ODA dips by 3.6 per cent in ten months

Post Report

KATHMANDU, May 23  ; Despite the resumption of much-awaited peace process, the flow of Official Development Assistance (ODA) from the developed nations to Nepal during the first ten months of the current fiscal year declined by 3.6 per cent.

According to statistics released by Foreign Aid Co-ordination Division of the Ministry of Finance, various bilateral and multilateral agencies committed a total assistance of Rs 30.72 billion for 41 projects by mid-May.

Like the past trend, the amount of grant was three-fold higher than the total amount received under loan heads. During the period, the total inflow of grants for 37 development projects remained at Rs 23.56 billion while the total loan amount for four projects was Rs 7.16 billion.

During the review period, the Road Network Development Project remained the single biggest absorber of foreign loans. The project received Rs 3.45 billion in loan assistance from the Asian Development Bank (ADB), a multilateral developing agency.

Similarly, in terms of project amount, Secondary Education Support Programme was the second largest absorber during the period. The project received grant assistance worth Rs 3.03 billion from the Danish government.

Similarly, Master Plan Operation Projects for the period of 2002 to 2006 remained the third largest recipient of grant assistance. The project attracted grant assistance commitment worth Rs 2.77 billion from the United Nations Fund for Population Activities (UNFPA).

With a loan assistance of Rs 2.33 billion from the ADB, the Secondary Education Support Programme became the fourth largest recipient while Global Food for Education Initiatives secured the fifth position by receiving a grant assistance of Rs 2.27 billion from World Food Programme (WFP).

During the period, the WFP positioned itself as the number one lender to Nepal with Rs 6.06 billion grant assistance for four projects. Likewise, with the total loan assistance about Rs 5.91 billion, the ADB became the second largest donor to Nepal. During the period, the ADB, which used to be the largest donor in the past, extended loan for five projects.

Likewise, the government of Denmark secured the third position by extending a grant amount of Rs 3.03 billion for Secondary Education Support Programme. During the review period, the government of Japan, which used to be the largest bilateral donor, remained slipped to the fourth position by extending grant assistance worth Rs 2.52 billion for five projects. The UNFPA, which provided a grant assistance of Rs 2.77 billion for Master Plan Operation, remained in the fifth position.

Despite the marginal decline, the continued encouraging flow of foreign aid is mainly attributed to the reform-oriented image that Nepal made during the last meeting of Nepal Development Forum (NDF) held in Nepal for the first time. During the meeting, Nepal reiterated its commitment to speeding up economic reforms and has accorded a top priority to the financial sector reforms.

Nepal heavily depends upon foreign assistance for its development activities as majority of the total development expenditures come from foreign assistance. The budget for the current fiscal year also seeks about Rs 27 billion for development expenditure from foreign loans and assistance.

Band paralyses life in Dailekh

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DAILEKH, May 23  : An indefinite band, general strike, called by Dailekh Chamber of Commerce and Industry (DCCI) since May 19 has paralysed the life of the local people.

Agitated businessmen launched the strike on Monday to protest against what they called the syndicate practised by the Trucks and Tractors Association (TTA). The government banned syndicate system on April 1, 2003.

All businesses have come to a complete halt due to the strike running in the fifth day, but with no solution to the problem in sight yet.

Since the beginning of the strike, there has been no business transaction including foodstuffs in the district.

The DCCI has barred thousands of litres of milk and curd, tons of vegetables and meat from entering the district that used to come from neighbouring villages. The chamber has warned traders of taking strong action if they traded goods.

Some sellers tried to sell meat and other dairy products but the strikers threw their products on the road.

Displaced families who had been operating teashops and selling vegetables along with the local farmers are hit hardest by the strike.

President of Ekta Multipurpose Women Farmers Group says that around 13 quintals of tomato has already rotten due to the ban on the sale.

The lack of daily consumer goods and foodstuffs has compelled students to return their homes who were staying in the district headquarters. Civil servants are also hit hard by the strike, as they cannot procure foodstuffs.

The association, based in Surkhet, had allegedly been prohibiting all other vehicles coming into Dailekh. They forcefully unload consignments from alien vehicles and load them on their own vehicles charge unreasonably high fare. The local transporters even loot the goods if the outsider transporters refuse to unload their cargoes. Any vehicle wishing to go to Dailekh has to pass through Surkhet.

The District Administration Office (DAO) Dailekh on Monday told The Kathmandu Post that it had invited both parties to talks. But it could not materialise.

Achyut Prasai, Executive Member of DCCI said, "The local administration office and the TTA has a nexus. It is under the office’s wings that the syndicate flourished. Under such circumstances we couldn’t reach to an agreement."

The DCCI is demanding a complete abolishment of the system and fixing of a new and fair transport fare. The DCCI has also seized about a dozen trucks and tractors belonging to TTA members.

‘Pre-emptive measures a must to insulate financial institutions’

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KATHMANDU, May 23  ; Immediate initiation of bold pre-emptive measures is a must to insulate financial institutions from any possible financial mess, said Dr Tilak Rawal, Governor of Nepal Rastra Bank (NRB) today.

