LAWYERS ATTACHED WITH NGOs NOT TO BE APPOINTED JUDGES Kathmandu, 5 June: Judicial Council has decided not to appoint any lawyer working in international non-government organisations or NGOs to the post of appellate court judges, JC member Khem Narayan Dhungana told The Himalayan Times today [Tuesday], according to Anaanta Raj::Luitel. The JC is in the final stage to select 51 permanent and ad hoc judges and 10 additional judges for the appellate courts. It will appoint 26 lawyers to these posts, including five or six women. As many as 650 lawyers, including those working for NGOs and INGOs, have applied for the posts. “We’ll select only professional law practitioners this time even if those working for NGOs and INGOs are more talented,” Dhungana said. The JC would also give preference to lawyers from Madhesi, Dalit and backward communities and regions if they are equally competent as others from general category, added Dhungana. According to another source, the JC will also give preference to physically challenged lawyers if they are willing to serve as a judge, keeping in mind the principle of inclusion. Sources say JC has already decided on names to fill the vacancies meant for cadre judges and court officials. On the second day of deliberations today, Acting Chief Justice Sharma, who heads JC, senior most justice Ram Kumar Prasad Shah, Law Minister Hari Prasad Neupane and members Dhungana and Upendra Keshari Neupane dwelt on the probable names for more than six hours. They have narrowed down to 70 names to pick 25 lawyers. Acting Chief Justice Sharma said JC was close to take a decision on the final names. He added that they would meet again tomorrow. “It is good that JC has decided not to select those working for NGOs or INGOs. But how can the JC maintain quality since lawyers working for INGOs and NGOs are comparatively more talented?” wondered a top NBA official . Nnnn MORE SMALL FINANCIAL COMPANIES REPORT LOSSES Kathmandu, 5 June: The number of small finance companies and development banks incurring losses increased in the past quarter, while larger financial institutions were able to earn enviable profits, Dikshya Singh write in The Himalayan Times. Among the licensed financial institutions that have published their financials, the unaudited financial statements of one commercial bank, 14 development banks and 13 finance companies for the third quarter show cumulative losses of more than Rs 1.3 billion. During the second quarter, there were 15 development banks and 10 finance companies that had incurred losses of about Rs one billion. On the other hand, larger commercial banks have been able to increase their profits by more than 40 per cent in the third quarter. The piling up of bad loans and subsequent provisioning has eaten up prospects of profits for development banks and finance companies. The average non-performing assets of these loss-incurring financial institutions is higher than 17 per cent of the total loans. The industry average non-performing assets of commercial banks stands at three per cent, for development banks at 5.8 per cent and finance companies at 9.4 per cent. International Development Bank has incurred the highest loss with its financials showing loss worth Rs 202.5 million as the class ‘B’ financial institution had to set aside Rs 285.9 million to provision against bad loans —an amount higher than its operating profit. Its non-performing asset is higher than 10 per cent. Likewise, Vibor Bikas Bank and Synergy Finance also suffered through losses of Rs 195.4 million and Rs 134.16 million, respectively, in third quarter. Among commercial banks, Kist Bank continued to incur losses in the quarter with losses worth Rs 55.01 million with non-performing assets of 7.89 per cent. “Smaller institutions with less paid up capital do not have the capacity to absorb shocks so if a few large borrowers default on loans then it is difficult to make profit,” said president of Nepal Finance Companies’ Association Rajendra Man Shakya. Financial institutions are required to provision 25 per cent of the principal and due interest if borrowers fall behind the payment schedule for three months, 50 per cent if delay in repayment crosses six months, and 100 per cent provisioning is required after that. So, the higher the amount of non-performing loans, the higher is the provision required. This in turn leads to higher chances of incurring losses. Development banks have provisioned Rs 1.9 billion for loan loss in the third quarter, which is 44 per cent higher than the amount set aside in the second quarter. Likewise, finance companies have set aside Rs 1.09 million for possible loan loss, which is 40 per cent higher than the amount provisioned in the second quarter. Loans floated to land plotting and crusher industries have particularly become toxic for financial institutions. “The root cause of mounting losses of financial institutions is the high level of provisioning that exhausts the income