The idea of soft loans to disaster victims is NRA’s desperate bid to prove its relevance after its failure in reconstruction process

The soft loan scheme under the “post-reconstruction rehabilitation programme” has broadly been divided into six categories: commercial agriculture and livestock, educated youth self-employment, foreign migrant returnees, women entrepreneurs, The National Reconstruction Authority (NRA), which was instituted three years ago with the sole objective of rebuilding the damaged public infrastructure and private houses, has now come up with yet another lofty idea of proving “soft loans” with interest subsidy to the earthquake, flood and other natural disaster victims. Providing what it calls “soft loans” to the disaster victims is not the NRA’s mandate. When it was instituted after the 2015 earthquake, its mandate was for five years (until April 2020) during which it should complete rebuilding the private houses and reconstruct the public infrastructure. The new proposal of availing soft loans at two per cent — additional  seven per cent to be borne by the government — interest rate has come after the World Bank “agreed” to support the NRA in mobilising engineers in each district and social mobilisers in each rural/urban municipality. As per the plan, the social mobilisers will provide “social and technical support” to the disaster victims while engineers will refer the victims to banks and financial institutions for the soft loans after submitting required collaterals.

Dalit community entrepreneurs and higher and technical and vocational education. As per the plan, a victim is entitled to avail minimum Rs half-a-million to maximum Rs 50 million as a soft loan against his/her property as collateral. However, banks and financial institutions provide a loan up to 60 per cent of the collateral. It means if a person wants to avail a loan amount of maximum Rs 50 million for commercial farming, s/he is required to submit property worth around Rs 85 million as collateral. When a person has that much property s/he may be no longer considered a disaster victim. And, a real victim who, despite NRA’s support, is struggling to rebuild his/her home for three years cannot engage in self-reliant scheme as proposed. Then, who has the soft loan scheme been proposed for?

This, it seems, is the NRA’s desperate bid to prove its relevance despite its utter failure in fulfilling its major and only objective of rebuilding. Its own data show it has miserably failed to accomplish its mission, as only over 33 per cent of the quake victims have rebuilt their houses in the last three years. There is no guarantee that the rest of the task will be completed in another two years. NRA Chief Executive Officer SushilGyewali has said a total of 732,771 beneficiaries, mostly from hill areas, who have signed grant agreements with the NRA to rebuild houses, will be eligible for the soft loans. On what basis the NRA came to this conclusion that the disaster victims will benefit from this untested scheme? It’s as simple as that a disaster victim who has been rendered homeless cannot engage in any kind of self-reliant scheme unless s/he is first provided with a safe and secure shelter. The NRA should better focus on providing shelters to the disaster victims.

Invest in education

Education is fundamental human right. Education sets the foundation for prosperity and opportunities. So it is imperative that the state makes maximum efforts to ensure that all children get education. Governments at all levels must strive for ensuring adequate budget for the education sector so as to create a solid foundation for prosperity and opportunity. Education is a major driver of personal and national development. Education is the biggest investment.Despite commitments, Nepal’s spending on the education sector is still far from desirable. In the new federal set-up, it was expected that provincial governments would lay more emphasis on the education sector, but they seem to be following the footsteps of the central government. The federal government in its budget for 2018/19 has allocated Rs 134 billion, around 10 per cent of the total budget despite commitments earlier to increase it to 20 per cent. The provincial governments’ budget allocation for the education sector also is not quite satisfactory, with SudurPaschim being the only province to earmark 6 per cent of its total budget for the sector. Others have allocated only 2-4 per cent for the sector.