I have led the Office of the Investment Board Nepal (OIBN) since June 2016. We have the privilege of being the private face of government that facilitates foreign investment in Nepal. The OIBN is extremely grateful to everyone, especially government agencies and the private sector, for taking the initiative in addressing policy gaps related to foreign direct investment (FDI).
In 2018, we witnessed two major breakthroughs on IBN targets, the commencement of commercial operations at Hongshi Shivam cement factory and the start of construction at the Arun-3 hydropower project. Hongshi Shivam cement factory initiated the first phase of its commercial operations from May 2018. Currently, it manufactures 6,000 MT cement per day and plans to increase production to 12,000 MT per day in the second phase. A special thanks to all stakeholders and the developer for the timely completion of its construction. It has made significant contributions to our economy particularly in employment generation and import substitution.
The developer of the Arun-3 hydropower project expedited construction work after its foundation stone was laid in May 2018. The export-oriented 900 MW project is expected to be completed by 2023. Around 2,000 workers are currently employed at the construction site and all contracts related to powerhouse and dam construction have been awarded. The project diversion tunnel is expected to be ready by, May 2019 and construction of all adits are in progress.
2018 was also remarkable in terms of policy reforms. Nepal Rastra Bank (NRB) eased the process of repatriation, as it had committed to, in its monetary policy. For instance, it allowed the contractors of Arun-3 hydropower project to open Indian Rupee accounts in Nepalese banks. Some other concerns like land for land replenishment in the case of forest clearances were also simplified through legal amendments. The Environmental Impact Assessment (EIA) of Nijgadh Airport was approved within a month by a dedicated team from the relevant Ministry. The Initial Environmental Examination (IEE) is also being approved over a short time span. A recommendation to revisit the labor rule was also made by the IBN Board and is under consideration.
Several laws related to investment, including the Foreign Investment and Technology Transfer Act (FITTA), Public Private Partnership and Investment Act (PPIA), Intellectual Property Act (IPA), and the Special Economic Zone Authority Act (SEZAA) are in the process of amendment and enactment as per the government’s policy declaration. All these initiatives have been taken to acknowledge the active role of the private sector in improving the business climate and to protect investments.
IBN, along with other Ministries, organized an Investment Summit in 2017 to communicate to global investors that Nepal is open for business. The 2017 event went well and concluded with fruitful outcomes. A blended finance conference in April 2018 and the MIGA-IFC-IBN event in December 2018 are other important events that made significant contributions to policy reforms.
The completion of elections for all three levels of the federal structure has brought political stability and the government has clear policies and programs for economic transformation. As a result of these developments, the Investment Board decided to organize the next Summit in March 29-30, 2019. The response from around the globe has been highly encouraging.
The Summit is an opportunity to refine our policies, amend our rules, and improve our practices. At the same time, it is an opportunity to share developments and reform measures taken, learn about international best practices, and showcase some of the projects we have prepared.
I hereby request everyone to help make this event successful. We are eager to welcome our foreign delegates and guests to the summit.
Finally, I am confident that this summit will be a milestone in materializing the government's vision of ‘Prosperous Nepal, Happy Nepali’.
MAHA PRASAD ADHIKARI