Investment-friendly environment created in Nepal: Finance Minister Paudel

KATHMANDU: Deputy Prime Minister and Minister for Finance Bishnu Prasad Paudel has announced that an investment-friendly environment has been established in Nepal.

Speaking at a news conference in Kathmandu today, he highlighted that Nepal's BB score in the sovereign credit rating signifies a favourable environment for investment. He explained that this rating reflects Nepal's advanced economic structure, public finance mobilisation, and macroeconomic and financial conditions.

"The credit rating result indicates that Nepal's credit capacity is high, and its financial and economic capacity is strong, enabling it to secure loans at low interest rates from the international market," said Minister Paudel.

He expressed confidence that this situation would boost private sector confidence and attract foreign investment. The sovereign credit rating evaluates four main sectors of the economy: structural aspects, macroeconomic performance, and public and external sector economic indicators.

These aspects are assessed independently using various sovereign rating models and qualitative measurement methods, with the score given a rating from minimum to maximum.

The rating process analysed Nepal's economic structure, public finance status, internal and external debt, monetary and financial sector indicators, and the economic index of the external sector. It also considered the medium-term and long-term economic growth plans outlined in the 16th Plan, along with other details and statistics.

As part of the qualitative evaluation phase, researchers conducted an on-site visit to Nepal and consulted with high-ranking officials from government agencies such as the Office of the Prime Minister and the Council of Ministers (OPMCM), the Ministry of Finance (MoF), the National Planning Commission (NPC), and the Nepal Rastra Bank. They also consulted with private sector officials and bilateral and multilateral development partner agencies. The Nagdhunga tunnel was observed as a model for evaluating the implementation of Nepal's mid-term and long-term infrastructure development plans.

Joint Secretary at the MoF, Narayan Prasad Risal, stated that the sovereign credit rating is used by global investors and financial service providers to assess the investment environment of any country.

According to him, the rating evaluates the structure and condition of the country's economy from the perspective of independent experts, providing a realistic view to investors worldwide.

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