10th Plan Eng

Unofficial Translation
TENTH PLAN
(2002-2007)
His Majesty’s Government

National Planning Commission
Nepal
2002, March
Kathmandu, Nepal
Prime Minister March, 2003
Message
In the context of the efforts made for the planned development of the country,
so far nine periodic plans have already been implemented. Despite the
meaningful contribution made by these plans in the process of social and
economic transformation of Nepal, the problems of the poverty and the
backwardness still exist in the country.
The present economic and social structure, the peace and security situation,
and the limited availability of sources and means have made our planned
development efforts more challenging. However, it will not be difficult to
eradicate poverty and backwardness of the country, with committed and
honest efforts of all sector of society for the genuine cause of nation building.
In the process of country's all round development, the active participation and
involvement of all the sections and classes/communities of the society
becomes prerequisite for development of equitable and prosperous Nepali
society. Thus, in the process of formulation of the Tenth Plan, efforts have
been made to make this plan a common document based on the overall
development aspirations of Nepali people through extensive discussion and
interacting with concerned stakeholders.
As the Tenth Plan in itself is the strategic document for alleviating poverty, its
only objective is poverty alleviation. The four strategic pillars adopted by the
plan for poverty alleviation are a) high, sustainable and broad based economic
growth, b) social sector and rural infrastructure development, c) targeted
programme and d) good governance. In the context of market oriented
economy and the pivotal role of the private sector in the overall economic
activities, the investment of the government sector will be focused towards
poverty alleviating programmes in the plan.
Various targeted programmes have been designed for the women that occupy
half of our society, backward areas and communities, ethnic group, dalit,
blind, disabled and senior citizens. People that have no access to resource and
means w ill be benefited through provision of sufficient resources in the
development of rural sector.
Likewise, the fact that the role of the government, local agencies, private and
non-government organizatins are explicitly defined, active participation of the
development stakeholders is sought during the plan period for the overall
development of the country. I expect an active participation of all those
concerned including the people from all walk of life for the attainment of set
objective of poverty reductio n of the Tenth Plan.
Lastly, I would like to thank all those involved in the formulation of the Tenth
Plan and hope that implementation of the Plan would significantly contribute
the development of the nation.
Lokendra Bahadur Chand

Prime Minister, and
Chairman, National Planning Commission
Foreword
The Tenth Plan, the tenth stepping stone in the process of planned
development of the country, is not only the first plan of the twenty-first
century and the New Millennium, but it is also a strategic doc ument of poverty
alleviation. This plan has been formulated with the sole objective of poverty
alleviation. It has incorporated the directives and suggestions provided by
National Development Council, the development aspirations of the people
reflected during the deliberations and interactions carried out at different
levels and has considered the impediments encountered in the implementation
of past plans.
It has also embraced the suggestions of development partners who have
supported the economic and social development endeavour of Nepal and
Nepalese people, realised the sensitiveness for the progress and upliftment of
all sectors, class and communities of the society, the prevailing economic and
social situation and the challenges emerged from it at the implementation level
and has come up as a pragmatic, realistic and implementable plan.
As the third periodic plan formulated after the reinstatement of democracy it
has aimed at expanding economic activities with the active involvement of
private sector in line with the market economy and the role of the government
in these sectors has been limited as facilitator and promoter of the private
sector. Policies are designed in a way that the government can play a leading
role in an effective way in order to mainstreaming the deprived, suppressed,
dalit and backward class and areas and to eradicate poverty.
The envisaged objective and the sectoral targets could not be achieved and the
overall development process hindered due to the deteriorating condition of
peace and security within the country in the last two years of the Ninth Plan.
In case, the peace and the security conditions are not improved, it is certain
that there will be a negative impact in the investment of both the private and
government sectors. Despite the critical situation, and taking into account the
fact that without an clear cut framework of poverty reduction for overall
national development, investment and development programmes can not be
effective, this plan has come into existence. Based on the realistic evaluation
of the situation, resources mobilization, investment and economic growth rates
have been projected. It is expected that under improved peace and security
situation, estimated total capital investment will reach Rs. 640 billion and the
average annual economic growth rate will stand at 6.2 percent. In case of
unfavourable domestic and external situation investment will decline and the
economic growth rate will contain at 4.3 percent Development expenditure
and necessary resources have been adjusted in line with those economic
growth rates.
It is not possible to successfully implement the plan and attain expected
outcomes without the real identification of the people ’s aspirations and the
necessities. Keeping in view this reality in mind various discussion
programmes were organized expecting the participation of all the classes of
society in the process of formulation of this tenth plan. D iscussion
programmes were organized at regional level involving representatives of the
village development committees, district development committee and
municipalities to determine the framework of the plan. At the national level,
wide consultations were held with Parliamentary Committees,
parliamentarians, academia and sectoral experts. Suggestions received from
such deliberations are taken as guidelines. Through this type of participation,
it is believed that the role of different sectors and classes of the society can be
maintained even during implementation of the Plan. While formulating the
plan, inter relationship between sectors and coordination during
implementation need to be ensured, only then the predetermined objective and
targets of the periodic plan may be attained. Thus, in order to coordinate the
plan formulation process, a coordination committee under the chairmanship of
vice-chairman of National Planning Commission and guideline committee
under the chairmanship of concerned member of the Commission were set up
and the sectoral ministries were actively involved
The draft Approach Paper of the Tenth Plan approved by the National
Development Council under the chairmanship of the Rt. Honourable Prime
Minister and the additional guidelines and the suggestions of the donor
communities have been incorporated while formulating the plan. This
document has attempted to incorporate the guidelines of the Third United
Nation Conference on the Least Developed Countries held in Brussels in 2001.
In view of high, sustainable and broad based economic growth, social sector
development and rural in frastructure development, targeted programme and
good governance, as the strategic pillars of the Tenth Plan, total development
activities have been focused towards poverty alleviation.
Resource will be mobilized for sectoral programmes in order to mainstream
the socially deprived, suppressed and dalits by increasing their access to
development outcomes, and for additional targeted programmes.
After analysing the peace and security situation that hindered the development
process, their causes and its impact in the economic and social development,
basic services and income generating programmes with least cost and time
have been ascertained in order to augment the development and security
situation. In this context, the Tenth Plan has formulated important
programmes to rehabilitate people affected by insurgency and reconstruction
of damaged infrastructures.
Arrangements have been made for coordinated development of and giving top
priority to agriculture and rural infrastructures by recognizing the fact that
agriculture is the main source of income of entire Nepalese people residing in
rural areas. Therefore, its development is critical for overall economic
development of the country. It is believed that the social and the economic
development of the rural areas will help to eradicate the poverty of the people .
To make this plan a result oriented and to make optimum use of scarce
resource and means, programmes and projects have been priortised and
classified as first, second and third. Programmes and projects classified under
the first priority have been ensured with adequate resources.
The Policy and programme logframe formulated with overarching national
goal, sectoral objectives, policy indicators, source of information, major
programmes, external factor and risks has been taken as an effective tool for
monitoring and evaluation during implementation of programmes and projects
under the Tenth Plan. Arrangements have been made for monitoring of
programe /projects implementation, impacts of various program/projects on
poverty reduction and evaluation of policies on poverty alleviation.
In view of the role of various agencies and inter sectoral strategy, the Tenth
Plan has clearly specified the roles of the government, local agencies, private
sectors and civil society.
The role of government has been clearly defined to build physical and social
infrastructure, and to implement targeted programmes for the upliftment of the
backward and vulnerable groups and to create necessary environment for the
private sector development.
Lastly, it is hoped that the Tenth Plan will make a meaningful contribution in
fulfilling the national commitment of the country’s poverty alleviation by
accelerating the pace of social and economic development of the country. The
active participation of all Nepalese people is expected in its implementation
from their respective capacities.
March, 2003 National Planning Commission

Acknowledgement
We are sincerely thankful to the Parliamentary Committees of the Ministries

of His Majesty's Government, departments and other agencies, intellectuals,
District Development Committees, Village Development Committees, and
representatives of the Municipalities, non-government organizations, civil
society/social workers, representatives of the indigenous and dalits, the
women’s, labourers and private sectors for their valuable suggestions and co-
operation rendered in the process of drafting the Tenth Plan. We also want to
extend our thanks to the former Vice-chairmen of National Planning
Commission Mr. Prithivi Raj Legal and Dr. Narayan Bahadur Khadka,
members, Mr. Hari Shankar Tripathi, Dr. Rameshananda Vaidya, Dr. Nirmal
Parasad Pande, Dr. Jagdish Chandra Pokhrel, Dr.Prakash Sharan Mahat, Dr.
Minendra Rijal, and Member-secretary Mr. Shreeman Shrestha for their
valuable cooperation and contributions at various stages of the preparation of
this report. We would also like to express our thanks to all the donor countries
and donor agencies for their valuable cooperation in various stages of planning
process. The National Planning Commission Secretariat's staff should be
praised for their hard work. Likewise, our special gratitude goes to the team
involved in drafting the Tenth Plan process particularly Dr. Champak Prasad
Pokhrel and the other members of the team Dr. Bhuvanbajra Bajracharya, Mr.
Manoj Chipalu, Mr. Mukund Prasad Sharma and late Madan Raj Joshi. Mr.
Kedar Govinda Amatya involved in preparation of statistical framework and
all other specialist and consultants involved in the vario us taskforce in the
preparation of the plan also worth mentionable . We expect such help from
them in future too.

March, 2003
Rt.Hon’ble Prime Minister Mr. Lokendra Bahadur Chanda Chairman
Dr. Shankar Prasad Sharma Vice-chairman
Dr. Yub Raj Khatiwada Member
Chief Secretary Dr. Bimal Prasad Koirala Ex-officio Member
Finance Secretary Mr. Bhanu Prasad Acharya Ex-officio Member
Mr. Bhoj Raj Ghimere Member Secretary

Table of Content
Page
Chapter 1 : Background 1
Chapter 2 : Review of the Ninth Plan 5
Chapter 3 : Poverty Analysis 14
Chapter 4 : Objective, Target and Strategy of the Tenth Plan 26
4.1 Perspective development strategy 26
4.2 Tenth Plan: objective, target, strategy 28
4.3 Role of different agencies 40
Chapter 5 : Economic growth rate, management and appropriation of 45
resources and means
Chapter 6 : Macro-Economic Sector 62
Chapter 7 : Cross Cutting Sectoral Policy 116
7.1 Poverty Alleviation and Employment 116
7.2 Human Resource Development 121
7.3 Regional Development and Balance 123
7.4 Productivity Enhancement and Management 128
Development
7.5 Private Sector Development 129
Chapter 8 : Development and Social Peace 137
High, sustainable and broad based economic growth

Chapter 9 : Agriculture and Cooperatives 144
Chapter 10 : Forest and Soil Conservation 180
Chapter 11 : Land Reform And Management 200
Chapter 12 : Agriculture and Rural Credit 212
Chapter 13 : Culture, Tourism and Civil Aviation 224
Chapter 14 : Industry, Commerce and Supplies 246
Chapter 15 : Labour and Transport Management 271
Chapter 16 : Electricity Development 289
Chapter 17 : Irrigation and water induced disaster prevention 304
17.1 Irrigation 304
17.2 Water Induced Disaster Prevention 326
Chapter 18 : Road Transportation 335
Chapter 19 : Information and Communication 360
Chapter 20 : Science and Technology, and Alternative Energy 370
20.1 Science and Technology 370
20.2 Information technology 377
20.3 Alternative Energy 383
Chapter 21 : Housing, Building and Urban Development 395
Chapter 22 : Population, environment and natural disaster management 413
22.1 Population management 413
22.2 Environm ent Management 421
22.3 Natural and man made created disaster management 431
Social Sectors
Chapter 23 : Education and Sports 436
Chapter 24 : Health 457
Chapter 25 : Drinking Water and Sanitation 483
Chapter 26 : Women, Children and Social Welfare Sector 503
Targeted Programmes and Local Development