and reserves as well,” said Shakya. In the last one quarter, general reserves of finance companies have declined by Rs 85 million, while that of development banks increased by Rs 80 million and of commercial banks by Rs 300 million. “Losses are increasing at present because the sectors where these financial institutions have invested heavily in are not in good shape,” pointed out spokesperson for Nepal Rastra Bank Bhaskar Mani Gyanwali. “Profits and losses are also of a cyclical nature. A couple of years back financial institutions were enjoying good profits. After the present phase is over, they will once again be flush with funds.” nnnn BPC TO BEGIN CONSTRUCTION OF 141MW POWER PROJECT Kathmandu, 5 June: Targeting to complete within four years, Butwal Power Company (BPC) has planned to start the construction works of 141-MW Lower Manang Marsyangdi Hydropower Project (LMMHP) from this year, The Rising Nepal reports from Lamjung.. The LMMHP is located in Manang district. As per the detail design of the project, power will be generated by dropping water through an underground tunnel in the powerhouse to be built in Khotro village of Dharapani VDC of Manang by making a dam in Tachai Bagarchhap VDC of Manang. According to the project, it would have a 45-meter long and six metre high dam along with 5.3 meter diameter tunnel, said statement issued by the company. Two turbines of equal capacity would be used in the powerhouse located at Khotro village of Dharapani VDC, said . Nirmal Kumar Acharya, project development manager. He said that the project was conducting studies as there is possibility of increasing the capacity to 210 MW from 141 MW as permitted. The project has already submitted the detail feasibility study and Environment Impact Assessment (EIA) to the concern authorities but it was yet to sign Power Purchasing Agreement with Nepal Electricity Authority (NEA). The project has complained that works could not be started as the Nepal Electricity Authority (NEA) did not provide PPA yet, even as all the processes were completed. The run -of -the -river project has got license of survey and 5 km long double circuit transmission line of 220 kV capacities and its survey is said to begin immediately. The project administration said that works could not gain momentum if the locals demanded free shares and created other problems from political front. BPC has large projects like 30-mw Ngadi, and 37.6 MW Kaveli along with the Lower Manang Marsyangdi. Nnnn TEXT BOOK SHORTAGE IN MID AND FAR-WEST Kathmandu, 5 June: Acute shortage of textbooks has hit many districts of mid and far western regions even though the new academic session has started two months ago, The Rising Nepal reports from Banke. . Despite having 3,000,000 sets of textbooks at Jumla district, many children of the far-western districts have been compelled to attend their classes without textbooks. Owing to the imbalance in the distribution of textbooks from the initial phase of academic session, the shortage of books has occurred in this region. Rabindra Sharma, regional chief of the Janak Education Materials Center, Nepalgunj informed that the western districts had not received full sets of class six textbooks and some textbooks of class four and five are also unavailable. Sharma claimed that Sajha Publication, distributor of JEMC said 50 per cent of textbooks in surplus were supplied in Jumla . The teachers and guardians, especially from the hilly areas, complained that the students were without text books till the time they are required to appear in the half-yearly examination owing to the shortage of books. Shyam Pokharel, a teacher, said classes are affected when the textbooks remained unavailable and that many students in the distant villages got failed in the SLC examination due to the same reason. Likewise, JEMC claimed that textbooks from the private publishers were being sold overlooking the instruction from the Education Ministry. The Ministry of Education has allowed the private publishers to sell their textbooks only at Eastern and Western Regions. Chudamani Poudel, Regional Educational Directorate of Banke said JEMC and Sajha Publication had not informed him about textbooks storage at Jumla. nnnn GOVT.PUTS ON HOLD SUGGESTION TO DECLARE FOUR INDUSTRIES SICK Kathmandu, 5 June: The cabinet has put the industry ministry"s proposal to give "sick industry" status to four firms on hold, stating that the firms do not meet the criteria, Bhoj Raj Pokhrel writes in Republica.. The Ministry of Industry (MoI) a few weeks ago recommended to the government to give "sick industry" status to Birat Leather, Birat Shoes, Shree Nepal Boarders and Basulingi Private Limited. “The cabinet declined to give "sick industry" status to those firms stating that they do not meet the criteria set in Industrial Act 1992,´ an official at the MoI said. “The cabinet has put the proposal on hold.” The Industrial Act 1992 states that only the industries which have