ADB Nepal Portfolio by sector

More funds depend on progress in project performance: ADB official

Published On: November 24, 2018 08:40 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Nov 24: A senior official of the Asian Development Bank (ADB) has said that improvement in project implementation performance is key to Nepal for getting more funds for development.

Speaking at the opening of the annual Tripartite Portfolio Review of ADB operations in Nepal, ADB Deputy Director General for South Asia, Diwesh Sharan, has urged the government to increase its performance of projects supported by the ADB. 

Out of the total portfolio, projects worth $1.91 billion are in the implementation phase and those worth $719 million are in the inception phase. The ADB is winding down remaining projects worth $171 million. 

“ADB has increased the annual lending level to Nepal from about $254 million a year on average during 2014-2016 to an annual average of $551 million in 2017-2018,” said Sharan. “Improved portfolio performance will help the country to sustain and further tap opportunities of increased lending space provided by ADB.”

The statement of the ADB’s senior official comes in the wake of weak progress of projects financed by the Manila-based multilateral regional development bank. 

After recording the highest disbursement and contract awards in 2016 and 2017, the overall performance of ADB operations in Nepal has been lagging behind in 2018, according to the ADB.

Of the net available funding amount of $2.8 billion spread over 36 investment projects (31 loans and 5 grants), 44 percent is still to be contracted and 64 percent is still to be disbursed. 

Government officials, however, say that the ongoing federalism implementation process has also hampered the progress of various projects. 

“The ongoing federalism implementation process has posed some challenges along with the current inadequate fiduciary, technical, and project supervision capacity,” said Shreekrishna Nepal, Joint Secretary and Chief, International Economic Cooperation Coordination Division, Ministry of Finance. “Nevertheless, a realistic action plan to remove key constraints could accelerate the project implementation performance of the ADB-funded projects.”

He also urged project staff to examine the implementation constraints, expedite the procurement process, and submit disbursement requests to ADB within the agreed deadline to achieve the projected 2018 targets. 

“We will continue to tackle the systemic constraints as well as project-specific problems with strong partnership with the government,” said Mukhtor Khamudkhanov, ADB’s Country Director for Nepal.

“With these efforts, and with major contracts to be awarded in December 2018, we are hopeful that the annual contract awards and disbursements will substantially increase.”

However, Khamudkhanov said that construction works of major projects, such as Gautam Buddha International Airport Project, have been expedited after delays, and the reconstruction of schools under the ADB-supported Earthquake Emergency Assistance Project is nearing completion.


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