"There is no option left but to reinforce accountability of these institutions by bracing up corporate governance so that they can survive even if crisis occurs," said Rawal making presentation on "Corporate Governance and Financial Sector Reform in Nepal", organised by the Society for International Development (SID).

"The reason behind the technical insolvency of Rastriya Banijya Bank (RBB) and Nepal Bank Limited (NBL) is poor and weak corporate governance," said Rawal, "and this threat continues even in case of private banks as we are yet to come with effective inspection and regulatory mechanism."

Highlighting the infamous Asian financial crisis during 1997, Rawal attributed it to the weak supervision and monitoring financial mechanism that prevailed during the period in the affected countries.

"Hence, chances of our economy becoming a victim because of ineffective inspection measures cannot be underestimated," he added. "So a strong corporate governance is a must for the development of a vibrant and resilient financial market."

However, he also expressed positive note towards the growth of financial sector in the country in recent times despite the weak monitoring mechanism. "Entry of overwhelming number of financial institutions in the market has at least shown its immense potential," said the governor.

Meanwhile, he claimed that non-economic factors are more to blame than economic factors for economic stagnancy last year, which registered a negative Gross Domestic Product (GDP).

"The external factors are more to blame for economic growth going down last year and the major cause for that is no other than the increased domestic violence unleashed by the Maoist insurgency", remarked Rawal.

Rawal laid emphasis on effective implementation of prudential norms and regulations of the central bank to maintain overall discipline among the financial institutions of the country, thereby making a way forward for healthy growth.

Earlier, Bishwa Keshar Maskey, President of the SID, highlighted the importance of financial sector in the development of the country terming it as the foundation for delivering sustainable economic growth.

Appreciating recent reform measures undertaken by the NRB, Maskey said such long-term measures are sure to contribute to higher and more equitable distribution of economic growth through a vibrant and efficient financial sector.

The central bank last year initiated some reform measures including raising paid-up capital to Rs 1 billion from Rs 500 million for commencing any national level commercial bank among others.

Youth’s dream to earn dollar in foreign land shatters

By Krishna Regmi

KATHMANDU, May 23 : It looks all rosy in the beginning when some manpower agents offer a dream of an attractive overseas job. The temptations to earn hundreds of dollars per month make people spend thousands and millions of hard-earned savings, and some even sell all their parental property. The entire dream shatters into pieces, when both the lucrative job and the agent disappear all of a sudden.

Devendra Dilip Singh Kunwar, 36, a resident of Achham, is a glaring example of how naive villagers are being cheated in the name of foreign job. He spent Rs 1.2 million to reach his dreamland, the USA, but in vain.

The woes for Devendra began when one of his close relatives, Shyam Kumar suggested him to apply for a visa at the American Embassy, consoling him he could easily manage the visa.

"I was carried away by his suggestion. I sold my ancestral land to provide him with Rs 1.2 million as he said that he knew the consular at the embassy," he said. Surprisingly for him, the visa was rejected. Then he asked the money back, but for no avail.

He has filed complaints against the swindler at the Labour Department in Kathmandu and at the District Police Office, Dhangadhi. But there seems no hope.

When asked about the matter, Superintendent of Police at Dhangadhi, Keshav Adhikari, said that they are trying to catch the swindler.

There are hundreds and thousands of aspiring Nepali youth, who, like Devendra, spend large amounts of money in pursuit of a lucrative foreign job. However, their dreams soon turn into a sandcastle.

Kaji Rai went to Saudi Arabia spending Rs 100,000. His agents had said that he would be employed as a chauffeur, and would earn 800 Saudi Riyal. But when he reached there, there was nothing.

"I was tempted to go to the Gulf as many people were going out of the country. But when I reached there, I was given the job of a road sweeper and was paid only 600 Riyal," Rai said.

The Saudi employer held all of Rai’s documents including the passport. "I did not know when my visa was to expire. The employer notified me only three days before my legal stay there terminated."

"Moreover, the employer threatened me to shoot if I did not leave the country within three days," he continued. "I did not even have the return ticket", he related his agony.

Rai had gone to Saudi Arabia through Worldwide Employment P Ltd. When asked about Rai’s plight, Pushpa Dahal, the proprietor, flatly denied his knowledge on the matter. "We know nothing about his sufferings," he said. "But if we knew the hardships that Rai faced, we would have surely taken necessary steps to help him."

Rajendra Shahi is another victim of the employment agents. "I reached Malaysia through Kasthamandap Overseas. They said that I would get a job of bicycle mechanic, but I was asked to remove garbage," Shahi said. "To me it was better to die than to throw the garbage with shovel," he poured out his agony.

He anyhow managed to fly back to his homeland. Now he is thinking ways to pay back the loan he had borrowed to go to Malaysia.

The victims of manpower agency fraud blame the government for ignorance. When asked, Director General at the Labour Department Lalit Bahadur Thapa said that the government was doing its best to punish the culprits.

"We are doing our best to prevent cheating by some criminals who claim themselves to be manpower agents," Thapa said. "We are also trying to make people more aware so that they do not get easily cheated." He also pointed out that as more cases are related to unauthorised individual agents it was more difficult to bring them into justice.

According to the Department, 48 fraud cases have been filed only this month, out of which 16 cases are related to foreign employment agencies.