" target="_blank">the agitators</a> for the struggles their home states would rather erase.
Khalistan flags fly outside Indian consulates in Vancouver and <a href="https://www.tribuneindia.com/news/punjab/perturbed-over-waving-of-khalistani-flags-at-an-event-in-melbourne-india-warns-australia-of-khalistan-separatists-and-their-links-with-terror-groups-458320/" target="_blank">Melbourne</a>. Tamil activists march through London, demanding accountability for the <a href="https://www.aljazeera.com/news/2024/5/19/grim-reminder-sri-lankas-tamils-mark-15-years-since-end-of-civil-war" target="_blank">massacres in Mullivaikkal</a>. Kashmiri protests in Washington and New York refuse to let India’s crackdown slip into diplomatic amnesia.
For host countries, these movements pose uncomfortable questions. Freedom of expression collides with fears of extremism. Clashes erupt between communities carrying wounds that their new homelands.
Meanwhile, South Asian states pursue their adversaries across borders. India faces allegations of <a href="https://www.nbcnews.com/news/world/canada-says-india-home-minister-ordered-campaign-against-sikh-activist-rcna177972" target="_blank">targeting Sikh activists for assassination in Canada</a> and the <a href="https://www.npr.org/2024/10/27/g-s1-29561/sikh-separatist-assassination-india" target="_blank">United States</a>. Pakistan continues to court Kashmiri separatists abroad while crushing Baloch dissent at home. <a href="https://apnews.com/article/sri-lanka-tamils-civil-war-dead-5b372b0bba567837c5a4d94250040e7d" target="_blank">Sri Lanka</a> lobbies furiously to brand Tamil diaspora organisations as fronts for terrorism, even as it stonewalls investigations into its own wartime atrocities.
The old insurgencies have not been defeated. They have been globalised. South Asia’s governments have long mistaken silence for stability.
In Punjab, India broke the back of the <a href="https://www.cnn.com/2023/10/06/india/india-canada-sikh-khalistan-analysis-intl-hnk/index.html" target="_blank">Khalistan insurgency</a> through brute force. The fields grew green again, the trains ran on time. But the wounds were never closed, the <a href="https://www.dw.com/en/why-is-indias-khalistan-separatist-movement-on-the-rise/a-65081729" target="_blank">movement’s heart beats</a> not in Amritsar but in Brampton and Surrey.
In Sri Lanka, the <a href="https://www.academia.edu/4738983/The_Man_Who_Destroyed_Eelam" target="_blank">military crushed the Tamil Tigers</a> with <a href="https://www.newyorker.com/magazine/2011/01/17/death-of-the-tiger" target="_blank">overwhelming brutality in 2009</a>. <a href="https://www.scmp.com/week-asia/politics/article/3264148/we-want-our-children-back-sri-lankan-families-still-demanding-justice-their-missing-loved-ones" target="_blank">Tamil families still search for their missing</a>, still mourn their dead – and still organise across the diaspora for justice that remains undelivered.
In Kashmir, Delhi boasts of new <a href="https://www.aljazeera.com/opinions/2023/2/4/kashmir-is-bleeding-its-economy" target="_blank">highways and investment corridors</a>, showcasing the region as a trophy of unity. But when the visitors leave and the cameras are packed away, <a href="https://harvardlawreview.org/print/vol-134/from-domicile-to-dominion-indias-settler-colonial-agenda-in-kashmir/" target="_blank">the checkpoints, the raids, and the quiet despair remain.</a>
Victory parades fade. Grievance endures. Suppressing insurgency may end battles. It does not end the ideas that fueled them. In a region where <a href="https://www.nytimes.com/2025/04/23/world/asia/kashmir-attack-india-pakistan.html" target="_blank">history is rarely past</a>, and memory is rarely voluntary, states that rule through repression are only ever buying time. And often, not very much.
South Asia’s unfinished wars are not accidents. They are the inevitable consequences of states that confuse conquest with consent, and erasure with reconciliation. They cannot legislate memory out of existence.
Every <a href="https://www.bbc.com/news/articles/c15qyyzz89lo" target="_blank">disappeared son in Balochistan</a>, every <a href="https://medium.com/the-wvoice/the-half-widows-in-kashmir-fef80c6b88e9" target="_blank">half-widow in Kashmir</a>, every <a href="https://www.doctorswithoutborders.org/what-we-do/focus/rohingya-refugee-crisis" target="_blank">refugee child born stateless in a Rohingya camp</a> carries forward the memory of betrayal – a memory that outlives soldiers, politicians, and peace accords alike.
