IFC portal to facilitate application for business license

KATHMANDU, May 6: International Finance Corporation (IFC), a member of the World Bank Group is developing an e-portal through which entrepreneurs can apply online to start up and operate a business.



Chief Secretary Madhav Prasad Ghimire soft launched the portal at a function in the capital on Friday. [break]



IFC and UK Department for International Development officials, who are working with the government of Nepal, expressed hope that new economic activities would grow this e-portal as new business can be set up and many existing informal businesses formalized by obtaining licenses.



Around half of the current inventories of the business licenses in Nepal have a license validity period of one year or less. The study carried by these organization shows that obtaining licenses takes much longer than in Act or Charter.



Speaking at a program organized to share key findings of Business License and Investment Climate Assessment in Nepal, Dr Pitambar Chettri said information pertaining to license, processes and due links to the acts and regulations are not available easily in print or websites. One of the key finding of the study showed that inadequate resources, lack of inter-agency coordination and discretionary authority or lack of clear guidelines given to licensing officers are often causes of delay.



Findings of Investment Climate Assessment show that two major obstacles in investment are political instability and power cuts. According to the study, access to finance and labor regulations are the third and fourth most important obstacles. Similarly, problem of transportation, corruption and informality were considered other severe obstacles.



Presenting the report of the study, Gabi G Afram, Senior Financial Economist of the World Bank said, 90 percent of the firms considered political instability to be major obstacle and 57 percent of the firms considered power cuts to be a severe obstacle.



“Civil unrest cost firms 44 production days a year on an average and electricity shortages up to 27 percent of total sale for firms,” he added. Citing the finding Afram concluded that Nepali economy is stuck in a cycle where lack of investment opportunities and jobs drive people to migrate.



Speakers at the program said that improving investment climate could reduce costs and manage risks for local entrepreneurs. Nepal was ranked 116th out of 183 countries in the World Bank Group´s Doing Business 2011 report.

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