Leaders discuss law, order, other outstanding issues

BY A STAFF REPORTER

Kathmandu, October 3: Senior government ministers and prominent opposition leaders were engaged in a round table meeting today to review all outstanding issues, including the law and order situation at home.

The meeting, third in the series, discussed the major problems facing the country, said Speaker Taranath Ranabhat who presided over the all-party meeting that started last week. The Speaker called the meeting days after underground Maoist rebels launched a massive pre-dawn swoop across the district headquarters of Dolpa.

The rebels killed 14 policemen, broke into a prison and freed close to 20 inmates and looted 60 million rupees from a local bank. Two days after that raid, the Maoist insurgents raided another police post in Lamjung and shot eight policemen dead from close range as the cops ran short of ammunitions in the early morning.

Finance and, since yesterday, Defence Minister Mahesh Acharya, Deputy Prime Minister Ramchandra Poudel, Chairman of the National Assembly Mohammad Mohsin, Chairman of Rastriya Prajatantra Party Surya Bahadur Thapa, Polit Bureau member of the main opposition Communist Party of Nepal (UML) Jhalanath Khanal, President of Nepal Sadbhavana Party Gajendra Narayan Singh were among others present in the day’s meeting. The Ruling party’s General Secretary Sushil Koirala, Spokesman Narahari Acharya and UML lawmaker Raghuji Pant were also present in the meeting.

"The Maoist problem is worsening at present and debate is going on whether the government should mobilise Royal Nepalese Army to contain the insurgency," participants at the meeting said.

The participants however declined to disclose the issues that came up for discussion. Although nothing has been said of the meeting formally, the series of all-party meetings are expected to continue in the days to come.

The Speaker declined to comment on how exactly the meetings were proceedings or what the contents were.

"These meetings have proven to be very important to discuss and exchange views between ruling and the opposition parties on the existing problems of the nation," Acharya said. The series of meetings have helped create an atmosphere for co-functioning to put an end to the problems facing the nation."

The opposition parties are commenting on the strengths and weaknesses of the government and these comments would help further strengthen the government and its machinery, he said.

Acharya said the all-party meetings were not directed solely at mobilising the army to fight back the Maoists, who have waged "People’s War" since early 1996. Well over 1460 people have killed since then. "Maintaining law and order is one of the principal responsibilities of any government. The government can decide to use all its arms to restore law and order."

The government and the opposition parties are exchanging views on a variety of issues but no particular issue is at the top of agenda, he said. As guardian of the nation, the government has taken the meeting very seriously.

Khanal, who represented his UML party to the talks, said there was no official agenda as such. "The declining law and order situation and all other outstanding issues are being discussed at the meetings," Khanal said. He denied commenting on the prospects of mobilisng army to crush the Maoist activities.

Melamchi financing gap overcome

BY A STAFF REPORTER

Kathmandu, Oct 3: The financing gap in the US$ 441 million Melamchi drinking water project has been overcome after the Asian Development Bank, the lead donor of the project increased its loan commitment from US$ 100 to US$120 million.

Following the appraisal mission of the project conducted recently the Asian Development Bank (ADB) looks forward to present to its Board for consideration of approval of a loan amounting to US $ 120 million in December this year.

The base cost of the project with physical contingencies was estimated at US$ 338 million, which has gone up by nearly US$ 100 million when adding the price contingencies, interest during construction and taxes and duties. The government of Nepal will bear 25 per cent of the total financing costs.

"The bank has now decided to increase its loan commitment to US$ 120 after discussing the financing gap," ADB Resident Representative Richard Vokes told a press conference today.

"The outcomes of the review and the discussions have been very positive and understandings have been reached amongst the financing partners including HMGN on project features, financing, implementation arrangements, donor coordination and policy issues," Dinesh Chandra Pyakurel Executive Director of the Melamchi Water Supply Development Board (MWSDB) said.

The bank fielded the appraisal mission recently towards its loan approval. The mission was joined at different stages by missions from NORAD, SIDA, NDF, JBIC and the World Bank who are expected to finance different components of the project.

The joint mission reviewed the project components, the project costs and other implementation arrangements.

It also held discussions on various project issues, policy reforms for sector improvement with the related high officials of the government.