incurred loss for five consecutive years and are still in operation shall be given "sick industry" status. “None of the recommended four industries are in operation,” the official added. Confirming the development, Krishna Gyawali, secretary at the MoI said the cabinet has neither endorsed the proposal not has asked the ministry for further information about the firms. “I have briefed Minister for Industry Shankar Koirala on the exact situation of the four firms,” added Gyawali. The government"s attempt to revive sick industries had failed in the past as well due to confusion over criteria. “This time also the cabinet couldn"t take any decision on sick industries because of the criteria,” the official at MoI said. According to the industry ministry, a total of 37 firms had applied at the Industrial Promotion Division (IPD) to get "sick industry" status. The ministry had formed a technical committee under the leadership of chief of the IPD to conduct study on those firms. After conducting field study and due diligence auditing of all the firms, the committee had recommended to the ministry to forward the name of four firms to the cabinet. The government had announced programs to provide relief package to sick industries through its Immediate Relief Program 2011/12. The MoI was assigned to identify actual number of sick industries upon submission of a report in 2011 by the Sick-industries Rehabilitation High Level Task Force (SIRHLTF) that laid emphasis on revival of sick industries. INTERVIEW UML ISHWAR POKHREL SPEAK Nearly three months into the appointment of Khil Raj Regmi as the head of the interim election government with the sole mandate of holding new CA polls, an election date is yet to be announced. Negotiations continue to settle contentious election related issues like downsizing the Constituent Assembly and the proposed one percent threshold for PR seats in new CA polls. Thira L Bhusal and Biswas Baral talked to CPN-UML General Secretary Ishwar Pokhrel, an important interlocutor in ongoing negotiations, on a range of issues including CA polls and UML-Maoist rivalry. Of late, divisions over whether Khil Raj Regmi should resign as Chief Justice seem to be deepening, both between the political parties and even within UML. All along, our party has been speaking in favor of separation of powers and independence of judiciary. If you look at our formal documents, we have taken this stand. Yes, there are people in UML both in favor of and against the appointment of CJ as executive head. But right now, UML believes that a closed chapter should be left closed. Our focus should be on taking the open chapter to the right conclusion. Our only concern at this point is that the executive should not unduly influence the judiciary. If Regmi’s vacating the post of CJ can bring the agitating forces on board for election, it could certainly be an option. Talking about agitating parties, there has been a big debate on the proposed PR threshold and cutting down CA’s size. Where is the debate headed? This debate is unnecessary and I hold the Maoists responsible for it. They get into an agreement today, and even before the ink on the paper has dried, start opposing it. This raises a serious question mark over their political honesty. It was with the agreement of UCPN (Maoist), reflected in the 11-point political agreement and 25-point constitution amendment proposal, that the decision to reduce the size of the CA from 601 to 491 was made. But within two days, the Maoists started opposing the same provision. I don’t understand how the Maoists can get away with such blatant political dishonesty. But the Maoists say that the provision of a 491-strong CA is contingent on whether Nepali Congress and UML are ready to compromise on PR threshold and candidacy of people with criminal background. Look, the Election Commission made the proposal for smaller CA, PR threshold and barring of candidates with criminal background after widespread consultations with 33 parties represented in the erstwhile CA, including UCPN (Maoist). The EC’s consultations with the big four forces on these issues was even more rigorous. Now Pushpa Kamal Dahal accuses the Election Commission of proposing laws that are against the 11-point understanding and 25-point constitution amendment proposal. The bottom line is that the Maoists once established a culture of violence in Nepali politics. Now it is the chief force promoting anarchy and opportunism in the Nepali political arena. On the basis of its performance so far, do you believe the Khil Raj Regmi government will be able to hold new CA polls by the December deadline? We should think positively. The whole rationale for the formation of Regmi government was to hold new CA polls. He should be able to do it. CPN-UML has come to be known as a party which vigorously debates important national issues, comes to logical conclusions, but cannot implement them. Is this a right characterization? The biggest