The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has called on the government to implement policy reforms, enhance investment opportunities, and streamline business services in its Policies and Programmes for the fiscal year 2025/26.

Issuing a recent statement, FNCCI said its President Chandra Prasad Dhakal submitted the suggestions to Minister for Industry, Commerce, and Supplies Damodar Bhandari on Wednesday. The Federation emphasized the need for effective regulations and their proper execution, noting that while some positive policy reforms have been observed, further improvements are necessary.

Among its key proposals, the FNCCI recommended maximizing the use of technology for business registration, renewal, tax payment, and other services by integrating a ‘business icon’ into the Nagarik App run by the government. It also urged the government to enhance public service delivery under the ‘smart’ service concept and introduce a separate policy to attract foreign investment, reads the statement.

"Since foreign investment in Nepal is currently limited to just 0.2 percent of GDP, a special investment campaign should be launched to increase it. The Office of the Investment Board and the Department of Industries should be merged and restructured, and the ‘one-stop’ service center should be fully implemented," the FNCCI stated. It stressed that investors should not have to visit multiple offices after submitting the required documents.

Addressing the concerns related to the banking sector, the FNCCI noted that while Nepal’s banking system has around Rs 600 billion available for investment, the pace of investment remains slow. It pointed out that despite a drop in interest rates by three percentage points over the past three months, credit disbursement has not been effective. The Federation recommended reviewing the capital loan guidelines introduced by Nepal Rastra Bank two years ago and postponing their implementation for at least two more years.

The FNCCI also proposed immediate policies to promote Nepali agricultural products and facilitate water exports to the Gulf countries. It suggested establishing cold storage, X-ray machines, and warehouse facilities at the airport to boost exports, leveraging the 12 daily flights from Nepal to the Middle East.

To support the manufacturing sector, the Federation recommended gradually reducing the tax rate by five percentage points over five years, lowering the income tax rate, and increasing the tax exemption limit.

The Federation also suggested facilitating hotels, resorts, polytechnic institutes, other educational institutions, teaching hospitals, etc., established in hill stations near the Indian border, thereby attracting Indian tourists and other investments.

The federation suggested reforming the tax policy to promote domestic industries, taking into account the impact of SAFTA.