KATHMANDU, MAY 19 -
Finance Minister Ram Sharan Mahat on Sunday said that the government
would introduce new economic reform plans while presenting the budget
for the next fiscal year. The finance minister has been advocating
launching a second tier reform measure to attract more domestic and
foreign investment and spur growth.
Among the areas where reform will be implemented are banking,
cooperative, energy, industry and public procurement. The government
intends to introduce a new act related to these sectors particularly in
banking and cooperative in a bid to bring discipline while boosting
investments in energy and industry. The government has also been working
on a new Pubic Procurement Act so that its procurement will be
practical as per the changed context and procurement-related problems in
development projects can be addressed. Speaking at a pre-budget
discussion organised by the Management Association of Nepal, Mahat said
that the main focus of the new budget would be on energy as it is the
biggest bottleneck to attracting investment.
“The government will focus on creating a conducive environment to
attract investments from the private sector and foreign investors in the
energy sector,” he said. According to a World Bank study, Nepal
requires as much as $ 5.3-7 billion to fill the funding gap in
electricity by 2020.
The government will also keep erecting transmission lines, developing
solar power and conducting power development agreements (PDA) with
foreign developers of hydroelectricity. “The government will focus on
developing transmission lines through the budget. It will include
construction of double circuit lines with 400 KV, 240 KV and 120 KV
capacities,” said Mahat.
There is concern at many hydropower projects under development that
transmission lines necessary to feed their power into the national grid
will not be completed. Besides attracting private sector investment in
the power sector, the finance minister said that bringing more foreign
aid in the infrastructure sector was also his priority.
Lately, donors like the World Bank, Asian Development Bank, Japan
International Cooperation Agency and European Investment Bank, among
others, have been showing increasing interest in investing in Nepal’s
infrastructure sector particularly energy.
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