FITTA 2019 -- the governing framework, and a nationality-neutral statute
Foreign investment into Nepal is governed by the Foreign Investment and Technology Transfer Act, 2075
(2019) -- FITTA 2019. The minimum capital threshold for foreign investment was reduced from NPR 50
million to NPR 20 million, announced in the FY 2022-23 (2079-80) budget speech and effective 30 May
2022. This platform found references in later secondary sources to further threshold-reduction
discussions in subsequent Nepali budgets but could not confirm any further reduction below NPR 20
million from a primary Department of Industry notification during this research -- readers should
verify the current threshold directly before relying on it. Certain sectors are restricted or reserved,
including poultry farming, general retail business, arms/ammunition/explosives/radioactive materials,
real estate speculation (construction itself is treated differently), domestic courier services,
media/broadcast (newspaper, radio, television), Nepali-language film production, and most professional
services (accounting, legal, engineering, management), which generally cap foreign ownership at 51%.
This platform found no source confirming that Indian investors receive any statutory carve-out or
preferential treatment under FITTA compared to other foreign investors -- the Act reads as
nationality-neutral. India's practical dominance in Nepal's economy instead comes from geographic
proximity, the fixed currency peg (1 INR = 1.6 NPR), and long-standing historic and commercial ties,
not a statutory preference.
Approval process and company registration
Foreign investment approval runs through the Department of Industry for investments up to NPR 6
billion, or the Investment Board Nepal for larger investments, with approval targeted within seven days
and repatriation approvals targeted within fifteen days under FITTA's stated service standards. A
residential visa is available for investments exceeding USD 1 million, and a “Single Point
Service Center” is intended to streamline visa, work-permit, and registration processes. Separately,
company registration itself is handled by the Office of Company Registrar (OCR) under the Companies
Act, 2063 (2006), through the CAMIS digital portal -- name reservation (approved names are held for 90
days), preparation of the Memorandum and Articles of Association and shareholder documents, online
submission, and OCR review and approval, with a standard timeline commonly cited as 7 to 21 days. The
minimum authorized capital for an ordinary private limited company is commonly cited as NPR 100,000 --
a separate, much lower bar than FITTA's NPR 20 million threshold, which specifically applies to
investment recognized as foreign direct investment.
The scale of India-Nepal trade and investment
India accounts for over 60-64% of Nepal's total external trade on figures this platform reviewed, with
bilateral goods trade cited at roughly USD 9.38 billion for FY 2025-26 per the Embassy of India,
Kathmandu. Nepal sends more than 80% of its exports to India. India is estimated to account for roughly
one-third of Nepal's total foreign direct investment stock, with cumulative Indian investment estimated
around USD 800 million spread across banking, insurance, dry ports, education, telecom, power, and
tourism. Energy cooperation has deepened recently: in 2025 Nepal began exporting power to Bangladesh via
India's electricity grid, described as South Asia's first tri-national energy-transit project, and India
has committed to purchasing up to 10,000 MW of Nepali power over a decade.
Common mistakes people connected to Nepal make with business questions:
- Assuming Indian nationality provides a formal exemption or preference under FITTA -- it does not
appear to on the face of the statute.
- Confusing the general company-registration minimum capital (NPR 100,000) with the much higher
FITTA foreign-investment threshold (NPR 20 million).
- Not verifying the current FITTA minimum-capital threshold directly, given this platform's flagged
uncertainty around any reduction since 2022.
