Nepal has undergone several changes over the years, from political amendments, the Maoist insurgency, the Royal Massacre, economic developments and the formation of a new constitution. While these created a lot of unsettling situations in the country, they have, over time, also tailored Nepal into a nation full of opportunities to grow and learn from the mistakes made in the past.
In Venture Talk with Shekhar Golchha organized by Next Venture Corp on Thursday, June 7th, Mr. Golchha shared, including several of his own, and his company’s examples, how these changes have moulded Nepal into an ideal shape for businesses to launch and take off.
Four significant changes of the past 25 years, that shaped Nepal into an entrepreneur’s paradise:
A surge in national remittance:
Mr. Golchha described increased foreign employment to be the most significant and impactful economic activity in Nepal. An outflow of domestic labour to foreign countries generated remittance, which reached as high as 600 to 700 million dollars per month. This unambiguously increased the per-capita income, and as a result, helped with poverty alleviation. A higher disposable income for several families meant a growth in consumption, and according to Mr. Golchha, revenue in the market of consumers goods in Nepal has risen by 30 percent per year in average, opening up opportunities to start businesses.
A stable inflation rate of 4 to 5 percent, a stable currency value, a mean age of only 23.5 for the working population, and an increase in the capacity to leverage collectively give our country a head-start towards an ideal economic environment, where investors and entrepreneurs could potentially track down several opportunities to invest.
Living in the world’s most economically active zone
Nepal is conveniently situated between India and China–the two fastest-growing economies. With such a high level of economic activity surrounding it, there’s an endless supply of opportunities for startups to grow internationally.
As an avid traveler, Mr. Golchha believes that in terms of climatic conditions, landscapes, scenery and soil conditions, there is no country as ideal as Nepal. We are rich with natural resources that are being either underused, and this opens up a sea of opportunities in commercial agriculture and tourism.
Breaking down opportunities sector-by-sector
As overemphasized as it may seem, agriculture, tourism, and industries in Nepal really have the potential to take off and become the backbone of the Nepali economy. Mr. Golchha said that he realizes, keeping in mind the troubles faced by Nepali workers abroad, that only depending on national remittance is not right, and creating jobs domestically is important. A country with cultural diversity and natural beauty, an effort to market what we have to offer to the world would attract several more tourists than we have coming into the country right now. Similarly, reforms in agriculture, such as bee farming, animal husbandry, organic farming, fish farming, instead of just traditional agriculture can enable income to go up. Lastly, the industrial sector of Nepal–the automotive industry, electronic market and FMCG industry has seen 15 to 20 percent growth each year. The market has a lot to offer–it is only a matter of entrepreneurs tracking down opportunities for themselves, and moving towards the growth of their business.
Challenges we’re still facing
While the political climate is stable, problems because of load shedding have reduced, and labor relations have improved, Nepal is still not completely challenge-free. The most prevalent challenges, according to Mr. Golchha are the challenges surrounding infrastructure. We have an influx of 100,000 tourists, yet, airport delays, air traffic, parking holds and landing holds are still a problem. A country with such a huge prospect in tourism should be able to overcome challenges like these.
Similarly, creating a business-friendly atmosphere with foreign investment laws, laws to eliminate the black market, and so on has also been something our country has been lagging behind on.
Lastly, Mr. Golchha emphasized that the notion that businesses charging higher prices for their products equals to socially non-optimal business models is wrong. Businesses should charge what the product is fit to be valued at because if it isn’t, workers behind the product will not be paid sufficiently for the effort they have put into it.
Mr. Golchha used his grandfather, as an example, who started empty-handed, from a hut in Dewangunj, and dreamed of establishing Nepal’s first jute factory. At that time, there were no industrial laws, and he had to talk to government officials of the Rana regime to issue the first license to start an industry in Nepal. Today, Golchha Organization has created job opportunities for over 17 thousand workers. If starting a business in an environment without business regulations, industries or licenses was possible, Mr. Golchha emphasized that it is certainly doable in today’s economic conditions of Nepal. He concluded with two keys to his and his company’s success–perseverance and humility, which, paired with the current social, political and economic conditions, will help entrepreneurs take their businesses to new heights.
By: Falguni Basnet