Er.energyNP@Gmail.com

Nepal’s national pride projects could take at least another decade to complete if construction continues at the current pace, according to a study conducted by a subcommittee under the Infrastructure Development Committee of the Federal Parliament.

The subcommittee has found that the average physical progress of 15 national pride projects that have been under implementation for around 15 years stands at only about 55 percent. The progress varies significantly among projects, ranging from roughly 20 percent to around 70 percent.

Subcommittee Coordinator Shriram Neupane said the projects have failed to move forward at the required pace due to persistent problems related to budget assurance, land acquisition, forest clearance, tree felling, limited working hours, procurement and contract management.

“If the 15 national pride projects continue at the pace at which they are currently being implemented, they will not be completed even within another 10 years,” Neupane said.

According to the subcommittee, although some projects have made relatively better progress, even their annual progress has generally remained limited to around 5 percent. The slow pace has significantly increased both the implementation period and the overall cost of the projects.

Nepal has identified 17 projects as national pride projects. Of these, the Upper Tamakoshi Hydropower Project has already been completed, while the West Seti Hydropower Project has yet to begin construction. The remaining 15 projects are under various stages of implementation.

Neupane said the estimated cost of the national pride projects when they were initiated around 15 years ago ranged from about Rs 35 billion to more than Rs 100 billion. However, despite the enormous investment and lengthy implementation period, most projects remain incomplete.

“Projects that started 15 years ago with estimated costs ranging from Rs 35 billion to more than Rs 100 billion have reached only around 70 percent at the most. Some have completed only 20–25 percent. On average, only about 55 percent of the work has been completed,” he said.

Land acquisition identified as biggest bottleneck

The subcommittee has identified land acquisition and compensation as the most common obstacle affecting almost all national pride projects.

Neupane said there was virtually no project that had not faced problems related to land acquisition, compensation or disputes over land.

He argued that the existing mechanism, under which land is acquired through district-level committees chaired by the chief district officer, has not been effective enough for large-scale infrastructure projects.

The subcommittee has therefore recommended a separate legal framework governing public and private land management and acquisition for development projects.

Such legislation, according to the subcommittee, should establish clear, transparent and time-bound procedures for acquiring land and distributing compensation so that projects do not remain stalled for years.

Forest clearance and environmental approvals delay projects

Forest and environmental approval procedures have also emerged as major barriers to project implementation, particularly in hydropower projects.

Neupane said delays in obtaining approval for tree felling and environmental impact assessments (EIAs) have frequently prevented projects from moving ahead.

He proposed the introduction of a “Sunset Act” and the declaration of a “Development Decade” to accelerate infrastructure development.

Under such a framework, legal and administrative procedures considered obstructive to development projects could be simplified or temporarily suspended for a specified period, while maintaining necessary environmental safeguards.

Neupane also questioned whether Nepal has been able to obtain sufficient economic value from its large forest resources.

He noted that forests cover around 46 percent of Nepal’s total land area, while the sector contributes only around 3.5 percent to gross domestic product.

He argued that forest conservation and infrastructure development should not be treated as mutually exclusive objectives.

“Nepal’s major natural resource is water, and hydropower has enormous potential. But forest-related procedures have increasingly become a barrier to hydropower development. At the same time, the forest sector has not been able to make a proportionate contribution to GDP,” he said.

According to him, a temporary development-oriented legal framework could help resolve such structural contradictions while ensuring that environmental protection remains in place.

Budget assurance and payment delays

The subcommittee has identified inadequate budget assurance and delays in payments as another major factor behind project delays.

Projects frequently face uncertainty over whether the required budget will be available in the required fiscal year. Delays in payment to contractors can further disrupt construction schedules and affect cash flow.

The subcommittee has recommended ensuring adequate resources for national pride projects and maintaining timely payments so that construction can proceed continuously.

Contractor capacity and contract management remain weak

Weaknesses among construction contractors and shortcomings in government contract management have also affected project performance, according to the report.

Neupane said some contractors lack the experience, technical capacity and financial strength required to implement large infrastructure projects.

At the same time, terminating contracts with non-performing contractors does not immediately solve the problem because the government faces legal and procedural hurdles in appointing replacement contractors.

He cited the Sunkoshi-Marin Diversion Project as an example, saying that even after a contract is terminated, legal clarity is required over how a new contractor can enter and operate at the project site.

The subcommittee has recommended improvements in public procurement procedures to address such issues.

Construction materials and customs procedures create additional delays

The availability and management of construction materials have also been identified as significant challenges.

According to Neupane, local-level restrictions on the extraction and transportation of construction materials such as aggregates and sand frequently disrupt project work.

Contractors also face difficulties in ensuring a consistent supply of required materials.

The import of heavy machinery and construction equipment presents another challenge. Customs and tax-related procedures can result in imported machinery and equipment being held at customs points, delaying their deployment to project sites.

The subcommittee has recommended simplifying such procedures for nationally significant infrastructure projects.

Coordination problems across three tiers of government

The report has also pointed to weaknesses in inter-agency coordination and coordination among the federal, provincial and local governments.

The selection of project chiefs and technical personnel, procurement of machinery and equipment, coordination among government agencies and institutional decision-making have all affected implementation.

Disputes among project authorities, contractors, consultants and other stakeholders have further complicated project execution.

Some disputes reach arbitration, while others end up in courts and remain unresolved for extended periods.

The subcommittee has identified the absence of clear legal and procedural standards concerning design changes, contract variations, extension of time, price escalation and settlement of contractors’ claims as another major weakness.

Neupane said that although Nepal has amended the Public Procurement Act to address some of these problems, additional reforms are still required.

Need for full-phase construction

The subcommittee has also recommended that national pride projects should not be treated merely as subjects of periodic monitoring and discussion. Instead, there should be a mechanism capable of immediately removing legal and administrative obstacles encountered during implementation.

Neupane said construction should be carried out in multiple shifts wherever technically and financially feasible rather than restricting work to conventional working hours.

“Development projects cannot be completed on time by working only eight hours a day,” he said, emphasizing the need for full-phase construction and more efficient use of equipment and resources.

15 major challenges identified

The subcommittee has identified 15 major challenges affecting national pride projects, including land acquisition, compensation, forest and environmental approvals, budget assurance, contractor capacity, contract management, construction materials, customs and taxation procedures, project leadership and human resources, machinery and equipment, inter-agency coordination, coordination among three tiers of government, dispute resolution, design changes and contract variations, and claims and payment settlement.

The report was prepared after the subcommittee conducted field inspections of the Kathmandu–Terai/Madhesh Fast Track and Sunkoshi-Marin Diversion Project.

It also collected presentations and progress details from project chiefs and held discussions with experts and stakeholders involved in other national pride projects.

The subcommittee said the findings from field visits, project presentations and consultations with experts were used to prepare recommendations aimed at reducing implementation delays.

Neupane said that if the legal, administrative and institutional reforms recommended by the subcommittee are implemented effectively, the completion period of several national pride projects could potentially be reduced to three to five years, instead of the additional decade that may be required under the current pace.

The findings underscore a persistent challenge in Nepal’s infrastructure sector: while national pride projects are designed to serve as transformative engines of economic development, prolonged delays in land acquisition, approvals, financing, procurement and contract management have prevented them from delivering their intended economic impact within reasonable timeframes.