Nepal

R.Shrestha & Associates, Nepal – Global Accounting Alliance Member

Economic Overview & Business Opportunities

Nepal is a landlocked central Himalayan country in South Asia. Spanning over 143,351 square kilometres of land and 3,830 square kilometres of water, Nepal is the 94^th largest nation in the world. Home to a population of around 26 million, Nepal population is equivalent to 0.39% of the total world population.

Nepal has adopted liberal economic policies and has offered various incentives to create a more conducive investment climate. The establishment of Special Economic Zones (SEZs) in various parts of the country have created more opportunities where investors have advantages provided by relaxed regulations and expedited services from the government. The government of Nepal has put in efforts to create a competitive investment environment by making the administrative procedures simple and easy with attractive incentives and facilities to attract foreign investors to traipse into the market of Nepal. Another reason that has contributed to this matter is the low labour cost of Nepal.

Other than the supports from the government, the natural resources are among the factors that spur the economic growth. Nepal has a huge potential of hydropower that comes to about 83,000 MW out of which 43,000 MW is economically viable. The government has been encouraging private foreign investment to venture in this sector in order to harness and develop hydropower. Tourism is another industry that yields high scope for foreign investment opportunities.

As a country that is sandwiched between two fastest growing large economies: India and China, Nepal has opened its door for foreign investment by adopting the most liberal economic policies. In other words, its strategic location reflects the easy access to markets (China and India) of more than 2.6 billion people. The duty-free and open border accesses to India and China have created tonnes of opportunities for Nepal-based foreign investors to venture into the nearby huge markets. Voted as one of the nations with the ‘Ease of Doing Business’ in South Asian countries, foreign investors have 100% ownership of a company in almost all sectors. With the expectation to supplement domestic private investment through foreign capital flows, transfer of technology, enhancement in management skills and productivity and to get into the global market, Nepal is rising as one of the hotspots for foreign investment.

On a final note, the favourable location, pleasant investment climate, and untapped qualified work force are among the factors that attract foreign investors. If you are planning to venture abroad, or to expand to Asian markets like China and India, Nepal is ideal revenue for you to traipse into the markets.

Rabindra Shrestha
Management