The Nepali Government has made it mandatory for investors setting up two wheeler assembly plants in the Asian country to ensure certain domestic value addition, employment and environmental standards.
A number of assembly plants, mostly electric vehicle plants with Chinese investment, have been registered, according to the Department of Industry.
As per a notice issued by the department on Tuesday, a motorcycle assembly plant must ensure a domestic value addition of at least 10 per cent in the first year and at least 30 per cent within five years.
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A two wheeler plant also needed to create at least 50 jobs in the first year and at least 200 jobs within five years, and ensures the use of 10 per cent domestic materials in vehicle assembly within five years.
“An examination in regard to environment and safety standards will be done by a committee involving relevant stakeholder agencies such as the Department of Environment, Department of Transport Management and Department of Industry,’’ the notice said. “We set the conditions as per the authority given to us by the law.
“The logic behind these conditions is that Nepal should benefit from vehicle assembly plants set up in Nepal in the areas of domestic value addition and employment after the government provides various tax exemptions for such plants,’’ Jiblal Bhusal, Director General, Department of Industry said.
He added that his agency was also setting up standards for four wheeler plants now.
“The conditions will be more or less the same,’’ he explained. For now, Nepal fully relied on imported vehicles, particularly those from India.
As its market was growing, Nepal was attracting more foreign investors, including those from its northern neighbour that has registered at least 20 electric vehicle plants in the South Asian country since 2015, according to the Department of Industry.
