Foreign Direct Investment (FDI) in Nepal

Foreign Direct Investment (FDI)

Foreign Direct Investment in Nepal can be done in the form of loan investment, equity investment, and reinvestment from the profits obtained from the above two forms.

Nepal has witnessed expanding regime of foreign investment in Nepal for the last few decades. Foreign Investment and Technology Transfer Act 2019 (“Foreign Investment Act”) which replaced Foreign Investment and Technology Transfer Act 1992 aims to reform and facilitate foreign investment in Nepal. Other key legislations that govern foreign investment are Foreign Exchange (Regulation Act) 1962, and Industrial Enterprises Act 2016 while the Department of Industry, Investment Board, Office of the Company Registrar, the central bank of Nepal, and Nepal Rastra Bank are the major regulatory authorities. 

Foreign Direct Investment in Nepal is permitted as an investment in shares, purchase of assets, technology transfer, lease of machinery and equipment, and investment in secondary and foreign stock markets. The recent years have seen increasing investment in the sector of energy, e-commerce, information technology, and manufacturing industry which have been more challenging and require innovative assessment due to legal gaps in such industries. The establishment of the One Stop Service Center is expected to streamline approval requirements and simplify the legal process involved in foreign investment.

Sada Associates provide service to obtain necessary approval from the concerned government authority, incorporate a local company, register industry and prepare required commercial contracts and documents accordingly for Foreign Direct Investment in Nepal.