Sub-committee to probe Fast Track details

Kathmandu, August 5

The Finance Committee of the Legislature-Parliament has formed a seven-member sub-committee to conduct a study of the Kathmandu-Tarai Fast Track road project. It has been mandated to look into the financial, physical and technical aspects of the project and come up with a report within 15 days of starting the investigation.

A meeting of the committee today decided to form the sub-committee after the government’s preparation to award the project to an Indian bidder drew immense criticism.

“The sub-committee will recommend whether it is justifiable to award the project to the Indian bidder or not,” said Prakash Jwala, chairman of the committee. He said that they will also look into the possibilities of Nepal government building the road on its own initiative.

The sub-committee comprises lawmakers Kamala Pant, Keshab Badal, Garima Shah, Gopal Dahit, Jagadeshwor Narsingh KC, Bikram Pandey and Shakti Basnet as members and they have been asked to select a coordinator among themselves.

As part of the preparation to award the project to the Indian bidder — a consortium of Infrastructure Leasing and Financial Services (IL&FS) Transportation Networks, IL&FS Engineering and Construction, and Suryavir Infrastructure Construction — the Ministry of Physical Infrastructure and Transport (MoPIT) has already completed its negotiations. The bidder had also prepared a detailed project report (DPR) of the 76-km expressway.

The project will cost Rs 111.03 billion, including Rs 12.77 billion in VAT, according to the DPR that has also been already approved by MoPIT. The Fast Track road construction plan had landed in controversy after the government considered of providing $750 million loan at three per cent interest rate from the $1 billion line of credit provided by India and also assured of Rs 15 billion grant to the developer. However, Ministry of Finance is yet to decide over the issue of $750 million loan to the developer.

Citing that awarding the project to the Indian bidder could be a mistake, former prime minister and senior UCPN (Maoist) leader Baburam Bhattarai had also underlined the need to explore possibilities of the government implementing the project itself by involving local contractors.

However, MoPIT is against this idea. MoPIT officials said that Nepali construction companies would not be able to undertake the project as the construction work would require implementing new technologies for construction of tunnel and tall bridges.

In a meeting of the Development Committee last week, Physical Infrastructure and Transport Minister Bimalendra Nidhi had said that the government was close to sealing the concession agreement with the bidder. He had said that the government would sign the agreement for the project by focusing on the national interest and that further changes in the plan would again cause delay in construction of the project. The project is expected to be completed within five years after the signing of the agreement.