Officials rule out power tariff hike

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KATHMANDU, Feb 12 : Following the latest approval of a Nepal Electricity Authority (NEA) restructuring plan, officials rule out any early hike in the domestic electricity tariff. Upward revision in electricity tariff was one of the major conditions laid down by the Asian Development Bank (ADB) during the sanctioning of the loan for the country’s power sector over three years back.

High level NEA and government sources talking to The Kathmandu Post said that the NEA Board approved the restructuring and re-engineering plan with the main aim to prevent any unwarranted hike in domestic electricity tariff under ADB pressure. Nepal’s electricity tariff regime is already among the highest in the world.

The NEA Board recently approved the reform plan that seeks to reduce the huge amount of leakage and non-technical losses that NEA incurs. Containment of such losses is expected to considerably reduce the pressure to upscale the electricity tariff, a condition without which the NEA would not be able to meet the financial health standards laid down by the ADB.

The multilateral lending agency during the signing of the loan for the Rural Electrification, Transmission, Distribution and System Reinforcement Project had asked the NEA to maintain its self-financing ratio (SFR) at 23 per cent, rate of return (ROR) at 6 per cent and debt service coverage ratio (DSCR) at 1.2 percent.

All conditions under the present circumstances are virtually impossible to meet given the poor financial state of the state-owned power monopoly. As of now, the NEA has SFR at 6.2 per cent, ROR at 1.3 and DSCR at 2 per cent. Above all, the non-technical loss stands at a whopping 23 per cent.

The principal financier to Nepal’s power sector has welcomed the NEA plan. "The ADB welcomes the reform programmes formulated by the NEA. If properly implemented, such a plan can certainly help reduce pressure on tariff," said Dr Richard Vokes, Country Director, ADB-Nepal Resident Mission, talking to The Kathmandu Post.

However, much would depend on the assessment of the NEA’s restructuring plans by the ADB. A mission from the ADB headquarters in Manila is due to visit Nepal in March to assess, among others, the institutional restructuring plan of the NEA. The mission comes in part in response to a recent Manila visit by an NEA official.

Executive Director of NEA Dr Janak Lal Karmacharya during his Manila visit had floated NEA’s reform plans in the hopes of convincing the multilateral lending agency to review and revise the ADB conditions attached to power financing, especially that on tariff. In the past two years alone, the NEA has hiked tariff first by 25 per cent and then by 10 per cent.

"The ADB is ready to revise the conditions. It is for the purpose that a mission is coming," knowledgeable government officials claimed, adding that the ADB is even positive on the NEA’s request to prevent any future tariff hikes. "The ADB is convinced that the implementation of the NEA’s plans would be enough to prevent tariff hikes," a high level official at the Ministry of Water Resources said.

"The NEA’s restructuring would help reduce, to a considerable extent, the system and technical losses. Once the restructuring plan comes into implementation, the ADB should not pressurise the NEA to hike electricity tariff," said the government official preferring to be unnamed.

However, though the ADB officials concede that the latest plan could reduce the strain on the need to hike tariff, much would depend on its implementation. The picture would be much clearer only after the mission carefully studies the NEA plans. The ADB has also offered NEA for a Technical Assistance (TA) project that is due for May.

"The Technical Assistance would help the NEA to move forward with its reform programmes," said Dr Vokes. Among others, the TA would help in maintaining the financial health of the NEA through management reforms and formulation of dry and wet season tariff adjustment mechanism.

The NEA’s ambitious restructuring plan includes the launching of the NEA distribution centres across the country. The NEA Board also decided to review the tariff structure at the beginning of each fiscal year on a scientific and rational basis, which officials believe would help to lower tariff considerably.

Govt to appoint labour attaché to Malaysia

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KATHMANDU, Feb 12 : The government has decided to appoint a labour attaché to Malaysia in an attempt to safeguarding the rights of Nepali workers there. An estimated 75,000 Nepalis are working in Malaysia.

The labour attaché will be appointed only after the government establishes an embassy in Malaysia and a recent meeting of the council of minister took the decision on setting up an embassy there.

"We have decided to appoint a labour attaché for Malaysia as soon as our embassy starts functioning there," said a highly placed source at the Ministry of Labour and Transport Management (MoLTM).

Besides pressures exerted by various labour rights activists, a large number of incoming complaints on rights abuse of Nepali workers in Malaysia also compelled the government to set up an embassy there. Malaysia is one of the countries that absorb a considerable number of blue-collar Nepali workers.

Many a Nepali want to go to Malaysia as acquiring visa is comparatively easier and they also get better pay compared to other nations particularly the Gulf countries.

