'Economy is at the critical juncture'

Kathmandu, Mar. 30: Finance Minister Dr. Yuba Raj Khatiwada said on Friday that the national economy was at a critical stage and the treasury was fast depleting. 

“The macroeconomic indicators are not positive, the informal economy is flourishing, economic activities have shrunk in the absence of a favourable investment climate, and public finance management is challenging due to the growing trend of non-budgetary expenditure,” he said while interacting with journalists at the Ministry of Finance following the issuance of the white paper on the current economic status of the country. 

He said that financial discipline was not followed by the past governments, and tax waiver was provided against the established system and norms. 

“Capital formation activities are sluggish, both on the public and private fronts. Execution of development projects is not satisfactory, and almost all such projects are witnessing time and cost over-runs,” he said.

In his ‘brutal’ assessment and presentation, Dr. Khatiwada said that it was a fair diagnosis of the national economy.  

While the nation is aspiring to graduate to the status of a developing nation from its current status of a ‘Least Developed Country’ by 2022, there is a huge gap in funding to meet the Sustainable Development Goals (SDGs). 

According to the National Planning Commission’s recent estimates, Nepal needs to invest Rs. 1.7 trillion year on average to achieve the 17 SDGs while the size of the current fiscal year’s budget is about Rs. 1 trillion. 

So the country has a challenge to board the private sector, which is supposed to invest about 60 per cent of the total SDG investment in the development process and create a linkage among the public, private and cooperative sectors to mobilise resources. 

Likewise, Nepal has long failed to execute development projects well, which resulted in poor capital expenditure. In the past several years, the average size of the development budget is 21 per cent of the total budget of each fiscal year, and only 72 per cent of the capital budget, on average, has been spent. 

According to the Finance Minister, there was problem in the fair distribution of the achieved economic growth, while more than two decades went in vain due to the armed conflict, prolonged political transition and policy uncertainty. 

He criticised the banks and financial institutions (BFIs) for the unfair competition of the interest rates. 

He said that the Nepali capital market was surficial and had a constrained base. 

“Though 208 companies are listed in the Nepal Stock Exchange (NEPSE), about 75 per cent of them are BFIs, and they contribute to 81 per cent of the trading of the securities in the stock market. The hydroelectricity sector has a 5 per cent share while manufacturing and hotel sector have only a 3 per cent and 2 per cent share respectively,” said Dr. Khatiwada. 

According to him, the NEPSE index was unstable due to the lack of institutional investors, shortage of liquidity, growing interest rate and supply of large number of shares. 

He expressed serious concern over the diminishing export trade. With the failure and collapse of export-oriented manufacturing industries, the import-export ratio has been continuously increasing.

The contribution of the manufacturing sector to the Gross Domestic Product (GDP) of the country has come down to 5 per cent from 14 per cent about a decade and half ago. 

Finance Minister Khatiwada pointed towards the need for a review of the privatisation modality since the privatised public enterprises have either been shut down or were contributing less revenue than when they were run by the government. 

“The government should run businesses in the non-profitable sectors that provide basic goods and services to the people and let the private sector run the profitable ventures,” he said. 

However, he said that the present government held tremendous opportunity due to a majority of the Left Alliance in the parliament and political stability, and could develop long-term development strategies and plans. 

Similarly, implementation of federalism and active and autonomous governments at the provincial and local levels would help identify new avenues of resources and set priorities for local development. 

“Likewise, the international community is interested in supporting Nepal in its development endeavours. In addition to that, we have an opportunity to exploit and harness the natural resources and develop in various sectors, including information technology,” said. Dr. Khatiwada. 

He stated that reforms in every economic sub-sector will begin at the earliest. 

Published in The Rising Nepal daily on 31 March 2018. 

Govt. mulls to create aviation hubs to ease flights to hills

Kathmandu, Mar. 29: The Ministry of Culture, Tourism and Civil Aviation (MoCTCA) is mulling developing a regional aviation hub to facilitate swift and reliable flight services to the hills and mountains across the country. 

Minister for Tourism Rabindra Adhikari indicated towards developing one airport in each of the provinces, except in Province 2, for this purpose. 

“There is a plan to operate flights with large aircraft from the capital city to the regional hubs and link the airports in the hills and mountains with those hubs,” he said while talking with journalists at his office in Singha Durbar on Thursday. 

In the past, flights to the hill areas were operated from the airports in the plains, such as Nepalgunj to Jumla, and Buddha Air recently started flight service on the Pokhara-Bharatpur and Pokhara-Nepalgunj routes while some mountain flights are operated from Pokhara. 

If the plan is implemented, it would lessen the burden on Tribhuvan International Airport (TIA), the only international airport of the country. 

