NON-RESIDENT NEPALI ASSOCIATION

POWER SUMMIT 2013
KATHMANDU, NEPAL
27 AUGUST 2013
“NRNS INVESTMENT IN
HYDRO POWER PROJECTS
– OPPORTUNITIES &
ISSUES”
Tenzi Sherpa
General Secretary
International Coordination Council
Non-Resident Nepali Association
FOR NEPALI BY NEPALI
DIASPORA & DEVELOPMENT
FOR NEPALI BY NEPALI

Diaspora is fast emerging as one of the forces for
development in the globalized world

Diaspora retains human, financial, and social capitals
worth for development of home countries

Remittance and direct investment from diaspora – a
good resource potential to benefit home country and its
population

Human capital can result from higher education,
training, and experience in diasporas, that were gained in
more developed countries

Migrants are unofficial ambassadors and bridges
between developed market around the globe and Nepal

Orienting foreign direct investment in different sectors
NON-RESIDENT NEPALI
ASSOCIATION
NRNA was established on 2003 to unite the
Nepali Diaspora; marshal their knowledge,
skills, resources and involvement in the
socio-economic development of Nepal and
the Nepali people
Our Motto : “FOR NEPALI BY NEPALI”
FOR NEPALI BY NEPALI
OBJECTIVE OF NRNA
FOR NEPALI BY NEPALI

Promote and protect the rights and interest of Nepalis
residing outside Nepal and to promote Nepal.

Coordination among Nepali communities and their
organization to establish a global network and a
common platform to represent the Nepali Diaspora.

Mobilize the knowledge, skills, capital and other
resources in the disposal of NRNs for the socioeconomic development of Nepal in coordination and
partnership with the government, national and
international institutions.

Preserve and promote Nepali culture and tourism
globally.

Act as a catalyst in attracting and facilitating NRNs
and foreign direct investment in Nepal.
NRNA’S COMMITMENT
Collective Investment, Issues of foreign
employment, sustainability of NRNA, Charity Works,
Continuation of Nepali Citizenship issues,
Amendment of NRN acts, Skill Knowledge and
Innovation Transfer, Open University of Nepal
Initiative and other ongoing activities etc.

 To
channelize investments for Government of
Nepal prioritized sectors; hydropower, tourism and
agriculture
Hydropower project (upto 100 MW capacity) :
First among the prioritized sectors

FOR NEPALI BY NEPALI
NEED FOR COLLECTIVE
INVESTMENT
FOR NEPALI BY NEPALI

To encourage investment from people in foreign
employment to create huge basket of funds

To diversify the investment portfolio of NRNs with
established business already in Nepal

Risk minimization for growing numbers of NRN
initiated investments

Mobilization of the saving amount to more
productive sectors professionally

Genuine contribution to the overall development
of the nation in a big picture

Getting benefits of emerging globalized economy
SCOPE
FOR NEPALI BY NEPALI

Approx. 3.2mn NRN’s in over 100 countries

Over 90% in Foreign Employment

$5 billion Remittance annually

Upward trend in foreign employment

NRN’s interest for Collective Investment

Government of Nepal supportive to facilitate
NRN’s Investment

Lack of domestic capital for hydro sector
investment

Guaranteed market and price in Hydro
projects
INVESTMENT PRIVILEGES FOR
NRNS
FOR NEPALI BY NEPALI

NRN cardholder can open bank account in foreign
currency in any of commercial banks in Nepal

NRN can repatriate to his/her country of residence
the amount in foreign currency, which is equivalent to
investment plus the net profit earned

Unrestricted business rights at par with Nepali
citizens

Tax exemption on capital investment

2012/13 as the years of Investment in Nepal as
announced by GoN Very likely that GoN may impose
other investment friendly atmosphere
NRN INVESTMENT LIMITED
FOR NEPALI BY NEPALI

NRN’s formed an Investment Company in Nepal
in September 2013

Some 785 investors, including 3 FDI and 4 local
company subscribed for nearly Rs. 1bn
investment

25% of the commitment amount was called and
received ending Feb 2013

Some 18 hydropower project was identified and
analyzed

NRNIL acquired 51% stake in 27MW Dordi
Khola Hydropower Project in Lamjung.
1ST PROJECT OF NRNIL – DORDI
KHOLA PROJECT 27 MW
FOR NEPALI BY NEPALI

4 years Project period, 142.32GWh Energy, 4.3bn
project cost, IRR 13.1%, RoE 16.9%, Simple Pay back
<6yrs.

Project work is continuing, DPR is expected end May.

Land acquisition work is going on.

Banks are engaged, financial closure is expected in
Sept.

Interaction Program and project site visit are on
going.

Detailed project information are availabe in :
http://nrnil.com/index.php?option=com_content&vie
w=article&id=94&Itemid=478.
WORK IN PROGRESS
FOR NEPALI BY NEPALI

Engineering and Consulting Team selection in process

NRNIL is working on to get share lagat certified from
ROC

Issuance of Share Certificate to the investors in process.

Working with government authorities and hydro
engineering consulting team to secure other projects
which will aggregate to 100MW.

All un-invested money has been kept under call account.
This now earns some 9% interest annually, the return.

Call for second installment of investment made
OPPORTUNITIES
FOR NEPALI BY NEPALI

Risk-free investment (Guaranteed market and price)

Market of peak production

Demand (long term) and Huge Potential

Government subsidy:Tax and Custom Rebate

Long term return-30 years

Easy financing- prioritized sector, must finance
scenario, low interest rate

Experience of development of hydro projects by
NRNs
ISSUES
FOR NEPALI BY NEPALI

Lack of Political Commitment

Potential projects are all occupied

High Premium for partnership

Mitigating local demands

Lack of proper infrastructure

Repatriation of NRN Foreign investment

Non issuance of NRN Card to foreign Spouses of NRN

Discrepancy in the definition of NRNs in NRN Ordinance
2062 and NRN Act 2064
THANK YOU
FOR NEPALI BY NEPALI