Nepal's new Maoist Premier Prachanda on Monday promised new business-friendly policies as he urged Indian companies to invest in agriculture, tourism and infrastructure in his impoverished nation. Prachanda, on his first visit here as prime minister, said he would set up a panel "to introduce the necessary reforms in industrial policy and ... simplify processes of setting up a business in Nepal."
"We will do all we can to ensure industrial security in Nepal," said the 53-year-old, dressed in a crisp business suit and looking at home at a meeting organised by three major Indian chambers of commerce. Prachanda has set a target of double-digit economic growth and harnessing 10,000 megawatts of hydropower for Nepal in the next decade.
But India's business community expressed concerns about investing in the neighbouring country. "The biggest issue is of security," said Harsh Pati Singhania, senior vice president of the Federation of Indian Chambers of Commerce and Industry (FICCI).
"This has become a big deterrent to additional investment by Indian companies and also for existing companies, which are finding their operations more and more difficult," he said.
Labour unrest and an uneven tax structure were other problems dampening business interest in Nepal, Singhania said. In his response, Prachanda promised "receptive policies for foreign investment" that would create "a homelike environment for engaging in business," inviting Indians to invest in areas including power projects. A former school teacher, Prachanda whose real name is Pushpa Kamal Dahal, led a decade-long insurgency against Nepal's monarchy before signing up for peace in 2006 and embracing multi-party democracy.
Prachanda, who visited giant northern neighbour China soon after becoming premier, called ties with India "crucial and vital," adding this was inevitable given the "specific cultural, historical and tradition of economic interdependence."
"The geo-proximity and close co-operative relationship between Nepal and India should help us realise the dream of being together and growing together," he said, pointing to other investment opportunities such as in health and information technology.
Nepal also wanted relations with China, he said, but added ties with Newn the agenda, an Indian official said, after the Kosi river breached its embankments in Nepal and submerged large swathes of north-east India last month. India and Nepal traded blame over the disaster, which left hundreds of villages underwater and millions of people destitute. Prachanda will also visit India's southern IT hub of Bangalore before returning home on Thursday.
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