FDI commitments drop 66.57% to Rs 3.77 billion in first month of 2026/27

KATHMANDU: Foreign direct investment (FDI) commitments dropped 66.57% to Rs 3.77 billion in Shrawan (mid-July to mid-August) from Rs 10.38 billion in the previous month, reflecting a sharp month-on-month decline in foreign investment pledges.

Data from the Department of Industry (DoI) show Nepal received FDI commitments worth Rs 3.77 billion in the first month of the current fiscal year 2026/27. A total of 191 FDI projects were approved between mid-July and mid-August of the fiscal year. Of these, 187 projects were approved through the automatic route, with total commitments of Rs 3.47 billion, while four projects committing Rs 299.4 billion were approved through the regular approval route.

In the previous month, Nepal had received FDI commitments of Rs 10.38 billion for 202 projects. Similarly, total FDI commitments worth Rs 58 billion were received for 1,116 projects in fiscal year 2025/26.

The projects approved in the first month of 2026/27 have pledged to create 1,773 jobs.

In addition to FDI approvals, the department approved three projects under the Share Purchase Agreement/Share Subscription Agreement (SPA/SSA) worth Rs 254 million. It also approved eight technology transfer agreements (TTAs) during the month.

The data indicate that the automatic route accounted for the overwhelming majority of FDI approvals in the first month of the fiscal year. The government has been promoting the automatic route to facilitate smaller foreign investments by allowing eligible investors to obtain approval without going through the conventional approval process.

ICT-related ventures accounted for the largest share of FDI approvals in terms of the number of projects during the first month. A total of 128 projects, or nearly two-thirds of the approved projects, were in the information and communication technology (ICT) category. However, the category attracted FDI commitments of only Rs 569.83 million, or around 15% of the total commitments.

Tourism emerged as the largest recipient of FDI commitments among the industry categories. The government approved 33 tourism-related projects with total commitments of Rs 1.64 billion. This accounted for around 43.4% of the total FDI commitments received during the month. Manufacturing was next with a total commitment of Rs 843.2 million in nine projects.

The service sector accounted for 19 approved projects with total FDI commitments of Rs 682 million. Similarly, one energy project attracted Rs 20 million and one agro and forestry-based project received another Rs 20 million.