Towards an improved business environment:

How the Business Promotion Centre is encouraging investments and entrepreneurship in Pokhara

By Shambhavi Basnet

Background

The Business Promotion Centre (BPC) was ideated by the Pokhara Metropolitan City (PMC) with the aim to promote business environment, jointly with the local private sector to solve issues related to enterprise and business development, and to access financial services, grants and rebates provided by various levels of government.

BPC would act as a service centre (a “one-stop solution”) with the required resources and skilled workforce, having good knowhow and updates on business-related policies, programs, planning, budgeting, registration and approval process, as well as eligibility criteria for the targeted and subsidised schemes.

 

NURP, after coming into operation in 2019, has been supporting PMC to promote inclusive local economic development, green urban development, good governance and institutional growth. The support provided to the BPC by NURP falls under the intervention of improving business environment and partnerships and implementing Inclusive Local Economic Development Strategy & Action Plan (ILEDS&AP) prepared for PMC.

 

The BPC will support aspiring entrepreneurs to smoothly move ahead with the business establishment process and necessary documentation. It will act as a trusted service point for aspiring entrepreneurs, youth and women to obtain necessary information on business/company registration and certification, business proposal and documentation, as well as the standard procedures/steps. This is expected to minimise unproductive transaction costs and motivate the aspiring entrepreneurs to contribute to building a diverse and inclusive local economy. The BPC is also expected to strengthen partnership between the municipality and the private sector to improve business environment and attract green investment in Pokhara. The Centre will facilitate easy access for the Micro/cottage, Small and Medium Enterprises (MSMEs) to finance from the financial institutions, especially the targeted and subsidised schemes for grants, subsidies and interest/tax rebates.

 

In terms of aligning with Green, Resilient and Inclusive Development (GRID) goals, the BPC will contribute to support PMC in preparing immediate policy, strategy and action plans to help mitigate the adverse impacts of traditional fossil fuel-based business/development practices, adapting to innovative technologies, recovering from existing damages and minimising risks and vulnerabilities. It will help to improve enabling business environment with a focus on GRID, attract green investments for green growth, and provide a platform for aspiring and existing entrepreneurs to access opportunities, thereby increasing inclusion and resilience. Likewise, BPC will function as a Public-Private Partnership (PPP) Centre whereby it will bring together sectoral stakeholders to improve policy dialogue on productivity enhancement, labour skilling, technology transfer, and related framework conditions related to enterprise creation.  

The signing of MoU among NURP, PMC and PCCI in August 2022.

Launch of BPC and various activities

At various stages, NURP has facilitated the ideation, structuring, and formation of BPC via technical assistance. A Memorandum of Understanding was signed between NURP, PMC and Pokhara Chamber of Commerce and Industry (PCCI) to establish the BPC. The process of setting up the BPC started with a wider consultation workshop with key stakeholders – PMC division chiefs, representatives from provincial office of industry, Pokhara Chamber of Commerce & Industry (PCCI), Federation of Woman Entrepreneurs’ Associations of Nepal (FWEAN) and experts from development partners such as United Nations Development Program (UNDP). This workshop built the base ground on collective inputs from these stakeholders on agreeing on BPC’s legal status, organizational structure, and other important information needed for the development of BPC’s operational guidelines. 

 

The operational guidelines was eventually approved by PMC, which paved the way for the endorsement and operationalisation of BPC.

 

After its launch, BPC started to provide business development services to entrepreneurs in Pokhara. Twenty-four innovative businesses received a grant of NRs. 50,000 and a day orientation on entrepreneurship and scaling under UNDP’s Enterprise and Business Incubation Centre (EBIC) program. BPC also collaborated with the cooperative and industry section of PMC to provide grant support up to 50% (NRs. 25000) for ten local producers. BPC delivered few activities such as a 15-day doll making and designing training to 25 participants and plans to develop a syllabus for gold and silversmithing artists and designers which will be recognised through Council for Technical Education and Vocational Training (CTEVT) Nepal. BPC has also announced to conduct a Business Feasibility Study for all ward levels at PMC, aimed at improving economic development.

 

In the past year, NURP provided support in the development of a robust strategic action plan for BPC. The strategic action plan entails a detailed action plan, MEAL plan and GESI mainstreaming strategies. Additionally, a sectoral plan based on the municipality’s priorities was also developed to supplement the action plan. Through a wider consultation, the stakeholders provided solution-oriented feedback regarding BPC’s role in productivity enhancement, easing barriers to doing business, supporting MSMEs and upskilling. The main goal of this strategic action plan is to guide the plans, programs and activities to be formulated in the fields of policy, institutional and procedural reforms, studies and research in cooperation between PMC and the private sector. This action plan will make a significant contribution to strengthening the partnership between the municipality and the private sector in terms of advancing the proposed programs and implementing complementary activities.

 

NURP, in the past year, also supported in developing a toolkit on concessional loans to demystify the local application process for aspiring entrepreneurs in PMC. This toolkit will provide information on various alternative financial instruments available in the market to small and medium entrepreneurs of Pokhara Metropolitan City and other municipalities as well. It is also a tool to increase access to interest rate subsidies and subsidized loans available from the government. The main purpose of this toolkit is to facilitate new entrepreneurs who want to start a business in PMC and who want to expand or upgrade their business to gain access to the financial instruments available in the market.

 

Both these documents were officially handed over to the PMC and BPC for future application.

Left: Concessional Loan Toolkit. Right: Strategic Action Plan of the BPC.

Current programs and the future of BPC

BPC recently organised a Public Interaction Programme featuring sector-specific discussions on building an enabling business environment in Pokhara. The 4-day event involved both public and private sectors, experts who discussed the recently released municipal policy, programme and budget of Fiscal Year (FY) 2080/81 B.S., job prospects in the specified sectors, existing issues in building an enabling business environment in Pokhara and possible solutions/actionable way forward.

During the event, NURP supported to disseminate the BPC Strategic Action Plan and Concessional Loan Toolkit to all the four sector-specific practitioners.

 

NURP’s support for the Business Promotion Centre (BPC) in PMC has resulted in significant progress. The municipal policy, programme, and budget document for FY 2080/81 B.S. have prioritised various BPC initiatives with a total budget of NRs. 20 million. This includes the Business Development Programme, Pokhara Job Fair, Youth Entrepreneurship Development Programme, and Skill-Related Capacity Building Programme. The policy document emphasises the promotion of investment in skills and technology to attract entrepreneurship development and business operations through the “Municipality with youth” campaign. Additionally, it addresses the provision of subsidised loans in collaboration with the Youth Self-Employment Fund to support young and small entrepreneurs in their start-up ventures. The municipality has also committed to operationalise the “Idea Mart” as a platform to promote start-up businesses by encouraging ideal thoughts and youth entrepreneurship. 

 

NURP will contribute to support BPC in carrying out activities such as organising private consultations and public-private dialogue forums.

A Public Interaction Program held by BPC in July 2023.

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