FICCI mulls stoking Indian investors’ interest in Nepal

The Federation of Indian Chambers of Commerce (FICCI), the umbrella body of Indian businesses, believes that it is high time for Nepal to attract Indian investment.
“Since the prospect of political stability is improving on both sides of the border, it is an opportune moment for both countries to exploit bilateral economic potential,” said a FICCI source.

India recently signed Bilateral Investment Protection and Promotion Agreement (BIPPA) with Bangladesh which will boost investment by Indians in Bangladesh. FICCI sources believe that the same can happen between Indian and Nepal. In fact, FICCI had sent a 55-member strong business delegation last month which was led by FICCI vice-president Harsh C Mariwala. According to the FICCI source, the team had held high level trade talks with Bangladeshi authorities including Prime Minister Sheikh Hashina where she underscored the need, among other things, for opening up trade routes among Bangladesh, Nepal and Bhutan through India so that they could do more business also with these countries.

India has also offered unilateral concessions to the SAARC LDCs including Bangladesh to enhance their economic development. According to FICCI estimates, Bangladesh’s trade deficit with India currently stands at $2,661 million while Nepal’s trade deficit with India stands at $878 million.

“India is taking big steps in forging its trade and investment links vis-a -vis Bangladesh and the same can happen with Nepal,” the FICCI source said.

Indian investors believe that despite close bonds between Nepal and India and the prospects of open border related incentives, many of their fellows are not aware of the business potential in Nepal.

“We will soon mount a delegation of Indian investors to Nepal and will also organise a trade fair in New Delhi to create awareness among Indian investors about the potential sectors of investment in Nepal including hydro power and tourism,” the FICCI source said.

“If investors from Tamil Nadu and Karnataka are ready to do business with Bangladesh, they would be equally eager to do business with Nepal,” the source added. FICCI believes that there is a need to sensitize Indian businessmen about the business prospects that exist in Nepal. According to the FICCI source, a lot of Indian investors have shown interest in investing in Bangladesh after the FICCI team’s recent visit to Bangladesh.

“It is no big deal for major investors of India to invest in Nepal. Even if 15 major Indian investors are wooed into investing in Nepal, I am sure that will change the economic landscape of that country,” the FICCI source said. Indian investors are likely to invest in Nepal’s hydro power, tourism including adventure tourism, agro and agro-based products and herbs. The official said Nepal needs to make the investment climate favourable and that FICCI would do every thing possible to woo Indian investors to invest in Nepal.

“Though Nepal is a small country, it is an important neighbour for us. Therefore, we would do everything possible to make economic prospects better in Nepal,” the FICCI official said. “It is also in the interests of India if all its neighbours move simultaneously on the path of development.”
Source: THT