Indian Ambassador to Nepal Ranjit Rae today asked Nepal to improve its legal provisions on intellectual property rights (IPR) and labour laws to attract more investments from India.
“Indian investors have been complaining that the weak legal provisions regarding intellectual property rights and lack of business-friendly labour laws are key barriers to investing in Nepal,” said Rae addressing an interaction organised by Nepal Chamber of Commerce here today.
Asking the Nepal’s private sector to play an important role to promote Nepal as an investment destination in the international market, Rae said that Nepali private sector should market the country’s potential to lure more Indian investments in the country. “Indian government and private sector both being willing to work in collaboration with Nepal,” he added.
As trade deficit with India has been ballooning in recent years, the Indian envoy suggested giving priority to exporting products that are in high demand in India. Imports of petroleum products has helped widen the trade deficit, he said, stressing on need to harness Nepal’s hydropower potential to help reduce the ballooning trade deficit. “India is also facing an energy deficit, so we are keen to purchase Nepal’s surplus power.”
Rae also suggested Nepal to tap the market potential in trade and tourism sectors by developing its transport infrastructure.
He also said that India might consider extending travel leave concession (TLC) – a domestic tourism scheme in India that encourages government employees and their family members to travel on leave – to Nepal.
The government of India provides travel leave and tickets to government employees every two years to promote travel within the country.
However, Rae also suggested to explore domestic tourism market in Nepal through similar schemes in India.
“India is also positive on providing Nepal an easier transit access for third country trade including Bangladesh,” he said, adding that India has been considering okaying five pending letters of exchange that deal with issues like allowing Nepal to use Visakhapatnam Port and transporting bulk cargo through Indian territory.
Recently investment from the northern neighbour has exceeded southern neighbour. In the last fiscal year 2013-14, Nepal received Chinese foreign direct investment (FDI) commitments worth Rs 7.31 billion against Rs 6.54 billion from India. However, India is still the largest contributor of accumulative foreign direct investment to Nepal till date. By the end of last fiscal year 2013-14, foreign direct investment from India stood at Rs 44.15 billion compared to Rs 17.96 billion from China.
Nepal Chambers of commerce president Rajesh Kaji Shrestha, on the occasion, asked envoy to encourage Indian travellers to visit Nepal and approve the pending letters of exchange as per the agreement reached at the secretary-level Inter-Governmental Committee (IGC) meeting held in December 2013 in Nepal. He also requested to speed up quarantine checking of Nepali goods and remove countervailing duty on a number of Nepali products including readymade garment and copper.
Nepal Chambers of Commerce has signed memorandum of understanding (MoU) with five state-level chambers of India including Kolkata and Tamil Nadu to expand trade ties at the local level.