Various manpower entrepreneurs including, Bharat Singh Thapa, President of Nepal United Association of Foreign Employment Entrepreneurs (NUAFEE) have appreciated the government’s decision on setting up an embassy in Malaysia. Talking to The Kathmandu Post, Thapa said that such a decision would be supportive to promoting foreign employment.

"A sizable number of unemployed Nepali youths, who aspire to go abroad for employment are encouraged with the decision of the government on appointing labour attaché in Malaysia," he added. However, he expressed his skepticism over the implementation of the decision at the same time.

The latest decision on appointing labour envoy for Malaysia has come following the bitter reality unearthed by The Kathmandu Post regarding the government indifference towards appointing such labour envoy for safeguarding and advocating the rights of Nepali workers abroad.

Although the Foreign Employment Directive has a provision of appointing labour attaché to all the countries where more than 5,000 Nepali workers are present, the government has not appointed a single labour attaché yet. According to an official data, more than 300,000 Nepalis are working abroad.

Hit hard by the downfall in major foreign currency earning businesses like tourism, garments, carpets among others, the government has decided to promote foreign employment. According to an independent estimate, remittance amounting over Rs 74 billion enters the country contributing significant to the national income.

IEDI to launch Rural Enterprises Assistance

Programme Post Report

ILAM, Feb 12 : Industrial Enterprises Development Institute (IEDI) is going to launch Rural Enterprises Assistance Programme with a view to developing small enterprises in four districts of Karnali and three districts of Mechi zones in an experimental basis.

The programme aims at providing financial assistance to small enterprises and helping in their capacity enhancement incorporating the local government bodies, private sector and the civil society.

According to Bishwo Raj Karki, National Coordinator of the programme, after the completion of the three-year programme, 4,000 people will be trained in entrepreneurship awareness building, 2,000 potential entrepreneurs would be trained in operating business and 1,000 people would operate new business.

He also said that the programme aims at helping 1000 entrepreneurs expand their business and 1,000 people would be employed. It is also expected to enhance capacity of partner organisations, he added.

Dolpa, Humla, Jumla and Mugu of Karnali zone and Ilam, Panchthar, and Taplejung of Mechi zone have been selected for the programme. After the experiment in those districts, the programme would be expanded to other districts.

A contact office has been established in Ilam for this purpose. A Participatory planning evaluation workshop was also organised in the district headquarters incorporating the representatives from local bodies and other organisations and businessmen. Speaking on the occasion, Dr. Chiranjivi Nepal, Director of the IEDI, said that the programme had been launched realising the need and importance of necessary skills to back up enterprises.

SNV and another Dutch organisation–ICCO have provided around Rs.51.8 million for the programme. Budget has also been set aside from the IEDI fund.

Interaction between Kantipur Publications and NCC held

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KATHMANDU, Feb 12 : Speaking at an interaction between the Business Bureau of the Kantipur Publications and Nepal Chamber of Commerce (NCC), NCC president Rajesh Kaji Shrestha highlighting the importance of economic journalism in the present context appreciated both Kantipur national daily and The Kathmandu Post for prominently covering the domestic economic activities.

The interaction was held as per the Memorandum of Understanding (MOU) signed between Kantipur Publications and the NCC in the publications’ office today.

Shrestha stated that such a broad coverage of economic activities by both the leading daily newspapers has greatly encouraged local entrepreneurs. Similarly, Surendra Bir Malakar, Vice-President of NCC also extolled both the dailies for their unbiased business reporting.

Speaking on behalf of the publications, Director Binod Raj Gyawali, said that the publications has always been supportive to the private sector and also assured of continuing the cooperation in the days ahead. He further said that the development of the private sector is important for the development of private media and added that the publications is committed to maximum possible coverage of business activities.

With an aim to boost mutual cooperation for the promotion of business-related news and activities, the NCC and the publications signed the MoU in April, 2001.

Pokhara braces for emerging as e-city

By Kulchandra Neupane

Pokhara, Feb 12 : E-commerce has been a buzzword around the globe at present. Many colleges and universities offer courses in e-commerce, many governments talked much about introducing e-commerce, many business pundits advocat the tremendous significance of e-commerce in a fast growing world. Many countries went well ahead in the race to materialising this blend of technology and business.

Nepal, a country where more than 99 per cent of the total population have never ever been connected to the internet or sent or received mail from the electronic mailing service, e-commerce would remain a distant dream given the current pace of growth in the information technology (IT) sector in the country.

Nevertheless, a ray of hope has come in the name of B2B.

Introduced in Pokhara, B2B is the first ever endevour made in e-commerce in Nepal. Sitting in your home and sipping a cup of coffee, you can order packet of tasty mushroom through B2B. Again, if you are worried about selling vegetables, this forum of e-commerce is a great help.

Opened with the joint efforts of Village Town Partnership Development Programme (VTPDP) and Pokhara Chambers of Industry and Commerce (PCCI), this forum offers several services such as arranging a meeting between the buyers and sellers and acting as a mediator for the trading.

