Kathmandu: In a proactive move to attract both domestic and foreign investors, the Nepalese government has announced significant amendments to nine key laws through an ordinance. This strategic overhaul aims to address long-standing grievances from the private sector regarding the existing legal framework, which has been perceived as a hindrance to creating an investment-friendly environment in the country.
The timing of these amendments is particularly noteworthy as they precede the highly anticipated Nepal Investment Summit 2024 scheduled for April 28 and 29. The government has emphasized the imperative of attracting substantial investment, citing insufficient domestic capital for the nation’s development and prosperity.
The decision to amend these laws was finalized during a recent Council of Ministers meeting, where the bill proposing amendments to various Nepal Acts related to investment facilitation received approval. Pending the endorsement of the President, the ordinance is poised to come into effect imminently.
Finance Minister Barshaman Pun underscored the government’s commitment to bolstering investor confidence through these amendments. He highlighted that the revisions were informed by recommendations from the private sector, emphasizing their collaborative approach to fostering a conducive investment climate. Minister Pun asserted that this move sends a positive signal ahead of the upcoming investment summit.
The ordinance encompasses amendments to pivotal laws including the Lands Act of 2021 BS, National Parks and Wildlife Conservation Act of 2028 BS, Land Acquisition Act of 2034 BS, Electronic Transactions Act of 2063 BS, Special Economic Zone Act of 2073 BS, Public-Private Partnership and Investment Act of 2075 BS, Foreign Investment and Technology Transfer Act of 2075 BS, Forest Act of 2076 BS, and Industrial Enterprises Act of 2076 BS.
Among the notable amendments, modifications to the National Parks and Wildlife Conservation Act 2029 are expected to streamline project execution in forest areas, particularly those of national significance or endorsed by the Investment Board Nepal (IBN). Furthermore, amendments to the Electronic Transactions Act of 2063 BS aim to simplify foreign exchange payments processes, enhancing transaction efficiency.
The revisions to the Special Economic Zone Act, 2073 BS are poised to facilitate the transfer of used machinery, tools, or equipment from industries operating outside the zones, thereby stimulating export activities. Additionally, amendments to the Forest Act, 2076 BS seek to ease the process of mineral mining within national forest areas, subject to stringent environmental assessments and governmental approvals.
While the private sector had advocated for amendments to approximately two dozen laws, the government’s focus on addressing key statutes reflects a proactive stance toward investment promotion. Rajesh Kumar Agrawal, President of the Confederation of Nepalese Industries (CNI), emphasized the necessity of broader legal reforms to foster an investment-friendly climate.
With the amended laws aimed at removing legal and policy barriers in industry, business, and investment, stakeholders anticipate smoother implementation of construction projects and establishment of industries. The upcoming investment summit is poised to showcase around 150 projects across various sectors, with significant interest from both domestic and international investors.
Over 300 foreign investors from around 50 countries have already registered for the summit, with invitations extended to approximately 1,400 potential participants. Anticipation is high for fruitful engagements and collaborations, with the event expected to attract investors from diverse sectors and regions, further propelling Nepal’s journey toward economic prosperity and development.