Chapter 27 : Targeted Programmes 539
Chapter 28 : Dalits and Neglected Communities 549
Chapter 29 : Indigenous People and Ethnic Groups 557
Chapter 30 : Local Development 565
Good Governance
Chapter 31 : Good Governance, Development Administration and Human 583
Rights
Chapter 32 : Decentralization 597
Chapter 33 : Monitoring and Evaluation 606
Chapter 34 : Development of Planning and Statistics 620
Annex
1. Policy Matrix of the Ninth Plan A-1
2. The Basis of the Formulation of the Tenth Plan A-40
3. Sectoral Policies and Policy Action Matrices A-59
Chapter-1
Background
The genesis of planned development in Nepal commenced on the year 1956 A.D.
Since then, a three-year plan and eight five-year plans have already been completed.
The Tenth Plan has come into effect from fiscal year 2002/03 on the completion of
Ninth five year plan by the year 2001/02.
The Tenth Plan, being the first one leading to twenty-first century and the
new millennium, is destined to enhance the concept of developing cultured,
competitive, affluent and equitable Nepali society reflecting the ultimate aspirations
of Nepal and Nepali people at large. The plan attempts to encompass the
aforementioned concepts while formulating it on the basis of maximum utilization of
available limited resources to include therein people's rising aspirations as far as
possible. It has to be framed in an atmosphere of severe constraints of resource and
means due to recent happenings taking place in national and international firmaments.
Under such circumstances, too, the plan attempts to adhere to the principle of
ensuring the utilization of here-to-fore developed infrastructures, institutional setups
and policy reforms to yield maximum returns .
The Tenth Plan is the third plan after the reinstatement of democ racy. As in
the last plan periods, poverty has remained the first and foremost challenge of the
country even for this plan. Poverty alleviation, therefore, has been instituted as the
main objective of the plan and an interim poverty reduction strategy has been
incorporated in it. As in earlier ones, agriculture sector has got the first priority to
meet the objective of poverty alleviation. Similarly, according to the open and free
market oriented development policy the government will curtail its role from the
areas where private sector can be attracted, and increase the role in the areas of social
and infrastructure development. The government will play an active role in the
development of dalits (low profile occupational castes), indigenous people, scheduled
castes and remote areas, and create an environment for blinds, disabled and helpless
people to live a respectful life. The women would be promoted as the focal point of
the development, and the government would comply with the international
conventions and agreements by investing on social reforms, human development, and
people's welfare.
The plan formulation process was coordinated by forming a mon itoring committee
under the chairmanship of Vice-Chairman of National Planning Commission and
different sectoral steering committees under the chairmanship of concerned member .
In order to support the committees, various subject/area teams of technical experts
were formed, and plan formulation work was carried in various ministries . The plan
was formulated by taking the stock of law and order situation, and analyzing its
causative factors and their impact on socio -economic development of the nation, so as
to bring an improvement over the existing situation, include remote areas and
deprived areas and communities from the main stream of development process and to
1
evolve necessary strategies which expedite over all development and reconstruction
works.
The Tenth Plan has given an emphasis to make it different and more realistic
than the earlier periodic plans. The plan has focused on the following five aspects:
1. Wider public discussion :

The preparatory process of the Tenth Plan underwent far wider public
discussions, various seminars and talk programs. Right from the drafts to the final
document, there has been wider public participation involving private sectors, NGOs,
intellectuals, women activists, nationalities, scheduled castes, civil societies and
communities, presidents of DDCs, mayors, representatives of council of VDCs and
honorable MPs in regional and national levels.(see schedule 1 for details ).
2. Direct participation of ministries and departments:

The participations of ministries and departments in the process of selection and
formulation of projects under their concerned spheres were called forth thickly so that
concerned ministry could hold full ownership over the selected project. This is
expected to make the ministries accountable and responsible towards the
implementation of the Plan.
3. Prioritization :
It is necessary to make qualitative improvements in the implementation and
formulation aspects of projects and programs to promptly meet the target of poverty
alleviation. The Tenth Plan has envisaged to follow the Public Sector Expenditure
Review Commission's recommendations to prioritize the projects from the stage of
selection. The projects and programs are prioritized under following eight bases:
1. Effective role in the national objective of poverty alleviation
2. Contribution in the sectorwise priority
3. Regional Balance
4. Requirement of the role of the government in the program .
5. The extent of people’s participation
6. Involvement of local body in accordance with decentralization
7. Participation of the private sector/support to enhance competition
8. Past achievements in reference to the current program
The projects and programs are catagorised into first, second and third priority on the
basis of percentage points gained through the eight bases. In case of the resource
constrains, the projects and programs falling under the first priority would be kept
intact, and the readjustment process will start with projects and programs falling
under third and second priority, respectively (for details see schedule 2).
4. Log-frame of policies and programs:

2
The log-frame schedule of policies and programs has been a major tool of the Tenth
Plan to strengthen the implementation and monitoring of projects/programs and
emulate objectives with project and program formulations. The log-frame of all major
sectors have been constructed for the whole plan period. The sector wise log-frame
can be divided primarily into two parts (a) a summary at national level, and (b)
additional explanatory note on major programs. The first column states the macro
objectives, policies and major programs while the following columns relate the
additional policies and programs designed to achieve the result contained in the first
column. Following six aspects are covered in the log-frame :1) Sectoral objectives
2) General policy/ working policy 3) Performance indicators 4) Sources of
information 5) Major programs and 6) Risk factor
The inclusion of aforementioned provisions in the Plan, are expected, to produce
clarity in implementation and strengthening the monitoring norms. National level
summary of log-frame is presented at the end of each chapter while the additional
explanation of major programme has been attached in annex ( see schedule 3 for
details)
5. Growth rate and investment analysis:

The projection of major indicators like growth rate, investment, employment, and
other major indicators are done on the basic of input-output analysis and macro
modeling. The sectoral growth rate, investment and other indicator are projected on
the basic s of these analyses. The projection of indicators is divided into two
categories in consonance with stock taking of volatile law and order situation at
present a) if there is outstanding improvement in the situation, the desired economic
growth rate shall reach the rate of 6.2 percent, and b) if the situation deteriorates the
growth rate will be 4.3 percent.
6. Clarity in the role of different agencies:

The overall development of the country is not only the responsibility of the
government, but also the liabilities of the local bodies , privates sectors, NGOs, CBOs,
and civil society. The present document clearly states the role of each stakeholder,
and has tried to create a conducive environment accordingly.
7. Poverty analysis:
The main objectives of the plan being poverty alleviation, it has specially treated
poverty analysis pointing out different aspects including HDI, social and gender
issues, underprivileged geographical regions etc and the causes thereof (for details
see chapter 3). It will help draw log-frame on poverty and integrate poverty
alleviation activities into concerned sectorwise planning/programming process.
The presentation of plan document is organized in 34 chapter and 3 schedules. High,
sustainable and wide economic growth, development of social sectors and rural
infrastructures, targeted programs and good governance are incorporated in the Plan
as the four pillars of poverty alleviation.
3
The Tenth Plan, in totality, envisages increasing participatory planning process.
Sincere attempts have been made in the plan to strike a balance between macro level
policies/strategies and sectoral policies/strategies . The sectoral as well as targeted
projects and programs are prioritized so as to let flow available resources towards the
areas yielding higher rate of returns . These all are meant to achieve objectives and
targets of the Plan in time. This will reshape the plan to be more realistic and will
create easier way, it is believed, to achieve the overarching target of poverty
alleviation.
4
Chapter-2
Review of the Ninth Plan˜
2.1 Background
Poverty alleviation was the sole objective of the Ninth Plan. The implementation of
the Agricultural Perspective Plan was the major means to alleviate wide-spread
poverty in rural areas. The plan had the target to drop the proportion of population
living under absolute poverty to 32 percent at the end of the plan period, and had a
20-year objective to reduce the absolutely poverty to 10 percent. It was estimated
that an annual economic growth rate of 7.2 percent in the long run was necessary to
meet the target. Thus the target growth rate of the Ninth Plan period was 6 percent.
There were three main strategic development policies within the framework of liberal
and market-oriented economy adopted in the Ninth Plan. And they were: achievement
of sustainable and wider economic growth rate, development of social sectors and
rural infrastructures, and targeted group programs for hitherto deprived areas and
communities.
The Ninth Plan period was severely disturbed by deteriorating law and order
situation, which not only hindered the implementation of development programs but
also forced the government to divert development fund into security sectors. The
global recession due to terrorist activities adversely affected Nepal's major economic
sectors like industry, tourism, foreign trade etc ., thereby macro economic conditions
too.
The review of the Ninth Plan includes the analysis on the progress made in poverty
alleviation, overall socio-economic development, physical infrastructures
development, and sectorwise physical progress.
2.2 Progress in poverty alleviation

The national household survey shows the detailed progress made in poverty
alleviation. As Nepal Living Standard Survey is scheduled for the first quarter of
2003 A.D. the population living under national poverty line has been calculated as the
ratio between economic growth rate and the percentage of such population. On the
same basis the mid-term evaluation of the Ninth P lan has also estimated that the
percentage of population living under poverty line has fallen down to 38 percent.
Similarly, on the HDI (Human Development Index) also target could not be met.
Adult literacy (15 years and above) is raised to 49.2 percent only against 70 percent
˜
Detailed statistical analysis of Ninth plan and its statistical review are presented in Annex
1, Table 1 to 35.
5
targeted growth. The women literacy rate is mere 35.6 percent, while the net
enrolment in primary classes reached only up to 80.4 percent against the target of 90
percent. But the average life expectancy has crossed the target of 59.7 years to 61.9
years. The child mortality rate is still 64.2 percent below the target of 61.5 percent
and the total fertility rate recorded 4.1 percent as against the target of 4.2 percent (see
table 2.1 below)
Table 2.1 The target and progress on poverty and HDI, Ninth plan.
Heading Target Progress
Population below poverty ( percent) 32.0 38.0
Literacy above 15 years ( percent) 70.0 49.2
Primary class enrollment ( percent) 90.0 80.4
Child mortality rate (1000 live birth) 61.5 64.2
Maternal mortality rate(100,000) 400.0 415.0
Total fertility rate ( percent) 4.2 4.1
Average life expectancy (yrs) 59.7 61.9
Population using drinking water ( percent) 100.0 71.6
The plan could not meet the HDI targets due to over ambitious targets, inaccessibility
of the facilities and services to the target groups and poor quality of services,
whatever delivered. In order to mitigate the observed problems, from the last year of
the Ninth Plan the management of primary schools and health posts have been
transferred to local bodies in accordance with Local-Self Government Act, 1998.
Though progress in the HDI was not up to the target, the achievements were quite
encouraging vis-à-vis other SAARC countries.
2.3 Progress on main physical infrastructures:

