KATHMANDU, Nov. 7 (Xinhua) -- Nepal received over 90 percent of total foreign direct investment (FDI) commitment from China during the first quarter of the current fiscal year 2019-20 that began in mid-July, Nepal's Department of Industry said.
China has been topping in FDI pledges to Nepal for the last four consecutive fiscal years.
Of total FDI pledges which stand at 95 million U.S. dollars, China alone pledged 88 million U.S. dollars during the first quarter, according to the department. This represents nearly 93 percent of total foreign investments committed FDI, showing dominant position of China when it comes to FDI commitments to the Himalayan nation.
Britain came second with FDI pledge of 1.85 million U.S. dollar followed by India with 1.76 million U.S. dollar in the third position.
Bangladesh and Japan came fourth and fifth in pledging the highest amount of foreign investment.
FDI pledges from China during the first quarter of the current fiscal year stood at 7.79 times higher than the amount the Chinese investors pledged during the same period of last fiscal year. In the first quarter of last year, China had pledged total FDI of 11.3 million U.S. dollars.
"China pledging over 90 percent of total pledged FDI reinforced China's status as dominant foreign investor in Nepal," Jeevan Prakas Sitaula, director general of the department, told Xinhua on Wednesday.
He said he felt the growing Chinese investments in Nepal as most of foreign investors he met came from China.
Nepali industrialists said there is even more potential for growth.
"We have got a few big investments from China in the areas of hydropower project and cement projects," said Pashupati Murarka, former president of the Federation of Nepalese Chambers of Commerce and Industry, the apex private sector body of Nepal, on Wednesday. "But, large Chinese investment is still low in manufacturing sector except in cement."
Murarka saw the potential of increased investment from China in Nepal after Chinese President Xi Jinping visited Nepal last month. Due to the significant contribution from Chinese investment pledges, overall FDI commitment during the first quarter this fiscal more than doubled. In the first quarter last fiscal year, overall FDI commitment to Nepal was 42.63 million U.S. dollars.
Sitaula said political stability, policy and legal reforms such as introduction of new foreign investment law, new Industrial Enterprises Act and ease in customs clearance could play a role in increasing overall FDI.