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The government and the World Bank jointly launched the $275m (Rs 34.96bn) Accelerating Nepal’s Regional Transport and Trade Connectivity (ACCESS) Project on Sunday. The project is expected to help improve trade and connectivity by reducing trade and transport costs and transit time along selected corridors in Nepal. The project was launched by Minister of Physical Infrastructure and Transport, Prakash Jwala, and the World Bank Vice President for South Asia, Martin Raiser. Speaking on the occasion, Minister Jwala said, “The ACCESS project will help develop resilient infrastructure in Nepal and help unlock Nepal’s economic potential through better connectivity and trade, both between the provinces as well as regionally." The 69-kilometer two-lane section of the Butwal-Gorusinghe-Chanauta road along the East-West Highway will be upgraded to a climate-resilient four-lane highway under the project. With a focus on ensuring better road safety, the project is expected to reduce travel time by 30 percent, thus providing better access to India’s western seaports. According to the World Bank, the project will construct at least three market areas with required internet and trade information facilities along the highway to help enhance economic opportunities, especially for women entrepreneurs and traders. The project will also support advancing Nepal’s preparedness and subsequent implementation of the Motor Vehicle Agreement signed by Bangladesh, Bhutan, India, and Nepal to allow the smooth passage of goods and passenger vehicles in each other’s territories. “Enhanced trade and transport connectivity promotes economic integration and opens larger markets among South Asian countries. The ACCESS Project will help improve regional trade and promote sustainable infrastructure development to support Nepal’s green, resilient, and inclusive development,” said Raiser. The project will be implemented by the Ministry of Physical Infrastructure and Transport, Ministry of Industry, Commerce, and Supplies, and Ministry of Forest and Environment. The government and the World Bank signed the financing agreement for the project in September 2022.

In a major victory for the Nepal government, the International Centre for Settlement of Investment Disputes (ICSID) on Friday, ruled in favor of Nepal in the dispute over the determination of capital gains tax (CGT). The ruling of ICSID, a Washington DC-based international arbitration and settlement institution that is a part of the World Bank Group, also saved the Nepal government from paying as much as Rs 66 billion to Axiata Group Berhad, a Malaysian telecommunications conglomerate that owns Ncell Axiata Limited in Nepal. On 20 May 2019, Axiata filed a case against the Nepal government in the determination of CGT on the purchase and sale of the company’s ownership claiming damages worth $420m (Rs 55.54bn). In a verdict on Friday, the ICSID issued a verdict in favor of the Nepal government arguing that Axiata failed to establish its claims that Nepal hasn't treated Axiata fairly and denied justice to the company. Axiata claimed that Nepal’s conduct in relation to CGT imposed on Ncell goes against the Bilateral Investment Treaty between Nepal and the United Kingdom. “The ICSID verdict has saved us Rs 66bn,” said a government official involved in arbitration fights with Axiata. “The government spent around Rs 500m in legal fights and we are supposed to spend around the equivalent amount for payment for violation of procedural order of the ICSID.” According to the official, with the Malaysian company also demanding as much as 16 percent interest till the possible payment for damages and arbitration expenses, losing the case could have increased the government’s liability by as much as $500m or Rs 66bn. Axiata had contended that creating a tax liability for Ncell instead of TeliaSonera which had sold its share to Axiata breached fair and equitable treatment to be accorded to the foreign investors as per the Bilateral Investment Treaty between Nepal and the United Kingdom. Although Axiata is headquartered in Malaysia, it argued that the investment dispute must be settled as per the UK jurisdictions since its UK-based subsidiary—Axiata Investments had acquired Reynolds Holdings, a company registered in the British Virgin Islands, which has an 80 percent stake in Ncell. “At the expense of around Rs 1bn, the government is saving around Rs 66bn which is a great achievement,” said the government official. “Moreover, the non-monetary gain is also huge from the verdict as it dismissed Axiata’s claims that Nepal does not treat foreign investors fairly and that there are regulatory hassles in Nepal, and there is a profit repatriation problem for foreign investors.” Initially, the government was reluctant to engage in legal fights with Axiata. So, Nepal didn’t choose any arbitrator to settle the dispute. In Oct 2019, the ICSID itself appointed an arbitrator to advocate on behalf of the Nepal government to pursue the case further. The government was contending that as the tax was imposed on Ncell based on domestic law, it is not subject to international dispute settlement. After consistent pressure from experts that the government’s apathy to engage in legal fights could result in serious defeat in international arbitration, the government became ready to engage in legal fights. The Nepal government appointed five law firms—UK-based Nepali-origin lawyer Surya Prasad Subedi’s Three Stone, Washington-based law firm Foley Hoag, US-based legal practitioner of Nepali origin Khagendra Kshetry’s Kshetry and Associates, Nepal-based law firms Prudential Law Associates and Abhinawa Law Chamber—to engage in a legal fight on the behalf of the government. Additionally, the government also appointed constitutional lawyer Bipin Adhikari and former finance secretary Vidyadhar Mallik as legal and tax experts. “By participating in the legal fight, Nepal could produce evidence that the Ncell has not faced mistreatment from the Nepali authorities,” said the government official. “This judgment of the international court has sent a message that the agreement between the Nepal government and Ncell has not been violated,” said Semanta Dahal of Abhinawa Law Chamber. “It also establishes the fact that tax can be levied if shares are traded outside the country of the company registered in Nepal.” The taxation controversy began with the exit of TeliaSonera, a Swedish-Norwegian company, from Nepal, by selling all of its 80 percent stakes to Axiata, in April 2016 at Rs 144bn. The buyout deal was done abroad as Axiata Investment (UK) purchased the Reynolds Holding company, registered at Saint Kitts and Nevis, a tax haven, which is the owner of Ncell, from TeliaSonera. The 54th annual report of the Office of the Auditor General became the turning point to drag Ncell into controversy related to tax evasion. The OAG in its report stated that the deal was taxable in Nepal as per Clause 57 of the Income Tax Act and stated that the government needs to raise Rs 32bn as CGT from the buyout deal worth Rs 144bn for an 80 percent stake. Then, the Large Taxpayers Office of the Nepal government determined Rs 60bn in CGT to Ncell. The Malaysian telecom giant went to the Supreme Court to challenge the decision but the court quashed the petition of Axiata before moving to ICSID.

