Govt allocates Rs 91 billion for reconstruction drive


The government has allocated a total of Rs 91 billion to kickstart its reconstruction drive from next fiscal year. It has set a target to complete reconstruction works within the next five years, under the slogan ‘after Earthquake: ’.

As per report prepared by the the government will require a total of Rs 667 billion in the first phase of the reconstruction of the damage caused by the April and May earthquakes. Of the total budget allocation for reconstruction for next fiscal year 2015-16, Rs 50 billion will be utilised for housing, Rs three billion for public building, Rs two billion for archaeological structures and Rs seven billion for other physical infrastructure. Similarly, Rs six billion each will go for manufacturing and social sectors.

Resources needed for rehabilitation and reconstruction works will be utilised from the with focus on speedy reconstruction. Under this fund the government will also issue reconstruction bonds to involve the general people and gather resources.

“I have kept relief, rehabilitation and reconstruction works as the first priority in the budget as it will also be an opportunity for new construction works,” said Finance Minister Ram Sharan Mahat, while unveiling the budget for the next fiscal year today. He, however, said there is a challenge to complete the reconstruction within the scheduled time based on the lessons learnt from other countries that have prospered after an earthquake.

To supervise the reconstruction drive, the government has already decided to form a Reconstruction Authority. Until the authority starts its work, the reconstruction of public buildings, schools, health institutions, archaeological and cultural heritage sites and other physical infrastructure will be carried out by the concerned ministries. A separate resource of Rs 17 billion has been allocated in this regard.

In the budget, the government has also announced of a plan to provide support of Rs 200,000 to owners of houses that were completely damaged and want to build a new house as per the government set criteria. Similarly, earthquake affected people will be able to obtain loans from banks and financial institutions at two per cent interest rate to rebuild their houses. Under this provision, quake affected people can avail loans of up to Rs 2.5 million in Kathmandu Valley and Rs 1.5 million out of the Valley.

The budget has also talked of reconstructing historical and cultural heritage sites damaged by the quakes by adopting modern technology and utilising local goods and workforce as far as possible under campaign . The ‘Heritage Fund’ a separate fund under NRF, will be set up in which Nepali and foreign nationals will be able to contribute resources. It will also receive one per cent service tax to be collected from users of telecom services.

Government has also allocated budget for immediate reconstruction of drinking water and sanitation infrastructure. Drinking water sources in many affected villages had been damaged by the earthquakes. There is a plan too under which the government has targeted to impart skill training to 50,000 youths on carpentry, masonry, plumbing and electrical works, among others focusing on the need of an able workforce for reconstruction activities.

To smoothen the supply of construction materials, the government has also provided an extra time of one year for relocation of crusher plants to government identified areas. The budget has also decided to provide subsidy on customs duty for the import of materials like bricks, zinc sheets, prefab houses and raw materials to manufacture the said commodities.

Similarly, considering the possible rise in demand for timber, the government will make sales of abandoned tree logs from forests easier. “Skilled youth workforce will be mobilised as volunteers in quake affected districts for rehabilitation and reconstruction,” as per the budget. Such a workforce will be institutionalised to be mobilised during times of disasters.

Major points

  • Rs 50bn for housing and Rs 2bn for archaeological structures
  • Rs 17bn for reconstruction to be used by concerned ministries
  • Rs 200,000 support to house owners who reconstruct houses under government criteria
  • Earthquake affected people to get bank loan at two per cent interest to rebuild houses
  • Reconstruction Bond to be issued to gather resources
  • Heritage Fund under National Reconstruction Fund to be established
  • Crusher plants provided one more year to relocate
  • Skill training on carpentry, masonry, plumbing and electrical works to be provided to 50,000 individuals