FinMin says new economic reform plans coming up

- POST REPORT, Kathmandu
FinMin says new economic reform plans coming up

May 18, 2014-

Finance Minister Ram Sharan Mahat on Sunday said that the government would introduce new economic reform plans while presenting the budget for the next fiscal year. The finance minister has been advocating launching a second tier reform measure to attract more domestic and foreign investment and spur growth.

Among the areas where reform will be implemented are banking, cooperative, energy, industry and public procurement. The government intends to introduce a new act related to these sectors particularly in banking and cooperative in a bid to bring discipline while boosting investments in energy and industry. The government has also been working on a new Pubic Procurement Act so that its procurement will be practical as per the changed context and procurement-related problems in development projects can be addressed. Speaking at a pre-budget discussion organised by the Management Association of Nepal, Mahat said that the main focus of the new budget would be on energy as it is the biggest bottleneck to attracting investment.

“The government will focus on creating a conducive environment to attract investments from the private sector and foreign investors in the energy sector,” he said. According to a World Bank study, Nepal requires as much as $ 5.3-7 billion  to  fill the funding gap in electricity by 2020.

The government will also keep erecting transmission lines, developing solar power and conducting power development agreements (PDA) with foreign developers of hydroelectricity. “The government will focus on developing transmission lines through the budget. It will include construction of double circuit lines with 400 KV, 240 KV and 120 KV capacities,” said Mahat.  

There is concern at many hydropower projects under development that transmission lines necessary to feed their power into the national grid will not be completed. Besides attracting private sector investment in the power sector, the finance minister said that bringing more foreign aid in the infrastructure sector was also his priority.

Lately, donors like the World Bank, Asian Development Bank, Japan International Cooperation Agency and European Investment Bank, among others, have been showing increasing interest in investing in Nepal’s infrastructure sector particularly energy.

Published: 19-05-2014 09:23

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