Dozens of agreements likely during Investment Summit: IBN CEO Adhikari
In view of upcoming Nepal Investment Summit 2019, Gorkhapatra Corporation held Gorkhapatra Sambad (an weekly interaction programme) with Maha Prasad Adhikari, Chief Executive Officer, Investment Board Nepal (IBN) and Hari Bhakta Sharma, President, Confederation of Nepalese Industries (CNI). The following is the excerpt about what the IBN CEO Adhikari said during the interaction:
Maha Prasad Adhikari, Chief Executive Officer, Investment Board Nepal (IBN) gestures while speaking at the Gorkhapatra Sambad on Sunday, Mar 24 at the Gorkhapatra Corporation office, Kathmandu.
The preparation for Summit is going on, how is the feedback?
The summit is going to be held on March 29 and 30. The preparation is going on in full swing. We have got positive feedback from the foreign participants. More than 600 participants are attending the summit where a few Non Residential Nepalis are also on board. We have not been able to accommodate all the enthusiasts. We are also accommodating more Nepali investors in ‘matching number’ as their involvement is also equally important.
We are excited looking at more participants than our expectation. We have only expected to have maximum 400 participants but it has crossed 650.
Nepal is a virgin land for development with various potentials. The government has also brought policies to secure, encourage and simplify investment and its procedures. We can only complete our project with the collaboration of national and foreign investors.
We organised Investment Summit two years ago. How this year’s summit different than the last year?
There is no need for the summit itself to be different. Still we are successful in bringing some changes this time. This time we are able to make some amendments to laws concerning protection of investors prior to commencement of the summit.
Likewise, we are incorporating many projects than we anticipated. Nearly 50 of the government projects and 20 private projects are incorporated in the summit.
The interested private sector investors have said that they would sign agreement with the foreign investors for joint venture.
In previous summit Rs. 1400 billion was committed by the investors but it was not realised. What strategy would be brought to implement investor’s commitment?
Let us not regard previous summit as unsuccessful. At that time 257 foreign investors participated in the summit. There are various reasons as to why the foreigners didn’t act as per their commitment.
For instance, we could not take the Nijgadha International Airport project to the market. We were unclear regarding its modality. Recently we have decided to implement the project in Public Private Partnership (PPP) model. Because of the policy and political instability many of our projects could not move ahead. Despite the situation, 25 per cent of the projects of the summit are undergoing. The Summit is a type of ongoing programme. We are obliged to continue with this. It is vital for us to market as well. It is the responsibility of all to utilise this summit for the welfare of the nation.
What are the plans to follow up on the inquiries made by the investors during the summit?
We put all our projects up on the website 3-4 days ago and people’s interest went up significantly. This has put a lot of pressure on us. We must be able to cash in on this interest, otherwise we won’t see the kind of development we want. We must seize this opportunity and change our working model. We are going to have a board meeting soon. This meeting will decide on how to translate the achievements of the summit to actual successes on the ground. Then we will formulate a solid “follow up” plan.
Inter-departmental cooperation has been lacking in Nepal when it comes to attracting investments. What measures have been developed to solve this problem?
Any project requires involvement of many state agencies and hence the question of inter-departmental cooperation pops up. No matter how hard we try to change things, it will take some time to bring change in the traditional mindset of the people. I had expressed concern during the construction of the airport two years ago. I had said that if the government took sole responsibility of the construction then only portions of the work would get done. The same is the case with the Special Economic Zones (SEZ), which have still not begun full operation. We have advised to construct a smart-SEZ from the private sector but it took a long time to bring everybody on board.
There are countless examples which highlight the lack of inter-departmental cooperation. Instead, whenever we advocate for such cooperation, they call for the Investment Board to be brought under the Prime Minister’s Office (PMO). We still function in an environment that is reluctant to recognise the Board.
The private sector is also actively involved in the project selection process. How has the Board been involved in this?
We had discussed with the state governments for the selection of the projects. The private sector was very closely involved, even naming specific projects. We had also coordinated with different ministries and the Infrastructure Bank while preparing for the showcase. There were also instances when we travelled to project sites themselves to gather information. All of this has helped us draft a preliminary report containing basic information of all the projects. But at the end of the day, it is the private companies who will be implementing these projects on the ground. So, coordinating with them is necessity for us.
Why invest in Nepal instead of investing in the Nepal-bordering areas of our neighbours?
Nepal is landlocked while our neighbours are not. So, investors might be dissuaded. But we can attract them with various incentives like tax breaks. The goal is to create a favourable investment environment. That is what the investors want.
The Investment Board is a ‘deal maker’. We look at the sustainability and the long-term returns of a project. We do not try to dominate the private sector and encourage relative incentives for the investors.
Which project are the investors most interested in among all those being showcased?
The investors seem to be most interested in infrastructural projects. The private sector is most attracted to the hotel and industrial sectors. We have already received applications for projects related to hydroelectricity. The investors are also showing an interest in cold stores and warehouse along with agriculture and solid waste management.
(Prepared by: Ajita, Sampada and Ashish)
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