The web-site of the e-commerce is www.B2B.com.np, through which buyers and sellers meet and deal.

"The objective of this forum is to provide an opportunity for both consumers and producers to have an online interaction or negotiation, or whatever," said Prakash Pandey, programme coordinator of the VTPDP. "This will help them to easily reach a deal."

Here is how it works. The consumers can post all the information regarding their demand or need in the web site free of cost. There are PCCI employees available online 24-hours, who process the demands and put them in the web site in a businesslike-manner.

On the other hand, if you are a producer or a seller, you can post everything about your product on the site, also free of cost. To manage the information on sales too, there are PCCI employees. The consumers can choose whatever they want. The only prerequisite is an access to internet.

In the first phase, e-business has encompassed mainly agricultural products. Till now, the VTPDP has kept in B2B.com the information of seasonal agricultural products by 12 farmer groups within the Pokhara Sub-Metropolis.

"We are working towards expanding the field of this online commercial venture," says PCCI president Ramesh Karmacharya. "Our long-term goal is to establish Pokhara as the main centre for e-commerce in Nepal. The United Nations Development Programme (UNDP) is assisting us in the endeavour."

The UNDP has plans to introduce e-governance in 12 municipalities where VTPDP has been implemented. "For the feasibility of this plan, the e-commerce programme has been introduced in Pokhara and an experimental e-governance in Bharatpur," informed Pandey. He also said that if the electronic mode of transaction or commerce becomes successful and facilitates the implementation of e-governance, the programme would be introduced to other municipalities as well.

Similarly, with the implementation of e-governance, one will obtain all information regarding all government services and procedures in the Internet. This will tremendously help the common people by saving their time as well as money when they have to visit the government offices for some purpose, said Pandey.

"With a good practice of e-governance, people will be well aware of all rules and regulations concerning them and hence would be relieved to a greater extent from the bureaucratic hassles," remarked Pandey.

RNAC to acquire new aircraft for 7 weeks

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KATHMANDU, Feb 12 : As one of its two Boeing 757s is flying for regular C-check on March 31st, the Royal Nepal Airlines Corporation (RNAC) has initiated process to acquire one similar capacity aircraft on lease for a seven-week period.

"Unlike the previous practice of acquiring aircraft through a direct deal, we have decided to call tender for the delivery of an aircraft for the period of 7 weeks," said a high level source with the RNAC.

As per the proposed procedures, individuals would be barred from participating in the competition. "Only international airlines would be allowed to tender their sealed quotation, said the source. The tender call would be published in the local dailies soon, added the source.

The source also said that the national flag carrier has initiated necessary process to acquiring an aircraft nearly two months before dispatching its Boeing 757 to correct the lessons learnt during its last routine C-check. At that time, the RNAC had to suspend a number of flights after it failed to manage an aircraft for replacement of one of its Boeings sent for the check.

The C-check of Boeing engine is carried out for all sorts of repairing and necessary overhauling of several parts, other than the engine. According to the flight schedule for coming summer season that would begin from March 31st, the two RA Boeings fly 720 hours every month. This schedule also includes the new flight to the Malaysian capital Kuala Lumpur.

Meanwhile, the RNAC source informed that the date of flight commencement to Kuala Lumpur has been finalised. "One of the existing Boeings will be flying to the Malaysian capital via Singapore from March 30," the source said.

The RNAC management had decided to begin fresh air-link with the Malaysian capital a couple of weeks ago. The decision was based upon feasibility study report submitted to the RNAC management earlier.

The RNAC is expecting a minimum of 50 per cent passenger occupancy on the flight and is hoping to operate in profit within three months. The duration of Kathmandu-Singapore flight is two and half-hours, and Singapore-Kuala Lumpur flight is a little more than an hour.

The main strength of the proposed new flights is the existing Nepali labour force working in Malaysia. According to the figures of Labour and Employment Promotion Department, there are more than 75,000 legal workers in Malaysia. The latest statistics say that some 7,000 workers fly to Malaysia every month.

Stating that there would be some adjustments for operating the Kuala Lumpur flights, the source informed that one flight each from the current schedule to Bangkok and New Delhi would be withdrawn after March 30.

As majority of Nepali people flying to Malaysia go through Bangkok, the withdrawal of one flight will have no impact on the regular Bangkok flights, the source added. Even the withdrawal of the Delhi flights will have nominal impact, the source claimed.

The RNAC, under the prevailing flight schedules flies to eight different cities of five countries with its two Boeing 757 aircraft. The RNAC flies to Indian cities of Mumbai, Delhi and Bangalore in addition to the flights to Bangkok, Hong Kong, Shanghai, Osaka and Dubai.