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Important Steps in starting an industry in Nepal


Important Steps         Action to be initiated                         Approximate Timing Schedules

Willingness to          Background information on
Consider Nepal          Nepa-Visit Royal Nepalese Missions
			UNIDO, IPS offices etc. for information;
			Request information from FIPD, D/I, 
			FNCII, YPO in Nepal.

Develoment of           Interaction between Foreign investor            At the convenience
project ideas           and Nepalese investor; Consult                  and urgency of investor.
			Brochures, Guides, Economic Reports etc.

Visit Nepal             Contact FIPD, D/I, FNCCI/Banks/Embassy
			for briefing on investment climate, rules
			and regulations, procedures for application, etc.

Selection of            Preliminary agreement betwwen foreign and 
project                 local investor; Brief D/I on proposed 

Credentials of          Exchange of information on respective cos.
Partners                Consult commercial banks, embassies, FNCCI
			foreign chambers of commerce & Industry

Feasibility Study       Identify consultant for detailed study and 
Application to D/I      prepared study.                                 3-6 months
			Complete application form and submit ten
			copies of project feasibilty report & one
			copy of joint venture agreement to D/I.

Processing of           a/ Evaluation of project by D/I and 
Application             recommendation to IPB.
			b) IPB examines the recommendations
			and takes decision on project.                  30 days

Issue of Licence        D/I issues licence setting out terms and 
			conditions applicable.                          Within 35 days

Formation of Co.        Prepare Memorandum & Articles of                
			Association and submit for registration
			to D/I. Contact management consultancy
			firm, legal firm to prepare papers,
			D/I registers Co.                                       Within 21 days.

Financial Package       Approach commercial banks, NIDC,N.ADB,          The process could run
for investment          foreign financial institutions with             concurrently with
			licence, feasibility report and formal          application to D/I.
			application for loans.

Selection of Site       Local & Foreign partner to decide on            6-12 months
Construction of         civil design, estimation, selection             depending
Factory                 of contractor and award of contract             on project

Utilities               Contact D/I to facilitate speedy                This could run
			connections for electricity, water              concurrently during
			telecommunication facilities.                   construction Phase.
			Contact Nepal Electricity Authority,
			Water Supply and Sewarage Corporation
			for installation of facilities.

Plant & Machinery       Selection of Plant & machinery,                 2-3 months
and foreign             obtain import licence; secure foreign
exchange                exchange requirements through
			commercial banks.

Commissioning of

Trial Production

Commercial Production

Abbreviation used:

FIPD -  Foreign Investment Promotion Division   NIDC - Nepal Industrial Development Corporation
FNCCI - Federation of Nepalese Chambers of      YPO -   Young Presidents' Organization
	Commerce & Industry
NADB - Nepal Agricultural Development Bank      D/I -   Department of Industry

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Ministry of Industry
Foreign Investment Promotion Division
Singha Durbar
Kathmandu, Nepal
Tel: 216692
Fax: 220319
Tlx: 2610MOI NP

Copyright 1996 by Foreign Investment Promotion Division, Ministry of Industry, HMG

Webmaster: Anita Shrestha, AMAA, INC