Nepal’s attempt to take its airlines out of the EU’s ban has again hit a roadblock. The European Commission has recently published the EU Air Safety List, a list of airlines that are subject to an operating ban or operational restrictions within the European Union (EU) airspace for not meeting international safety standards. The commission has continued its ban on Nepali airlines as well. The Department for Mobility and Transport of the EU, making public its latest report on the air safety list, has continued the blacklisting of 20 Nepali airline companies including the national flag carrier Nepal Airlines Corporation (NAC), private airlines, and helicopter companies. European airspace has been barred for Nepali airlines for the last 10 years though Nepal has been maintaining that it has ‘improved its air safety status’. However, the Yeti Airlines crash in Pokhara on Jan 15, in which all 72 people died again raised the question of air safety in Nepal. The European Commission, in Dec 2013, imposed a ban on Nepali airlines from flying into the EU after the September 2012 crash of Sita Air Flight 601 at the Manohara River bank in Kathmandu. The other reason behind Nepal continuing to be on the blacklist, is the Nepal government’s failure to endorse two pending aviation bills which would split the country’s aviation entity into two separate bodies. The Civil Aviation Authority of Nepal Bill and Air Service Authority of Nepal Bill envisage two separate bodies—one as a service provider and the other as a regulator. Had Nepal expedited the endorsement of these two bills, it would have made Nepal’s case stronger. The EU has long been urging Nepal to split CAAN into regulation and operational bodies as the main condition to remove Nepali airlines from the list. The European Aviation Safety Agency (EASA) of the EU carried out a safety audit of Nepali airline companies last year. Although the EU agency stood positive in the beginning, it was reportedly unsatisfied with the government’s slow process of unbundling the CAAN. CAAN Spokesperson Jagannath Niraula said that he expects Nepal to be removed from the blacklist from the EU’s review meeting in November. “As we understand, due to the air accident in Pokhara, the EU immediately postponed the audit report that was to be published in February. However, even after that, we are in constant communication with the EU,” said Niraula. “There may be some technical errors in the Pokhara incident. The entire airspace cannot be evaluated based on that,” he further said. According to Niraula, the EU has said that it will soon publish the on-site audit report of Nepal. “After that report comes, it is believed that Nepal will be removed from the EU’s blacklist from the review meeting in November,” he said. After the Jan 15 Pokhara crash, the EU, which was planning to visit Nepal to conduct an ‘on-site assessment’ of Nepal’s aviation security, postponed the visit.