There is mixed progress report on physical infrastructures such as roads, irrigation,
telephone, and electricity (Table 2.2). The progress in road construction has gone up
beyond the target while electricity generation progressed to the tune of target. But the
extension of te lephone lines and irrigation facilities remained far behind the target.
The excess progress in road construction is the result of enthusiasm shown by VDCs
and DDCs as they keenly utilized whatever the grant HMG provided. There is,
however substandard quality of road constructed in spite of its increased length. This
suggests the urgency to improve the quality of constructed roads especially in
mountain regions in the absence of which the added problem of soil erosion may
emerge. The withdrawal of subsidy, especially in underground irrigation sector, had
been the main constraint to fail the target met.
6
Table 2.2 The target and progress of main physical infrastructures up to Ninth
plan
1. Total length of road (km) 13564 15905
2. Total irrigation facility ('000 hect) 1198 1121.4
3. Total no.of telephone lines (‘000) 643.7 328
4. Telephone service per 1000 people 25 14
5. Electricity generation (Mwatt)* 598 584.4
6. Electricity service to people ( percent) 20 40**
* including thermo-electricity
** 7 percent from alternative renewable energy.
2.4 Macro Economic Indicators

2.4.1 Gross Domestic Product(GDP):
The Ninth plan had set the target to achieve the annual economic growth rate of 6.0
percent by gaining 4.0 percent growth in agriculture sector and 7.3 percent in non-
agricultural sector. The annual population growth rate during the plan period was
assumed to be 2.4 percent thereby the net annual per capita growth rate would register
3.6 percent.
The annual growth rate during the Ninth Plan period was limited to 3.6 percent due to
low level of investment and production in non-agricultural sectors as a result of
deteriorating law and order situation. Similarly, the low productivity in agriculture
due to adverse monsoon thereby pulled down the sectorwise growth to 3.3 percent in
agro-sector and 3.9 percent in non-agro-sector (Table 2.4). As the population grew by
2.25 percent, the net per capita income growth rate is estimated at 1.3 percent
annually during the plan period. The contribution of agriculture sector in GDP was
40.4 percent in 1996/97, The base year of the Ninth Plan, which was lowered down to
39.3 percent in the final year of the plan in 2001/02. (Schedule 1,Table 4)
The annual average growth rate of 4.6 percent marked the first four years of ninth
plan heralding a set of positive achievements in several sectors. Unfortunately, they
couldn’t be sustained in many sectors up to the fifth year. The GDP growth rate on
the fifth year was negative by -0.5 percent due to internal and external adverse
situations, which brought home unhealthy stress on poverty alleviation and
employment generat ion (Annex 1 Table 3).
The expected growth rate could not be achieved due to the lack of increased
investment in agriculture as designed by the plan, the weaknesses on implementation
side of Agricultural Perspective Plan (APP), loss of agricultural production during the
first and last year of the plan due to adverse monsoon, low level of investment and
production in non-agricultural sector caused by worsening law and order situation,
considerable damage inflicted upon development infrastructures . Recession in the
export and tourism on the final year of the plan due to pervading depression in the
7
international scenario affected plan. The growth rate of all sectors except the social
sector, therefore, got setback compared to targets on this plan period. Important
economic sectors such as industries and commerce, hotel and restaurant witnessed
low progress. The growth rate of several sub-sectors of them diminished too negative
on the last year of the plan.
2.4.2 Savings
The average annual national saving ratio stood at 16.5 percent by the end of the plan,
which exceeded the targeted rate of 16.1 percent. Domestic saving increased by very
low rate of 0.6 percent as against the target of 9.3 percent. There has been a set back
of 3.1 percentage points on the estimated growth rate of nationals saving (Table 2.3).
This growth in national saving was possible only because of foreign employment.
Table 2.3: The target and progress of macro economic indicators in Ninth Plan
(in percentage)
(at constant price of
96/97)
GDP growth rate 6.0 3.6
National saving growth rate 8.8 5.7
Domestic saving growth rate 9.3 0.6
National saving/GNP ratio* 16.1 16.5
Domestic saving/GDP ratio* 14.1 11.6
Gross investment/GDP ratio* 24.3 24.4
Gross investment growth rate 6.1 3.5
Commodity export growth rate 12.5 11.1
Commodity import growth rate 8.8 -2.1
Goods and services export growth rate 11.0 0.5
Goods and services import growth rate 8.5 3.3
Current account /GDP ratio(including grant and -4.8 -4.9
transfer)
Current Account/GDP ratio(Excluding grant and -8.5 -7.0
transfer)
Consumers’ price index 6.5 5.7
*At producers' cost of last year of plan.
Table 2.4 :GDP and its sectorwise growth rate in Ninth Plan (in percent)

GDP (at factor cost) 6.0 3.6
8
Agriculture Sector 4.0 3.3
Non Agricultural sector 7.3 3.9
Industry, Quarrying & Mines 9.1 2.1
Electricity, Gas and Water 10.4 6.1
Construction 5.9 4.1
Trade, Hotel and Restaurant 7.4 1.4
Transport and Communication 8.7 6.0
Finance and real state 5.8 4.0
Social services 7.0 6.6
GDP(at producers price) 6.5 3.6
2.4.3 Investments
It was estimated that total fixed capital investment would be Rs 37271.1 crores and
marginal capital output ratio of 4.1:1 at constant price of 96/97 in the Ninth Plan for
6.0 percent annual average growth rate. Out of this, the share of public sector
investment was 33.6 percent while remaining 66.4 percent was of private sector. At
the completion of plan period gross fixed capital formation amounted to Rs 31037.0
crores at the constant price of 1996/97. Of this, public sector occupied 37.4 percent
share while the remaining 62.6 percent was that of the private sector (Annex 1 Table
6). It is obvious that expected share of investment from the private sector could not be
realized. The reasons behind the increased share of public sector investment
culminates mainly to recession of private sector investment due to law and order
situation and large-scale investment in big projects under electricity generation.
During the plan period (the first four years) marginal capital-output ratio increased to
4.5:1. It shows an increase by 0.4 points over the initial estimate of the plan. This is
so because of large scale investment in capital intensive projects like electricity. The
gap between investment and saving has been narrowed down to 7.0 percent from
existing 9.7 percent in the base year 1996/97.
2.5 Government Expenditure:

The government expenditure amounted to Rs 27846.8 crores over the targeted
expenditure of Rs 33729.0 crores at the constant price of 1996/97, which created the
expenditure gap of 17.4 percent.
2.5.1 Regular Expenditure:

Regular expenditure has gone up to Rs 14936.3 crores in the plan period which is
higher by 1.1 percent over the estimated target of Rs 14771.0 crores (43.8 percent of
the total budget) at the constant price of 1996/97 (Annex 1 Table 8). The regular
expenditure absorbed 8.6 percent of GDP on the base year 1996/97 which increased
9
to 11.2 percent in the F.Y. 2001/02, the final year of the Ninth Plan. It states that there
has been annual average increase of 9.3 percent in the regular expenditure (Annex 1
Table 8). The share of regular side in total expenditure of the plan was estimated to be
43.8 percent, which has actually increased by 9.6 percentage points over the
estimation amounting. This substantial increase in regular expenditure is due to
increase in the salary and pensions to civil servants and on, rise in security related
expenditure specially in the later years of the plan.
2.5.2 Development Outlay

The development outlay during the plan period targeted at Rs 18958.0 crores (56.2
percent) at constant price of 1996/97 has actually been only Rs 12910.5 crores
leaving a gap of 31.9 percent. Development outlay as percent of GDP has dropped
from 9.5 to 7.6 percent during the period 1996/97 to 2001/02 (Annex 1 Table 9).
Similarly, the development outlay had been decelerating by 1.1 percent annually
within the plan period. The share of development expenditure was proposed to be
56.2 percent of the total plan outlay but the unex pected rise in regular expenditure
force to limit it to 46.9 percent during the plan period.
The target expenditure on economic services, infrastructure, social services and
miscellaneous (Administrative and contingency) was 29.4, 36.3, 33.4 and 0.9 percent
of the development expenditure, respectively. The actual figure turned out to be 22.7,
35.7, 39.9 and 1.7 percent, respectively. The expenditure in unproductive sector
especially on miscellaneous heading has exceeded the target while the expenditure on
productive sector like economic services and infrastructures has remained below the
target (Annex 1 Table 10).
2.6 Sources of Development outlay

It was targeted that the financing of development expanditure would be 33.3 percent
from revenue, 7.9 percent from other domestic sources, 17.2 percent from foreign
grants and 41.6 percent from foreign loan in the Ninth Plan. These sources actually
financed 17.6 percent, 26.2 percent(including cash balance), 19.5 percent and 36.6
percent respectively(Annex 1 table 20). As the revenue surplus failed noticeably to
meet the targeted expenditures the added pressure fell on internal debt mobilization.
2.6.1 The revenue

Of the targeted revenue collection of Rs. 21084.0 crores at the constant price of
1996/97, the actual collection reached only Rs. 17222.5 crores leaving a deficit of
18.3 percent over the target. The average annual growth rate of 4.9 percent at constant
prices prevailed in revenue collection (Annex 1 table 14). The ratio total revenue ratio
at 10.9 percent at the beginning of the plan reached to 12.0 percent at the end of the
plan, registering a growth rate of only 1.1 percentage point over the period (Annex 1
table 13). This ratio stagnated without noticeable progress specia lly during the last
two years of the plan. Still the revenue collection dropped far below the target at the
final year of the plan. The causes behind such slackening on the target of revenue
collection are mainly due to deceleration in investment and production in non-
10
agricultural sector specially in industry because of worsening law and order situation,
no widening of tax base and no effective and transparent revenue administration. The
progress in revenue collection was distinct in import revenue increased by 21.2
percent, sales tax (including VAT) by 22.9 percent and income tax by 16.4 percent
during the plan period while low collection of revenue marked in land tax(0.1
percent) and export tax(1.1 percent). The annual average growth rate was 4.9 percent
at current prices of which the growth was 11.3 percent in income tax, 5.6 percent in
sales tax, and 3.4 percent in import duties (Annex 1 table 14).
2.6.2 Budget deficit and financing deficit.

Budget deficit at constant price of 1996/97 including foreign grants Rs. 1436.2 crores
was in the beginning year of the plan which rose to Rs.1665.2 crores in the final year
increasing at an average annual rate of 4.3 percent during the plan. Similarly, the
budget deficit without foreign grant rose from Rs. 2035.0 cores to Rs. 2327.0 cores
showing 3.6 percent average annual increase (Annex 1 table 17). The share of budget
deficit with and without foreign assistance is 29.1 percent and 38.2 percent,
respectively, on the average during the plan period. It accounts for to 5.5 percent of
GDP (Annex 1 Table 19). Deficit was targeted to finance (by internal loan and cash
balance) worth Rs 531.8 crores in the base year 1996/97 of the plan which rose to Rs
832.8 crores at constant price of 1996/97 in the las t year of the plan. Thus the
percentage share of deficit financing in the base year of 1996/97 was 1.9 percent
which has increased steeply to 2.6 percent at the final year of 2001/02 the share of
deficit finance in the total internal revenue has remained 62.2 percent during the plan
period (Annex 1 Table 18). The deceleration in revenue mobilization and acceleration
in regular expenditure have been the main reasons to increase the amount of deficit.
2.6.3 Foreign Aid

During the plan period, the estimate d foreign aid amount was Rs 11154.6 crores at
constant price of 1996/97 and the share of foreign grant was expected to be 29.2
percent of it. The foreign aid totaled to Rs 7242.0 crores only at the constant price
which is less by 35.1 percent of the target. But the share of foreign grant slightly
increased to 34.7 percent of foreign aid. The share of foreign aid in development
outlay was estimated to be 58.8 percent which has actually been 56.3 percent, lower
by 2.5 percent of the target during the plan period (Annex 1Table 20,21).
The foreign debt of Nepal totaled to Rs 2063.0 crores which counts for more than 48
percent of GDP. But as it is long and soft term loan, payments of interest and
installments do not appear a problem being less then 1 percent of GDP till now.
2.7 Monetary and price situation and internal debt.