The other financiers for the project to be completed by September 2006 include Japan Bank for International Cooperation(JBIC), which will provide a loan of US$ 52 million, Nordic Development Fund will provide a loan of US$ 11 million, NORAD will provide a grant assistance of US 29 million, loans amounting to US$ 14 million will be provided through the OPEC Fund, SIDA will provide a mixed credit of US$ 25 million, the World Bank will provide a loan of US $ 80 million and His Majesty’s Government of Nepal will invest US$ 110 million in the project.

The Project will now have low weir built with provisions of de-silting basins in the Melamchi Khola slightly above its confluence with Ribarma Khola. About 170 MLD water will be diverted in the first phase to a conventional treatment plant which will be constructed in Mahankal near Sundarijal, through an approximately 26.5 Kms long tunnel of about 10 square meters cross sectional area.

The treated water will then be bulk distributed to 16 reservoirs around the valley through a bulk distribution system of pipes ranging between the sizes of 300 mm to 1600 mm.

The existing distribution network will be rehabilitated to ensure that the water is equitably distributed to consumers and the quality of treated water is maintained.

A private operator will be hired to improve the operation, management and rehabilitation of urban water supply and sewerage facilities presently being managed by the Nepal Water Supply Corporation. The operator is expected to be in place by September 2001, a press release issued by the MWSDB said.

On the price of the water to be distributed by the Melamchi project, Pyakurel said the tariff adjustments being made reveals that by the year 2010, per cubic meter of water would cost nearly 23 rupees.

ADB representative said that the cost recovery has been identified as an important part.

"Significant cost recovery will be there and tariffs will be slightly higher than what it is at present," the ADB representative said.

A Social Uplift Programme (SUP) has been designed to improve the social and economic life of the Melamchi valley people. About five million US$ has been allocated for SUP activities in the project cost, Pyakurel said.

Govt expenditure decelerating

BY A STAFF REPORTER

Kathmandu, Oct. 3: The macro economic performance of the country during the first month of the current fiscal year reveals deceleration in the government expenditure and encouraging trend in foreign trade sector, according to Nepal Rastra Bank (NRB).

The NRB statement released today says that the first month of the fiscal year 2000/04 marked a deceleration in both narrow and broad money Government expenditure has decelerated mairly due to a decline in both the regular and development expenditures. In spite of a decline in revenue collection, resource mobilisation remained high because of a significant growth in foreign cash grant receipts and non-budgetary income, thereby resulting in budgetary surplus. The rate of inflation on point to point basis dropped to less than one per cent mainly because of the decline in the prices of food and beverages group. In the extenal front, because of a higher growth rate of exports than that of imports, trade deficit has narrowed down compared to that of last year. The foreign exchange holdings of the banking system rose substantially due to a surplus in the balance of payment emanating from the growth in miscellaneous capital inflows. The resulting foreign exchange reserve was sufficient to cover merchandise imports for ten months and a half. In the share market, share transaction improved significantly compared to the pnevious month.

During the first month of the fiscal year 2000/01, broad money registered a decline of 1.7 per cent (Rs 3154.8 million) amounting to Rs 181325.5 million compared to the decline of 0.2 per cent (Rs 303.7 million) during the same period last year. This was mainly due to a decline in the growth of net domestic assets as well as net foreign assets. As a consequence of downward revision of interest rate on deposit, growth of imports and expansion in resource mobilisation activities of non-bank financial institutions, growth of time deposits decelerated from 1.8 per cent (Rs 1815.4 million) in the previous year to 1.1 per cent (Rs 1367.9 million) during the review period. Narrow money declined by 3.0 per cent (Rs 1786.9 million) during the review period compared to a decline of 4.2 per cent (Rs. 2119.1 million) in the previous year, the press release said.

As a result of decline in credit to both government sector and private sector, total domestic credit of the banking system declined by 1.5 per cent (Rs 2348.3 million) during the review period compared to an decrease of 1.2 per cent (Rs 1396.9 million) in the preceding year. The flow of bank credit to the private sector decreased by 0.2 per cent (Rs 211.3 million) during the review period compared to a grwoth of 0.2 (88.6 million) in the preceding year.

