Role of Foreign Direct Investment in Hydropower development of Nepal

B.Sc. Kamala Nepal

Master's thesis

Abstract:

Nepal has immense potential for hydropower generation and the sector is getting higher FDI than any other sector in the economy. Because of the rising demand for energy consumption, for more than a decade the country was in an energy crisis. However, with time Nepal is increasing its hydropower generation through the FDI and local funds. Also, the country has decreased its power import from India in recent years by improving its quality and decreasing electricity leakage problems. In a case of a least developed country like Nepal, it’s not possible to do the self-funding and thus FDI plays a key role in the development of bigger projects. Nepal receives FDI from the various countries in the world, China and India are the highest investing countries in Nepal. This research aims to highlight the current state and prospects of the power and energy sector of Nepal, the policy related to FDI, and empirical analysis of the casualty among the economic growth, energy and electricity consumption, and FDI in the power and energy sector of Nepal for the periods 1999-2018. The cointegration test and Granger causality tests were applied to find the relationship among the variable in the short-run and long-run. And the Granger causality shows conflicting results that the variables didn’t have any relationship in short-run, as well as long-run, multiple regression model with the usual ordinary least square method, has been examined to see how FDI, Electricity Consumption per capita and Energy Consumption affect the economic growth of the country. And the results confirmed variables are statistically significant excepts for electricity consumption per capita.

Keywords

Nepal, Foreign Direct Investment, Least Developed Country, Hydropower Development, Hydropower Generation, Renewable energy, Power Trade, Law and Regulations, Power Trade Agreement, Project Development Agreement, India, China

Jazyk práce: English

Datum vytvoření / odevzdání či podání práce: 30. 11. 2020

Obhajoba závěrečné práce

• Vedúci: Ing. Pavel Kotyza, Ph.D.

Czech University of Life Sciences Prague

Faculty of Economics and Management

Master programme / odbor:
Economics and Management / Economics and Management