Strik­ing the Right Note: Re­in­forc­ing Bi­lat­eral Eco­nomic En­gage­ment Be­tween In­dia and Nepal

The Gov­ern­ment of Nepal has placed a high pri­or­ity on the in­dus­trial devel­op­ment in the coun­try and is fo­cused on the cre­ation of an in­vest­ment-friendly en­vi­ron­ment, in­creas­ing em­ploy­ment, production and pro­duc­tiv­ity, and sub­sti­tut­ing im­ports and min­i­mizi

FICCI Business Digest - - News -

The Global Com­pet­i­tive­ness In­dex 2016-17 ranks Nepal on 98th po­si­tion among the 138 coun­tries which makes the Hi­malayan na­tion the fourth most com­pet­i­tive econ­omy in South Asia. In­dia is on the 39th po­si­tion on the list. The bi­lat­eral trade be­tween the two coun­tries has in­creased ex­ten­sively from US$3631.94 mil­lion in 2012-13 to US$5892.72 mil­lion in 2016-17.

Thus, it is an op­por­tune time to in­vest in Nepal which was the clear mes­sage con­veyed dur­ing the sem­i­nar on 'Indo-Nepal Trade and In­vest­ment Op­por­tu­ni­ties in Nepal' spear­headed by FICCI in part­ner­ship with the Em­bassy of Nepal in Hy­der­abad on 4 May 2018.

The sem­i­nar brought to­gether prospec­tive In­dian in­vestors as well as se­nior of­fi­cials of the Em­bassy of Nepal for in­ter­ac­tions on fa­cil­i­tat­ing the In­dian in­vest­ments in var­i­ous sec­tors in­clud­ing tourism, hy­dropower, con­struc­tion, phar­ma­ceu­ti­cals, tex­tiles, wood and wood prod­ucts, tele­com, trans­port equip­ment, food pro­cess­ing, chem­i­cals, light en­gi­neer­ing, IT and ITeS.

Bharat Ku­mar Regmi, Charge d'Af­faires, Em­bassy of Nepal, said that there are am­ple, ready-to-tap op­por­tu­ni­ties for in­vest­ment and co­op­er­a­tion for In­dian com­pa­nies in dif­fer­ent sec­tors in Nepal and in­vited In­dian in­vestors to in­vest in the coun­try and reap rich div­i­dends. He added that the year 2018 is a year of new be­gin­nings in Nepal af­ter suc­cess­ful con­clu­sion of three tiers of elec­tions, paving the way for po­lit­i­cal sta­bil­ity and good gov­er­nance.

High­light­ing the gov­ern­ment's pol­icy of at­tract­ing for­eign in­vest­ment, he called on In­dian com­pa­nies and en­trepreneurs to uti­lize the op­por­tu­ni­ties for in­vest­ing in var­i­ous sec­tors in Nepal by tak­ing full ad­van­tage of enor­mous pos­si­bil­i­ties avail­able and the gov­ern­ment's favourable in­dus­trial and in­vest­ment poli­cies.

Kr­ishna Hari Pushkar, Min­is­ter-Eco­nomics, Em­bassy of Nepal, made a de­tailed pre­sen­ta­tion on var­i­ous ar­eas for po­ten­tial in­vest­ments in Nepal. He also urged busi­ness com­mu­nity to in­vest in Nepal while de­scrib­ing the gov­ern­ment's sup­port and fa­cil­i­ta­tion mea­sures to boost

the busi­ness re­la­tions men­tion­ing com­pet­i­tive ad­van­tages avail­able par­tic­u­larly in hy­dropower, in­fras­truc­ture devel­op­ment and ad­ven­ture tourism sec­tors. He re­it­er­ated that the Gov­ern­ment of Nepal and the Nepalese pri­vate sec­tor work well in tan­dem. Through sus­tain­able eco­nomic devel­op­ment, Nepal is work­ing to­wards po­lit­i­cal sta­bil­ity, peace build­ing, trade fa­cil­i­ta­tion and eco­nomic ca­pac­ity build­ing.

The Gov­ern­ment of Nepal has placed a high pri­or­ity on the in­dus­trial devel­op­ment in the coun­try and is fo­cused on the cre­ation of an in­vest­ment-friendly en­vi­ron­ment, in­creas­ing em­ploy­ment, en­hanc­ing production and pro­duc­tiv­ity, and sub­sti­tut­ing im­ports and min­i­miz­ing the trade deficit by pro­mot­ing ex­port-ori­ented in­dus­tries.

