s
Year of Publication: 12 October 2011 | The Kathmandu Post
Publication Type: NEWS
Published by: CESLAM
Bibek Subedi
Non-Resident Nepalis (NRNs) may not be rolling in money in their adopted countries, but ever since the NRN movement began, they have been making increasing investments in their place of birth.
On the eve of the Fifth NRN Global Conference, a group of NRNs have been busy with foreign investors exploring investment potentials in the hydropower sector.
The TBI Group, promoted by NRNs from Japan and having interests in the media, apparels and breweries, is now entering the aviation sector with BB Airways.
The Sanima Group, after the Mai Khola Hydropower Project, is looking at a 415 MW hydropower project.
These are the latest investment initiatives by NRNs that illustrate their seriousness to invest in Nepal. With no authentic data available, it is hard to quantify the size of NRN investments in Nepal, but conservative estimates has put them at US$ 350 million.
Even though they have been criticised for not bringing the expected amount of investments, NRNs do have sizeable investments in sectors ranging from telecom, banking and education to tourism and hydropower. The country’s leading GSM mobile player Ncell has NRN investment, so does Sanima Bank, a leading development bank. The country’s largest garment factory, Momento Apparels that was reeling under debts, was given a new lease on life with investments by the TBI Group last year.
After investing in Medicare Hospital, Upendra Mahato, former president of the Non-Resident Nepali Association (NRNA), is now gearing up for yet another venture in health. Mahato is now working to start a medical college and hospital in Kathmandu. Mahato’s project, Ashwini Medical College and Hospital, is a Rs 7 billion one. Along with the hospital, a 100-seat medical college is also being established.
Along with these large investments, there are many small investments being made by NRNs in tourism and banking. NRNs have made investments in two development banks—Kasthamandap Development Bank and Kali Gandaki Development Bank. Some of them have invested in hotels in Pokhara and Chitwan.
“The Nepali Diaspora is emerging and is not financially sound as the Indian or Chinese diasporas, hence it is unfair to expect too much from them,” said former finance secretary Rameshwor Khanal.
However, as they make progress abroad, they are increasingly eyeing their birthplace for investments. In Khanal’s words, NRNs in the last two years are serious over investing in Nepal. Last year, during NRN Day, NRNs formally asked the government to identify projects for investment.
“Even though NRNs are making progress financially, they are yet to get the same status as Indian and Chinese diasporas who are treated as investors in third countries,” said Khanal. “That is primarily due to the sorry state of development in their homeland.”
The seriousness on the part of NRNs for investment, according to Khanal, is not just lip service like it was in the past. “Now they have understood that unless Nepal uplifts herself from the status of a least developed country, NRNs will not have a good image in the countries where they are residing,” said Khanal. “Hence, they want to make an impact on economic growth by pouring in money.”
NRNs say that despite their genuine efforts to invest in Nepal, there has not been a warm response on the part of the government. Ratan Jha, CEO of US-based Grisham and Jha Group that specializes in infrastructure development, says that their proposals have often received a cold response from the government.
NRNs say the onus lies on the government to make an environment to promote investment in Nepal. Recently, the government appealed to NRNs to invest in hydropower. But till now, the modality of such investments has not been made public.
Of late, the hydropower sector has attracted NRN interest. Khanal says infrastructure and hydropower could be two major sectors for NRNs to invest in. “Construction of the Nagdhunga Tunnel on Tribhuvan Highway has an estimated cost of Rs 2 billion, and it can be recovered within three years by collecting tolls,” says Khanal. According to him, commercial agro industry, tourism and mine-based industries can be other areas for investment.
It is not that the government has not been making efforts. The NRN Act promulgated in August 2007 has addressed their demands to a certain degree. It has allowed them to own property and repatriate deposits and assets according to the same rules applied to foreign investors.
This fiscal year’s budget has talked of allowing NRNs to buy commercial and residential housing and invest in the Nepali capital market.
Major NRN investment till date
Ncell
Sanima Bank
Mai Khola Hydropower Project
Kantipur TV
Momento Apparels
Karobar Daily
United Breweries
Medicare Hospital
Aswini Hospitals
Kantipur Engineering College
Acme Engineering College
Kali Gandaki Development Bank
BB Airways
Published on: 12 October 2011 | The Kathmandu Post
GET IN TOUCH