2.7.1 Monetary situation
The targeted monetary expansion was calculated at 13 percent in M 1 and 14.8 percent
in M2 on the basis of estimated growth rate of 6.0 percent, inflation of 6.5 percent and
expansion of monetization by 0.5 percent. During the plan period. the average annual
11
expansion rate reached 15.7 percent for M 1 and 17.1 percent for M 2 within the plan
period (Annex 1 Table 22).
Net foreign assets was estimated to grow on an average by of 9.1 percent and of total
domestic credit by 16.6 percent at current prices during the plan period. The average
annual increase of 18.0 percent and 15.3 percent, respectively have been registered in
net foreign assets and total domestic credit. Credit to the private sector has slackened
because of emergence of adverse investment situation in industry and tourism sectors
due to the security problem. Of the total domestic credit an increase of 15.4 percent in
the credit to the government has been witnessed. This increase is attributable to meet
the growing budget deficit due to decelerated growth in revenue mobilization (See: 1
table 22/23).
2.7.2 Price situation

Inflection (in terms of change in consumer pric e index) was targeted at annual
average growth of 6.5 percent during the plan which has grown only to 5.7 percent,
lowered by 0.8 percent than the target. The price has increased by 5.2 percent in food
& beverage and by 6.4 percent in non food items and services during this period
(Annex 1 table 26). The average annual price rise in GDP has been 4.7 percent only.
2.7.3 The credit and d eposit situation

There has been a noticeable growth of financial institutions resulting in increased
savings mobilization. The average annual growth of resource mobilization and their
utilization by commercial banks has marked 17.1 percent at current prices and 12.4
percent at constant prices during the plan period. T he total deposit, the main source of
banking resources has increased by 13.4 percent at constant prices and by 18.1
percent at current prices. Of the total deposit, saving deposit has recorded the highest
rate of increase of 19.4 percent at constant prices while fixed and current deficits 9.7
percent and 10.3 percent respectively.
On the resource mobilization front, the resource mobilization seems to have increased
due to increased loan and investment to the government sector. There has been an
increase of 26.3 percent (31.0 percent at current prices) of loan and investment to
HMG. Similarly, loan to public enterprises has increased at an average annual rate of
9.7 percent (14.4 percent at current prices) and at 11.1 percent (15.8 percent at current
prices) to private sectors (Annex 1 table 24). The sectorwise loan flow of commercial
banks in FY 2001/02 has been 44.5 percent in industry, 34.7 percent in commerce,
12.4 percent in consumption, 5.0 percent in services, 2.3 percent in agriculture and
0.7 percent in miscellaneous sector (Annex 1 table 25). In the analysis of loan
structure between base year and the final year of the plan, the banking sector has not
been able to introduce any remarkable new destination of investment in this direction.
Financial sector is weak in identifying suitable opportunities of promising investment.
On the other hand, the ensuing retardation in investment environment has adversely
affected the loan flow. The recovery rate of loan is less than 75 percent for large
banks which is not considered a healthy. The risk on the part of deposit-holders has
been increasing due to lack of sufficient monitoring mechanism to control the
financial institutions in comparison to institutional growth of private sector. In spite
12
of efforts to minimize the government’s involvement in commercial banks and
provide greater autonomy to them, no remarkable achievement has been witnessed
13
Chapter - 3
Poverty Analysis
3.1 Various aspects of poverty

Poverty has been perceived from different perspectives. Income based poverty,
weaknesses in different aspects of human development, and social exclusion are the
main aspects of poverty.
The main indicator of income based poverty is the percentage of people living below
poverty line. Human development capacity indicators are also equally important
because these indicators do not change as per the change in income-based indicators.
The typology of these capacities includes access to existing resources, human
resource development and participation in social/political decision making process,
etc.
The society bestows all individuals entitlement to participate in social/political
decision making process and do possess right to live with human dignity. But any
group or community deprived of such right by whatsoever reason it may be, belongs
clearly to identified poverty group or community. It is essential, therefore, to bring
them in the main stream of development with the identification of such deprivation.
The evaluations of this type of causes also fall under the purview of analysis of
poverty status.
3.2 Income based poverty

The first income poverty estimation on scientific basis was carried on in 1976/77
which estimated that 33 percent of total population live below poverty line. The
incidence of poverty was high in mid-western and far western development regions
along with rural areas highly affected. The next survey of 1984/85 estimated that 41.2
percent people live below poverty line. The difference in poverty incidence between
various geographical and development regions was almost similar.
According to the next survey exclusively done in rural areas in 1990/91, it was
estimated that high incidence of poverty fall hard on landless and small farmers; but
poverty was not only limited to these groups.
The latest extensive household survey w as conducted on in 1995/96 to evaluate
poverty and measure living standard of the Nepalese people. Another survey of the
same kind has not been done yet. Therefore, a brief overview of this survey at the
threshold of Ninth Plan is presented in this chapter .
It was estimated at the beginning of the Ninth Plan that 42 percent of populations live
14
below poverty line. The Nepal living standard measurement survey had estimated
annual per capita income of Rs. 4404/- to meet the expenses on daily minimum
average of 2124 kilo calories from food basket and other non-food items
requirements too. The income level at the current prices of 2001 turns out to be Rs
6100/-
The mid-term evaluation of the Ninth Plan has estimated that 38 percent of
population live below poverty line. These macro level of estimates do not provide
disaggregated statistical distributions of poverty on geogr aphical basis. According to
Nepal Living Standard Survey 1996(NLSS), 44 percent of rural population lives
below poverty line whereas the figure for urban sector is 23 percent only. There is a
great difference between Kathmandu Valley and other urban areas in this regard, too.
It is estimated that 34 percent of people live below poverty line in urban areas
excluding Kathmandu Valley. The level of income inequality is high in urban areas.
Since 86 percent of the total population lives in rural areas, the nature of poverty in
Nepal is rural-oriented one. The poverty pressures in Terai and Mountains are similar,
but it is extremely high in Himalayan region. By to development regions incidence of
poverty in mid western and far western development regions are the highest.
Table 3.1 : 1995/1996 Survey: Indicators of Poverty Measurement
(Poverty line : Rs 4404/ per capita per year )
Ecological Zones Poverty incidence: Poverty gap: Severity of
percent of people living Depth/intensity of Poverty(
below poverty line Poverty( percent) percent)
Mountains 56 18.5 8.2
Hill 41 13.6 6.1
Terai 42 9.9 3.4
Rural/Urban
Urban 23 7.0 2.8
Rural 44 12.5 5.1
Nepal 42 12.1 5.0
Source: World Bank (1999): Nepal; Poverty at the Turn of Twenty First Century.
Other indicators of income based poverty are depth intensity of poverty and severity
of poverty. The poverty intensity indicators show how low the income of the poor
living below poverty line is, and by what ratio the income should increase while the
severity of poverty describes the intra-poor conditions of poverty. The NLSS (1996)
puts intensity of poverty percentage to 12.1 percent i.e. io an average. T he per capita
income of poor living below poverty line should be increased by 12.1 percent. The
incidence of poverty is 5 percent. In Nepal mountain region is most affected by
poverty. Though the level of poverty is similar in the terai and the hilly regions, it is
more intense and severe in hilly regions. So the data shows that problem of poverty is
most severe in mountain region followed by hill and terai region.
Since the nature of income poverty is rural-based and the source to subsistence
livelihood in rural areas is agriculture, the main crux lies, therefore, in the poverty
incidence existing in agriculture sector and the access of poor in the development
15
perspectives within the sector. The low graded and least productive activities
occupied by poor and that too, in small patches and insufficient amount, subsistence
agriculture and low capacity to invest to increase productivity due to low income
level etc. are the main components of the vicious circle of poverty existing in
agriculture sector. According to NLSS 1996, the average farms size of holding for
low income households is less than 1.0 hector. The lowest 25 percent income groups
have only 37 percent of their land in plain and irrigable area whereas there is 54
percent of such land with people of highest 25 percent income group. Similar
difference exists in the ownership and use of land with round-the-year irrigations
facilities.
Table3.2: Household Distribution by their access to Agriculture Inputs, 1996
Household Ploughed (khet) Year round Chemical percent of
income land as percent irrigated land fertilizer household with
of total as percent of bought from institutional
cultivated land cultivated land AIC (in kg/ha) loans
Bottom 25 37 11 10 8
percent
25-50 percent 53 14 19 16
50-75 percent 57 15 30 16
Upper 25 54 18 39 16
percent
Average 51 15 26 14
Sample 2550 2550 2679 3373
household (No)
Source: World Bank (1999): Nepal Poverty at the Turn of the Twenty First Century
The state of poverty incidence is explained by limited access of poverty group to

agricultural inputs, use of low amount of chemical fertilizers and the percentage of
households paying institutional loan. The agricultural productivity of poor farmers is
extremely low due to low grade land and limited access to agriculture resources.
Poverty is not confined to only small farmers. There is poverty even in medium and
large farmers. Though the productivity of land of small farmers is higher as compared
to that of medium/large farmers, the overall land productivity is very low for poor of
all groups. There is deeper inter-relationship between the level of education of
household chief and the level of agricultural income, i.e., higher the level of
education, higher the level of farm income.
It is necessary to think over the access of poor to prerequisites of human development
and their macro level state to facilitate their access to new unfolding opportunities.
The access of poor households to such infrastructures as electricity, telephones and
road is extremely low . According to income groups only three percent of the lowest
income earning 25 percent households enjoy the service of electricity. Only 12
percent of total households do have access to black topped road within half an hour
distance. Telephone service is strictly limited to urban areas. It is only on community
basis that this service is recently extended to rural areas.
16
Table :3.3 Percentage distribution of households having access to infrastructures
(1996)
percent of households within percent of households
half an hour access to road covered by electricity services
Lowest 25 percent 12 3
25 percent to 50 percent 13 6
50 percent to 75 percent 19 11
Uppermost 25 percent 25 12
Average 18 14
Sample size 2657 3733
Source: ibid
Table 3.3 shows that as the income level grows the access to infrastructure also
grows. Since the productivity of households having access to infrastructures is high
in general, it prescribes that the access of poor to such facilities needs to be increased
in order to increase their productivity.
3.3 Human Development Indicators

