Discouraging sign

  • Dire state of KUKL dampens hopes of people for smooth water supply

Nov 8, 2016-

The first of three phases of the Melamchi Drinking Water Project is finally going to be completed by September 2017. This is much needed progress for a project that has been in operation for two decades now. The first phase envisages bringing 170 million litres of water every day from the Melamchi river in Sindhupalchok district through a 27.5km tunnel to the parched Capital. 

This news must have been music to the ears of the residents of the Kathmandu Valley, where many taps currently emit air rather than water. But to their chagrin, there are new fears about the ability of the drinking water supplier to deliver quality service even after the Melamchi water gushes to the Valley.

The Kathmandu Upatyaka Khanepani Limited (KUKL), the sole distributor of water in the Valley established under a public-private partnership, is 

in a shambles. Its board members have been criticised for resorting to nepotism, displaying high-handedness and dragging their feet over crucial decisions. It has not held its annual meetings for the past three fiscal years. 

Unsurprisingly, a no-confidence motion was passed by the seven-member board last year against the Chairman Suresh Kumar Basnet, who was once the president of the Nepal Chamber of Commerce that holds a 9 percent stake in the utility. To make matters worse, as many as 70 percent of the KUKL employees are ‘non-technical staff’—occupying layers of administrative and accounting positions and making their machinery inefficient and unwieldy.

The various shareholders with the KUKL, including the government, need to immediately address the problems in the company. Now that the water from Melamchi is finally going to arrive next year, the KUKL needs to be able to fulfil its responsibility. 

However, there is a bigger issue here. It goes without saying that the dire state of the KUKL raises serious concerns over the supply of water in the Valley after the Melamchi project’s first phase is completed. But it also casts doubt on the viability of public-private partnership (PPP) in Nepal. 

PPP is a long-term agreement between the public and the private sectors to deliver services originally provided by the government. It aims at improving the quality and efficiency of the services and at allocating public resources to cash-strapped projects. It has played an important role in bridging national infrastructure gaps in developing countries, especially in Latin America, in the last two decades. However, the PPP policy was only introduced last year by the Nepal government, after holding discussions with various stakeholders for over two years. Although KUKL is just one example of PPP in Nepal, it can offer useful lessons for such 

undertakings in the country.

The PPP policy was introduced in the country to rope the private sector in to be part of the government’s development initiatives. The private sector should rise to the occasion and tap this opportunity. 

Published: 08-11-2016 08:08

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