The 900MW Arun-3 Hydropower Project accomplished its key milestone—Financial Closure (FC) on February 6, 2020. A consortium of seven banks, including two Nepalese banks—Nabil and Everest—put a total of NPR 101 billion to the project, which has the total investment of approximately NPR144 billion. With the FC, the project has guaranteed its financial capability and we will witness its commercial operation by 2023 given any technical hitches don’t stall its construction. Arun-3 has become the largest project in terms of capacity and investment in Nepal.
The last decade(s) was a decade of great disillusionment for Nepal. Petty politics reigned supreme and issues of development took a backseat. It wouldn’t be wrong to say that all the social progresses Nepal has made thus far—decreased infant mortality rate and progress on education, maternal health etc—have been despite the government, not because of it. But the 2020s presents an opportunity for Nepal to right its wrongs and chart a new way forward to ensure economic prosperity for all.
When the government fails to speed up infrastructure development, it could mean three things. One, the government has not been able to manage fund for development, meaning there is little capital to spend. Two, the government has enough money to spend but it has no proper plans for the same. Three, the government has commitment for speeding up capital spending process but the procedural hurdles are way too many or our bureaucracy is too lethargic. But in either of three cases, it is the government or the people in the government who are responsible. Nepal’s story has been that, despite being a struggling economy, we somehow manage funds for development but we simply fail to spend. Here is the irony, the irony that is making the mockery of capacity of almost every government, of federal democratic Nepal that needs to be sorted out once and for all.
KATHMANDU, Nov 20: The government spending on development works was recorded 6.05% of the allocated budget in the first four months of the current fiscal year, revealing low spending capacity of the government in the construction of infrastructure despite its repeated commitments to spearhead economic prosperity.