FDI in Herbs, Cosmetic, Natural and Cosmetology industries in Nepal

10 Reasons to Invest in Nepal’s Herb-Related Cosmetics, Natural Cosmetics, and Cosmetology Industry

Foreign Direct investment in the herbal cosmetics industry

Natural components are currently being employed in the cosmetics industry to generate products that are in high demand on the global market. Herbs of many kinds thrive in Nepal. Mountains, hills, and terai make up Nepal, and it has a huge amount of potential for still-valuable herbs. Cosmetics are products that clean, beautify, and enhance the appearance of the human body while leaving its structure and function unchanged. Natural cosmetics, also referred to as herbal cosmetics, are a form of cosmetic.

 Herbal cosmetics are created by layering one or more herbal substances on top of a base of approved cosmetic materials. Rather than importing chemicals, it involves creating molecules from locally accessible plants.

Women in Rome, for example, were not considered beautiful if they did not wear cosmetics, causing cosmetics prices to skyrocket. This was the start of the beauty industry’s evolution.

Cosmetics were given a higher priority in Japan, with aristocratic ladies being forbidden to leave their homes without applying cosmetics to their entire bodies. For a multitude of reasons, including the fact that they were costly, poor people would not use them.

They couldn’t use cosmetics because it was against the regulations. The herbs of Nepal are used in foundation and mascara, skincare such as moisturisers and cleansers, hair care such as shampoos, conditioners and hair colour, and toiletries such as bubble baths  can be prepared.In the cosmetology industry, sometimes known as the beauty industry, traditional medicinal plants are used to make products.

The following are the reasons for foreign investment in the cosmetology industry.

1.Boundless supply of aromatic plants (MAPs)

Plants that are grown for their aroma and flavor are known as aromatic plants. The pharmaceutical sector relies heavily on aromatic herbs, essential oils, and scent compounds. The root, wood, bark, leaves, flower, fruit, seed, and other sections of the plant contain aromatic compounds.

690 species of flowering plants have been identified as having therapeutic potential in Nepal (HMGN 2002). There are 510 species found in Nepal’s wild, 120 species under cultivation or that have become naturalized, and 60 foreign species.

A group of botanists and other specialists manage the Therapeutic & Aromatic Plant Database of Nepal (MAPDON), which classifies 1624 plant species as having medicinal characteristics. As a result, Nepal produces cosmetics manufactured from traditional medicinal plants.

2.Ethnobotany expertise

Ethnobotany is the study of plants in a specific location, as well as their practical applications based on local culture and expertise. Ethnobotany is the study of plants used by people in diverse places of the world. In Nepal, it is also known as Ayurveda tradition.

For three thousand to fifty years, Ayurveda has been practiced in Nepal. Longevity, physical and mental health, and any information based on ayurveda are all examples of ayurvedic knowledge. Foreigners can benefit from our experience in the cosmetics industry.

3. There is an increase in the number of flowering plants.

Flowering plants are commonly used in the cosmetics business. Despite accounting for only 0.1 percent of the world’s surface area, Nepal contains a considerable amount of the world’s biological diversity. Nepal is home to 2% of all the world’s flowering flora.

 Nepal is home to a variety of flowering plants, including Aloe Vera.This plant is most known for its medicinal properties, which are commonly used in the pharmaceutical industry.

Roses are not only lovely flowers with a wide variety of species, but they’re also a popular natural cosmetic. Rose oil from Nepalese roses is strong in vitamin C and has good hydrating effects. 

3. Calendula

Calendula has a reputation for reducing redness and promoting skin healing. Calendula is a common ingredient in cosmetics.

4. Lavender

Lavender oil, namely lavender oil, is applied to the skin to hydrate it. It has a nice odor and is excellent for a wide range of scented items, including fragrances, bath and body care products.

5. Jojoba

Because the oil extracted from the plant contains qualities similar to the sebum generated by human skin, jojoba is extensively utilized in face creams. It also adds suppleness and hydration to the skin, making it ideal for persons with sensitive or dry skin.

6. Tea tree

One of the most often utilized components in acne and acne-prone skin treatments is tea tree oil. It’s widely regarded as one of the most effective natural alternatives to skin-irritating chemicals.

7. Chamomile

Chamomile is used in natural cosmetics for its anti-inflammatory, antibacterial, decongestant, disinfecting, analgesic, emollient, and healing effects. Chamomile flowers or the aerial area of the plant are used to make a variety of cosmetic treatments for the skin, neck, hands, hair, and feet, depending on how they are used.

 8. Geranium

Geranium is a common ornamental plant that is also used in cosmetics as an oil. Geranium oil is cleansing and toning, making it great for greasy, acne-prone, or eczema-prone skin.

 9. Basil

Basil is a beauty ingredient as well as a medical plant. It’s found in acne treatments, hair care products, perfumes, and a wide range of cream and body care products.

10.  Rosemary

Antifungal, anti-inflammatory, antioxidant, and antibacterial properties are all found in rosemary. It effectively heals alopecia by encouraging hair development and also functions as a balm, renewing and improving the appearance of hair. The tonic and hydrating characteristics of rosemary oil make it ideal for treating acne-prone skin and reducing small wrinkles.

11.Environmentally friendly

People are well aware of their medical issues. Natural herbs have fewer or no negative effects than pharmaceuticals, and they can even be grown in your own backyard or kitchen garden. These herbal components have been used to make a variety of formulations in order to conduct pharmacological tests and evaluate cosmetic properties.

 Ethanobotanical and ethanopharmacological research could lead to the discovery of new skin care and medicinal plants, as well as lead compounds. This type of business is good for the environment. It is beneficial to everyone.

13. A cost-effective and environmentally sustainable tax exemption for the cosmetics business.

The Nepalese government is subsidizing the eco-friendly cosmetics industry with tax benefits. In order to operate such facilities, foreigners should bring in equipment capable of performing cosmetic product research, and the equipment brought into the country is subject to tax benefits.

14. Encourage people to take part in research.

In order to attract foreign investment, the Nepalese government will assist in doing research into the manufacturing of herbal cosmetics. The Nepalese government plans to fund and expand research in Nepal’s current Ayurvedic hospitals and research centers.

15.Permission from the Department of Drug Authority (DDA) and the Department of Ayurvedic Medicine

The first step in establishing a herbal cosmetics company in Nepal with foreign investment is to obtain a license from the Department of Drug Authority (DDA) and the Department of Ayurvedic Department.

16. Cosmetology experience is desirable. Cosmetology necessitates the acquisition of specific abilities.

Going to school can teach you how to make people’s hair, skin, and nails look great. In ancient Nepalese scriptures, there are allusions to herbs. If assessed differently and foreign money is brought in, cosmetology may look to be a fantastic field to enter.

17. Profitable margins

The secrets of healing substances can be found in natural substances or herbal plants. In this example, cosmetology businesses sell hair care products and other products with higher profit margins, such as shampoo. In such industries, foreign investment is extremely helpful.

18.  An atmosphere conducive to investment

Provisions in the Foreign Investment and Technology Transfer Act of 2019 encourage foreign investment. A corporation seeking to invest can submit a land acquisition request to the government, which can assist them.

Similarly, the Maosit insurgent difficulties were resolved after the peace agreement was signed. Now that the country is achieving political stability, It is appropriate to bring in foreign investment into the country in such a situation.


Foreign investment in the herbal cosmetics industry is now permitted in Nepal. If you are interested in bringing foreign investment into the country, please call at +977-9745374671 or by email: info@corporatelawyernepal.com for legal assistance.

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