GOVT. FAILURE TO SPEND BUDGET EARMARKED FOR DEVELOPMENT

TAI OFFICIALS FREED ON BAIL
Kathmandu, 12 April: Two TAI official Mahesh Paudel and Purna Bahadur
Basnet accused for taking a bribe of Rs.150,000 from a Nepali woman to board a flight for USA last October were freed on bail by special court Wednesday.
A Sherpa woman was stopped from barding a flight even as she produced her passport.
The woman boarded the flight after paying the bribe which was recorded by her
on camera.
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ONLY RS. 65B EARMARKED FOR DEVELOPMENT SPENT
Kathmandu, 12 April : If the latest estimates of Ministry of Finance (MoF) is anything to go by, the government could miss the revised target of capital spending that was scaled down to Rs 65 billion from initial annual target of Rs 72 billion, throwing cold water on development aspirations of Nepalis in general.

Such a scenario surfaced after fresh data of capital spending forwarded by 27 different government ministries showed they had managed to spend about Rs 16 billion over the span of eight-and-a-half months.

“The amount spent so far is mere 22 percent of the annual capital allocations. Even if we make a very optimistic projection including donors´ grant and kinds support, which are not included in this figure, we see little chance of total capital spending crossing over 35 percent (of the allocation) by the end of first nine months of 2011/12,” said a senior MoF official.

And given that the existing fiscal norms restricts the government from spending more than 40 percent of the total allocations in the last quarter, he said capital spending over this fiscal year could remain confined at around 75 percent of the initial promise only.

If his calculation is anything to go by, development spending of the government over this fiscal year could remain at just over Rs 54 billion. The projection is some Rs 10 billion less than even the revised capital spending target that MoF unveiled during the mid-term budget review.

The situation, meanwhile, has exerted severe pressure on the government to lift the fiscal norms, under which it has committed to cap total spending for the last quarter at 40 percent of total capital budget and limit the 12th month´s spending at 20 percent of annual allocations.

“We will not relax the prudent norms irrespective of the pressure,” said Lok Darshan Regmi, chief of budget division at MoF.

Finance Minister Barsha Man Pun, who reviewed the status capital spending at a program in which government Secretaries from 27 different Ministries attended on Wednesday, also echoed what Regmi stated.

However, other officials at the MoF said the Ministry might need to ´review´ its stance particularly considering the ´necessity´ of development projects and country´s development aspirations.

“If we did not relax it, we will fail to spend committed volume of development budget. I do not think the government is ready to face this criticism, even though the finance minister is rejecting any relaxation on cap now,” said the source.

Citing delayed budget and low spending, the government had relaxed the norms last year as well.

The government had put in place the cap on capital spending mainly to control haphazard spending at the last hour of fiscal year. It was adopted after MoF assessed that such final hour spending was causing huge leakage of resources and corruption.
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GOVT. DRAFTING AGRICULTRE DEVELOPMENT STRATEGY
Kathmandu, 12April : The government is preparing to start drafting 20-year long vision document of Agriculture Development Strategy (ADS) afresh after newly inducted representatives from farmers associations refused to accept previous team´s assessment of Agricultural Perspective Plan (APP), Bhola Raj Poudel reports in Republica. .

Though a steering committee entrusted to draft the ADS, which will replace APP once it ends in 2015, had already completed the assessment of the APP and also developed vision of ADS, newly inducted Prem Dangal, general secretary of the All Nepal Peasants Federation said the whole process needs rework because the evaluations done by the previous team were faulty.

“APP was a complete failure, but their assessment does not reflect that. If we accept it, we will stand on faulty premises and that will misguide the new vision, plan and strategy,” said Dangal, adding that the government has already given nod to restart the whole exercise afresh.

However, sources said the government has not taken any concrete decision on the matter particularly as the exercises carried out so far was funded by multilateral and bilateral donors and outright rejection of report prepared by experts they assigned could ´hurt their sentiment´.

Finance Secretary Krishna Hari Baskota, who chaired a meeting of ADS stakeholders this week, said that they reached an conclusion to rethink the assessment and vision report of previous team as farmers representatives strongly expressed dissatisfaction.

“But we will take a concrete decision only after discussions with concerned ministers,” he told Republica, adding that a meeting between Ministry of Agriculture and Cooperatives (MoAC) and Ministry of Finace (MoF) will be held soon to decide on the matter.

Nonetheless, he added that there was no meaning of continuing the draft process when farmers are completely against it.

A meeting held last Monday had asked the ADS steering committee to stop working till the government makes concrete decision whether to own the work that has been completed so far.

The government had initiated process to develop ADS in 2011 and had formed a committee under the leadership of Francesco Goletti, a policy and institutional specialist and president of Agrifood Consulting International - New York University. The team included former bureaucrats and foreign consultants.

