FDI pledge declines by 28%

Kathmandu, Apr. 15: Nepal has recorded a notable decline in foreign direct investment (FDI) commitments during the first nine months of the current fiscal year 2025/26.

According to the Department of Industry, total FDI commitments stood at Rs. 41.79 billion for 615 projects between July 17, 2025, and April 13, 2026, of the current fiscal year. 

This marks a decrease of Rs. 16.18 billion, or 28 per cent, compared to the same period last fiscal year, when commitments had reached Rs. 57.97 billion. 

The FDI commitment last fiscal year totalled Rs. 64.96 billion. The monthly trend shows a sharp fluctuation in investor interest. 

The highest commitment was recorded in Shrawan (mid-July to mid-August) at Rs. 24.10 billion, followed by Rs. 8.98 billion in Bhadra (mid-August to mid-September 2025). 

However, commitments steadily declined in subsequent months, hitting a low of just Rs. 386 million in Falgun (mid-February to mid-March). In Chaitra (mid-March to mid-April), FDI commitments were recorded at only Rs. 1.19 billion, significantly lower than Rs. 13.31 billion in the same month last year.

FDI commitments amounted to Rs. 2.04 billion in the month of Ashoj, Rs. 1.54 billion in Kartik, Rs. 1.91 billion in Mangsir, Rs. 599 million in Poush, and Rs. 1.04 billion in the month of Magh during the current fiscal year.

Of the total commitments, Rs. 37.69 billion came through the approval route, while Rs. 4.09 billion was invested via the automatic route. 

A total of 615 industries were registered with foreign investment, including 426 through the automatic route and 189 through approval.

Despite policy reforms such as the removal of the upper investment limit under the automatic route, most foreign investments were directed toward small-scale industries. 

Earlier, the government of Nepal had streamlined the process for approving foreign investments of up to Rs. 500 million through the automatic route.

Out of the total, 599 were small industries, while only eight each fell under medium and large-scale categories.

Sector-wise, the information and communication technology (ICT) sector attracted the highest number of projects, with 366 registrations accounting for nearly 60 per cent of the total.  The tourism sector followed with 164 projects, representing 26.6 per cent. 

Similarly, 38 industries were registered in manufacturing, 47 in the service sector, and 16 in the agriculture sector.

During the review period, only two industries have been registered, each in the mineral and energy sectors.  No industry was registered in infrastructure sector during the first nine months of the current fiscal year.

However, in terms of investment volume, agriculture topped the list with Rs. 22.08 billion in commitments, followed by tourism with Rs. 11.46 billion.  Service industries attracted Rs. 3.89 billion, while manufacturing secured Rs. 2.50 billion in FDI pledges.

The ICT sector received commitment worth Rs. 1.45 billion, the mineral sector worth Rs. 115 million, while the energy sector received Rs. 234 million during the review period.

The industries registered during the period have pledged to create 22,316 jobs.