Print Edition - 2016-03-21 | MONEY
Govt told to build project on its own
- kathmandu-tarai fast track road
Mar 21, 2016-
A meeting of the Parliamentary Finance Committee on Sunday directed the government to build the 76km Kathmandu-Tarai Fast Track Project on its own.
Terming it a “national pride project”, the committee asked the government to use national resources and skills to build the project, which links Kathmandu to Bara’s Nijgadh.
The previous government’s plan to hand over the project to an Indian developer—a consortium of Infrastructure Leasing and Financial Services (IL&FS) Transportation Networks, IL&FS Engineering and Construction, and Suryavir Infrastructure Construction—had landed in controversy.
The government had planned to make almost all financing (Rs75 billion of the estimated cost of Rs98 billion) itself with soft loans received from India, going against the general practice of developer itself generating necessary resources.
The plan also drew flak due to high compensation (a maximum of Rs15 billion a year) the government would be subjected to pay as “minimum revenue guarantee” if the traffic remained inadequate to make profits.
Amid the controversy, Supreme Court (SC) on October 8, 2015, had issued an interim order, halting the government’s preparations to award the project to the Indian developer.
The apex court is yet to conduct final hearing as IL&FS, one of the defendants, has not yet presented itself in the court. The SC has scheduled the hearing for this week and both the defendants will be present this time, according to a Nepal-based agent of the Indian company.
Prakash Jwala, chairman of the committee, said since the Fast-Track project is a national pride project, the parliament committee directed the government to consider national interest and arrange financial sources domestically.
“One should not doubt the country’s ability to arrange financial resources to build the 76-km road,” said Jwala. “We will again hold a meeting of the committee soon inviting representatives from the Ministry of Physical Planning and Transport and the Finance Ministry.”
During International Conference on Nepal’s Reconstruction held on June 25, 2015, Indian External Affairs Minister Sushma Swaraj asked Nepal to allow India to develop the Fast Track Project and Second International Airport in Nijgadh.
Published: 21-03-2016 09:07