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Foreign Direct Investment (FDI) in Nepal: Key Policies & Entry Routes

May 20, 20267 min read
Foreign Direct Investment (FDI) in Nepal: Key Policies & Entry Routes

A guide to foreign investments, minimum capital limits, fit-for-purpose sectors, and getting FDI approval under FITTA in Nepal.

Unlocking FDI Opportunities in Nepal

Foreign Direct Investment (FDI) is crucial for scaling up larger industrial projects and technology transfers in Nepal. The primary governing framework is the Foreign Investment and Technology Transfer Act (FITTA).

1. Minimum Investment Threshold

Currently, the minimum investment threshold for foreign investors has been set to NPR 20 million (reduced from NPR 50 million to attract more startups and SMEs).

2. Investment Approving Authorities

  • Department of Industries (DoI): Approves FDI requests up to NPR 6 billion.
  • Investment Board Nepal (IBN): Handles larger infrastructure projects exceeding NPR 6 billion.

3. Restricted Sectors

Certain sectors are restricted for foreign participation, such as retail trade, primary agriculture, cottage industries, and travel agencies to protect domestic micro-industries.