Govt to hike rent in industrial zones

government has resumed the process of increasing rent of land and building inside all 11 Industrial Estates (IEs). The government´s attempt to jack up rent had failed a few weeks ago following strong protest from industrialists.
The government has given a nod to the Industrial Estate Management Limited (IEML)--that oversees the management of industries inside the IEs--to constitute a committee, incorporating industrialists, to build a consensus on rent hike.
“Our ministry has asked the IEML to initiate talks with industrialists to get their support in this regard,” Krishna Gayawali, secretary at the Ministry of Industry (MoI), told Republica on Saturday.
Earlier, the IEML had unilaterally decided to raise rent in IEs--that house around 6,000 firms on 5,128 ropanies of land--in the range of 400 to 850 percent.
Following this, the Federation of Industries in Nepal Industrial Estates (FINIE), an umbrella body of industries operating in industrial estates across the country, led a protest.
At the same time, the industrialists also labeled the government decision a breach of the agreement between the government and industrialists reached some 15 years ago that emphasized on "bilateral understanding" prior to taking any decision on rent hikes.
As pressure intensified, the ministry directed the IEML not to enforce the decision on rent hike.
Now, the government has once again said “it has no option but to raise rent”. “That´s why we are holding consultations with industrialists,” Gayawali said.
The government, meanwhile, is also mulling over reforming the management of industrial estates to address host of complains from industrialist.
The FINIE had earlier asked the government to handover the property of all 11 industrial estates to the private sector to ensure proper management and optimal utilization of resources.
Around Rs 13 billion has so far been invested in the IEs, where more than 11,000 people are employed.

Govt to appoint directors at Birgunj Sugar

The government has decided to formally appoint board members at Birgunj Sugar Factory to resume operation of state-owned enterprise that has remained closed for the last one decade.
“The Council of Ministers has given a nod in this regard and has forwarded the proposal to its financial committee,” Yam Kumari Khatiwada, joint secretary at the Ministry of Industry (MoI), told Republica on Friday.
The MoI, which acted on recommendation laid by the factory´s ad-hoc board of directors led by Dhurba Lal Rajbansi, director general of the Department of Industry (DoI), had submitted a proposal on appointment of board members at the sugar mill to the cabinet more than a week ago.
“The new board directors will be responsible for carrying out the task of identifying the most effective way to resume operation of the sugar factory,” Khatiwada said.
According to an MoI official, the new board of directors will comprise 7 members, of which four will come from government agencies and three from the private sector.
The MoI took the step after the Public Enterprises (PE) Board gave its nod to resume operation of the factory by roping in the private sector.
“We suggested that the government resume operation of the factory but on condition of handing it over to the private sector since the government has time and again failed to run the factory smoothly,” Bimal Wagle, chairman of the PE Board, said.
The factory that was closed nine years ago still has to deal with 193 former workers who denied the government´s golden handshake offer.
“The new board of directors will also be responsible in settling this issue,” Khatiwada added.
The factory was almost liquidated by the government some nine years ago after it started incurring losses due to problems such as over-staffing and continuous shortage of raw materials, especially sugarcane.
Earlier, in 2009, the then finance minister Babu Ram Bhattarai, who is now the prime minister, declared that he wanted to see the factory running.

NEA staff to agitate against Trishuli III 'A' upgrade

Following the government´s move to upgrade the capacity of Trishuli III ´A´ from 60 to 90 megawatts, employees of Nepal Electricity Authority (NEA) have announced a month-long protest against the decision.
“We are against the government´s decision to upgrade the capacity of Trishuli III ´A´ since this will just create loss for the country and NEA will be in greater trouble,” Janardan Bhattarai, president of NEA Employees´ Association, said at a press meet organized in capital on Thursday.
All five employees´ organizations at NEA, such as NEA Employees´ Union and NEA Employees´ Association, have joined hands to protest the government´s decision.
The month-long protest program that begins Friday will comprise different types of symbolic activities in the initial days. “We will be compelled to increase the intensity of the protests if the government doesn´t roll back its decision,” Bhattarai said.
The government last week decided to increase the capacity of Trishuli III ´A´ through a meeting of the councils of ministers. The decision drew huge criticism from the oppositional parties and from experts.
The run-of-the-river project, which is being developed by Chinese contractor China Gezhouba Group Co. with a US$ 89 million soft loan from the Exim Bank of China, will not help address the power shortage in the dry season, experts claim.
“The government´s decision will just inflict additional losses on the NEA,” Bhattarai said. “This decision cannot be acceptable to us.”
According to NEA officials, the decision has only delayed completion of project.
“The government had awarded the project to China Gezhouba under the Engineering, Procurement and Construction (EPC) model,” Bhattarai said. “It was supposed to be completed by the next 15 months and people would have gotten some relief from the ongoing heafty power shortages.”
He further added that the government´s decision has delayed the project for another three years. Under the EPC model, the contractor designs the installation, procures necessary materials and builds the project.
Earlier, a writ petition was filed at the Supreme Court against the government´s decision. The SC has issued a show cause notice against Prime Minister Dr Babu Ram Bhattarai, the Prime Minister´s Office, the Ministry of Energy, NEA and China Gezhouba, among others.

