Government has given high priority to private sector, PM Shah reaffirms

Kathmandu: Prime Minister Balendra Shah has assured hotel entrepreneurs that the government is working swiftly to promote Nepal’s tourism industry and urged them not to be discouraged.

During a meeting with officials of the Hotel Association Nepal (HAN) at the Office of the Prime Minister and Council of Ministers in Singha Durbar on Wednesday, PM Shah said the government has placed the private sector at the center of its economic agenda and called on businesses to work closely with the government as development partners.

He urged entrepreneurs to comply with existing laws and fulfill their business responsibilities. The Prime Minister also encouraged small and medium-sized hotels to register with the Department of Tourism, come within the tax system, and explore opportunities for collaboration under the public-private partnership (PPP) model.

During the meeting, attended by Minister for Culture, Tourism and Civil Aviation Khadak Raj Paudel, HAN officials said Nepal’s hotel industry has the capacity to accommodate up to four million tourists annually.

They noted that Nepal currently receives around 1.2 million tourists each year and said increasing tourist arrivals would create jobs, strengthen the hotel industry, and help reduce the outflow of young Nepalis seeking employment abroad.

The association also highlighted Nepal’s potential to grow as a destination for health tourism, wedding tourism, and cross-border tourism, while presenting several policy recommendations to the government.

Among their key demands, HAN urged the government to provide the hotel sector with the same electricity tariff concessions available to manufacturing industries. It also requested that the threshold for requiring a Brief Environmental Impact Assessment (BEIA) for small and medium hotels be increased from 25 beds to 50 beds, arguing that the current provision is impractical.

The association further called for the full operation of Pokhara and Bhairahawa international airports, improved services by Nepal Airlines, and amendments to the Foreign Investment and Technology Transfer Act, 2018.

Specifically, HAN sought a revision of the provision that caps trademark royalty payments under technology transfer agreements at five percent of total sales (excluding applicable taxes), proposing that royalty rates instead be determined through mutual agreement between the parties. It also urged the government to review and amend other laws affecting the hotel industry.

The entrepreneurs further requested simplified procedures for bringing jewellery into Nepal for wedding events to support the country’s promotion as a wedding destination. They also called for broader promotion of medical tourism through comprehensive treatment packages that include full storytelling and professional content production, rather than limiting promotional activities to a single photo or video session.

HAN Acting Chairman Dinesh Tuladhar, General Secretary Sajan Shakya, Treasurer Yuvraj Shrestha, executive members Jayadin Shrestha and Ashlesha Karki, and Secretariat Chief Tek Bahadur Mahat were present at the meeting.