The process of conducting sovereign credit rating, considered crucial for attracting foreign investment, is set to progress soon. 

Though the government had earlier announced that the process would be completed before the Nepal Investment Summit held on April 29 and 30, the international credit rating agency assigned to the task has yet to begin its work.

Fitch Ratings will be responsible for Nepal’s sovereign credit rating, also known as a country rating.

“Representatives from Fitch Ratings, the American credit rating agency, will be arriving in Nepal next week to move forward the credit rating process,” an official at the Ministry of Finance informed NBA on condition of anonymity. “Meanwhile, government officials are being trained for the matter."

Officials have said that Fitch's delegation is expected to deliver the final credit rating report within three months after its arrival in Nepal. 

Currently, employees from several key institutions — including the Ministry of Finance, Nepal Rastra Bank, Nepal Securities Board, National Insurance Authority, and National Planning Commission — are undergoing training.

Additionally, employees from the Prime Minister’s Office, the Council of Ministers, and the Ministry of Law are being trained at the Ministry of Finance to effectively present Nepal’s financial status to the Fitch’s delegation.

Former Finance Minister Barshaman Pun  had said during his tenure that foreign investors would be able to view Nepal's financial profile in a single document after the completion of the rating. 

“This means we won't need to repeatedly explain our facts and figures at every international event we attend," Pun said.

Sovereign credit ratings assess a country's ability to meet its debt obligations and overall financial stability. These ratings, provided by credit rating agencies, reflect the country's financial health and risk of default. Higher ratings indicate lower risk and stronger financial health, while lower ratings suggest greater risk and potential instability.

Agencies like Fitch use a scale from 'AAA' to 'D' to classify creditworthiness. An 'AAA' rating signifies low risk and robust financial health, whereas ratings of 'B' or below suggest higher risk and potential instability.

Standard & Poor’s (S&P), Moody’s, and Fitch are globally recognized credit rating agencies, with their ratings viewed as trustworthy by investors worldwide.

A year-and-a-half ago, a task force was established under the leadership of the Joint Secretary of the Financial Division at the Ministry of Finance to complete the country rating before the investment summit. 

Although the group had made some preparations a year ago, the rating company failed to conduct a field visit. 

Officials at the Ministry of Finance say they are now focused on updating the indicators developed by the ministry. 

“We have collected the data as per the rating company's format,” a ministry official told NBA in condition of anonymity. “Updating it won’t be difficult".

In order to attract foreign investments, the government had mentioned conducting a sovereign credit rating in the budget for the fiscal year 2018/19.

A public notice was issued inviting companies to apply for the rating.

All three major global rating agencies—Fitch, Moody's, and Standard & Poor's—had applied. The government selected Fitch Ratings Agency.

Additionally, a separate agreement for technical assistance was established with the British International Development Agency (DFID) and UK Aid.