2.4 MW hydro project in Mustang

Tachhar Hydro Company is developing a 2.4-MW hydropower project in Mustang with an investment of Rs 357 million.
"We are planning to develop the project with the support of locals," said Krishna Kumar Sherchan, promoter of the company, at a public hearing here on Friday. "Around 30 percent of the company´s shares will be issued to the public."
The project, estimated to be completed by 2015, will be a stepping stone for the development of different sectors, including health and education, in the northwestern district of Nepal. "So the project will contribute to overall development of the district," Sherchan said.
Locals, too, are optimistic as the project will create jobs for them.
"Locals should be getting job opportunities during the project development phase and even after its completion," Ananda Lal Sherchan, a former chairman of district development committee, said.

Japan hands over solar power plant to KUKL

Japan International Cooperation Agency (JICA) on Friday handed over 680 KW-capacity solar power plant to Kathmandu Uaptyaka Khanepani Ltd (KUKL).
The energy assistance has come at a time when the water utility company was facing difficulty in operating its deep tube well due to load-shedding. KUKL intends to sell surplus energy to Nepal Electricity Authority (NEA) by supplying it to the national grid.
“Almost one-third of power generated by the plant will be used by KUKL. Remaining will be sold to NEA,” Hari Prasad Dhakal, executive director of the Kathmandu Valley Water Supply Management Board (KVWSMB), said.
According to Dhakal, KUKL will generate revenue of Rs 3.1 million per year by selling surplus power to the NEA.
“It´s a big respite for valley denizens. Now, they would get water supplied by KUKL even during load-shedding,” Kunio Takahashi, Japanese envoy to Nepal, said in the handover ceremony organized at Dhobighat, Lalitpur.
Workers busy in fixing block at the construction site of the project of the Clean Energy by Solar Electricity Generation System on the Aid of Japan Grant in cooperation with Government of Nepal. (Photo: Bikash Karki)
Takahashi handed over the key of solar plant to Kishore Thapa, secretary at the Ministry of Urban Development (MoUD).
This is the first time solar energy has been added to national power grid.
“We are very excited about the project. It´s a good model to replicate in other parts of the country,” Rameshwor Yadav, managing director of the NEA, said.
The plant was installed at an investment of Rs 538 million.
“This is an important project from every perspective. I hope KUKL will make optimum utilization of the project,” said Takahashi.
Inaugurating the plant, Secretary Thapa, said: “The solar plant, even in the small scale, can be useful in addressing the country´s power crisis.” He also requested the private sector to replicate the model in different parts of the country.

BPC shuts Jhimruk Hydropower plant

Butwal Power Company (BPC) has decided to shut its 12 MW-capacity Jhimruk Hydropower in Pyuthan district, after locals attacked the plant inflicting loss of around Rs 60 million on the company.
The company has said it would resume power generation only after the government ensures security at the plant.
The decision means Nepal Electricity Authority (NEA) will lose 216,000 units of power a day at a time when the country is facing daily power cuts of 12-14 hours.
"Jhimruk Hydropower will remain shut until the government makes necessary security arrangement at the power plant,” Pratik M S Pradhan, vice president of BPC, said in a press meet in the capital on Wednesday. "Workers and technicians at the plant are scared; they are not in a position to resume works.”
The locals had attacked the plant after BPC decided to enforce load-shedding in the district following the direction of NEA. “We had imposed six-hour power cut in the district after NEA directed us to do so,” said Pradhan.
BPC, which is generating 21 MW of hydropower from its three plants -- Aandhikhola (9 MW), Khudi (4 MW) and Jhimruk, has also demanded strong action against the people involved in the attack. It has also sought compensation for the loss it incurred.
“The attack has deeply disturbed us,” Ranjan Lohar, CEO of BPC, said in the press meet. He further said the attack had unleashed a situation of panic among hydropower developers. "How can the government expect fresh investment in the hydropower sector when power plants are in constant fear of attacks?”
Meanwhile, Independent Power Producers´ Association Nepal (IPPAN) has condemned the attack on the power plant. "The attack on Jhimruk Hydropower is an attack against the country and its priority," IPPAN said in a statement. “It is unfortunate that the plant was attacked just because it followed the instructions of NEA.”
The association has strongly urged the government to take action against those involved in the attack and provide compensation to the company.
Additionally, IPPAN has requested the government to form a committee to look into the incident.

'Monopoly may rule roost in absence of effective monitoring'

Experts and officials have cautioned that monopoly may prevail in the market if agencies responsible for its monitoring do not carry out their jobs efficiently.
"Government agencies should be effective in insulating consumers from negative impacts of inflated prices of goods and services that mainly result from monopoly," said Dr Posh Raj Pandey, chairman of the South Asia Watch on Trade, Economics and Environment (SAWTEE), during the inaugural session of a four-day workshop on competition, promotion and market protection that kicked off in the capital on Tuesday.
"The government shouldn´t intervene in market operations, but there must be efficient mechanism and institutions to monitor the market effectively," Pandey told the workshop.
The workshop, attended by consumers, officials from monitoring institutions such as the Department of Commerce and Supplies Management, and experts, has raised issues related to weak market monitoring and its impact on people´s lives.
Commerce Secretary Lal Mani Joshi said people were being forced to pay unreasonable prices for goods and services, as the government agencies have failed to monitor the market properly.
It was an irony that the commerce secretary made such a statement as the Ministry of Commerce and Supplies (MoCS) itself is entrusted with the task of carrying out market monitoring activities through its line agencies.
The workshop, organized by SAWTEE in collaboration with the United States Agency for International Development (USAID), was organized to strengthen capacity of officials working in agencies that conduct market inspections.