The region’s future will not be decided by GDP figures or infrastructure projects alone. It will be decided by whether its governments can summon the political courage to face the truths they have long suppressed – or whether they will continue down a path <a href="https://theconversation.com/india-is-using-the-g20-summit-to-further-its-settler-colonial-ambitions-in-kashmir-205166" target="_blank">where forgetting is demanded</a>, and rebellion becomes inevitable.
Shyam Tekwani is a professor at the Daniel K. Inouye Asia-Pacific Center for Security Studies in Hawaii. This <a href="https://dkiapcss.edu/nexus_articles/ghosts-at-the-border-south-asias-unfinished-wars/" target="_blank">article</a> was originally published on <a href="https://dkiapcss.edu/security-nexus/" target="_blank">DKI APCSS Security Nexus.</a> The views expressed in this article are those of the author and do not reflect the official policy or position of DKI APCSS, the Department of Defense, or the US Government. The appearance of external hyperlinks does not constitute endorsement by the United States Department of Defense (DoD) of the linked websites, or the information, products, or services contained therein. DoD does not exercise any editorial, security, or other control over the information you may find at these sites.

Balochistan to Kashmir

The discourse around <a href="https://nepalitimes.com/editorial/nepal-s-corruption-carousel">corruption in Nepal</a> is mainly about politicians and bureaucrats accepting bribes and kickbacks. The private sector usually does not get as much blame.
But the prevalent <a href="https://nepalitimes.com/here-now/nepal-s-crony-communism-exposed">climate of cronyism</a> in Nepal means that the politicians and businesses are often hand in glove. The private sector is generally considered to be in favour of free market competition to encourage <a href="https://nepalitimes.com/here-now/nepal-has-to-curb-corruption-before-wooing-investors">investment</a> and innovation so that wealth is generated.
But insider trading, cartelling, and conflict of interest have become a given in Nepal’s private sector, and it all happens with the blessings of the government. In fact, <a href="https://nepalitimes.com/news/the-business-of-politics-in-nepal">tycoons have become legislators and politicians have become businessmen</a>.
“Such collusion kills the free market, and does not allow entrepreneurship and innovation to flourish,” says Kush Kumar Joshi, former president of the Federation of Nepal Chamber of Commerce and Industries (FNCCI).
An example of this is the Dangote Group of Nigeria, which was planning for a cement factory in Nepal. A Dangote executive told us that Nepal’s cement cartel got the government to sabotage their plans.&nbsp;
Earlier, the same cartel tried to do the same thing to the Chinese companies Hongxi and Huaxin, arguing that Nepal’s cement industry was capable of meeting domestic demand and did not require foreign investment. Ultimately, Hongxi partnered with Nepal’s Shivam and Huaxin with former FNCCI president Suraj Vaidya.
In 2019, industrialists successfully lobbied lawmakers to prevent foreign investment in agriculture by amending the Foreign Investment and Technology Transfer Act. Two years later,<a href="https://nepalitimes.com/news/aid-rarely-aids-agriculture-in-nepal"> foreign investment in agriculture</a> was opened, but only if 75% of the products were exported.
There is a long history of local lobbyists obstructing the entry of multinationals, like J Walter Thompson advertising agency and the international shipping company Maersk. Microbreweries, which can be operated by restaurants, have been prohibited at the behest of larger beer companies. The <a href="https://archive.nepalitimes.com/news.php?id=1292">private dairy sector </a>opposed the government-owned Dairy Development Corporation when it tried to begin production in Pokhara a decade ago.
“The<a href="https://nepalitimes.com/news/business-as-unusual?fbclid=IwAR3qEnUrVu9pRhZU669FR1F4zF95uPJKBpbQbq-q1Bm26p7OMVw-8JBP7FU"> business sector</a> is a reflection of Nepali society and government which do not care about <a href="https://archive.nepalitimes.com/news.php?id=6725">ethical business practices</a>,” says former CNI president Hari Bhakta Sharma. “The environment is not conducive to the few businessmen who are honest.”
Lobbying by businesses is not unusual in a democracy, but its basic character should be for the collective good, not individual greed.
“This kind of profit-over-everything mindset is fatal for businesses. Entrepreneurs must prioritise social, worker, and customer welfare,” adds Sharma.
