NRNA announces ambitious ‘NRN Nepal Development Fund’

Minister for Finance Bishnu Poudel (C) among others during a press conference organized to announce ‘NRN Nepal Development Fund’ at Ministry of Finance, Kathmandu on Monday. Photo: NL Today

NL Today

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Kathmandu: The Non-Resident Nepali Association has launched ‘NRN Nepal Development Fund’ of Rs 10 billion to invest in Nepal’s multi-sectors including transport, industries and infrastructure.

The umbrella organization of non-resident Nepalis has set up a company aimed at bringing in collective investment in collaboration with the government of Nepal.

The company, which is a part of the NRNA’s Flagship Projects, has government as one of its investors, with a five percent stake in the overall investment.

NRNA will account for 10 percent of the fund while the rest will be directed exclusively towards non-resident Nepalis who will be able to buy shares of the company.

At the press conference held at the Ministry of Finance NRNA President Kumar Panta announced that the fund will be increased to Rs 50 billon following investment from non-resident Nepalis.

Also speaking, Finance Minister Bishnu Poudel underscored the challenges that come with such investment opportunities.

“We have to make sure that while welcoming knowledge, capital, and technology, we ensure that institutional controls will prevent black money from coming in,” Poudel said, “All investments should be geared towards strengthening the nation. The NRNA should also act as ambassadors to attract foreign investment in Nepal.”

Chairman of the company, Upendra Mahato said that the development of Nepal is only possible when Nepalis around the globe feel a sense of belonging to the country.

“That sense of belonging can be strengthened through the investment of capital and technology,” Mahato stressed.

Secretary of Finance Ministry, Shishir Kumar Dhungana, congratulated NRNA for the accomplishment while stressing that the company should steer its investments to non-traditional productive sectors.

“Nepal needs and is exploring bilateral and multilateral investments. We’ve already made policy adjustments to institutionalize NRN’s investment in the secondary capital market which has garnered results in the past,” said Dhungana, “We hope that by turning it into a holding company, we will explore alternative sectors of investment in Nepal.”

He reiterated that the government is a partner with the NRNA in the venture and will facilitate its undertakings.

Nepal’s law permits investment in Nepal by a non-resident Nepali or a foreign company in which a non-resident Nepali owns a majority interest, with the condition that the money is earned abroad.

The government has been attempting to facilitate such investments by exempting any tax on the capital sum at the time of investment and enabling the repatriation of such investments and income.

This is not the first time a public company has been established with initiative from the NRNA.

The ‘NRN Infrastructure and Development Limited’ was established in 2012 to pool capital in order to invest in Nepal’s hydropower sector while also looking at other investment opportunities.

Since its inception, it has invested in hydropower projects like the Dordi Khola Hydropower Project which was the first commercial investment of the NRNs in Nepal. Other projects include the Middle Tamor, the Lower Likhu, and the Mathillo Mailung hydropower projects. The projects are currently in the process of completion.