If you’re planning to invest in Nepal, knowing which sectors are off-limits — or have ownership caps — is the first thing to get right. Nepal’s Foreign Investment and Technology Transfer Act (FITTA) 2019 defines a negative list of industries where foreign investment is either fully restricted or limited to a maximum equity percentage. Getting this wrong at the structuring stage can derail an entire investment.
Note that while foreign investment is restricted in these industries, technology transfer may still be done with the approval of the Department in any of these sectors, provided the industry is established with Nepali investment.
Fully restricted industries
The following industries are completely barred from foreign investment under the FITTA schedule.
| # | Industry / Business |
|---|---|
| 1 | Animal husbandry, fish farming, beekeeping, fruits, vegetables, oilseeds, pulses, dairy business, and medium industries related to primary agricultural products that export at least seventy-five percent of their own production, and other industries or businesses in these sectors except agricultural technology and mechanization. |
| 2 | Small and cottage industries. |
| 3 | Personal service businesses (such as hair cutting, tailoring, driving, etc.) |
| 4 | Industries producing arms, ammunition, bullets, gunpowder or explosives, as well as nuclear, biological and chemical (NBC) weapons; industries producing atomic energy and radioactive materials. |
| 5 | Real estate buying and selling business (except construction industry), retail trade, domestic courier service, local catering service, money changer, remittance service. |
| 6 | Travel agencies involved in tourism, tour guides, trekking and mountaineering guides, rural tourism including homestays. |
| 7 | Mass communication media businesses (newspapers, radio, television and online news), national language film business. |
| 8 | Management, accounting, engineering, legal consultancy services, language training, music training, computer training. |
Industries with foreign investment caps
The following industries permit foreign investment but only up to a specified equity limit. Investment beyond these caps is not allowed.
| # | Industry / Business | Maximum foreign equity allowed |
|---|---|---|
| 9 | Consultancy services | Up to 51% |
| 10 | Ride-sharing | Up to 70% |
| 11a | International air service | Up to 80% |
| 11b | Domestic air service | Up to 49% |
| 11c | Aviation training institutions | Up to 95% |
| 11d | Aviation maintenance institutions | Up to 95% |
Nepal’s negative list is relatively contained — the majority of sectors remain open to foreign investment, including manufacturing, energy, technology, financial services, and hospitality. Understanding where the restrictions and caps apply is the starting point; structuring your investment correctly within those boundaries is what determines whether your entry into Nepal is smooth or complicated.
If you are considering investing in Nepal and want clarity on which structure works for your sector, you can go through this guide.
If you’d like expert guidance on your specific investment, SACA can help — from initial eligibility assessment through to DOI approval, company registration, and ongoing compliance.
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