The price of gold has dropped by Rs 100 per tola in the domestic market on Monday. According to the Federation of Nepal Gold and Silver Dealers’ Association, the yellow bullion is being traded at Rs 112, 400 per tola today. The yellow metal was traded at Rs 112, 500 per tola on Sunday. Meanwhile, tejabi gold is being traded at Rs 111, 850 per tola. It was traded at Rs 111, 950 per tola. Similarly, the silver is being traded at Rs 1,455 per tola today.

As many as 1.25 million people are likely to be affected by the monsoon in the country this year, it has been predicted. A study carried out by the National Disaster Risk Reduction and Management Authority (NDRRMA) based on different scientific analysis has predicted that 1.25 million people belonging to a total of 286,098 households are likely to be affected by rain-induced disasters this year. The study has predicted that the incidents of natural disaster will mostly affect Madhes Province followed by Koshi Province. The incidents would affect around 400,000 people in the Madhes and 300, 000 people in the Koshi province this year, the report stated. According to the Authority, the disaster would affect 200,000 people in the Lumbini Province, 100,000 in the Bagmati Province, 147,000 in the Sudurpaschim Province, 69,000 in the Gandaki Province and 35,000 in Karnali Province. Last year around two million people were predicted to be affected by the incidents of disasters. In view of this, the government has intensified early preparedness and response efforts before the monsoon set in the country. The Ministry of Home Affairs has stepped up its preparation to put in place mechanisms to tackle devastating disasters this year.  

An earthquake measuring 4.4 on the Richter scale struck Bicchiya of Bajura district on Monday. According to the National Earthquake Monitoring and Research Centre, Lainchaur, the earthquake occurred at 7.38 am. Lately, earthquakes have been recurrently taking place in the eastern and western areas of Nepal. Nepal's hilly and mountainous areas are considered the vulnerable zone for earthquakes.  

The Supreme Court on Sunday registered a writ petition demanding the prosecution of then supremo of the Communist Party of Nepal (Maoist) Pushpa Kamal Dahal and his second-in-command Baburam Bhattarai for forced conscription of child soldiers during the decade-long insurgency. In his third stint as Prime Minister, Dahal, chair of the CPN (Maoist Center), heads a coalition government that has come under fire from the opposition parties in the Parliament for what they consider a ‘poor showing’ during his four-day visit to India (May 31-June 03). The minor soldiers’ move does not come as a good tiding for Dahal. Bhattarai is a former prime minister and the chair of Socialist Party of Nepal. Nine former child combatants, including Lenin Bista, founding chairperson of the Discharged People’s Liberation Army, had moved the apex court accusing the former rebels of committing war crimes by forcing minors to join military activities in contravention of international human rights laws. On May 30, the apex court administration had refused to entertain the former child soldiers’ petition, pointing out that transitional justice mechanisms overseeing war-era cases are supposed to look into this case also. But a single bench of Justice Anand Mohan Bhattarai ordered the court staff to register the petition against Dahal and Bhattarai. A preliminary hearing on the petition is scheduled for Tuesday. The verification of former PLA combatants, which the United Nations Mission in Nepal had conducted in 2007 for integrating former rebel soldiers into the Nepali Army, had disqualified thousands of Maoist combatants, including Bista, for being minors. Of the 4,008 disqualified combatants, 2,973 turned out to be minors while the remaining 1,035 were found to have joined the Maoist ‘People’s Liberation Army’ after the first ceasefire of 26 May 2006—six months before the signing of the Comprehensive Peace Agreement between the government of Nepal and the Communist Party of Nepal (Maoist) in 2006. The government had provided Rs 500,000-Rs 800,000 each to combatants opting for voluntary retirement, whereas the child soldiers had received token assistance from the United Nations.

Traffic rules are one of the most important things in roads and highways. There are many things to follow in the street such as zebra crossing, lights, speed control and other things. If we minimize the traffic jam if all things are duly followed. And, traffic police are always there in the street. We should implement their command and instructions to make all of us disciplined.  First, people should cross the roads from zebra crossing because it helps to control accidents. When people cross the road, vehicles should provide them time. All of us know, there are certain lights such as red, green and yellow and they have different messages to them. Red means we should stop, yellow means either we have to prepare to go or we can go carefully.  Similarly, there is the issue of speed control. We should fix speed limitations  and we have to control them. On highways, there are speed rules that should be followed. As a student, we should create awareness about the traffic rules. If need be, you should voluntarily help the traffic in the street. If we make a habit of rules from childhood, it will be good in the future.  We have seen a lot of traffic accidents and the only way to correct them is to implement the traffic rules strictly.  Prabesh Bhattarai Class: 6 Global Pathshala, Kausaltar