Nepal | May 20, 2019

EDITORIAL: Slow progress

The Himalayan Times

NRA has been slow in the post-quake reconstruction works thanks to its inefficiency, political interference and shortage of resources

People of the central region were jolted out of their beds by a 5.2 magnitude tremor in the early hours Wednesday, as if to remind them of what had taken place four years ago this time, when a tremor of 7.8 magnitude shook most parts of the country, leaving over 9,000 people dead and injuring more than 23,000. According to the National Reconstruction Authority (NRA), around 800,000 private houses, thousands of schools and hundreds of government buildings, health posts and monuments were damaged in the quake. The initial estimated cost of rebuilding was Rs 900 billion. For this, the government held an International Conference on Nepal’s Reconstruction on June 25, 2015 to raise funds for rebuilding the damaged infrastructure and private houses. Donors and development partners had pledged $4.4 billion in financial aid during the conclave. But the government has been unable to fully bring in the pledged amount due to its own poor organisation and preparedness, delay in forming the NRA and frequent changes in its leadership. It took eight months just to constitute the authority through law.

After its formation in December 2015, the NRA has so far spent Rs 309 billion under the rebuilding plan. It also expects to mobilise another Rs 200 billion through the government’s regular programmes. On the eve of the fourth anniversary of the disaster, NRA CEO Shusil Gyawali said he still needed Rs 429 billion to complete the reconstruction works. He said the funding gap would be met with a soft loan of $500 million from the World Bank. He claimed that 80 per cent progress had been achieved in rebuilding the private houses; 85 per cent in rebuilding schools; 66 per cent in health facilities; 59 per cent in heritage rebuilding; 56 per cent in the security sector and 98 per cent in rebuilding government buildings. Despite his claim, around 30 per cent of the households are still rebuilding their homes.

Post-reconstruction works would have picked up momentum had the government passed a law on time and formed the body soon after the disaster. After the 2001 Bhuj quake in India and Kashmir quake in Pakistan in 2005, India had made more than 87 per cent progress and Pakistan 70 per cent in rebuilding the houses by the fourth year. Both the countries were able to achieve the targets as they formed the rebuilding agencies within a month of the disaster. The NRA also took much time to frame the reconstruction policy. However, one positive side of the NRA’s reconstruction is
that misuse of the government grant has been minimal as the beneficiaries were provided funds through the banking channels. But the government has failed to keep its word of providing soft loans to the quake victims. Four years down the road, NRA has sought an additional Rs 429 billion to complete the remaining tasks. Given its dismal performance, it is unlikely that it will be able to complete its tasks within the remaining year as it is now facing a shortage of skilled hands, who have largely been transferred to the sub-national levels. NRA needs to enhance its capacity to absorb the funds it may receive from donor agencies. It also needs to work in tandem with the local levels, which can help NRA complete its mission.


Cut luxury imports

The government’s bid to control haphazard imports, especially luxury goods, through the upcoming budget for fiscal year 2019-20 is most welcome. Until now, the government has been allowing rampant import of goods simply to achieve its revenue target. And the flood of cheap goods as well as those that Nepal does not actually need has come at the expense of our own industry.

Creating enterprises in the country will not only help provide employment to the hundreds of thousands of young people entering the labour market each year but also help meet revenue targets through expansion of the tax base. But before industry and other sectors can flourish, a progressive taxation system must be introduced in the country. For instance, it is cheaper to import finished goods than produce them here because of the higher taxation on raw material imports. Nepal’s imports are sustained largely by the huge remittances sent by the millions of youths toiling in sub-human conditions far away from home. That money should be spent in productive areas so that the country prospers.


A version of this article appears in print on April 25, 2019 of The Himalayan Times.


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