Nepal keen to attract more Chinese investment

By Zhang Lulu
0 Comment(s)Print E-mail China.org.cn, January 20, 2017
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An aerial view of Kathmandu, capital of Nepal, one week before a devastating earthquake hit the country in 2015. [File photo by Chen Boyuan/China.org.cn] 



The Embassy of Nepal in China held a seminar on investment opportunities on Jan. 19, in a bid to attract more investment from China into Nepal.

Speaking to a group of Chinese governmental officials and business owners, Leela Mani Paudyal, the ambassador of Nepal to China, encouraged investment from China in trade, tourism, energy and other sectors. The ambassador said his country has yet to explore its abundant natural resources.

Nepal sits between China and India. "Nepal's prosperity is a prerequisite for stability in the trans-Himalayan region."the ambassador said.

According to Binod Prasad Acharya, the economic minister of the Nepali embassy in China,the country's trade with China reached 76 billion yuan (about US$11 billion) from 2015 to 2016. China is Nepal's second largest foreign direct investment (FDI) contributor after India. A total of 1,121 Chinese industries have been registered with Nepal as of late 2016, which are worth 6.16 billion yuan in project cost, with direct investment reaching 3.79 billion yuan, according to the minister.

Collaboration between China and Nepal used to focus on transport, health, manufacturing and energy industries. Future investments will be encouraged in the areas of hydropower, tourism, transport infrastructure, information technology, agriculture, health and education, the minister said.

He took the power sector as an example. The country will need to add 6,000 megawatts of power by 2030 to meet its growth aspirations, which requires investment worth US$6.45 billion in transmission and distribution.

One of the recent collaborations between China and Nepal is an initial joint venture agreement signed between the Nepal Electricity Authority and China Three Gorges Corporation to develop the West Seti hydropower project in west Nepal, which is expected to generate 750 megawatts of power when completed.

Power generation and transmission are open to foreign investors, the minister said.

He introduced a set of policies and acts that Nepal has adopted in recent years to attract foreign investment. For instance, under the Industrial Enterprise Act introduced in 2016, companies that engage in the energy industry will enjoy 100 percent income tax exemption for 10 years and a 50 percent exemption in an additional five years. Companies investing above 2 billion Nepalese rupee will have 100 percent exemption of their income tax for five years.

The country was ranked second in South Asia in the World Bank Ease of Doing Business in 2015, with its "untapped potential" and "young, energetic and trained labor force," he said. Industries there will not be nationalized, the minister added.

With its breathtaking scenery and rich Buddhist culture, Nepal boasts unique tourism resources which the embassy has long been keen to promote. Harishchandra Ghimire, the minister counselor of Nepali embassy in China, said that investment opportunities in the tourism sector include the construction of airports and roads, establishment of airlines, hotels, resorts and conference facilities, restaurants, recreation parks, and so on.

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