Melamchi project may be restructured

Kathmandu, August 18:

Following Norway’s backing out of supporting the Melamchi Water Supply Project (MWSP) a month ago, the project is now planning a meeting with other donors for a probable “restructuring” of distribution of funding. On July 20, Norway decided to terminate the bilateral agreement on financial support to MWSP, considering developments after the February 1 royal takeover as “a serious setback to to multiparty democracy, constitutional monarchy and human rights”. Executive director of MWSP, Suman Sharma, today said the project was planning to meet donors, following the shortfall after the $15 million donation blocked by Norway, which was supposed to be used for construction of a 26.5 km-long tunnel.

The dream project of around $500 million, has promised to bring 170 million litres of water daily to Kathmandu Valley by 2006, after digging a tunnel but political realities indicate it is a bridge too far. “The Norway setback did affect the project but we can restructure funding. We are optimistic,” Sharma said. Development partners supporting MWSP are Asian Development Bank, Japan Bank for International Cooperation, Swiss International Development Agency and the Nordic Development Fund. Within a total $464 million, construction of Melamchi tunnel covers 32 percent of the total project cost while rehabilitation of the network covers 46 percent and the management contract plus institutional reforms cover 4 percent.