Government’s ambitious plan to achieve FDI of Nu 500 billion starts its policy review

To rebuild and revitalize the economy and transform our country into a developed nation, PDP pledged to achieve the Economic Goal of increasing ambitious Foreign Direct Investment (FDI) target from Nu 43 billion to Nu 500 billion in the next five years.

On 29 January 2024, the Prime Minister had issued an executive order on his first day to establish the Economic Development Board (EDB).

The primary mandate of the EDB is to fast-track the establishment of business and FDI while enhancing the efficiency of the government-private collaboration.

The government has announced a comprehensive review of the FDI Policy.

Ministry of Industry Commerce and Employment (MoICE) Minister, Namgyal Dorji, shared, “To encourage greater foreign investment, there will be a comprehensive examination of the FDI Policy along with its associated rules and regulations. Specifically, the roster of key sectors available for foreign investment will be reassessed. This review aims to make the investment environment more flexible, tackle obstacles, ensure clear policy guidelines, bolster investor trust, and improve coordination among various agencies. The policy will integrate international standards for attracting investments.”

Central to the review is the reassessment of priority sectors open for FDI, with a focus on liberalizing the investment regime and eliminating bottlenecks. This inclusive approach seeks to ensure policy clarity, bolster investor confidence, and promote seamless coordination among relevant agencies.

The process will be characterized by thorough consultations with stakeholders from both the private sector and government bodies. This collaborative endeavor aims to incorporate diverse perspectives and insights, ensuring that the revised policy reflects the interests and aspirations of all stakeholders involved.

“FDI plays a critical role in stimulating economic growth by facilitating the inflow of capital, technology, and market penetration while generating employment opportunities. The ongoing revision of the FDI Policy underscores the government’s commitment to adapting to evolving economic landscapes and leveraging international best practices,” he further added.

In addition to revising the FDI Policy, the government will adopt strategic investment promotion mechanisms and enhance collaboration with domestic and international agencies, including embassies. These measures aim to augment the country’s attractiveness as a destination for foreign investment and foster sustained economic progress.

Recognizing that the significance of foreign investment extends across various sectors, the review process emphasizes a whole-of-government approach to policy coordination.

While the primary objective is to enhance the investment, efforts will be made to ensure that policy revisions are aligned with broader development goals and priorities.

Once finalized, the revised policy will be made available in the public domain, and notifications regarding the changes will be shared to the public.

The MoICE Minister shared that the transparency is a key element in ensuring that stakeholders are well-informed about the modifications and can actively participate in the evolving landscape of foreign investments in the country.

The government has set an ambitious timeline for the review, aiming to complete it within the fiscal year.

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