Print Edition - 2015-06-29 | MONEY
If all pledged aid comes, govt need not use its funds
- reconstruction & rehabilitation
Jun 28, 2015-
If all the foreign aid commitments materialise, the government can complete reconstruction and rehabilitation of quake-damaged infrastructure without using its internal resources.
The government received total aid pledges of $4.4 billion during the International Conference on Nepal’s Reconstruction (ICNR) held in Kathmandu on June 25.
As per the Post-Disaster Needs Assessment (PDNA), the country needs $6.66 billion for rebuilding and rehabilitation.
According to the National Planning Commission (NPC), which coordinated the PDNA process, the government will have to invest 60 percent ($3.99 billion) of the required resources, and the rest is expected to be fulfilled by the private sector, community and individuals.
So the committed amount is more than what the government has to invest. Finance Minister Ram Sharan Mahat has said the amount pledged is more than what the government expected.
NPC Vice-chairman Govinda Raj Pokharel said the donors’ commitments suggest there is no dearth of money for rebuilding infrastructure devastated by the April earthquake and subsequent aftershocks. “The only thing we need to do is improve our project implementation capacity so the resources are well spent,” he said. “If we can realise the entire committed amount, we won’t have dearth of resources for other development projects.”
The government’s spending capacity has remained poor over the last several years. As of June 27, only 67 percent of the budget has been spent, with capital expenditure remaining at just 45 percent, according to Financial Comptroller General Office (FCGO).
The government expects less than 80 percent spending at the end of the fiscal year, according to the Finance Ministry.
The poor absorbing capacity of the government, along with transparency and accountability issues, were the major concerns raised by the donors during the ICNR.
Indian Minister for External Affairs Sushma Swaraj pointed out some of the challenges Nepal faces. “Efficient and transparent utilisation of funds, to achieve the PDNA goals, will not be easy. It will require a robust institutional mechanism and the tireless dedication of an empowered team of officials,” she said.
Representatives from Denmark, Switzerland and the International Monetary Fund urged for accountability, transparency and efficient mobilisation of funds along with local body elections.
Amid concerns over the government’s aid absorbing capacity, it formed the National Reconstruction Authority through an ordinance to carry out reconstruction activities.
The authority, led by the Prime Minister, has been given all powers to take quick decisions on procurement, land acquisition and environmental impact assessment, which have emerged as big challenges in carrying out development activities in recent years.
There are also concerns about appointment of chief executive and other officials at the authority. It is still not clear whether they are appointed based on their political affiliations.
Pokharel said qualified persons should be appointed to the posts so that reconstruction activities could be taken ahead smoothly.
Published: 29-06-2015 08:22