At the International Conference on Nepal’s Reconstruction held in Kathmandu last week, Indian External Affairs Minister Sushma Swaraj openly praised the National Planning Commission for coming up with a ‘comprehensive’ report on Post Disaster Needs Assessment. “(The report) would be the framework for donors to finalise their relief packages and pledges (for disaster-hit Nepal),” she told the inaugural session of the conference, which saw participation of almost 300 delegates from around 60 countries and agencies. Others like Neven Mimica, European Union commissioner for international cooperation and development, and officials of the World Bank and Asian Development Bank also commended the NPC for coming up with a ‘credible’ report. So, by the time the conference ended, the government had secured funding commitments of around $4.4 billion from various countries and agencies for recovery and reconstruction of parts of the country ravaged by the recent earthquakes. The funding pledge was almost 66 per cent of the country’s total recovery and reconstruction needs of $6.7 billion. Rupak D Sharma of The Himalayan Times caught up with Swarnim Wagle, NPC Member and one of the main architects of the over 580-page PDNA document, to discuss the making of the report and challenges that the country might face while executing tasks related to reconstruction.
PDNA report came out very well and development partners have also called it credible. How did NPC pull it off? We’re quite pleased with the outcome and I think it has set an exemplary standard in terms of content and the process. Also, the government’s drive to finish the work on time was commendable. Foreign experts, who were involved in PDNA exercise in other countries, have already made the point that the way the government took the leadership in driving this exercise has become a benchmark for others and a good case study to follow. At the same time, we are also happy that the report became a credible basis for donors to pledge the amount (for recovery and reconstruction). The task of conducting PDNA was extremely challenging. When we first held orientation meetings on May 20 and 21, we knew we would be able to pull it off; we had that confidence. But we were not sure about the quality of the report because there were 23 working groups. And we knew some teams were better placed than others in terms of access to data and the quality of the government counterpart (with which the teams had to coordinate). So, we were a bit anxious whether all the working groups would produce reports of the same quality. But the NPC drove the exercise well by asserting its authority both in terms of executing policy coordination role and providing intellectual leadership to the government. Also, I am proud of the Central Bureau of Statistics, which immediately revised the growth estimate after conducting a detailed survey on economic losses that at least 15 sectors were likely to suffer in between April 25 and the end of the current fiscal year. These figures provided by the Bureau were then matched with the number that PDNA teams had derived. This was the additional tool that we used to enhance credibility of the PDNA report. At the same time, we also did a lot of consultation with the civil society, parliamentarians, academics, disaster management experts and heritage experts. So, a series of consultations were held even though there was very little time to finalise the report. NPC led quite a big team that involved all the ministries. It’s not that easy to work with these government bodies. How did you coordinate? We were also pleasantly surprised by the way government counterparts participated in this process and took leadership as well as ownership of the process. In some cases, joint secretaries even wrote drafts of sectoral reports. At times they even challenged the views, interpretation and analysis of representatives, consultants and experts of development partners. In total, around 500 experts were mobilised to prepare the report. These experts — a majority of whom were Nepalis — were split into 23 groups. I think the level of coordination and cooperation among the members of these teams was another reason why PDNA report ended up being credible and a high-quality document. The PDNA report only provides ballpark view of the needs of key sectors. Now, it is time to conduct in depth analysis of all the sectors covered by the PDNA report, isn’t it? People should understand the limitations of PDNA. It is a rapid assessment done using the best available data within our reach at that certain point in time. So, within two weeks of the disaster, we started preparations to conduct PDNA, and we had less than a month to complete the report. Now, the challenge is to dive deeper into each of the 23 sectors and craft detailed strategies, and that is what we are expected to do. So, the first stage of PDNA, which involved conducting rapid assessments and coming up with credible figures on damage, losses and needs, is over. The most important part of the PDNA was to inform our development partners on Nepal’s expectations in terms of assistance. Of the $6.7 billion that we identified as the national need for recovery and reconstruction, around $3.8 billion was earmarked as state’s obligation. The response from donors during the International Conference on Nepal’s Reconstruction (ICNR) was overwhelming and their commitments exceeded $3.8 billion that we were actually looking for. So, the credibility of the PDNA