IIN to scale up programmes for promoting investment, equitable economic growth

By TRN Online, Kathmandu, Nov. 14: Invest for Impact Nepal (IIN) platform is scaling up its programme to promote investment and equitable economic growth that contributes to social and environmental impact in Nepal.

The scale-up programme which runs from November 2022 to August 2025 builds on initial discovery phase activities such as assessing specific challenges and opportunities for Foreign Direct Investments (FDI) in Nepal, according to the IIN.

The discovery phase also looked into investment opportunities through financial institutions (FIs), Private Equity and Venture Capital (PEVC) funds, and Financial Technology firms. The IIN platform is promoted by Development Finance Institutions (DFIs) of the United Kingdom - British International Investment (BII), the Netherlands - Dutch Entrepreneurial Development Bank (FMO) and Nepal’s Development Partner- the Swiss Agency for Development and Cooperation (SDC), said IIN in its press release.

"This group comprising of Development Finance Institutions (DFIs) and Development Partners (DPs), will complement existing efforts to attract more investments and advance the development of the country, by channelling efforts to unlock the possibilities of investing patient, flexible capital to support private sector growth and innovation – helping to solve the biggest development challenges in Nepal".

The overall objective of IIN’s scale-up programme is to accelerate growth, create jobs, and develop a more sustainable economy in Nepal. IIN will achieve this by enabling FIs and PEVC funds to access resources from DFIs which will be directed toward investing into productive and inclusive Nepali businesses with a long-term outlook in Nepal, said the IIN.

The IIN platform also encourages financial intermediaries to join capacity strengthening efforts in environment, social, and governance (ESG) through a flexible Technical Assistance (TA) facility. It will develop local ESG service providers and strengthen the Private Equity Association of Nepal, helping to encourage more players to join the investment ecosystem. To support the SME sector, IIN will enable key investment ecosystem stakeholders including DFIs, DPs, FIs, PEVC Funds, private sector and regulators to participate in market information gathering and work with them to conduct a detailed analysis on regulatory framework, financing opportunities and access to foreign direct investment.

“IIN is a unique initiative that aims to make Nepal an attractive market for foreign investment and DFI capital. We are delighted to scale up our support to the platform, in partnership with FMO and the Swiss Agency for Development and Cooperation (SDC), to help realise this ambition and help drive in capital from financial institutions and PEVC funds who play an important role in ushering in much-needed capital to support entrepreneurs and enable businesses growth in Nepal. This platform’s focus on these intermediaries, among others, resonates well with BII’s own strategy in emerging markets along with our ambitions to deploy patient and flexible capital to boost productive, inclusive and sustainable growth in Nepal”, said Mr. Srini Nagarajan, MD, and Head of Asia at BII, according to the press release.

“We started investing in Nepal’s financial sector in 2008, with banks like Clean Energy Development Bank, which later merged into NMB. FMO also supported private equity funds like Dolma Impact Fund I and recently Fund II, which provide scarce growth capital to small and medium-sized businesses. Recently, together with BII and SDC, we launched Invest for Impact Nepal, a collaboration between DFIs and development partners in the country. The aim is to further accelerate investment in Nepal and at the same time support the private sector to raise its environmental and social standards together with local stakeholders” said Michael Jongeneel, CEO FMO.

“We believe that DFI investment and capital mobilization will play a key role in financing Nepal's development in the future, leading to private sector growth and job creation, which are essential to ensure economic growth and reduce inequalities among women and discriminated groups. In coordination with our partners, ensuring that ESG (Environmental, Social, and Governance) factors are integrated into financial products and transactions remains our core focus. We welcome this important partnership”, the IIN quoted Elisabeth von Capeller, Swiss Ambassador to Nepal, in its press release as saying.