The country urgently needs to ease the air traffic at the TIA as a large number of domestic and international aircraft have to be held in the sky while landing. 

Though the ministry is planning to expand the taxiway at the TIA, the expansion of the runway is no more possible. 

The plan to develop a second international airport (SIA) at Nijgadh of Bara district is still in a limbo as the government has not been able to spend the budget for the last couple of years, clearing a large number in the forest area and resettling about 1,400 families is still to be executed.  

Adhikari said that the government was reviewing alternative models of project development for the SIA. 

However, regional international airports at Bhairahawa and Pokhara are under construction.

“Currently, we can expand the taxiway and install modern air safety equipment at the TIA. In addition to that, it needs massive managerial reforms,” said the minister.

 He said that the national flag carrier, Nepal Airlines Corporation (NAC), immediately needed new aircraft and capacity enhancement. 

According to him, investment made on the aircraft is investment on tourism as it directly supports the movement of tourists. 

The Tourism Ministry is also planning to produce tourism promotion materials, including websites and other literature in Chinese and Hindi languages, in addition to the current Nepali and English, with an aim to attract more tourists from the immediate neighbours. 

Talking about the casinos that were evading their tax liability, he said that the government would show no leniency to such companies and would raise taxes from them at the earliest. 

Published in The Rising Nepal daily on 30 Mar. 2018. 

PM to address nation from Rara on April 14

Kathmandu, March 28:

Prime Minister KP Sharma Oli is set to address the nation from the magnificent Rara Lake in Mugu district on the New Nepali Year at the start of a tourism campaign.

 

PM Oli is scheduled to go to Rara to inaugurate the ‘Tourism Year 2075’ campaign initiated by Karnali Province on April 14, and he will use the occasion to address the nation. 

“I will be the first tourist in Karnali. The bugle of tourism will be blown from Rara,” he said while inaugurating the 7^th General Assembly of the General Federation of Nepalese Trade Unions (GEFONT) here. 

He said that the present government didn’t have the luxury to run the country as in the past, so it would be more active, quick and deliver the results within a couple of years so that the people can feel the change. 

According to him, the government is a servant at the service of the people, so it will not resort to coercive methods. But those who engage in extortion and threaten the society with violence would not be spared. 

“The government is there to serve the people. It will not suppress anyone, but those who disturb social coherence and peace will be punished accordingly,” said the PM. 

PM Oli appreciated GEFONT’s role in fighting for the rights of the workers, and uplifting their lives.

He said that the government would run every development and awareness campaign in an aggressive manner. 

“I will support the admission of the girl child in school and urge every elected representative across the country to do the same. I also ask GEFONT to be ready for the campaign,” he said. 

He said that the government would also launch a campaign against corruption and obstruction in development works. 

Published in The Rising Nepal daily on March 29, 2018. 

 

NRA plans to run retrofitting campaign for damaged houses in quake

Kathmandu, Mar. 27: The National Reconstruction Authority (NRA) said on Tuesday that it was planning to run a special campaign for retrofitting houses damaged by the devastating Gorkha Earthquake 2015.

It has decided to execute a separate campaign for retrofitting private houses that faced minor damage in the tremors but are fit to live in with general maintenance. It has concluded that though there had been significant progress in the reconstruction, retrofitting couldn’t catch the desired speed.

According to the statistics of the reconstruction body, about 24,991 houses in 32 districts are in the retrofitting list.

“Development partner organisations like the DFID, UNOPS and Build Change have agreed to support the NRA in the retrofitting initiative, and we have a plan to train 2,000 technicians and 12,000 masons within two years,” said the NRA.

About 1,000 quake-affected houses will be retrofitted during the training. While retrofitting by the trainees, houses of the deprived communities at risk, as identified by the local governments, will be given priority.

UNOPS has submitted the proposal of the retrofitting programme to the NRA. The Housing, Settlement Development and Local Infrastructure Division of the reconstruction body will study the proposal and send it to the Central Programme Implementation Unit at the Ministry of Urban Development (MoUD) within a week.

“Currently, the NRA, CPIL-MoUD, UNOPS, DFID and Build Change are developing a curriculum for the retrofitting training, and it will be finalised by the first week of April,” said Prakash Thapa, joint secretary of the Authority.

After preparing the curriculum, training will begin at four different locations.

Makwanpur, Kavrepalanchowk, Sindhuli, Ramechhap and Gorkha have the highest number of houses that need retrofitting while Myagdi, Nawalparasi, Arghakhanchi, Dhankuta and Baglung have less than 100 house each that need retrofitting.

