Banking on project bank

Development projects are designated as ‘national pride’ in Nepal to ensure that they are implemented on time. However, a national pride project that began 25 years ago still remains incomplete. The National Planning Commission, responsible for the country's overall development over the past 66 years, is the government's top policy-making agency. It works under the National Development Council which advises on the country's development plans and policy formulation. Nepal started implementing five-year periodic plans in the 1960s. If an agency with six decades of experience can't complete a project in two decades, how can Nepal's development be possible? This question will continue to challenge Nepal's development efforts. Around  2,000 development projects in the country have ended in failure. It is not clear who is responsible for this situation. The government has not taken any action to address these projects and this issue has persisted for years without any significant improvement. People had low expectations from the government during the Panchayat period. But the introduction of multi-party democracy in 1990 raised hopes for development. However, despite changes in the political system, including the adoption of federalism and the republican system, little progress has been made in the past three decades. While the world economy has undergone major transformations in the past seven decades, the people of Nepal have not seen the benefits of such changes. The slow pace of development after the political change in 1990 is a disappointment to the citizens of the country. Data from the past decade reflects the sorry saga of development in Nepal. It shows that corruption has become widespread and persistent. Whenever a new government is formed, people become hopeful that their development aspirations will now bear fruits. Leaders talk about zero tolerance for corruption. But when their term ends, people feel that the corruption has increased further. Therefore, stability is not possible unless political leadership improves its conduct. Corruption cannot come down unless there is political stability in the country. Nepal's ranking of 110th in the 2022 Corruption Perceptions Index further highlights this issue.

The 15th plan is currently underway. The NPC recently conducted a mid-term review of the periodic plan. The results are disappointing. This raises concerns that the 15th plan may not make a significant impact on the overall development of the country.

Albeit late, the government has put forth the concept of a project bank. The creation of a national project bank can be a step in the right direction for the overall development of Nepal. In order to compete globally, Nepal must improve various aspects of development. The NPC-run project bank has the potential to bring a new dimension to development and help achieve economic prosperity. The projects in the project bank must prioritize balanced development and do not compromise on good governance. Successful implementation of these projects requires careful planning that takes into account policies and budgets. Otherwise, they may meet the fate of similar other projects. Necessary studies must be conducted to identify potential problems or obstacles before a project is initiated. The hope is that these projects will have positive socio-economic outcomes. Projects will only be added to the project bank after all preparatory work is completed and resources are secured. Feasibility studies and detailed project reports will have been completed before the project is implemented. While the government prepares to implement the project bank, financial data of the first half shows the government is suffering a budget deficit of nearly Rs 90bn. Stating that the government might not be able to service foreign loans, the finance ministry has decided to lower the budget of all state agencies by 20 percent and advised them to cut their expenses. The Financial Comptrollers General Office puts the budget deficit at Rs 109bn. How is the government running when it is earning Rs 511bn and spending Rs 620bn? How is development possible in this situation? When will the parties take responsibility for this? Development projects cannot gain momentum unless there is a strong political motivation. Making development plans, allocating budget and setting targets are the normal functions of the government. However, it is not easy to complete these tasks in a professional manner within the specified time, unless the human resources involved are competent. In addition to having one opinion, everyone should also have a strong will. The correct identification of the project determines the fate and future of the country. This may sound like a normal issue, but this is the first condition. Therefore, there is a need to put in place a certain criteria for selection of development projects and work without compromise. The immaturity seen in project selection in the past should not be repeated. Such projects won’t deliver expected results even if they are completed. Lessons must be learned from this. But we don’t seem to improve. First, not all of the 500 projects registered in the project bank as per the prescribed format. Second, the project bank, which was expected to be functional in 2018, is still to come into operation. Before starting the projects from the project bank, there is a need to complete the national pride projects in the current fiscal year. If not possible, arrangements should be made to ensure their completion date, secure the necessary budget, and remove any obstacles to implementation. Otherwise, even the projects in the project bank may suffer from this ‘chronic disease’. As corruption is prevalent in development projects, the Prime Minister, as the chairman of NPC, should guarantee 100 percent fiscal discipline in these projects. The concept of project banks has existed for over seven decades around the world. Many countries have seen significant development through the implementation of project banks. Nepal also started preparing to start a project bank about a decade ago. But despite its formal establishment in 2018, the project bank has yet to gain significant traction. This has caused some concerns. Countries like China, Singapore, Japan, and South Korea in Asia have set a benchmark in development. This happened because political parties and leaders there put their nation’s interest ahead of their vested interests. As a result, these nations are often named with pride when the world talks about Asia. It is therefore imperative that the projects in the project bank are picked without political bias. The focus should be on serving the interests of the nation and its people. A systematic and scientific approach should be followed to ensure the completion of projects within a specified time frame and to the highest quality standards, taking into account the principles of sustainable development. This will help build a brighter future for the country and its citizens.