Progress of NP, P1 projects dismal

Kathmandu, March 4

Many big ticket projects listed under ‘National Pride’ and ‘Priority 1’ categories in the fiscal budget for 2016-17 have failed to make any substantive headway till date due to lack of ground work for their implementation.

It is likely that the high priority projects will have to surrender their budget to the Ministry of Finance from the beginning of the last quadrimester (mid-March) of this fiscal as many of them are non-performing projects.

Among the projects listed under national pride, the Second International Airport, Nijgadh, South Asia Tourism Infrastructure Development Project and Pokhara Regional International Airport have nil performance. Likewise, progress on the Kathmandu-Tarai Fast-track Project, Budhigandaki Hydropower Project, Bheri Babai Diversion Multipurpose Project, Post-earthquake Reconstruction works and Prime Minister’s Agriculture Modernisation Project, among others, has also been dismal.

“Due to the dismal progress of priority projects, the objective of the fiscal budget could not be achieved,” economist Keshav Acharya commented. For instance, the government had launched the Prime Minister’s Agriculture Modernisation Project to raise agricultural productivity so that the rising import of agricultural commodities could be substituted to some extent. It was also introduced to tame the food price inflation by ensuring improved supply. However, the objectives will not be fulfilled due to lack of project implementation.

Money poured into non-perfoming national pride and priority 1 projects

According to the MoF, expenditure of 18 national pride projects has been miserable. In the first half of this fiscal, only 13 per cent of the total allocated amount worth Rs 54.18 billion was spent.

Post-earthquake reconstruction works are also moving at snail’s pace.

Apart from the grant to quake-affected households to rebuild houses, the remaining works have stalled. Out of the total of Rs 34 billion allocated for post-earthquake reconstruction works, which include construction of schools, government buildings, devastated roads, cultural heritage sites, health posts and drinking water facilities, merely Rs one billion has been spent, according to Finance Secretary Shanta Raj Subedi.

The MoF has asked the line agencies under various ministries to surrender the budget from mid-March if the projects fail to make any headway till the given deadline.

“The resources that are withdrawn from projects with dismal progress will be given to projects that have been performing well so that they do not face resources crunch and are completed on time,” Subedi explained.

“From the next fiscal, the MoF will allocate realistic budget based on the preparedness of the project and the capacity of the implementing agency to utilise allocated resources to avoid a situation like the one faced by national pride and priority projects.”