Question to the Department for International Development:

To ask Her Majesty's Government what assessment they have made of the economy of  Nepal and its attractiveness for UK investment; and to what extent, if any, they have invested in (1) hydropower, (2) tourism, and (3) medium-sized enterprises.

DFID and the Foreign and Commonwealth Office (FCO) make regular assessments of the economy of Nepal and its ability to attract Foreign Direct Investment (FDI), including from the UK. Analysis suggests that there is potential for FDI in areas such as hydropower, education and tourism. However, constraints to investment remain from poor transport, energy and urban infrastructure, and aspects of the regulatory environment. The UK is working with the Government of Nepal to address these barriers to growth.

DFID, through its funding of Investment Board Nepal, helped to secure $1.2bn of investment for the new Arun 3 Hydropower project, which will double Nepal’s hydropower generation and energy exports to neighbouring countries. DFID funding supported the Nepal Tourism industry to recover following the 2015 earthquake, and has supported the construction of and marketing for the Great Himalayan Trails. Support has also been provided to approximately 250,000 small-scale entrepreneurs and farmers to significantly improve their business practices, for example through better management of crop diseases, and contributed to increased incomes.