Nepal must restructure economy to revive private investment: FNCCI president

KATHMANDU: Federation of Nepalese Chambers of Commerce and Industry (FNCCI) President Anjan Shrestha has said the time has come to restructure the economy, emphasising that structural changes are necessary to address the current lack of economic momentum.

Speaking at the inauguration of NADA Auto Show 2026 in Kathmandu on Tuesday, Shrestha said economic prosperity remains unattainable until private sector investment is secured and a supportive business environment is created.

"Overall demand has not been able to rise, and it is difficult to operate industries and businesses, and entrepreneurs are in a tough situation. Business morale is at its lowest point in history," he said, adding, "Based on my 36 years of career experience, I consider the current state to be the weakest ever. The economy is in a challenging state, and the market remains sluggish. The new government has not been able to work in practice according to its budget commitments."

Shrestha called for state protection to support the establishment of domestic automobile manufacturing aimed at import substitution. He said that, despite some facilities opening, industrial development has faltered because the government has failed to pay attention to and understand the problems confronting industrialists and entrepreneurs.

He said the government’s announced budget commitments — to revive the economy, raise per capita income to $3,000 within five to seven years, build a US$100 billion economy, and generate 1.2 million jobs — have not progressed and that no corresponding strategies have been introduced.

Presenting figures for the automobile sector, Shrestha noted that imports reached Rs 106 billion in the last fiscal year, generating Rs 81 billion in state revenue. He voiced frustration that, despite generating such substantial revenue, the state's outlook towards the sector remains unclear and suggested the government should prioritise an industry that contributes 81 billion rupees of the total revenue of Rs 1.2 trillion.

Commenting on the government's enthusiasm for reopening long-closed factories, the FNCCI President Shrestha said officials attempting to revive enterprises closed for decades have paid no attention to the condition of businesses currently operating. He said the government remains silent regarding the difficulties facing the automotive industry and urged authorities to understand and resolve the issues confronting industrialists.