The document was being prepared with technical assistance from the Asian development Bank, the World Bank and USAID, among other 7 donors. The government has allocated US$ 2 million (about Rs 160 million) for developing ADS.

Farmers´ Organizations had been strongly protesting the approach the government adopted for preparing such a crucial document, saying that vision document prepared in the absence of farmers´ representatives might not address their concerns and agricultural reality of the country.
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COOKING GAS TO BE DEARER
Kathmandu, 12 April: Ministry of Commerce and Supplies is preparing to hike the price of Liquefied Petroleum Gas (LPG), The Hiimalayan Times reports.

The ministry will hike the price of LPG, popularly known as cooking gas, within a week, minister for commerce and supplies Lekh Raj Bhatta said at a programme here in the valley today.

“It is likely that the ministry will jack up the price of cooking gas by up to Rs 200,” an official at the ministry confirmed. He, however, elaborated that the ministry might hike the price in a phase-wise manner. “The ministry will start hiking the price of cooking gas every week from next week.”

However, minister Bhatta floated a different idea regarding the price hike during the meeting with representatives from petroleum sector. He proposed to scale up the price by Rs 800 on a cylinder of gas for industries, according to former president of Nepal Petroleum Dealers National Association Saroj Prasad Pande, who took part in the meeting.

“The ministry will introduce consumer cards to provide gas at subsidised rates from April 14,” he said, quoting Bhatta. “The country will not be able to ensure the smooth supply of cooking gas, if the price is not adjusted according to the purchase price and taxes, after the implementation of consumer cards,” according to the minister.

Nepal Oil Corporation (NOC) had also pledged to distribute consumer cards to provide cooking gas at subsidised rates to general consumers from April 14.

Currently, the price for a cooking gas cylinder is fixed at Rs 1,415 for general consumers. NOC is incurring a loss of Rs 802.2 on each cylinder, according to it.

The monthly loss from the supply of cooking gas is Rs 962.42 billion, according to the corporation. The ministry is left with no option but to hike the price of petroleum products. But, the Ministry of Commerce and Supplies and NOC will once again face the charge of protecting black marketers and bottlers if it decides to hike the price.

The scarcity of cooking gas has been prolonged for more than four months amidst accusations of black-marketing and hoarding by bottling plants. But, the ministry has remained a mute spectator even though it is responsible to regulate the market.

The direct message will be that the taxpayers are paying taxes for the protection of ‘black-marketers’ if the ministry hikes the price of cooking gas without ending the current crisis.

NOC had imported around 17,000 metric tonnes of cooking gas in January and February but even that record high LPG import could not smoothen the supply in the market.
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INITIAL FIGHTER UNHAPPINESS WITH ARMY SOLDIERS IN SURKHET SUSP
Kathmandu, 12 April: Maoist fighters’ regrouping work was halted for some hours after it began at Surkhet’s Dasarhpur-based PLA Sixth Division on Tuesday, Suryamani Gautam
writes in The Himalayan Times from Surkhet.

The sudden arrival of Nepali Army at the Sixth Division irked the fighters initially. However, the combatants were pacified when they were told that the NA had turned up as per the party and government’s agreement to take charge of the camp.

Special Committee had kept the NA team outside the camp for half an hour. They were allowed to get into the camp following the discussion between the Maoist division commander and Special Committee.

Division commander Mahendra Shahi said that fighters’ anger did not take nasty turn after they came to know that the decision was made by the party and government at the center. “The fighters were suspicious as the arch-foes of ten-year long insurgency had approached the camp abruptly,” Shahi added.

Meanwhile, Major Bisworaj Pyakurel who is commanding the NA team at the camp said that they had reached the camp in line with headquarters’ directive.

Maoist combatants at the PLA Sixth Division evoked mixed reactions regarding the army integration. Some fighters expressed their displeasure over their leadership for surrendering their weapons and containers to the NA, while others termed the decision as positive for achieving peace and constitution.

Division commander Asim Kshetri said that party leadership had wounded the fighters’ sentiment by dissolving the PLAs. “Did we fight for ten years to remain under the Army’s control,” asked Kshetri. He argued that yesterday’s decision to handover the charge of the Maoist fighters, weapons and containers to the NA was not only the height of surrender but also an insult to the martyrs and their dreams.

Company commander Chetan Karki said that it was erroneous to handover the control of the Maoist fighters and weapons without first fixing the ranks to the PLAs in the NA.

However, Sixth Division commander Mahendra Shahi said that decision was acceptable to them. He said that PLA was ready to make any sacrifice for peace and constitution. “But the PLAs should have given the rights to fix the ranks in the NA,” Shahi said adding, “If the PLAs are not granted such rights, army integration will not be respectable.” Shahi held that PLAs would not impede integration process.
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