Industrial infrastructure development hard hit by budget

The political deadlock which obstructed annoucement of a full-fledged budget for the current fiscal year 2012/13 has paralyzed government´s program to support cement industries utilizing local raw materials which was launched four years back in 2008/09.
Under the program, the government had promised to construct roads, drinking water facility and lay electricity lines to the factory sites. This, the government had claimed would encourage investors to make use of country´s huge limestone reserves, thereby saving billions of rupees on import of clinker.
The ministries such as Ministry of Physical Planning, Works and Transport Management (MoPPWTM), Ministry of Energy (MoE) and Ministry of Industry (MoI), which are entrusted to carry out the program, had failed to spend the allocated budget in the previous fiscal year 2011/12.
“Now, there is just one third budget of actual expenditure of last fiscal year, which means less money which is too little even to build small portion of the infrastructure in the factory sites,” an official at the MoI told Republica on the condition of anonymity.
The government over the last four years had constructed only one third of the total 32 km road it had promised to four cement factories -- Ghorahi, Sonapur, Dang and Rolpa. Though the government had released Rs 175 million for road construction, only 48 percent of the amount have been spent so far.
Private sector, which had praised the government program, has started expressing disappointment. “The program was somehow a good step to improve the condition of industrial sector in the country,” an official of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) said on the condition of anonymity. He still expects that the government would work once the full-fledged budget comes in place.
Meanwhile, the MoPPWTM is working on designing program for this fiscal year. “The ministry is working on developing the program with the allocation of the current fiscal year,” Tulsi Prasad Sitaula, secretary at the MoPPWTM said. “The program will be implemented after jointly approving it from the National Planning Commission (NPC) and MoI.”
The private sector was exerting pressure on the political parties to come with the full-fledged budget for the current fiscal year 2012/13 through consensus. “We knew that the situation would be like this. This is just an example of the scenario. There are many other sectors and programs which have been badly affected due to the lack of full-fledged budget,” the FNCCI official said.