Entrepreneurship in Nepal: Opportunities and Challenges

February 16, 2020 | Dwaipayan Regmi

INTRODUCTION

1500 – 2200 fly abroad from Tribhuwan International Airport every day. It costs at least 50,000 to fly abroad per person; that makes (50,000×1500) 75 million of cash flow every day in the name of job opportunities. There is a dollar from this migration, but not the dream, decision, devotion, determination, details, distribution, dedication, and density.

“Entrepreneurship is the process of creating or seizing an opportunity and pursuing it regardless of the resources currently controlled.”-Timmons

Various researches indicate that 90% of the jobs are created by Entrepreneurs. Basically, for the least developed countries, entrepreneurship is the only means for upgrading, as the job opportunities are rare there. Entrepreneurship is not only required for job generation but plays a significant role in the country’s economic prosperity as well. It is through entrepreneurship, factors of production are coordinated.

It contributes to the generation of national income, dispersal of economic power, it balances regional development, makes use of resources available, innovates enterprise, brings improvement in living standards and develops the feeling of economic independence. Any country must have capital, one form of a factor of production, for boosting up business firms in a particular country. The government can purchase it, but it is through entrepreneurial activities these capitals are brought or generated in any country. Only if those 1500 – 2000 youths would work for their own country, the country would naturally be benefitted. Exports would increase, and they could sell their effort in the international market staying in their home country itself.

SUCCESS STORIES

The story of Dhirubhai began when he started to sell bhajiyas to pilgrims of Mount Girnar when because of the bad health of his father he went to Yemen. There he worked in trading and oil bunkering port and learned how to do business. He came back, with little money and started a business of importing polyester yarn and exporting spices to Yemen. There he started the first office at Narsintha Street in Masjid Bunder that was a 350 sqft room with a telephone, one table and three chairs. They initially started with two assistants to help them with their business.

He later joined hands with Amit Mehera and started the first textile mill in Ahmedabad in the year 1966. He started the brand ‘Vimal’, which was named after his elder brother’s son. Extensive marketing of this brand made the popular household textile name. In 1975, after World Bank visited the Reliance Textiles Manufacturing unit, they even got certified with excellence by developed country’s standard during that period. Ambani never had to look back into the darker days again. The story looks simple, interesting and beautiful; however, entrepreneurs are always loaded with challenges when they come into the practical aspect.

CHALLENGES AND SUPPORT TO ENTREPRENEURS IN NEPAL

There are various challenges that an entrepreneur will have to face. He needs to go through the burden of cash flow management. The tough task of employee selection is to be faced by an entrepreneur because if the wrong employee gets in, the distance of the organizational goal gets further. Time management is the next important issue that entrepreneurs should always focus upon. Delegation of authority, marketing strategy, generation of capital, bureaucracy model of working troubles the entrepreneurs indeed. And out of all, there exist regulatory hurdles that trouble entrepreneurs a lot. The laws are written in a beautiful piece of paper, probably with some beautiful pen and in a beautiful manner.

“China and India are the best examples that we can trace where entrepreneurship has brought revolutionary changes in terms of economic factors and economic development.”

ARE THE LAWS SUPPORTIVE?

Company Act 2063 in Nepal explains that application for incorporation of a company under Section 4, the office shall after making necessary inquiries, register such company within 15 days after the date of making the application and grant the registration certificate to the applicant in the format prescribed. The general cases for the rejection here are usually when the name appears as duplication, and when the objectives of the company are unreasonable. Industries Enterprises Act 2049 explains that Cottage and small scale industries are to be registered in the department of the cottage and small scale industry or any office designated by the department on its behalf, while, medium and large scale industry is to be registered at department of industries designated by the department on its behalf. The certificate will then be provided within 21 days of the application submitted. There is various beautiful structure mentioned in the acts.

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Now if you want to open up TU affiliated BBA or MBA private college, it is a tough task for you. Despite these already mentioned laws; one has to pass through Tribhuvan University’s guidelines. This will then restrict you, from opening a new college. If you now think of investing somewhere else in A-class commercial bank, you will not be permitted because of the decision about several A-Class Banks in Nepal. Fine, now you decide to leave the idea of college and bank and think of something simple. You plan to run a public bus from Old Bus Park to Dakshinkali. You won’t get the permit for this as well. The Company Act and Industry Act are so simple to go through, but when one has to do start up a new venture, he will have to face lots
of problems as such.

POSSIBLE VENTURES IN NEPAL

There are several possible ventures likely to succeed here. Shankar Uprety’s Hamro Patro is already a super success. There are success stories of other new ventures – Urban Girl, Leaf Plus or Tootle. However, more than support, there are obstacles gifted to them by the state. 2076/77 Fiscal Policy seems to be somewhere supportive, but they need support more than that. Not unless the Government supports entrepreneurship within the nation, the glow would be highlighted. Acts, policies, and regulations are important – but let them not kill these ventures which would help the economy gradually.

CONCLUSION

There are scopes all across. Entrepreneurship is one important element that counts for the development as a whole. It is important that entrepreneurship should be promoted for economic progress. Educational institutions should motivate and promote budding and aspiring entrepreneurs. Laws should be supportive and there should be a favorable environment that should be created by the state.