ADB awarded four projects

Nepal needs to improve its performance portfolio in Asian Development Bank funded project

Sept. 27, 2013, 5:45 p.m. Published in Magazine Issue: Vol: 07 No.-07 Sept. 13 -2013 (Bhadra 28, 2070)

At a time when Nepal government lacks adequate resources to fund the development projects, Nepal can easily additional 90 million US dollar from the Asian Development Bank's fund. However, there is a fund as well as criteria Nepal needs to fulfill. For this, Nepal needs to enhance its performance and efficiency to meet the criteria set for the fund.

"It is possible for us. What we need to is to put all our efforts to enhance project performance and increase the efficiency," finance secretary Shanta Raj Subedi told New Spotlight. "Going through the last two months performance, I am pretty sure that we will qualify for additional 90 million dollar.

Addressing two days meeting of Asian Development Bank's Country Portfolio Review Meeting, finance secretary Subedi said that we will take all necessary actions to improve project portfolios addressing the key issues. "We have made certain progress in the last few months on the regard."

Attended by the staff of ADB and the Government of Nepal, the Country Portfolio Review meeting, reviewed the status of implementation of all ADB-assisted projects/programs. The meeting also examined and discussed country-specific common project implementation challenges and prepared a time-bound action plan with quantifiable monitoring targets to improve portfolio performance and delivery of results on the ground.

Explaining that the forthcoming five-year Country Partnership Strategy will place significant emphasis on improved portfolio performance and associated institutional development, Asian Development Bank's country director Kenichi Yokoyama emphasized on the need for (i) selectivity and focus on ADB operations to take up smaller number of larger projects forcing on critical bottlenecks such as infrastructure and human capital, (ii) enhancing project readiness with advancing detailed designs before project approval; (iii) strengthening project management systems with effective monitoring and troubleshooting, and (iv) pursuing genetic reforms for timely budget planning, approval and release, public procurement, public financial management, and other accountability mechanisms. He also underscored the need for substantially increasing the quality and quantity of capital investments in order for the country to go into a much higher growth trajectory of 7-8% per annum. 

"If Nepal can improve its portfolio performance and meet the rating, Nepal can be still awarded 90 million US dollaor," said Yokoyama.  "As of 31 August 2013, ADB's active portfolio amounts to about $ 1.5 billion with 35 investment projects, of which $ 0.9 (60%) is still to be awarded, and $ 1.2. Billion (80%) is still to be disbursed, of which  $ 0.9 billon (60%) is still to be awarded and $ 1.2 billion (80%) is still to be disbursed, which are very high ( and should ideally about 30% and 60 % respectively). In 2012, contract and disbursement was only 16% and 9% of uncommitted and undisbursed funds, which should ideally be over 20 Percent," said Yokoyama.

Nepal performance suffered in last few years due to frequent transfers of project chiefs, lack of regular budgets and delaying in the contract agreements. Political transition has badly affected decision making process.

The two day meeting held on 26-27 September widely discussed various issues related to the projects and recommended the ways to improve the performance portfolio in various projects.

In the inaugural session, four projects helping to improve water supply and sanitation services, air safety standards and the lives of the rural poor and farmers in Nepal have been recognized for excellence in delivering results by the Asian Development Bank (ADB).

The projects that won the awards are the Rural Reconstruction and Rehabilitation Sector Project, the Community Managed Irrigated Agriculture Sector Project and the Second Small Towns Water Supply and Sanitation Sector Project and the Air Transport Capacity Enhancement Project all of which are supported by ADB. 

Finance Secretary Shanta Raj Subedi presented the Outstanding Project Management Team Awards to the winning teams at a special ceremony held in conjunction with ADB’s annual Country Portfolio Review meeting organized by ADB with the Government of Nepal.

"These awards recognize the projects teams' efficiency in implementation and achievement of targets,” said Kenichi Yokoyama, ADB’s Country Director for Nepal. “We appreciate the efforts made by the project teams in delivering the desired results on the ground as well as enhancing overall portfolio performance.”

The Rural Reconstruction and Rehabilitation Sector Project is helping to reduce poverty in isolated areas of Nepal by improving connectivity, enhancing economic and employment opportunities, and increasing rural access to markets and social services.

The Second Small Towns Water Supply and Sanitation Sector Project is helping to improve access to water and sanitation services in 20 small towns by developing additional water sources, construction of water treatment facilities and storage tanks, private latrines, public toilets, wastewater management facilities, and storm water drainage.

The Community Managed Irrigated Agriculture Sector Project is helping improve the agriculture productivity and sustainability of existing small and medium farmer managed irrigation systems suffering from low water deficiency and cropping intensity. A total of 178,285 farmers are expected to benefit from the improved water accessibility. 

The Secondary Town Integrated Urban Environmental Improvement Project is helping improve the quality of urban life in key regional centers through effective, efficient, and reliable delivery of improved and affordable municipal services. 

Similarly, the Air Transport Capacity Enhancement Project is helping improve the country's airports and civil aviation safety standards. The project is helping to improve safety and capacity at Tribhuvan International Airport (TIA) in Kathmandu, and three domestic airports - Lukla, Rara and Simikot - that serve remote areas inaccessible by road.

ADB has worked in partnership with the Government of Nepal since the country joined ADB as a founding member in 1966. ADB began lending to Nepal in 1969. As of 31 August 2013, Nepal has received 163 loans/grants—126 sovereign Asian Development Fund (ADF) loans ($3 billion), 5 non-sovereign loans ($58.64 million), and 32 ADF grants ($798.25 million) totaling $3.9 billion.  

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