Under-construction Projects Should be Expedited for Quick Economic Recovery

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Under-construction Projects Should be Expedited for Quick Economic Recovery

Advancing infrastructure development by considering economic activities and sources available in the country can help improve the economy. However, the priority of political leaders and lawmakers in their constituencies has cast a shadow over our real need for development. For instance, roads have been constructed indiscriminately without proper planning. In many hilly areas, this type of 'development' has led to problems such as landslides.

There is no integrated master plan for infrastructure development in Nepal, nor it is possible to work on the basis of need. At present, the integrated development plan does not seem to be a priority for politicians. Political instability is one of the reasons behind this. Priority to development was only confined to the papers or speeches even when there was a stable government.

In order to attract domestic and foreign investment in infrastructure development, the government itself should construct the basic infrastructures such as transmission lines and access roads to the project sites. There will be no shortage of financial and other resources for the development of projects only when there is a guarantee of political non-interference and proposals are approved easily. There should be no delay in bringing major tourism infrastructures such as the Gautam Buddha International Airport and Pokhara International Airport into operation. Similarly, the construction of the Kathmandu-Terai Expressway should not be delayed.

The equitable distribution of benefits of infrastructure projects is also an important topic. Particularly, it is important to link infrastructure development with the rural economy. Even today, we are not able to inform the local people about the impacts the projects will have on their lives. As a result, there are obstacles such as not allowing the projects to be built. This is one of the reasons for the delay in the construction of projects.

In order to revive the pandemic-stricken economy quickly, the completion of under-construction projects should be expedited. The government needs to play an active role in this regard by removing obstacles, providing approvals in time and building the necessary infrastructure, etc. Similarly, focus should be given to complete the construction of the Melamchi Drinking Water Supply Project which was damaged by the flood in June, Kathmandu-Terai Expressway, Arun III Hydropower Project and irrigation projects that are under construction for a long time. The government should be ready to bring separate laws and policy decisions in order to complete these projects.  

Infrastructure development framework and strategy should be formulated. We need leadership that has the willpower to execute the projects that have already been studied. At the same time, attention should be paid to the socio-environmental aspect of infrastructure development. The devastation in the Melamchi area has highlighted the need to be more vigilant in this respect. This has taught us a lesson about climate change and environmental issues for the upcoming projects. Also necessary is to make long-term investments in data collection and research that will help to have insights into the environmental hazards.

Infrastructure development requires many years of investment. So, the private sector should also be included in this process. The private sector companies pay close attention to the possibility of single-day losses and try to avoid such a situation as much as possible. There are several risk factors involved in the construction of any infrastructure. As private companies constructing the projects will bear the risks, the costs to develop the projects will be less. One way to achieve this is by constructing and operating projects under the public-private partnership (PPP) modality.

In the current context of the Covid-19 pandemic, we need to think differently about the revival of the economy. It is necessary to ensure adequate investment in health and the necessary infrastructure for proper testing, availability and management of vaccines and treatment of the patients infected by Covid-19. The government has already allocated a significant budget in this regard. The main challenge now is to make good use of the allocated funds. In order to complete all the tasks within the pre-determined time frame, it is necessary to move forward quickly by identifying the risk and managing it properly.  

(Pant is Chairman of VRock and Company. He is former banker and former CEO of Investment Board Nepal. This article is based on conversation with him.)

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