On the fiscal front, government expenditure decreased by 7.5 per cent to Rs 1645.8 million during the review period compared to a growth of 29.7 per cent last year. Of the total expenditure, while regular expenditure and development expenditure decreased by 37.9 per cent and 65.6 per cent respectively, freeze expenditure increased by 26.4 per cent. The disturbances in the functioning of banking institutions followed by problems in cash release led to such a clecline in the total expenditure in spite of an increase in freeze expenditure mainly due to large volume of unspent sanctioned expenditure of last year. Resource mobilisations grew by 3.9 per cent during the review period compared to 20.6 per cent in the previous year. Revenue collection, a major source of resource mobilisations, stood at Rs. 1845.1 million marking a 24.1 per cent decline compared to 8.3 per cent growth in the previous year. Disturbances in the functioning of banking institutions as well affected the revenue collection. However, increase in the receipts from foreign cash grants and non-budgetary income resulted in the higher resources mobilisation with a budgetary surplus of 968.0 million. During the review period, the government received foreign cash loan amounting to Rs. 338.1 million, and subsequently there was a surplus of Rs 1306.1 million in the treasury.

National Urban Consumer Price Index, on point to point basis, recorded a rise of 0.2 per cent during the review period compared to a rise of 5.9 per cent in the previous year. A fall in the prices of food and beverages group helped to lower down the inflation rate to less than one per cent. Of the overall price index, price index of food and beverages group declined by 4.4 per cent compared to 6.9 per cent increase in the preceding year. Despite an increase in the price index of restaurant meals, spices, milk and milk product, meat, fish and eggs, pulses as well as beverages, the declining prices of oil and ghee, cereal products, sugar and sugar products and vegetables as well as fruits contributed for such a decrease in the price index of food and beverages group. However, price index of non-food and services group accelerated from 4.6 per cent in the previous year to 6.3 per cent during the review period. This was mainly due to the rise in prices of transport and communications, housing, medicine and personal care, tobacco, education and recreation, shoes, cloth, clothing and sweing services. Regionwise, price index of Kathmandu increased by 1.5 per cent while those of Terai and Hills decreased by 0.6 per cent and 0.3 per cent respectively.

On the external front, exports and imports both registered respective growths of 23.8 per cent Rs 3902.9 million and 14.1 per cent to Rs 8142.7 million during the review period. During the review period, although there has been a significant increase of exports to India, exports to third countries have declined. Although exports of readymade garment, woolen carpet, jewelry and pulses to third countries have declined, exports of tanned skin and nigerseed have improved compared to that of last year. During the review period, Rs 870 million worth of Pashmina has been exported.

The export-import ratio, which was 44.2 per cent in th eprevious year, improved to 47.9 per cent during the review period. The surge in imports was attributed mainly to a higher imports of food grains, medicine, textile, thread, chemicals, agricultural tools and machineries, plasticwares and other machinaries from India and rice, beetle nuts, crude oil, chemical fertilizer, copper wire and sheet, thread, transportation goods and spare parts, computer parts, aeroplares parts, and other machinery as well as their spare parts from third countries. The growth rate of exports was higher while that of imports remained comparatively lcw compared to last year. As a result, trade deficit during the review period stood at 6.4 per cent amounting to Rs 4239.8 million compared to a growth of 34.9 per cent in previous year.

Based on the monetary statistics for the first month of the fiscal year 2000/01, the overall balance of payment recorded a deficit of Rs 886.4 million. As a result, foreign exchange holdings of the banking system increased by 23.2 per cent to Rs 94775.8 million as at mid-August 2000. Of the total reserves, 86.0 per cent accounted for convertible currency and 14.0 per cent for non-convertble currency.

‘Effective mgmt of garbage concerns all'

Kathmandu, Oct. 3 (RSS): Chairman of Rajparishad Standing Committee Dr. Keshar Jung Rayamajhi has said that as the mere endeavour of the government alone will not be enough to resolve the serious problem of garbage, it is the common responsibility of all concerned for its effective management.

Inaugurating the Colorado-Nepal environmental exchange programme organised by Save the Environment Foundation (SEF) here today, chairman Dr. Rayamajhi said that various social non-governmental organisations should come forward in developing the Kathmandu valley as a pollution-free city.

President of Nepal Chamber of Commerce Rajesh Kaji Shrestha said that a long-term master plan has to be formulated and implemented with a commitment for the management of garbage, which affects the environment and public health directly and indirectly.