Districts with high retrofitting needs

S.N.	District	Houses
1.	Makwanpur	4,152
2.	Kavrepalanchowk	2,415
3.	Sindhuli	2,408
4.	Ramechhap	2,149
5.	Gorkha	2,019
6.	Okhaldhunga	1,643
7.	Dhading	1,494
8.	Nuwakot	936
9.	Lalitpur	667
10.	Dolakha	637

Source: NRA

Published in The Rising Nepal daily on 28 March 2018. 

Renewable energy technology conference from Thursday

Kathmandu, Mar. 27: With the aim of creating resilience against climate change impact through maximum utilisation of renewable energy sources, the 5^th International Conference on Developments in Renewable Energy Technology 2018 is being organised in the capital.

The Kathmandu University (KU) School of Engineering (SOE) is organising the conference that is expected to witness the participation of more than 300 experts, scientists, policy makers and students from more than 25 countries.

It will be held from March 29 to 31.

The conference carries high importance because if combined together, renewable energy technology can be a very powerful technology that could replace all kinds of thermal power plants based on fossil fuels in a sustainable manner, said Prof. Dr. Ramesh Kumar Maskey, Head of the Department of Civil and Geomatics Engineering at KU.

Speaking at the press conference organised to inform about the event, he said that to live and prosper, people need energy that is clean and easily accessible while preserving the earth’s land, water and atmosphere. Renewable sources of energy provide the solution.

“We also need to lessen our dependency on fossil-based energy technologies, which are polluting our environment and threatening our climate due to green-house gas emission. Renewable sources, such as water, sun, biomass and wind are clean and abundantly available. The use of such energy requires technologies that are being designed, developed and deployed in a cost-effective and easy-to-operate principle in the society,” said Dr. Maskey.

He said that announcing Nepali calendar years 2075-2085 as an Energy Decade and 2075 as a Renewable Energy Year should be the main agenda of the conference.

The conference will be addressed by distinguished personalities, keynote speakers and other experts.

“Extensive side events and plenary sessions and interdisciplinary integrated sessions on top of the technical sessions during the two-and-half-day events will provide a cutting-edge forum for networking between stakeholders, academics, students, professions, industries and policy makers’ alike and build-up the commitment for the betterment of renewable energy technology,” he said.

The technical co-sponsorof the event is International Electrical and Electronics Engineers Power & Energy Society (IEEE PES).

Similarly, the KU is collaborating with National Planning Commission, Ministry of Finance, Ministry of Water and Energy, Ministry of Education, Science and Technology, Ministry of Population and Environment, Nepal Academy of Science and Technology, Alternative Energy Promotion Centre, Institute of Engineering of Tribhuvan University, and other national and international institutions to hold the conference. 

Published in The Rising Nepal daily on 28 March 2018. 

Chinese contracter to build Khimti-2 with its own investment

Kathmandu, Mar. 25: While the Nepali banking sector is facing liquidity crisis for the last couple of years, Peoples Energy Limited (PEL) is developing 48.8 megawatt Khimti-2 Hydroelectricity Project with Chinese investment as per the EPC (Engineering, Procurement and Construction) model without government guarantee.

This would be one of its kind projects as the company would pay only 10 per cent of the total project cost – $ 88 million as an advance, and the rest 90 per cent money would be paid within 700 days after the completion of construction and electricity generation.

Chongqing, China based Chongqing Water Turbine Works (CWTW) will operationalise civil, hydro-mechanical, electromechanical and transmission line development as per the ECP mode.

“PEL and CWTW have already signed the contract for the project. Until now, the foreign companies have been involved in project development only with the government guarantee but due to prestige of the RM Group, major investor in the company, the Chinese contractor has agreed to develop the project on its own,” said Krishna Acharya, Executive Chairman of PEL.

According to him, Khimti-2 is the largest hydropower project in the country being developed by the independent power producers.

“I am hopeful that it would also contribute in addressing the liquidity crisis in the banking sector to some extent,” he said.

Nepali people in the country and abroad, experts of from various sector, locals and organisations of the project area, cooperatives, and other companies have invested in the project.

RM Group is developing 15.4 MW Rudi Khola Hydropower and 20 MW Langtang Khola Hydropower.

The company has concluded the financial closure with the consortium of 10 banks led by Sanima Bank Limited.

Acharya said that the project will earn Rs. 14 million in the first year of its operation and the income will grow by 3 per cent per annum so the income in the ninth year would be 17.4 million.

It will start electricity generation from 14 July 2021.

The project has completed the hydrology study, detailed survey, geological study, physical modelling and drilling works while camping facilities are being constructed.

“Construction of the access road to audit tunnel and dam site is at the final stage, and land has been acquired,” said Acharya. 

Published in The Rising Nepal on 26 March 2018.