The progress in human development indicators (HDI) front is rapid as compared to
that of per capita income in Nepal. The achievements made in extension and
development of education, health and drinking water has clearly surpassed the
economic growth rate.
Table 3.4 Human Development Indicators
Particulars Beginning of End of the
the Ninth Plan Ninth Plan
Literacy Rate ( Above15 years) 40 49.2
Net enrollment in primary school ( percent) 69.4 80.4
Average life expectancy (yrs) 56.1 61.9
Child mortality rate(per’000 birth) 74.7 64.2
Maternal mortality rate (per’00000 life birth) 439 415
Total fertility rate ( percent) 4.58 4.1
Population growth rate ( percent) 2.4 2.25
percent of people using safe drinking water 61.0 71.6
Delivery service from trained health personal ( - 13.0
percent)*
Human development indicators - 0.466
* Except trained birth attendants.
The stock taking of main indicators of human development shows that the progress in
some indicators is highly encouraging while in others it is not. The literacy rate is
49.2 percent and net enrollment in primary level is less by 11 percent of the target. It
is estimated that average life expectancy at birth is 61.9 years while child mortality
rate has fallen to 64.2 per thousand births . The maternal mortality rate is reduced to
415 per 100,000 live births. Similarly, the total fertility rate has gone down to 4.1
17
percent. There are noticeable differences among various ecological zones and urban /
rural areas in HDI as in income poverty.
Table3.5: HDI of Ecological Zones 1996 and 2000
Region Adult literacy Life Population HDI
Rate(above 15 Expectancy(yrs) having safe
years) at birth drinking water
1996 2000 1996 2000 1996 2000 1996 2000
Mountain 27.5 44.5 52.7 49.8 - 79.2 0.271 0.378
Hill 40.2 55.5 58 65.1 - 76.2 0.357 0.510
Terai 35.9 46.8 59.5 62.4 - 83.4 0.344 0.474
Rural/Urban
Urban 63.5 69 55 71.1 62 92.3 0.518 0.616
Rural 34.5 48 53.7 58.7 61 78.1 0.306 0.466
Nepal 36.7 50.7 55 59.5 61 79.9* 0.325 0.466
Source: Nepal Human Development Report 1998 and 2001
* The figure here does not confirm to others due to definition of drinking water, and
because of this difference other figures may also differ with similar figures given in other
places .
Mountain region is farthest left behind in case of human development indicators. Hill
region is slightly forward on this front. These indicators are found noticeably high in
urban areas. Though the figures are of 1996, the interregional differences, it is
guessed, does not seem significantly differing any more by now, too.
3.4 Social Exclusion , Backward Groups and Areas

It is a bitter reality that some groups in society are compelled to traditional social
values. These groups are denied of any new opportunities created by development
opportunities as they are extremely backward. Their access to resources is extremely
limited and so is their participation in decision making process. From this point of
view, poverty and HDI are of crucial importance as an effort to mitigate poverty of
backward and low caste groups .
Table: 3.6 Human Development Indicators by caste and ethnicity 1996

Average life Adult Average Per capita HDI
expectancy Literacy years of relative
(yrs) rate ( schooling income (Rs)
percent)
Nepal 55 36.7 2.3 7673 0.325
18
Gurung, Magar, Sherpa, 53 35.2 2 6607 0.299
Rai Limbu
Rajbanshi,Yadav, 58.4 27.5 1.7 6911 0.313
Tharu, Ahir
Occupational 50.3 23.8 1.2 4940 0.239
CasteGroup
Source: Nepal Human Development Report, 1998.
The major indicators of human development reveals that some castes are high above
the average while some others fall far behind. The so called low caste people, in
Nepalese social hierarchy who actually are occupational castes, fall back in almost all
HDIs. The NLSS shows that their average life expectancy does not exceed 50.3 years
and adult literacy rate is mere 23.8 percent. The average schooling is 1.2 years. The
other backward castes are Rajbanshi and Tharus and their HDI is also at low ebb.
This root cause of the castes’ backwardness manifests in their lack of access to
development programmes which inhibits their own development process. The
monitoring over these groups-specific poverty and human development condition,
therefore indicate the need for additional reforms.
During the Ninth Plan period, important measures were taken to address social
exclusion. Kamaiya,(bonded agriculture labourers) eradication, establishment of
National Academy of Indigenous People, Commission of Dalits(the occupational
caste) National Commission for Women, etc . are some of the examples in this
respect. The problem lies on the fact that no rehabilitation and income generation
programmes are there for freed kamaiyas . Though there is no data by what measure
the improvements are progressing in this front since the HDI based on caste hierarchy
is not available during the later years, it is assumed that the progress in caste-wise
status should have been going forward as there is overall advancement in these
indicators.
Women are other groups who are deprived and left behind interims of access to
resources . It is not limited to any particular caste or area but to overall sectors of
society. The difference between women and men’s per capita income is not available
(poverty by gender differentials). But the average life expectancy with women as the
head of the household is found far below as compared to that of men. Over that the
households of women-headed are mostly under extreme poverty where the source of
income is not definite.
The data related to human development shows larger gap existing between men and
women. Though the literacy rate of 54.3 percent for men and 21.3 for women
according to the NLSS of 1996 has changed to 65.8 percent and 35.4 percent,
respectively in 2000, still wide gap exists between the two. Likewise, another
important indicator of average schooling year also differs considerably between men
and women. In 1996 the average schooling year for men was 2.25 while for women it
was only 1.13 years. Though the figure has gone up in 2000, there is no improvement
towards bridging the gap.
19
Table 3.7 Gender Disparities in key Human Development Indicators*
Average life expectancy (yrs) Adult Literacy ( percent) Average schooling years
1996 2000 1996 2000 1996 2000
Male Female Male Female Male Female Male Female Male Female Male Female
Mountain 52.7 50.4 48.6 51.1 44.2 11.8 61.9 26.6 2.27 0.71 3.71 1.33
Hills 58.0 55.5 65.4 64.7 58.4 24.3 72.3 39.5 3.42 1.61 3.97 2.18
Terai 59.5 57.0 61.7 63.2 52.3 19.9 60.2 32.5 3.1 1.25 3.71 1.93
Urban 63.2 60.3 71.4 70.8 76.7 51.5 81.2 56.9 5.63 3.88 6.01 3.8
Rural 53.7 51.3 58.2 59.3 52. .0 19.5 63.6 32.3 2.93 1.15 3.4 1.66
Nepal 55.0 52.4 59.3 59.8 54.3 21.3 65.8 35.4 2.55 1.13 4.45 2.25
Source: Nepal Human Development Report 1998 & 2001
* Since the source of data differs, the figures seem different.
20
3.5 Gender Equality
Despite the fact that there has been no noticeable changes in the gap between female
and male, it certainly has started to move towards positive direction. The move
towards the equality is ascertained by the higher growth of HDI for women.
Though there is no remarkable difference in life expectancy among different
geographical regions, the relation between literacy and schooling years shows the
change. It is a statistical inference that as the decimal number moves more closely to
whole number, gender equality also moves closer from the analysis of data from this
perspective of the progress towards gender equality between 1996 and 2000. Yet the
gap is too wide that needs additional progress efforts to be implemented to realize the
desired results.
Table 3.8 Ratio of some HDI between man and woman
1996 2000
Average Adult Average Average Adult Average
Life literacy schooling Life literacy schooling
expectancy rate years expectancy rate years
Mountain 0.96 0.27 0.31 1.05 0.43 0.36
Hill 0.96 0.42 0.47 0.99 0.55 0.55
Terai 0.96 0.38 0.40 1.02 0.54 0.55
Urban 0.95 0.67 0.69 0.99 0.70 0.63
Rural 0.96 0.38 0.39 1.02 0.51 0.49
Nepal 0.95 0.39 0.44 1.01 0.54 0.51
Source: Nepal Human Development Report:1998 and 2001
3.6 Backward Areas

There are pockets of geographically disadvantaged areas as they are climatically
extreme, regionally far, and inaccessible by any means of transport. In general, people
in mountain and hilly regions are backward and poor. The people of these areas, who
are forced to take up animal farming and nomadic pasture dwelling life pattern
engaged in traditional trade and transaction due to limited natural resources fit for
acculturation, are not only backward in terms of social and economic upliftment but
are also excluded from the development mainstream prevailing in the land. Similarly,
the disadvantaged areas due to transport constraints especially without bridges over
large rivers inhibiting connection with other parts of country are bound to stick to
self-sufficient subsistence farming economy. There is problem of exclusion from
consuming fruits of development in these areas and households thereof as the supply
cost of infrastructure mount very high because of thinly dotted settlements.
In brief the nature and conditions of poverty existing in Nepal an as follows:
• Poverty in Nepal is rampant and its incidence is high specially in mid-
21
western and far-western development regions. Likewise poverty is deeper in
mountain region as compared to terai and hills.
• There is high incidence of poverty in rural areas. As the non-agricultural
sector development activities are especially urban-oriented, the income
poverty is reducing in cities but its resultant impact in rural areas is very low .
• Though the level of poverty is high with marginal and small farmer in
general, it is not limited to them only, it has extended equally to unskilled
people and women-headed households. Poverty pervades the life of low caste
people, specially the dalits in society.
• Though income evaluation on individual level could not be done, women are
highly affected by poverty and backwardness as shown by the human
development empowerment indicators. These indicators fall too low in case
of women residing in mountain and other inaccessible areas.
• Commonly, the poor have no access into promising agricultural lands . The
land under poor people’s ownership lack irrigation facility hence low
productivity and equally lacks transport facilities.
• If the HDIs are evaluated on district level, the incidence of poverty goes
deeper into inaccessible areas without road connections.
3.7 Consultation with civil society and people

NGOs, civil society, academic intellectuals along with backward indigenous people,
women activists and disabled expressed their views in various consultation programs
which do not markedly differ on nature and structure of poverty. These discussions
were held during the formulation process of the Tenth Plan and formation of interim
poverty reduction strategy paper and in the process of selecting indicators for
monitoring poverty.
These discussions helped to define those people as poor whose income does not allow
two meals a day, two sets of clothes in a year, do not have a settled residence (home),
can not send their children for education and those people whose access to resources
and skills necessary to earn a livelihood is denied.
These discussions categorically identify that the incidence of poverty is higher on
occupational castes such as Mussahar, Chamar, Damain, Sharki, Kami, Kumal, Badi,
Jhangad, Dushad, and on the people of different social low castes such as Tamang,
Rai, Limbu, Magar, Bhote, Tharu, and other backward indigenous people. Landless
agricultural labourers, indigenous groups and people residing in remote areas are also
identified as extremely poor.
3.8 Causes of poverty