Industrialists have actively lobbied for the removal of policies that prevent loan misuse and require bank loans in specific areas. They have partially reversed such directives.
Until the economic slowdown, Nepal’s fastest growing industry was construction. But even there, cement and steel rod manufacturers colluded by price-fixing. Banker Parshuram Kunwar Chhetri says Nepal’s corporates just do not believe in free market principles, adding: “Their ideas go against competition benefiting consumers. It is all about price fixing, cartels and monopolies.”
Read also:<a href="https://nepalitimes.com/news/poor-cash-rich-nepal"> Poor cash-rich Nepal</a>, Sonia Awale
Ideologically, Nepal’s Communist parties are supposed to be against the neoliberal free market, globalisation and the ‘imperialism’ of international financial institutions like the World Bank and the IMF. But cronyism is rife there, too.
Two years ago, the FNCCI and the Confederation of Nepalese Industries (CNI) accused the IMF of interfering in Nepal's domestic economic policy after the Fund demanded economic reforms as conditions for its Extended Credit Facility.
Says economic analyst Sujeev Shakya: “How can we expect an honest and ethical business sector when we as a society tend to laud those who earn money through illicit and corrupt means rather than lament their <a href="https://archive.nepalitimes.com/article/editorial/Editorial-moral,667">moral bankruptcy</a>?”
In October 2012, the Chaudhary Group’s CG Electronics warehouse in Kathmandu caught fire. A surveyor certified that the company had suffered Rs580 million damage, which was paid out by United Insurance Company.
The Commission for the Investigation of Abuse of Authority (CIAA) directed the Nepal Insurance Authority to investigate suspected insurance fraud, and found that the fire damage was actually Rs340 million.
The Patan High Court ordered Chaudhary Group to return the excess amount, a decision the company challenged in the Supreme Court. But in March, the apex court also found the Chaudhary Group guilty of insurance fraud.
Chaudhary Group's Binod Chaudhary, Nepal's only known dollar billionaire, is a Nepali Congress central committee member and MP, former president of FNCCI and founder of the CNI.
Then last February, the Central Investigation Bureau questioned Binod Chaudhary and arrested his brother Arun Chaudhary of CG Holdings over their alleged involvement in the illegal acquisition of the state-run shoe factory, following an investigative report by Ukaalo Online.
In 2021, Chaudhary and his family’s offshore business dealings landed them <a href="https://nepalitimes.com/here-now/nepal-s-richest-man-in-the-pandora-papers">in the Pandora Papers list</a> by the International Consortium of Investigative Journalists (ICIJ) for hidden assets in Panama.
Says Krishna Khanal, assistant professor of business ethics at King’s College: “Cronyism, political collusion, and anti-competitive cartelling are routine in the private sector. There is no other objective than to make money at any cost.”
Conflict of interest is rife in Nepal’s share market. In 2023, Ghorahi Cement owned by Triveni Group issued primary shares at a premium price. There is also evidence that a river was diverted for the construction of its business tycoon Upendra Mahato’s Mediciti Hospital. Bhatbhateni owner Min Bahadur Gurung is also involved in Lalita Niwas land grab scam in Baluwatar.
Meanwhile, Shankar Group Vice President Sulabh Agrawal, former honorary consul of Kyrgyzstan, was arrested by the police during the <a href="https://nepalitimes.com/news/nepal-s-uneven-covid-19-deaths">Covid-19 pandemic </a>after he was found selling 67 infrared thermometers from a vehicle with diplomatic credentials. He was later acquitted by the court for price-gouging.
Nepal’s most influential corporates were accused of evading billions in VAT by forcing invoices. Freedom Forum invoked the Right to Information to collect evidence of the involvement of CG Foods, Him Electronics of Shekhar Golchha, Morang Auto Works of Bishnu Agarwal, Sulabh Agarwal’s Jagdamba Steels, United Builders of Shakuntalal Hirachan, United Traders of Anuj Agarwal, and Min Bahadur Gurung’s Bhatbhateni Supermarket.
Most of these businessmen have held leadership positions in the FNCCI. Former FNCCI presidents Shekhar Golchha, Pashupati Murarka and Pradeep Jung Pandey, along with members of the federation's governing council Birendra Kumar Shanghai, Shashikant Agrawal, and others all have unpaid dues of Rs22 billion to Nepal Electricity Authority.&nbsp;
Former FNCCI president Chandiraj Dhakal was blacklisted by the Credit Information Bureau Nepal for non-payment of bank loans.