Pushkar pointed out the in­cen­tives and fa­cil­i­ties be­ing ex­tended to the for­eign in­vestors such as re­bate of cor­po­rate rate of in­come tax (max­i­mum ten years and up to 90 per cent re­bate); de­duc­tion fa­cil­ity from in­come for worker's wel­fare, ca­pac­ity en­hance­ment, in­vest­ment on pol­lu­tion con­trol, ad­ver­tise­ment and mar­ket devel­op­ment; no im­po­si­tion of ex­cise duty and VAT on ex­ports; re­fund of custom du­ties, ex­cise duty and VAT on raw ma­te­rial on the ex­port of the prod­uct (only 1 per cent custom duty on the in­dus­trial ma­chin­ery). The other fa­cil­i­ties in­clude per­mis­sion of sub­con­tract­ing for man­u­fac­tur­ing; com­mit­ment of the Gov­ern­ment of Nepal to pro­vide road, elec­tric­ity con­nec­tion and drink­ing water sup­ply fa­cil­i­ties to man­u­fac­tur­ing in­dus­tries where they are es­tab­lished; se­cu­rity of the for­eign in­vest­ments; and, no re­stric­tions on the repa­tri­a­tion of pro­ceeds of dis­in­vest­ments and earn­ings.

High­light­ing the im­por­tance of Indo-Nepal re­la­tion­ship, B Venkate­sham, Sec­re­tary of Tourism, Gov­ern­ment of Te­lan­gana, said that the eco­nomic co­op­er­a­tion can bring peo­ple of the two coun­tries even closer. He added that the re­cently formed gov­ern­ment in Nepal is en­gaged in the task of po­lit­i­cal and so­cio-eco­nomic trans­for­ma­tion of the coun­try through peace­ful and demo­cratic means to make it a sta­ble, in­clu­sive, full-fledged demo­cratic and pros­per­ous coun­try. Venkate­sham also high­lighted that the Gov­ern­ment of Te­lan­gana is in­ter­ested in sign­ing an MoU with the Nepal Tourism Board to pro­mote In­dia and Nepal as tourism des­ti­na­tions.

FICCI has been at the fore­front in its en­gage­ment process with Nepal for strength­en­ing bi­lat­eral eco­nomic re­la­tions. The apex in­dus­try cham­ber has been closely work­ing with the rel­e­vant stake­hold­ers be it from the gov­ern­ment, the em­bassies, its MoU part­ners in Nepal – FNCCI and CNI or academia. It is FICCI's third en­gage­ment with Nepal this year, fol­low­ing the for­ma­tion of a sta­ble gov­ern­ment in the coun­try. Ear­lier, FICCI had hosted an in­ter­ac­tive ses­sion with se­nior jour­nal­ists from Nepal and had co-or­ga­nized an In­dia-Nepal Busi­ness Fo­rum in hon­our of the Prime Min­is­ter of Nepal, KP Sharma Oli and the high­pow­ered del­e­ga­tion vis­it­ing In­dia.

The sem­i­nar also wit­nessed par­tic­i­pa­tion of San­jay Ka­pur, Sec­re­tary Gen­eral, Of the Fed­er­a­tion of Te­lan­gana and Andhra Pradesh Cham­ber of Com­merce and In­dus­try (FTAPCCI); of­fi­cials from Em­bassy of Nepal in New Delhi; and, rep­re­sen­ta­tives from the In­dian in­dus­try.

Through sus­tain­able eco­nomic devel­op­ment, Nepal is work­ing to­wards po­lit­i­cal sta­bil­ity, peace build­ing, trade fa­cil­i­ta­tion and eco­nomic ca­pac­ity build­ing.

Kr­ishna Hari Pushkar Min­is­ter – Eco­nomics, Em­bassy of Nepal

The re­cently formed gov­ern­ment in Nepal is en­gaged in the task of po­lit­i­cal and so­cio-eco­nomic trans­for­ma­tion of the coun­try through peace­ful and demo­cratic means to make it a sta­ble, in­clu­sive, full-fledged demo­cratic and pros­per­ous coun­try.

B Venkate­sham Sec­re­tary of Tourism, Gov­ern­ment of Te­lan­gana

Bharat Ku­mar Regmi, Charge d'Af­faires, Em­bassy of Nepal, ad­dress­ing the sem­i­nar.

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