• Poverty is a multi-dimensional and complex problem. The causes of poverty,
22
by analyzing different aspects of income and human poverty are not only
economic but also social and technological backwardness, too.
• One of the main causes of poverty is low economic growth rate. The stock
taking of economic achievement of last three decades shows a lower
economic growth rate of approximately 4 percent while annual population
growth rate was about 2.5 percent.The per capita income growth rate at a
very low level cou ld not contribute to mitigate poverty significantly.
• The economic growth rate in Nepal is not only very low but its annual
variation is also very high. The main reason behind such variation of high
degree has been the dependence on agriculture. Still agriculture in Nepal
depends on monsoon. Though agricultural productivity has increased, it is
increasing at insignificantly low rate. The concentration of poverty is high in
rural areas where the main economic base is agriculture. There is no
noticeable improvement in rural poverty because of low agricultural growth
rate and monsoon variation.
• There is significant contribution of non-agricultural sector in the growth rate
of GDP, but its impact is limited to urban areas. It has helped to lower the
intensity of poverty in urban areas, but it has not affected the rural areas
where majority of poor live.
• Public expenditure is one of the main factors to resolve poverty problem.
However, the effectiveness of government expenditure is low because of
weak prioritization, weak process of selecting projects and smaller amount of
budget allocation in a number of projects. Poverty is not reduced as targeted
because of ineffective public service delivery and lack of access of poor to
the services delivered by the private sector.
• Lack of good governance is said to be the chief constraint to impair
development efforts, and proper utilization of government expenditure on
poverty alleviation program. Poverty alleviation programs have been less
effective due to the factors like over centralization of decision making
process, good governance related problems such as no control over loopholes,
leakages and irregularities, lack of responsibility and transparency along with
the low capability of government to act as facilitator as demanded by the
liberal economic system as there is lack of legal and institutional frameworks
necessary to promote economy with the open and competitive market
environment.
• Development process has suffered because of the security problem and
political instability. The economic system has been weak due to instability in
government, weak bureaucracy, lack of transparency and responsibility. They
all together resulted in adverse impact on poverty alleviation programs.
• Lack of desired achievements from the targeted programs of both public and
private sectors and the lack of sustainability of such programs to a longer
23
period of time have cumulatively contributed to lower the overall
effectiveness of poverty alleviation efforts.
• Social discriminations, prevailing due to traditional, social values have
deprived the opportunity and access for all segments of society to education
and development works. There are deprived groups of people where the
poverty befalls squarely inhibiting their development of skills and
technological know-how to increase productivity.
The main factors causing poverty have been identified in course of various
discussions held between civil society and people. The factors included are related to
problems such as distribution of farm lands, debilitated approach of poor in resources,
fragmentation of holdings and causes related to weak implementation such as
incapacity to curb down the leakages and irregularities, political instability, lack of
uniformity between policy and programming, ineffective plan formulation, and
resource allocation and weak monitoring. There are other worth-mentioning socio-
economic causes such as low rate of economic growth, lack of technical education,
unexpectedly low positive response from private sector and social security problem
etc.
24
Chapter: 4
Objective, Target and Strategy
of the Tenth Plan
4.1. Perspective development strategy

The main objective of the long-term development is to free the nation from the
clutches of existing poverty, and to establish a cultured, modern and competent
society. In view of the long term perspective prescribed in the Ninth Plan, the main
socio-economic indicators of the Twelfth Plan would be to reduce the number of
people living under poverty line to 10 percent, a hundred percent literacy, population
growth rate to limit to 1.5 percent, all the district headquarters linked by road
network, drinking water facility to all, electricity service to 80 percent of the
population, maternity mortality rate to 250/hundred thousand and aggregate economic
growth of 8.3 percent. The long-term development targets are presented in table 4.1,
which also confirms the millennium development goals.
It has become imperative to realize socially justifiable development perspective by
bringing the hitherto-left-out groups into mainstream and achieve high and
sustainable growth rate stressing on proper mobilization, allocation and utilization of
available resources and means, vis-à-vis the newly emerging opportunities and
competitive environment arising out of liberalization in international front and the
existing poverty scenario. It is necessary to increase investment in human
development, as it is the target, stressing on development of education, health, safe
drinking water, gender issue and other sectors. It is equally necessary to state clearly
the respective role of government, local agencies, private sector, and civil society to
facilitate participations of all the stakeholders concerned with development and
activate still others into the folders of development services in a congenial
environment by strengthening the role of government in promoting social liabilities
and equity-oriented development. The long-term development perspectives in this
respect are as follows:
• To achieve broader, poverty alleviation oriented, high and sustainable
economic growth rate by mobilizing and utilizing effectively the available
resources facilitating the liberal and market-friendly arrangements, with
reforms in policy spheres and legal matters to create suitable environment for
economic, social, and institutional development. Structural reforms will be
carried out for equitable distribution based on geographic and social aspect,
the returns of the high economic growth.
• To achieve high and sustainable economic growth rate, emphasis shall be on
identification and utilization of areas of competitive along with enhancement
of competitive capacity. The role of government in social liability and
26
poverty alleviation sectors shall definitely be promoted for balanced
development.
• The role of government shall be that of catalytic, facilitator, and regulator to
strengthen the liberal and open market oriented economic activities for
modern and organized sectors. The role of private sector, in this perspective,
shall be activated more in such sectors where it has already been more
effective and active, such as agriculture, tourism, industry, commerce,
transport, electricity, communications, information technology, air services
and on other additional promising sectors. The safe vault thus created in
government investment shall be utilized for the development of social
sectors, infrastructures development and other viable areas .
• The principles of compact 20-20 shall be the guiding policy while
appropriating government investments and foreign aid resources to
accommodate additional budget in prioritized social sectors, to strengthen
education, health and other basic aspects of social sectors.
• Government shall take a lead role in the development of women, remote and
backward areas and groups. There shall be defin ite policy implementations
for women empowerment, Dalits and indigenous people. Government shall
implement targeted programs for vulnerable and disadvantaged groups and
remote and backward area development which have been left outside of
mainstream due to various reasons and promote their distinguished viabilities.
It is through these measures that such areas and self-employment
opportunities and groups shall be included in the mainstream and open new
employment for them to alleviate poverty.
• There shall be a policy of optimum protection, utilization and development of
natural resources and wealth in compliance with sustainable development
based on local community participation. For this purpose capacity
enhancement programs will be implemented for all concerned agencies from
center to local level. In the same vein, decentralized administrative system
will be geared up by emphasizing capacity building of local agencies
applauding good governance. The participation of stakeholders from top to
bottom shall be w idened in development process to reflect peoples’
aspirations. Public administration shall be made wider, quicker, effective and
more responsible.
• The measures of environmental and population management shall be well
integrated in each development program to formalize the concept of
sustainability.
• The access of all sectors of society in available resources and areas shall be
widened to facilitate development process to be more broad based and
socially justifiable by opening opportunities of for optimum utilization. The
mobilization and utilization of national debt shall be guided by long term
perspectives . The concerned parties who mobilize and utilize the means and
resources shall be equipped with necessary information, knowledge, skills
entrepreneurship to enhance their awareness and capacity.
27
• The existing mechanism of monitoring and evaluation system shall be
strengthened regularly to monitor the poverty status.
Table 4.1 Major Long-term Perspective Targets -in- Chief
Macro Economic Targets Target up to Twelfth Plan (2016-17)

1. Annual economic growth rate(at factor cost) in 8.3
percent
Agriculture 5.0
Non-Agriculture 9.7
2. Ratio of national saving/GDP ( percent) 30
3. Ratio of investment/GDP ( percent) 34
Major targets of physical infrastructures
1. Districts connected with road net-work 75
2. Irrigation (in thousand hectors) 1686
3. Distribution of telephone lines (per thousand 150
people)
4. Population with electricity services ( percent) 80
Major social targets
1. Child mortality rate (per thousand) 34.4
2. Total fertility rate( percent) 30.5
3. Maternity mortality rate(per ‘00000) 250
4. Primary education ( percent) 100
5. Literacy rate (above 15 years of age) 100
6. Women literacy rate (above 15 years of age) 100
7. Population below poverty line ( percent) 10
8. Population growth rate ( percent) 1.5
9. Population safe drinking water ( percent) 100
Source: Ninth Plan (2054 -059)
4.2 Tenth Plan: objective, target, strategy

More than 38 percent of people are under poverty lines even at the end of the Ninth
Plan who are not in a position to meet their minimum requirements of life. Poverty is
rampant all over the country; it is more intensive in rural areas as compared to urban.
The incidence of poverty is highest in remote and inaccessible areas. Some minorities
and occupational castes are gripped under grinding poverty due to various reasons
including defective social customs and lack of access to resources and means . The
poverty in Nepal is a multi-dimensional problem encompassing economic, social and
28
human aspects, alleviation of which has been the main challenge of national
development. Past experiences show that positive macro economic indicators alone
are not enough to bring poverty incidence down to the targeted level. This fact
establishes the need to direct economic growth and its distribution pattern basically
towards social justice, human development, social balances, empowerment and good
governance simultaneously and cumulatively. Similarly it is necessary to move into
development contours inclusive of all sectors of society.
4.2.1 Objectives
The main objective of the Tenth Plan is to alleviate poverty by mobilizing optimally
the means and resources on the mutual participation of government, local agencies,
non-governmental sectors, private sector and civil society to extend economic
opportunities and open new ones enlarging employment opportunities and widen the
access to means and economic achievements for women, Dalits, peoples of remote
areas and poor and backward groups through programmes like empowerment, human
development, security and targeted projects thereby improve the status of overall
economic, human and social indicator.
4.2.2 Targets
The set target of the Ninth Plan was to bring down the then estimated 42 percent of
the people living under poverty line to 38 percent by the end of the plan. There was
some improvement in this respect during the first three years of the plan as the mid –
term evaluation of the Ninth Plan estimat ed that the people living under poverty line
was brought down to 38 percent. But the growth fell so low in the remaining 2 years
that this percent remained as it was and the absolute number of people living under
poverty line is estimated to have increased. Keeping the progress status of the Ninth
Plan in view, the target is fixed to bring down the percentage of people living under
poverty line to 30 percent by the end of the Tenth Plan. In the same vein, other targets
are fixed such as to boost up literacy rate to 70 percent, to lower the infant mortality
rate to 45 per thousand, to increase average life expectancy to 62 years, to extend safe
drinking water service to 85 percent of population, electricity service to 55 percent of
population and to extend telephone service to all VDCs. It is estimated that the
improvement in different social indicators will bring a 10 percent improvement in
HDI. In view of the different targets of development, the expected growth rate is
estimated at 6.2 percent. But, if ther e is no improvement in present status of security
perspective and the investment environment does not show encouragement, the
growth rate will be limited to 4.3 percent in the lower case. The following social and
physical infrastructures as enumerated in tables 4.2, 4.3 and 4.4 are set targets of the
Tenth Plan against the above backdrop of a long term prospective, which would
easily be monitorable.
Table 4.2: Macro economic targets.
Particulars Status of Targets of Tenth Plan
Ninth Plan * Normal case Lower case
1. Annual economic growth rate 3.6 6.2 4.3
29
( percent at factor costs)
Agriculture 3.3 4.1 2.8
Non-agriculture 3.9 7.5 5.2
2. Ratio of national saving/GDP 17.4 23.1 16.1
( percent)**
3. Total investment/GDP ( percent)** 24.4 29.0 21.8
4. Fixed capital investment/GDP 23.4 27.7 20.5
( percent)**
5. Marginal capital / out put ratio 4.5+ 4.3 4.8
* Estimation of Plan period
** Estimation of last year (GDP at producer’s price ),cash deposit tentatively estimated at
1.3 percent of GDP.
+ Of first four years (fifth year not included being abnormal)
Table 4.3 Major social targets
Particulars Ninth Plan Tenth Plan (final year)
(status of Growth rate Growth rate
2002/03) of 6.2 of 4.3
percent percent
1. Infant Mortality rate(/thousand) 64.2 45 47
2. Total fertility rate ( percent) 4.1 3.5 3.6
3. Maternity mortality rate(per hundred 415 300 315
thousand)
4. Rate of Contraceptive users 39.3 47 46
5. Obstetric services by trained manpower 13 18 17
6. Average Life Expectancy (yr) 61.9 65 64
7. Net enrolment in primary education (above 80.4 90 89
6 year, percent)
8. Literacy (above 6 years percent) 55.5 70 68
9. Literacy (above 15 years percent) 49.2 63 61
10. Formal literacy (above 15 years, percent) 35.6 55 53
11. Safe drinking water (benefited population, 71.6 85 83
percent)
12. Population growth rate( percent) 2.25 2.1 21
13. Population under poverty line ( percent) 38 30 33
14. Human development indicator 0.466* 0.517 0.512
15. Human poverty indicator 39.2* 34.0 34.52
* Source: NPC/UNDP-Nepal Human Development Report, 2001
Table 4.4 Major targets of physical infrastructure