Resident Representative of Asia Foundation Nick Langton emphasised the need for assessment of environmental impact for sustainable development.

Various speakers including Bhushan Dahal of Kathmandu Metropolitan City and head of the Radiology Department of the Tribhuvan University Teaching Hospital Dr. Sunil Pradhan expressed their views at the programme chaired by executive chairperson of save the Environment Foundation Mrs Chanda Rana.

Swanson Environmental Management System Inc (SEMSI) has contracted Asia Foundation, Nepal to help in implementation of the Colorado-Nepal environmental exchange programme through coordination with local partners Save Environment Foundation (SEF) and Elean Wheel Nepa (CWN).

The primary goal of this project is to facilitate urban development in Nepal by strengthening the ministry of population and environment’s capacity to undertake its environmental protection mandate.

Oriental Hotel’s shares
Share allotment beset with festive holidays

BY ARHAN STHAPIT

Kathmandu, Oct 3: At a time when the country is keenly yearning to be taken away by the biggest possible celebrations during the much coveted, long festive holidays of Dashain, the very public recess has come as a bizarre technical glitch to go ahead with the share allotment of the Oriental Hotels Ltd. (OHL).

The shares of the Oriental Hotels Ltd. (OHL) for its Radisson Hotel Kathmandu have just been ready for allotment; that too not only for what initially had been floated of Rs. 125 million, but Rs. 150 million, a 20 per cent increment of the public stake in the company.

That more retention of public contribution in the company could come as a good news for many. But, as the government offices and public enterprises remain closed for nine consecutive days from October 4 to October 12 during the Great festival of the Kingdom, the share manager NIDC Capital Markets Ltd., would have to wait the completion of the one week-plus public recess to hand over the allotment certificates and unused subscription money to the public applicants.

The share allotment, according to General Manager at NIDC Capital Markets Ltd., Surendra Pradhan, will begin from October 13 (Aswin 27), when the public offices reopen after the festival.

As per the existing legal provisions, issued shares ought to be allotted within 75 days from the date of public share floatation. In the OHL’s case, it will turn 75 days on October 16.

It is worthwhile to recall that, earlier on August 4, NMCL General Manager Surendra Pradhan had told The Rising Nepal that they had been planning to allot the shares tentatively by mid-September to make it a 45-days venture.

But, what went wrong with their "venturous" plan to make it by the mid-September, i.e., within 45 days?

"While NMCL was making all preparations for the share allotment, the Oriental Hotels (Radisson) management, in the meantime, submitted the application to the concerned authorities seeking an approval to increase the public share contribution," said Pradhan. "This was a long process that entailed a number of legal formalities, and hence, a time consuming job."

"Keeping the public interest in mind, we, at the Security Board, had to be assured of full observation of a number of conditions by the concerned company before approving the public share increment proposal," chairman of the Security Board Damber Dhungel said.

"We sought satisfactory answers, among others, as to where the additional public money will be put to, what the revised representation of public shareholders will be in the company’s Board of Directors proportionate to the increment, and as to possible impact on the financial projections of the company," he said.

"We also had to check if necessary amendment has been made in the formalities concerned with the Company Registrar, and with all the papers needed for this process finally completed on last Friday afternoon, the approval has been issued today," he added.

"As the Security Board approval formally came to us just today, we have only limited days. We will, however, embark upon the share allotment process on October 12, which is well within the mandatory 75 days stipulated in the law and prospectus of the Radisson Hotel," Pradhan said. "Yet, we are mulling to seek a two weeks time extension for distributing allotment certificates and refund pay-orders."

As per the NCML sources, more than 75,000 share applications for about Rs. 860 million (paid-up cash Rs. 430 million approximately) were received.

"To avoid hassles of the whopping 75,000-plus public investors in course of collecting the allotment certificates, we shall provide adequate counters for the public convenience and speedy service as we had done at the time of share issue," chief of the Share Manager Company Surendra Pradhan said.

It may be recalled that the shares of the Oriental Hotels Ltd. had posted a more than 6 times over-subscription which experts termed as a new episode to reaffirm that Nepali stock market was bullish. Originally, the floatation of the OHL’s 1,250,000 units of shares worth Rs. 125 million kicked off from July 25 at 50 per cent paid-up face value.