Nepal Eases Foreign Investment Process, Removes Cap for Automatic Route Approvals

Kathmandu. The government has streamlined the process for bringing foreign investment into the industrial and business sectors. In its effort to make foreign investment easier and more digital, the Government of Nepal has facilitated an online approval process for foreign investment through the automatic route.

Previously, foreign investment up to NPR 500 million was approved only through the automatic route. However, the recent cabinet meeting has removed this ceiling. Now, foreign investment of any amount can be approved through the automatic route in specified sectors.

The new arrangement has opened the way for investment without any limit in a total of 102 business sectors across seven major industrial areas. Previously, according to the gazette notification published on Ashoj 15, 2080 BS, a maximum limit of NPR 500 million was set for foreign investment through the automatic route.

The new gazette has now repealed that old notification. Investors will receive the approval certificate via email immediately or within 7 working days after applying through the Department of Industry's online system. This speeds up company registration and industry operation.

Sectors where the automatic route applies include energy production, agriculture and forest products, infrastructure, tourism, information technology-based industries, service sectors, and manufacturing industries. There is also no minimum investment threshold in the information technology sector. Foreign investors must fill out an online form.

After uploading the necessary documents online with details such as the company's country, investment amount, and sector, the system will automatically grant approval if all criteria are met. After receiving approval, the source of foreign currency must be verified with the Nepal Rastra Bank.

In the first seven months of the current fiscal year 2082/83, a total commitment of NPR 40.28 billion in foreign investment has been received, with such investment increasingly coming through the automatic route. The automatic system has made it significantly easier for foreign investors to start businesses in Nepal. – News Agency Nepal