Particulars Tenth Plan (final year)
30
Ninth Plan (status Growth rate Growth
of 2002/03) of 6.2 rate of 4.3
percent percent
1. Districts with road net-work 60 70 70
2. Area under irrigation (/’000hectare) 1121.4 1417 1375
3. Telephone distribution (/’000 pop.) 14 40 36
4. VDCs with telephone service 1761 All VDCs 3590
5. VDCs with computer net-work 1500 1275
6. Population having electricity service 40 55 53
( percent)
7. VDCs with electricity service 1600 2600 2450
8. Agriculture and rural road (km) 10,000 8500
4.2.3 Macro strategies

The targeted reduction of poverty so far has not been achieved through the planned
development efforts. The main reasons behind are: lack of higher, sustained and
broader economic growth rate, the majority of poor people excluded from the
mainstream development process, lack of expected reforms in HDI which promotes
human capacity, dependents of agriculture in climate, low productivity in agriculture
and increasing population pressure, lack affective implementation of targeted
programs and service delivery of government being not effective, etc.
The macro strategy of the Tenth Plan shall be the creation of fundamental basis to
promote economic opportunities through high, sustainable and broader economic
growth and a fair system of distribution of opportunities thus created to achieve the
fixed target of poverty alleviation by controlling population growth rate and
emphasising on good governance. An increase in investment in the social sector will
be encouraged to encourage backward groups to take advantage of such opportunities
through women empowerment, capacity building and mainstreaming of the Dalit and
indigenous people classes to extend their access by promoting their participation in
the decision making process of both national and local programme including poverty
alleviation. Along with these, social security programs such as income generation,
self-employment etc . shall be operated with a view to directly benefiting all people
living under poverty line including geographically and socially disadvantaged classes,
castes and blinds and disabled and other vulnerable people.
The strategies of the Tenth Plan can mainly be grouped into following four
categories :
a) High, sustainable and broader economic growth.
b) Social sectors and rural infrastructures development.
c) Targeted programs
d) Good governance
a) High, sustainable and broader economic growth

As it is clear that without economic growth poverty alleviation is not possible, and
economic growth alone would not be sufficient to alleviate poverty, efforts would be
31
geared to keep economic growth rate high, sustainable and broad so that poor people
shall have easy access to returns achieved. For this purpose economic reform process
will effectively be strengthened to facilitate open and liberal economic policies.
The development of agriculture, forestry, industry, water rec ourse sectors will be
emphasized more as there are wide prospects to create opportunities for employment
and income generation and to achieve high sustainable and broad economic growth
rate. While developing these sectors, attention will be paid to keep them in line with
unfolding demand schedule at national and international markets. In order to extend
rural employment and income generation activities, commercialization of agriculture
based mainly on Agricultural Prospective Pla n (APP) shall be enhanced emphasizing
on the development of services sector such as tourism, communication and
information technology, finance and real estate, construction and transport etc.
Priority will be accorded to measures, which increase productivity and lower
production costs .For this purpose, implementation of appropriate technology package
will be promoted.
The role of government would be catalytic, facilitating and regulatory in the areas
where the private sector is attractive. But the government would play leading role ni
developing remote areas, in uplifting vulnerable and disadvantaged groups, schedule
castes, Dalit and other low castes and the areas where private sector is not attracted.
The role of local bodies, private sectors and non-government sector will clearly be
stated at policy level and their respective contributions will be encouraged in the
development process. The role of local bodies and private sector will be put on the
forefront in order to make development process sustainable and transparent.
b) Social sectors and rural infrastructures development

Social sector development is emphasized to upgrade the quality of life pattern and to
develop infrastructures as a fundamental basis for rapid economic growth. The sub-
sectors of social sectors such as basic education, health and safe drinking water etc.,
are accorded special priority because of their significant roles in human capacity
development and their determining position in human development, which directly
affect poverty alleviation. Economic utility aspects and qualitative improvements of
services along with increased access of common people in social services sectors are
duly considered while developing infrastructures.
c) Targeted programs
Targeted programs are meant to enhance the capability of those communities and
areas which are lagging behind in the main stream of development as defined by
liberal and market-oriented economies system. Targeted and empowerment
programmes shall be promoted to enhance the welfare of vulnerable, disadvantaged
and exploited groups, the Dalits and indigenous scheduled caste groups and to
improve respectful life for disabled, vulnerable and incapables and senior citizens.
Similarly, various targeted programmes will be implemented for mainstreaming,
empowering and bringin g about gender equality.
32
d) Good Governance
The emphasis on good governance is expected to produce result -oriented and
effective management of service delivery and implementation of projects /
programmes thereby correcting the weaknesses in practical field. For the
enhancement of good governance, participatory economic development is stressed
to strengthen monitoring and evaluation system, to make decision making procedure
and public expenditure pattern more responsible and transparent, to implement
effectively decentralization at local level and to enforce administrative mechanism to
be efficient, capable, responsible and effective. The working capacity and reliability
of local bodies will be enhanced to mobilize local resources through decentralization.
Transparent bases of projects selection, prioritization and transparency in their
implementation will be followed strictly to upgrade effective implementation of
development programmes .
Priority will be given on the utilization of new technology, productivity and
enhancement of work efficiency and population management to implement above
mentioned four strategies effectively and to make their cumulative effects positive
and high to achieve the target of the plan. Participatory development process will be
encouraged by managing active participation of private sectors, non-government
sector and civil society along with public sectors and local agencies to reduce poverty
through socio-economic transformation of rural areas. The role of women in these
strategies of poverty alleviation is regarded as central point, which calls for priority
on women empowerment and their mainstreaming.
4.2.4: Areas with Special Thrust

Following area with special thrusts are identified in the Tenth Plan on the basis of
national priority, existing problem and development prospectus:
a. Agriculture development, sustainable management of natural resources and

biodiversity
The income and employment of the majority of Nepalese people living in rural
areas depend on agriculture. The Agriculture Prospective Plan for twenty years
has the vision that poverty alleviation depends on the development of agriculture.
The experience of other developing countries shows that the positive impact on
agricultural development squarely falls on poverty alleviation. T hus the first
priority in the Tenth Plan has been accorded to agriculture in view of the main
objective of plan being poverty alleviation. The period of the Tenth and the
Eleventh Plans will be celebrated as agricultural-decade to successfully
implement the long term agriculture perspective plan. As there are close and
complimentary relationships between agriculture and natural resource
management, the sustainable management of natural endorsements and
biodiversity aspects are broadly included in agriculture development prospective.
b. Rural infrastructure development and rural energy
33
Our experience has visualized the necessity to develop rural infrastructures for the
economic upliftment of rural sectors through continuous modernization of
increased production by utilizing rural productive capacity. In the same way, rural
energy development helps to mobilize rural economy and to solidif y social
transformations as these program help add to alleviate poverty for which the
development of rural infrastructures and rural energy are especially emphasized
in the Tenth Plan.
c. Population management, social service and basic social securities.

In view of low level of social indicators in Nepal as compared to other nations,
weaker existence of social security measures and mounting additional pressures
on available social services, it has been dire necessity to increase investment in
these sectors as well as to stress on population management in order to raise the
living standard of rural masses, facilitating their capacity enhancement so as to
make them capable to utilize the unfolding opportunities of employment and
improve their production and productivity. In compliance with this basic policy
that there shall be an increase in the investment in social sectors
d. Under the role of private sector, development of tourism, water resources,

information technology, industrial and commercial sector
It has been visualized that as the development of areas like tourism, water
resources, information technology, ni dustry and commerce and their extension
pushes up the country’s economic development and contributes significantly to
increase employment opportunities, the role of government in the development of
such sectors is defined to be a catalyst, regulator and f acilitator and encourage the
private sector for active participation.
e. Human resource development and women empowerment

It has been a felt-need to accord proper priority on human resource development
in order to achieve macro economic growth through sustained increase in national
production and productivity and to develop capacity to internalize the benefits
arising out of such endeavours. Besides, it is necessary to step up special program
for capacity enhancement of women as a remedy to redress existing exploitation
and related problems due to gender inequalities. For this propose, it has been
conceptualized to involve them in decision making process via empowerment
activities and to widen their access to means and resources, raise their social-
economic status and thereby accelerate additional pace towards poverty
alleviation direction. It has been stressed to imply women related programs to full
extent in related fields and agencies .
f. The targeted programs for upliftment, employment and basic security of
Dalits, indigenous people and disabled class
Past experience clearly shows that weaker section of society fall behind because
each one sector or class has no easy access to the fruits of economic development.
In this connection, to identify disabled, Dalits, indigenous people and other
34
deprived sections into main stream of development, it is necessary to enable them
to competently fight for employment. Besides, the government should pilot
strong and separate package of program of basic security for blinds, disabled and
vulnerable section of society .It has been taken into consideration to move
specially through targeted projects.
g. Strengthening of local bodies, Non-government and community based

organization (NGOs, CBOs)
In compliance with decentralization policy, the program for strengthening of all
local bodies will be implemented, as their involvement is important to formulate
and implement effectively micro-plan to operate at local level. Similarly, as
NGOs, cooperatives, CBOs and civil society can contr ibute largely in poverty
alleviation programs by helping locally launched people’s consciousness
campaign and transporting and delivering necessary goods and services timely
and safely at low cost, their mobilization program is also emphasized.
h. Thrust on Areawise development and remote areas

Government shall launch specific programs for development of remote and
backward areas. The guiding policy to develop such areas would be to explore
and exploit the locally available resources and possibility to their full extent to
produce desired results. The plan shall take up development of Karnali water shed
as the specific remote area with high priority. Similarly, the development district
left behind in development MWDR and FWDR shall also be accorded high
priorities .
i. Use of better high-tech technology in rural area

It is through better use of new technology that the product and productivity will
be increased to bring positive change in rural economy. Reform and revitalization
of rural technology is a long felt need in Nepal. The proper use of sophisticated
technologies at increased scale like information and biotechnology and capacity
development in health will help to bring remote areas in the main stream of
national development. It has been stressed to develop rural capability to utilize
the opportunities of trade and employment emerging at national and international
level and to integrate the markets with it for the rural products and thereby
transfer technology, skills and knowledge to rural areas . It is assumed that this
process would play a significant role in alleviating rural poverty.
j. Reform and assurance of good governance

It is relevant to strengthen and reform the existing legal and administrative
frameworks to facilitate transparency process as it would not only be effective to
control possible irregularities and corruption but also control the quality of
development programs both on the formulation and implementation levels. In this
respect, it is necessary to move through the medium of decentralization process
into related sectors to provide guarantee and reforms and capacity enhancement
35
of agencies directly involved in corruption control so that the clean, accessible
and efficient administration may prevail.
k. Protection and conservation of environment:

In compliance with the priority of sustainable development as proposed by
Earth.Summit-Rio,1992, the integrated development of social, economic and
environmental aspects is stressed keeping in line with the inter-relationship
between poverty and environmental depletion. In this connection, special
attention will be paid for the protection of environment and control of pollution
while utilizing natural resources, biodiversity and infrastructure development to
accelerate economic growth rate. Similarly, for augmenting of environmental
consciousness, programmes will be implemented focusing on security, protection,
rehabilitation and prudent application of environmental technology along with
environmental health, education and other concerns . In addition, the urban
environment shall be made healthier.
l. Development of national and regional infrastructures

