Nepal is a landlocked country with a challenging market structure. Due to the unstable political situation, its geographical topography and poor infrastructure are hindering the development of the business in Nepal. Strike and Bandha are also disrupting the movement, although the situation has improved over the past year. Nepal, a country with a population of 29 million and per capita income of $564. Agriculture and remittance is a large contributor to the national economy. Most of the businesses are running through imported goods causing deficit in balance of payment. The policy and practices of the bureaucratic system is very slow and the attitude is also found not supporting business growth. Frequent policy changes and tax rates are always a problem contributing to discourage invest in the business. The legal process is also found to be very controversial. Corruption and the lacking in governance is a big threats to all interest sectors. Changing government has been creating the numerous obstacles to doing the business in Nepal. The clash between the political parties and the delayed in the peace process and drafting of the new constitution is also a challenge for business. So it has created the illusion for the long term investment. The labour relation and the shortage of the qualified labour are other emerging issues. The low wages and the fashion of foreign job, even though generating short term benefits, creating the long term impact in the business sector. The union and changing demand are always a non stop conflict in the business. Even though there are many steps are undertaken, the adaptation of mixed economy and the public private partnership are a significant movement. The liberal policy to attract the international investment and creating the competitive environment are also a major one. The member of WTO and SAFTA movement are becoming an opportunity as well as threat for the market. The easy processing and the start up with some good support...
References: Doing Business in Nepal: 2011 Country Commercial Guide for U.S. Companies
Gautam thaneshwor, An Exploratory Research Study on Nepalese General Business Environment, 2005
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