Nepal has attracted foreign investment from 58 countries, as reported in the Nepal Rastra Bank (NRB) survey on Foreign Direct Investment (FDI) in Nepal for 2022/23.
“As of mid-July 2023, Nepal has received FDI from 58 countries. India leads with a total FDI stock of Rs.103.5 billion, followed by China with Rs.35.5 billion, Ireland with Rs.22.6 billion, Australia with Rs.19.1 billion, and Singapore with Rs.18.8 billion,” according to the summary of the report released today.
Out of 754 enterprises that had received FDI approvals from the NRB by 2022/23, 238 responded to the survey.
“The survey results indicate that the FDI stock in Nepal rose by 11.8 percent, reaching Rs.295.50 billion by the end of 2022/23. Paid-up capital is the largest component, accounting for 52.8 percent of the total FDI stock, while reserves and loans represent 33.7 percent and 13.5 percent, respectively,” the report summary stated.
The electricity, gas, steam, and air conditioning sector holds the largest share, with 30 percent of the total FDI stock, closely followed by the manufacturing sector at 29.4 percent. Together, these sectors make up 59.7 percent of the total FDI stock in the industrial sector, as per the report.
The service sector accounts for 40.2 percent of the total FDI stock, with financial and insurance services comprising 26 percent, information and communication 6.7 percent, and accommodation and food services 6.3 percent.
By mid-July 2023, the outstanding foreign loans of FDI enterprises, excluding direct loans from foreign investors, stood at Rs.60.3 billion. The hydropower sector utilized the majority of these loans, with an outstanding amount of Rs.29.3 billion as of mid-July 2023, the report noted.
The capacity utilization of surveyed FDI enterprises in manufacturing was recorded at 60.69 percent, while the profitability of these enterprises was 11.61 percent in 2022/23.