He had previously obtained permission to use 36 hectares of government forest land in Chandragiri for 40 years without competition, and had received an exemption to build a ropeway there. The 54th report of the Auditor General, stating that Nepal had suffered as a result of these decisions, had suggested that the state be investigated for leasing land at low rates allowing large revenue exemptions.
Another ex-FNCCI president Pradeep Jung Pandey was sentenced to prison in 2014 following a corruption case spanning three decades. Former FNCCI treasurer Gyanendra Lal Pradhan is currently facing charges of <a href="https://nepalitimes.com/news/black-white-and-grey">money laundering </a>through insider trading.&nbsp;
Former FNCCI president Pashupati Murarka was acquitted by the special court in a corruption case, but it is still pending in the Supreme Court. His cement company was found to have exploited the environment by over-mining limestone at various times.&nbsp;
His Siddhartha Minerals was also found to have encroached forests in Palpa, following which the District Forest Office registered a criminal case against him and co-investor Manoj Kedia. Arrest warrants were issued for six people, including Murarka and Kedia, but Muraka was released on bail, while Kedia is on the run.
Current FNCCI president Chandra Prasad Dhakal during his tenure as a member of the Securities Board of Nepal (SEBON) was accused of conflict of interest in being a regulator in the sale of shares in a company that his family had invested in.&nbsp;
Dhakal is the chair of the IME Group, which owns banks, insurance, remittance companies, several cable cars and hotels, and has been embroiled in numerous ropeway-related controversies — most recently for allegedly using political connections to suppress local opposition to a<a href="https://nepalitimes.com/editorial/progress-and-or-preservation"> cable car project in Pathibhara</a>.
Another example of fraud committed in collusion with political leadership is Himalayan Reinsurance, the investors of which include prominent businessmen who have led FNCCI and CNI in the past, including Shekhar Golchha, Pashupati Murarka, Bhawani Rana, Rajesh Kumar Agrawa, Rohit Gupta, Amit Mor, Satish Mor, Shashikant Agrawal, and Sulabh Agrawal.
During <a href="https://nepalitimes.com/here-now/lessons-not-learned-from-the-pandemic">the Covid-19 pandemic</a>, the Nepal Insurance Authority requested approval for a reinsurance company through an emergency notice, even though such a government-operated company already existed. But Himalayan Re-insurance was granted permission without any explanation as to why another reinsurance company was needed, or how it was selected out of the five companies that submitted proposals.
It was found that the Securities Registration and Issue Regulation was amended to allow this company to issue shares at a premium price, allowing the shares priced at Rs100 to be sold for Rs206. Himalayan Re-insurance raised Rs6 billion. The Companies Act stipulates that primary shares can be issued at a premium price only after three years of operation, a criteria Himalayan Re-insurance did not fulfil.
Open competition, consumer protection, worker welfare, environmental consciousness, anti-corruption, and tax responsibility are the foundations of a country’s healthy business world. But most captains of Nepal’s industry themselves do not uphold those principles.
The business community here is instead actively engaged in lobbying and colluding with the political leadership, and forcing the appointment of their candidates to lead various regulatory bodies.&nbsp;
“While the <a href="https://nepalitimes.com/multimedia/reviving-nepal-s-craft">new generation of entrepreneurs</a> operating in sectors linked to external markets such as IT seem sensitive to and compliant with professional codes, ethics, professionalism, and honesty are sorely lacking in Nepal’s business sector in general,” says Rameshore Khanal, former Secretary of the Ministry of Finance.
He adds: “Even those following ethical practices have been forced to seek political favours for fear of being left behind. There will thus be<a href="https://nepalitimes.com/banner/it-does-not-pay-to-have-integrity"> no integrity in the private sector </a>until there is honesty in politics.”
Following the publication of this report in Himalkhabar, a Supreme Court judge on the condition of anonymity said: “Businessmen do not adhere to the principles of judicial independence, <a href="https://nepalitimes.com/opinion/federalism-rule-of-law-and-the-judiciary">rule of law </a>and <a href="https://archive.nepalitimes.com/article/editorial/government-to-governance-editorial,4200">good governance</a>. They use intermediaries and political connections to approach judges and win cases. Meanwhile, nobody raises these issues in public.” &nbsp;

economic-progress