Middle path proposed to end IBN-ministries ownership row

- POST REPORT, Kathmandu
Middle path proposed to end IBN-ministries ownership row

Apr 23, 2014-

A long-standing turf war between the Investment Board Nepal (IBN) and line ministries over the ownership of mega projects could find an amicable solution. An IBN board meeting on Wednesday discussed a middle path to give a fair share to both IBN and the ministries concerned. As per the new proposal, IBN will handle the mega projects until their financial closure, and then the ministries will take them over. “There was a broad understanding in this line, but we have yet to take a decision,” said a senior government official attending the meeting.

Ever since the IBN was formed and was handed over 14 projects, the line ministries that used to handle infrastructure projects were not keen to let the IBN run the show. The ministries have been questioning IBN’s capability, saying it doesn’t have the expertise and human resources to handle mega projects.

An IBN board meeting on May 26, 2012, had decided to entrust IBN with the job of developing 14 national pride projects, including five hydropower and seven infrastructure projects.

But the IBN-ministries ownership row continued with senior officials at Energy Ministry, Tourism Ministry and Physical Infrastructure and Transport Ministry raising the issue time and again.

This debate is seen especially in Kathmandu-Tarai Fast Track, Tribhuwan International Airport upgradation, Second International Airport and hydropower projects above 500MW capacity.

The National Planning Commission’s decision to transfer the Fast Track project to the Ministry of Physical Infrastructure and Transport from the IBN encouraged other ministries to claim mega projects under IBN. Tourism Minister Bhim Acharya had also said the Tourism Ministry would bring the Second International Airport project back to its fold amid no sign of progress. The Energy Ministry is also lobbying hard to take back hydropower projects under IBN.

In Wednesday’s meeting, Energy Minsiter Radha Gyawali strongly opposed the IBN handling of mega hydropower projects. The meeting mostly dwelt on issues of bonus, royalty and transmission line construction of hydropower projects under the IBN.

“With the Bonus Act stating 10 percent bonus and the Electricity Act saying 2 percent, there was a confusion about which Act to follow when it comes to bonus distribution,” said Industry Minister Karna Bahadur Thapa. “As other hydropower projects follow the Electricity Act, we have also agreed to follow the same.”

Established as a high-level agency to work towards attracting foreign investment for mega projects and provide potential investors a one-window solution, the IBN of late, is under pressure for “slow progress” of the projects under its purview. Non-cooperation from the ministries also pegged back the IBN. Despite its repeated request, the Tourism Ministry refused to hand over a detailed feasibility study report of the Second International Airport to the IBN.

Published: 24-04-2014 08:41

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