Money

Infra sector gains priority; energy projects get Rs62.5b

- BIBEK SUBEDI, Kathmandu

May 30, 2017-

The government has rolled out an ambitious annual budget, putting strong emphasis on development of hydroelectricity and other infrastructure projects. The government has allocated adequate funds for the development of various national pride projects.

The government has allocated resources for projects like Kathmandu-Nijgadh Expressway, Postal Highway, Budhigandaki Hydroelectric Project, Gautam Buddha International Airport, Pokhara International Airport, Second International Airport in Nijgadh, Melamchi Drinking Water project, Nagdhunga Tunnel Projects and irrigation projects in the Tarai, among others.

Deputy Prime Minister and Finance Minister, Krishna Bahadur Mahara presented the annual budget for the fiscal year 2017-18 at the parliament, on Monday. The budget focuses on the development of the energy sector, allocating Rs 62.47 billion to implement various hydro and transmission line projects.

The much touted 1200 MW Budhigandaki Hydroelectric Project was the highest recipient of the fund as the government has allocated Rs 10.17 billion to meet the operation cost and acquire private land for the development of the project. Likewise,

Rs 500 million has been allocated for 456 MW Upper Tamakoshi Hydropower Project which will be connected to the national grid by the end of the next fiscal year.

Similarly, the government has promised to allocate adequate funds to kick start strategic hydropower projects like Nalsing Gadh, Bher-1, Uttar Ganga, Naumure, Dudh Koshi and Tamor among others. Considering the peaking demand of electricity, according to Mahara, the government will conduct a feasibility study of the pump storage hydropower project.

Experts, however, criticised that the government allocation for the energy sector was still too low considering its plan to develop 17000 MW of hydroelectricity in seven years. “It clearly indicates a mismatch between what the government plans to do and how much it has allocated for it,” said Yub Raj Khatiwada, former vice president of the National Planning Commission. He also criticised the Energy Ministry’s tendency of demanding a huge fund but not spending it. Apart from the development of the hydropower project, the budget has given due attention to construction and upgradation of the transmission lines and substations to

evacuate and distribute the electricity generated from the domestic hydropower project.

The budget plans to prepare and implement a work plan to develop transmission lines under public private partnership. In a bid to run Dhalkebar-Muzaffarpur cross-border transmission line at optimal capacity, the government plans to upgrade the substation at Dhalkebar to 400 KVA. It also plans to upgrade the Hetauda-Dhalkebar-Duhabi transmission line to 400 kv and complete its construction within two years. Likewise, the budget plans to begin the construction of 400 kv Butwal-Gorakhpur cross-border transmission line in the coming fiscal year.

Mahara has allocated adequate funds for other infrastructure projects with Kathmandu-Nijgadh Expressway bagging Rs 10.14 billion in the coming fiscal year. Similarly, the government plans to complete the 518 km long first phase of Postal Highway within two years and has allocated Rs 4.27 billion for the purpose. Also, Mahara has promised to allocate resources to complete the detailed project report of the second phase of the highway.

Although the government has put strong emphasis on  infrastructural development and has allocated enough funds, experts have expressed doubt over its ability to implement its promises given its pervious track record. “Implementation would be a huge challenge for government as there has been no substantial change in

spending process and advance preparation in case of large infrastructural projects,” said economist Chandan Sapkota. “Also two more rounds of elections slated to be held in the coming fiscal year will affect the project development.” Former Finance Secretary Rameshwor Khanal, however, appreciated the annual budget and said it has rightly prioritised infrastructural development and allocated adequate funds for it.

Published: 30-05-2017 09:02

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