Shabda Gyawali's Blog

IFC’s annual assistance to Nepal could go up to $100 million -$200 million .click here to read   " The government and China´s Three Gorges Corporation (TGC) on Wednesday signed a Memorandum of Understanding (MoU) on construction of the 750-MW West Seti Hydro Electricity Project  The project will cost USD 1.6 billion. As per the MoU, the Chinese power company will have 75 percent of the total investment, while the Nepal Electricity Authority will bear the remaining 25 percent of the project cost.  The MoU also requires that the TGC should issue shares of one to five per cent of the its total investment to Nepali nationals."  click here to read more

Twenty year has passed since liberalization of the Nepali economy. Breaking barriers for private sector have supported thousands of household to graduate to the middle class, but at the same time socio-economic inequality have increased and millions of citizen fighting for day to day basic necessities of life has been  largely ignored. Judging by social and economic challenges faced by our country in the past twenty years, it is certain that the time has come for `the democratization of social entrepreneurship in Nepal. Social entrepreneurship is defined as- an innovative entrepreneurial approaches to tackle most pressing social and environmental challenges of the society. Rather than waiting for the government to meet its mandate and fix the problem. Social entrepreneur find out the unmet need, address the need by reinventing the existing system, scale the solution and help catalyze the solution in a different geographic settings. They generate social values as well as equita...

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In recent years board range of organisations has shown interest in adopting impact investing model to  investing in the low income countries . List includes but not limited to investment banks, sovereign wealth funds, and endowments, philanthropic foundations and, international development organization. Traditionally, inflow of foreign capital (not including remittances) in developing countries like Nepal  has taken   place in the form of investment designed to maximize financial returns, while no intentional consideration of social impacts or foreign aid structured to maximize social return, while no expectations for monetary returns. Impact investing provides a platform to blend capital from both foreign aid and foreign investments to support entrepreneurship culture in the developing world. Impact investor operates in the missing middle and fills the capital gap above micro-financing and below institutional financing. They structure there their investment ve...

Another type of foreign investment ………………….. Foreign Direct Investment (FDI) can bring great advantage to the host country. It fuels economic growth, help reduce poverty, create employment opportunities and assist building physical infrastructures. With the same intention, the Government has decided to observe 2012-2013 as Nepal Investment Year and has setup Nepal Investment Board to spur and facilitate foreign investments in the country. To attract foreign investments, NIB is launching promotional events like road shows in countries like India, UK and USA. NIB is targeting foreign firms that have the resources to investment in mega projects in sectors like energy, tourism, infrastructure development and commercial agriculture. Dr.BRB led cabinet has also passed Investment Board Act ,which ensures to facilitate investment above RS 25 billion through single window policy. A population of 28 million, rising per capita income (mainly due to remittances), demographic dividend, under...

 Nepal- India Agreement " There has been a lot of buzz about Bilateral Investment Promotion and Protection Agreement (BIPPA) signed on October 21, 2011 between Nepal and India.  " What is BIPPA "  BIPPA is a legal instrument that establishes specific rights and obligations to meet the primary purpose of protecting foreign investments against discriminatory measures (i.e. policy inconsistencies) by the host state. To ensure protection and promotion of investments, and to encourage capital flows along with the commitment to credible liberal economic policies, countries typically enter into investment protection agreements like BIPPA. In principle, it ensures reciprocal encouragement, promotion and protection of investments, thus enabling conditions conducive to increase investment ." Click here  Consequences of  BIPPA - " Irate international  investors  in  telecom companies, whose mobile phone permits were cancelled by the  Supre...

Recently read - "  IFC, a member of the World Bank Group, and the World Bank are helping governments in emerging markets simplify regulations for corporate bonds, changes designed to increase the volume of non-government bond transactions and improve the diversification and performance of institutional investors’ portfolios.  " click here to read more   While reading the article few thought came to my mind in context of Nepal Our sovereign debt is rated CCC+ ..... corporate bonds are usually more risky  then the government bond. Majority of the industrial houses that needs debt,has there own subsidiary bank  ( for example: Nabil Bank- Chaudary Group, Laxmi bank- Khetan group,etc...) .Are the industrial houses willing to get rated when they have acesss to capital through there financial subsidiary. As of now, not a single major industrial houses (besides banks ) are listed in Nepal Stock Market.....