report led to the success of ICNR? That’s definitely one of the reasons. But there are two other reasons as well. One is the decision to form the extra-ordinary mechanism (EOM) called the National Reconstruction Authority. As you know, there is a lot of red tape in the traditional or ordinary development mechanism. This mechanism is also slow because you have to tick off so many checklists and comply with so many regulations. Also, everyone knows we have been underspending the annual budget for the last one decade. So, donors wanted assurance that we would expedite spending. And the formation of the Authority, through ordinance, added to the credibility and gave extra assurance to the donors that funds would be spent well. The third factor for ICNR’s success was the leadership and teams involved in carrying out PDNA. I think a lot of credit has to go to Finance Minister Ram Sharan Mahat, who stood his ground on holding the conference in the country, despite calls for hosting it at a later date or outside of Kathmandu. So, all these factors tipped the balance and led to the success of the conference. The EOM is being touted as a cure for all bureaucratic ills. But the government, so far, has not been able to appoint its CEO. Moreover, the CEO selection process is expected to be very controversial, with leading political parties laying claim to the post. Do you think the mechanism will be able to perform its duties in a desired manner? I hope so. And I am pretty confident that the CEO will be appointed soon. Once the chief executive is selected, the process of appointing deputy CEOs and other staff members would also begin. The Authority will then pick up steam. Many are currently comparing the Authority to the Investment Board Nepal. But that is not the case because it has a lot more teeth in terms of putting things on fast track, mobilising resources and executing its programmes through line ministries. Besides, there are provisions to ensure line ministries toe the line of the Authority. Also, the mechanism would be under intense scrutiny of the civil society, media and our development partners because a lot depends on its success. So, for now, we have to trust elected leaders. And I hope they’ll rise to the occasion and do the right thing because we cannot afford to lose the momentum. Also, donors have placed a lot of faith in us and we should not lose the goodwill we have earned. Does that mean the Authority would be able to take decisions quickly, implement them and expedite spending? Many people are confused about the structure of the Authority because of involvement of the prime minister and ministers, and rather large advisory committee. Many of these arrangements are in place just for formality. The large advisory committee will probably not meet more than two times a year. This is the same with the committee headed by the prime minister, which also includes four Cabinet ministers. So, the day-to-day operations would be overseen by the CEO and the team of professional deputy CEOs. So, we can count on these four or five highly qualified professionals to make deliveries. Having said that we are trying something new here and there is nothing rigid about it — meaning if certain things don’t work the way we expected, there is room for change to make it even better. So, for now we should give the benefit of doubt to the institutional mechanism and allow the prospective CEO to exercise authority. How much do you think the Authority should spend on reconstruction in the next fiscal year? I think it will vary depending on sectors. For example, agriculture, commerce, tourism and manufacturing will probably need programmes for immediate revival. On the other hand, it might take two to three years for all the classrooms, damaged by the disaster, to be rebuilt in a better way. Cultural heritage will probably take the longest. This is because of shortage of artisans and distinct materials, such as yellow soil, which is required to rebuild old temples. In other words, sectoral time horizons and strategies will vary. And the donor commitments will also cover that length of period. So, considering the legal mandate and authority the EOM has been given, we should try to ask it to spend at least $1 billion (approximately Rs 100 billion) in the next fiscal. Lastly, do you want to add anything more? We have to note that PDNA was an entirely new exercise for us. What people should also realise is PDNA does not cover development of large projects of national importance, like Kathmandu-Tarai fast track, new airports, highways and large irrigation projects, which have nothing to do with earthquakes. These issues will be addressed through normal development course, for which we have periodic plans and separate strategies. So, I would like to ask experts and everyone who is commenting on the scope of the PDNA, to be a little more humble. Besides, some have also criticised us for organising the ICNR to mobilise resources from abroad, rather than tap internal sources. But we were very confident about the track we took. The other issue is that people are confused about the basic notion of fungibility of funds. Funds can move from here to there. You don’t write your name on a piece of note and say you can only use that note for a certain purpose. It looks like many of our experts are not very aware of this issue and how concessional loans and grants can be mobilised for different purposes. But I think as time goes on, much of these issues would be clearer.