problem with UML is that it cannot own up its decisions. If you are affiliated with an organization, you should be able to uphold its collective decision. UML has not been able to do this of late. This is a sign of incompetence. Do you believe that this incapacity has had a deleterious impact on national politics? I think it depends on the context. But overall, like I said, UML has time and again displayed the tendency not to own up its collective decisions which is likely to impact certain national issues in certain ways. What can be done to rectify this situation? First of all, everyone should understand the issues objectively. That is half the battle won. One after another influential UML leader is leaving the party to join UCPN (Maoist). The perception is that the Maoists might soon decimate the UML party machinery. Let us get our facts right. Everywhere I have been recently, from Mugu to Sunsari, hundreds of people from indigenous backgrounds have queued up to join UML. But this never makes news. Maybe this inability to get the message across is our own weakness. So far as our friends who have left the party are concerned, I don’t believe they have left the party over particular issues or policies. All of them have gone after milking the party for their personal benefits. When they left, they made it appear like there was no place for them in the party. Like I said earlier, it could also be a part of the Maoist plot. The Maoists are now the leading opportunist and anarchic force which is bent on destroying the democratic forces in the country. There is a perception that UCPN (Maoist) is steadily encroaching into the space that UML created for itself as the country’s leading communist force. How do you see the Maoist-UML dynamics play out in the lead up to CA polls? The Maoists are a temporary phenomenon in Nepali politics. But even though they are a temporary phenomenon, they still need to be managed. This is our compulsion. Tell me: What is the guiding principle of the Maoists? They have none. When a political party has no guiding principle, it becomes a completely opportunistic force. Death is the ultimate destiny of all such forces. We, on the other hand, are guided by a particular philosophy: janatako baudaliya janabad (people’s multiparty democracy), which is a principle of peaceful progressive transformation. How have you seen the role of UCPN (Maoist) in Nepal’s communist movement? Communists are pro-people who are in favor of peaceful social transformation. The Maoists have emerged as a force that wants to distort this image of communism. Tell me: What came out of their bloody war? What is the justification for such widespread destruction which sowed the seed of violence in Nepali politics? The real change came to Nepal only after the violence of Maoists was thoroughly rejected. There is a belief that CPN-UML has been rendered into a very weak force ahead of the new CA polls. Our strength is our ideology, organization network and a comparatively established line of leadership which is trusted by the majority of the people. Our long history is another asset. Our cadre base plays the role of our constant critics, which says what is right and wrong outright. Compare this with the cadre base of UCPN (Maoist). First, those who want to weaken the democratic forces in the country would like to see a weak UML. Second, we fail to take ownership of important national agendas and debates. These two things send the impression of a weak party. How do you counter the accusation that CPN-UML is not an inclusive party? Let the facts speak for themselves. Go fetch our organizational charts and compare them with those of any other party in Nepal. You will see that ours is easily the most inclusive of all political parties. You like to say that the country faces an unprecedented crisis in its history. Could you elaborate? For the first time in its history, the country is in the midst of a great national debate. I call it a great national debate because of its volume, intensity, agendas, participants and likely outcomes. If the political leadership can manage this debate, the country will reach new heights; otherwise there could be devastating consequences. The great contradiction today is that our leadership is small in stature, but the challenges are all big. Isn’t there an amicable way to settle this debate? The political leadership must be able to rise above petty interests and engage in the debate, realizing the gravity of the matter. There is a need for broader political unity on important issues at this very difficult juncture. I am afraid our only option is damage control. If genuine democratic, progressive and nationalist forces can come to the same page and gain command over elected bodies, we can check the situation from further deteriorating. Otherwise, there is no hope for the country. For the new CA to produce a democratic constitution, there must be a two-third majority of democratic forces. nnnn