IBN drafts ‘marketing document’ to attract FDIIn a bid to attract more foreign direct investment (FDI), the Investment Board Nepal (IBN) has drafted a template of Project Investment Agreement (PIA) with a provision of “numerous” facilities to investors.
In a bid to attract more foreign direct investment (FDI), the Investment Board Nepal (IBN) has drafted a template of Project Investment Agreement (PIA) with a provision of “numerous” facilities to investors.
The PIA is a “marketing document” to show Nepal is a FDI-friendly country, according to IBN CEO Radhes Pant. After signing the agreement, the investors will get various facilities such as tax exemption upon meeting certain criteria and other procedural help in setting up and operating projects.
Once the IBN board approves the PIA template, investors having acquired the FDI approval can sign the PIA. IBN said it will charge a certain fee from foreign investors upon signing the PIA.
As per the PIA, FDI projects are entitled to receive certain financial benefits if they are able to generate a significant number of employment to the Nepali citizens. They will also receive such benefits for contracting out some sections of projects to Nepali contractors. Pant said the financial benefits can be in the form of tax exemption.
The projects are also subjected to receive other nonfinancial benefits. One of such facilities is help in getting approval from various government authorities. “Getting approval from multiple government authorities can be a cumbersome task for foreign investors,” said Pant. “Under the PIA, the IBN will fast-track the process.”
Under the scheme, IBN will also provide help in activities like land acquisition. “Acquisition of both private and public land has been one of the major challenges for foreign investors, and in many cases, difficulties in land acquisition have delayed projects,” said Pant. “Upon signing the PIA, the IBN will help investors in acquiring land for project establishment and operation.”
The PIA also provides security to foreign investment from state intervention like nationalisation.
DPR gets nod
Investment Board Nepal (IBN) approved the Detailed Project Report (DPR) of two privately-owned companies for the Integrated Solid Waste Management (ISWM) Project. A meeting of the IBN board on Wednesday approved the DPR of Nepwaste Pvt Ltd and Clean Valley Company Pvt Ltd. The project envisioned by the Ministry of Federal Affairs and Local Development under the three packages will be crucial in managing solid waste of the Kathmandu Valley. Nepwaste will undertake the Package Number 1, which includes the Kathmandu metropolis, while Clean Valley will work for Lalitpur metropolis, municipalities of Kirtipur, Bhaktapur and Madhyapur Thimi under Package Numbers 2 and 3. Now, the IBN will start negotiation with both the companies to award the final contract.