It is necessary to develop coordinated essential infrastructures to optimally utilize
available of national and regional resources such as road transport, air transport,
telecommunications and information services, production of hydro-electricity
power, distribution grids, extension of development epicentre, etc. to achieve
high, sustainable and broader growth rate. Among them, the role of government
shall be crucial one to develop highways, hydropower distribution grid, airports
and extension of epicentres. In other areas, private sector is expected to be
attracted go with suitable policy formulations . The whole strategy of developing
national and regional infrastructures is guided centrally by this principle.
4.2.5 The summary logframe of development strategy of Tenth Plan

Each ministry concerned with development activities is directed to formulate its
programmes as envisaged in the Tenth Plan and the log-frame thereof of each
ministry must confirm to the broad log frame of the Plan itself. Policies and programs
have to be designed on the basis of the logframe and should prioritize the proposed
program accordingly. The objectives, indicators of programs, basis of verification,
anticipated level of obstacles should be explicitly stated in such log-frames. It is
assumed that progress monitoring and evaluation of the Tenth Plan would be based
on this logframe. In short, the logframe formulated for the Tenth Plan is as follows:
Policy and Program Log Frame- development strategy of the Tenth

Plan
Overarching National Objective: Poverty incidence of the Nepalese people
(men and women) will be reduced significantly and in a sustainable manner.
36
Target: Poverty incidence among Nepalese people (men and women)
significantly reduced.
Four major strategies
High , sustainable and Social sector and Targeted program Good governance
broad based infrastructure development
economic growth
Objective: Objective: Objective: Objective:

Regeneration Production capabilities of Productive capabilities Overall governance of
capabilities of broad human resources of marginalized national development
based economic sustainably enhanced. (deprived, process sustainably
regimes sustainably disadvantaged, remote improved with
strengthened and isolated increased
communities transparency ,
sustainably enhanced. accountability,
pluralism and
decentralization.
Results: Results: Results: Results:
§ *Agriculture § *Human Resource § Targeted § Promotion and

development, Development and programs for guarantee of
sustainable Women Empowerment dalits, indigenous good governance
management of • Development of people, deprived,
natural resources • National
Quality Education remote for their
and biodiversity administration
upliftment and structure
- Women education employment.
• Increase in reformed to
agriculture - Pre-primary and
• Deprived and coordinate and
productivity and primary education
disadvantaged facilitate
income. - Secondary communities development
- Food education empowered for programs.
production - Higher secondary self-help • Regional growth
education development. centres with
- Horticulture
related high - Higher education • Remote area complementing
valued communities regional
- Informal education
agricultural empowered for development
production like - Vocational and self-help administration
vegetable, Technical education development. structures
fruits, silk, - Special education • Empowerment of operating to
honey. facilitate and
- Teachers training disabled
c oordinate
- animal - Curriculum and text • Implementation of regional
products material peace and development
(meat, eggs, development
- Increment of quality process.
milk product) program
health service • Pluralism for
- fish products
- Infant protection § Emphasis on strengthening
- agricultural remote area and management of
technology - Safe maternity
regional social and
37
- Quality control - Control of development economic
- Agro- contagious and • Remote area and institutions
infectious diseases
biodiversity: isolated § Strengthening of
protection and - Curing of non- communities local bodies, non-
promotion contagious empowered for government and
- Co-operatives diseases their self-help community
- Basic health development. organization
• Increase in
productivity and services • Special program • Strengthening of
income of forest • Women empowerment for the local self-
sector and mainstreaming development of government
backward region bodies (DDC,
- Forest (grass, • Safe drinking water
fuel wood, and improvement in • Special priority on VDC and
timber) the development Metropolis) for
sanitation
of Karnali region. coordination and
- Soil - Rural drinking water simplification of
conservation. - Urban drinking local
- Agricultural water development
forest program
- Sewerage
- Herbal and - Rural and urban • Non -government
high valued waste-management organization and
non-timber civil societies
forest product - Development of functioning
rural infrastructure effectively in
- Biodiversity and rural energy
protection and facilitating
promotion. - Rural electrification national, regional
and local
• Development of - Rural and
development
tourism, water agriculture roads
programs.
resource, - Community
information irrigation
technology and - Rope way
industry and
commerce in the - Financial (credit
private sector. and saving
institutions)
• Increase in
production and - Alternate energy
income of industry - Agriculture related
and commerce. service
- Export- - Market
oriented management
production. - Utilization
- Restructuring cooperative system
of industries.
§ Population
- Trade management along
promotion with social service and
- Small and basic social security
cottage
• Population program
38
industry - Family planning and
- Agri-based maternal and child
industries program
• Increase of - Migration
employment- - Settlement
friendly service
sector. • Increasein social
security
- Rural
employment - Insurance System
- Urban - Security of old and
employment vulnerable
- Foreign § Improvement in rural
employment technology and
utilization of suitable
• Development of
technology
tourism sector
- Development • Increasein
and implementation of
diversification appropriate
of tourist technology (including
destination information
technology)
- Hotel/tourist
accommodation. - Agricultural
technology
- Transportation
- Bio-technology
- Market
promotion - Micro and Rural
industrial
- Improvement technology
in services.
- Telecommunication
- Eco-tourism. and information
- Cultural technology
tourism - Labour intensive
• Development and and environment-
extension of friendly technology
private sector in rural
infrastructure.
• Dev elopment of
national and § Environment protection
regional and promotion
infrastructures - Environment health
- Highways
- Environment
- Airways education/awareness
- Tele- - Environment
communication technology
and - Promotion of urban
information environment
system.
- Control of air, water
39
- Production of and land pollution
hydro-
electricity.
- Distribution
system of
electricity
- Extension of
development
centers
- Development
of financial
services.
4.3 Role of different agencies

People being the focal point of development, their spontaneous participation is
imperative. As a matter of fact, it is not possible to meet all the needs and aspirations
of people by the government alone with its limited resources and means in the
national development process. There is distinctive role of government, non-
government sector, private sector, political parties, occupational institutions,
educational bodies and local agencies in this process and it is pertinent to clearly
define their duties and responsibilities. In the present context, the role of these
different agencies is enumerated as follows.
4.3.1. Role of Government

The primary responsibility of the country’s development lies with the government. It
would play leading role in the development process and create amicable environment
to have helping hands from various other sectors. In this context, the role of
government will be as follows:
1. To establish law and order situation, to guarantee the fair and free justice, to
raise people’s consciousness and to modernize the concerned agencies
equipping them with resources and means to increase the quality of their
services.
2. To prepare and implement the national program of human right for its
effective protection and promotion and strengthen the National Commission
for Human Rights.
3. To formulate plan and policies for long term perspective development with
definite mission.
4. To play the leading role in programmes such as poverty alleviation,
mainstreaming and development of indigenous and Dalits development of
remote areas, women development and empowerment, empowerment of
disabled and guarantee social security provisions for senior citizens and
elderly people’s.
40
5. To promote and prepare a suitable environment for the private sectors to
involve it in economic activit ies such as, industrial ventures, trade and
commerce, tourism and water resource as facilitator by developing basic
infrastructures and human resource.
6. To assert regulator’s role to safeguard the welfare of the mass, to maintain the
quality standard of goods and services and to guarantee easy supply.
7. To increase the efficiency of public corporations, to move forward the
privatization process with priority, to create healthy competitive environment
by discouraging monopoly.
8. To involve private sector directly or indirectly by creating an environment of
participation in the development works of necessary infrastructures and
quality manpower to assist sustainable and high growth rate essential for
employment promotion and poverty alleviation.
9. To contribute to sustainable development by promoting quality services
through the transfer of necessary authority as well as resources and means to
local bodies directly involving them in development works as stipulated in
Local Self-Governance Act, 2055. In this process, to motivate them to
actively contribute to achieve national targets through population
management, employment promotion and poverty alleviation, literacy
campaign, extension of women education and empowerment, upliftment and
mainstreaming of Dalit and indigenous people, incapacitations of disabled,
social security of vulnerable people along with environmental protection.
10. To manage necessary provision of efficiency to implement, monitor and
evaluate local level development works along with their formulation and
prioritization by mobilizing peoples ’ participation and to transfer the
responsibility of such projects to local bodies including mobilization of
resources and means .
11. To promote participatory involvement of NGOs and community sector and
civil society with government and local bodies. To encourage these bodies to
prevail as pressure groups and monitoring agents to standardize and make
their projects people oriented.
12. To protect and promote natural, cultural and historical resources and heritage
while utilizing them optimally. To implement regulatory provisions such as
environment laws, rules, instructions, code of conduct etc while protecting
the environment by government.
13. To take lead in promulgating social justice and regional balance and in
framing policies and programmes to distribute returns of development to
common people.
14. To coordinate, monitor and evaluate and direct different development and
reconstruction works of the nation.
4.3.2. Role of local bodies
41
The role of local bodies, in the context of enlarging participation of people from all
sectors in development process and bringing backward areas and groups into main
stream of development to speed up development pace, shall be as follows:
1. To speedup the participatory development effort ahead at local level on the
basis of conceptual framework of decentralization through people's
empowerment programme and capable local-self governance.
2. To help promote the establishment of civil society on the basis of people's
participation by adopting such aspects as democratic process, transparent
dealings, bearing responsibility at NGOs level, etc.
3. To implement effectively the national programmes such as population
management, poverty alleviation, employment promotion, women
empowerment, upliftment and mainstreaming of disabled, Dalits and
indigenous people, security of vulnerable, literacy campaign and extension of
women education of local levels.
4. To promote necessary capacity to implement local level development works
and reconstructions and the formulation of planning, prioritization,
mobilization of peoples’ participation and implement, monitor and evaluate
them spontaneously.
5. To stress on socially justifiable distribution pattern of development returns in
balanced way through mobilizing local resources and means.
6. To manage and mobilize spontaneously the local resources to make effective
and sustainable local development works amidst the common participation of
government, non-government, community and private sector, too.
7. To make necessary provision for promotion of size and quality of services
and benefit for the majority of the common people through programmes
transferred to local level.
8. To manage institutionally established infrastructures to provide basic services
to all at the local levels .
9. To enable the local bodies to be responsible to people of concerned local
areas and to shoulder the responsibility accorded on them by local self-
government acts.
10. To protect local resources by organizing peoples’ participation at the
formulation and implementation levels of local plans to control pollution and
sustain local environment.
4.3.3. Role of the private sector

The private sector is accustomed to move spontaneously under the prevailing policies
and rules in the country to invest in those sectors where the return is maximum. As
this sector simply does not work only as business unit but moves cooperatively in
groups and/or organizations for mutual benefits taking care of all concerned,
including national welfare, its role should be defined in separate prospective in the
process of national development. At the same time, it is desirable to clearly define the
42
role of the private sector in the context of limiting HMG’s activities in business sector
and promoting private sector to enter with necessary investment in accordance with
the principles of economic decentralization. For the healthy development by
mobilizing optimally the available resources and means in dynamic and competitive
environment in order to enable all economic sectors to help mitigate level of the
poverty, the role of private sectors will be as follows:
1. To strengthen the role of the private sectors in the economic development by
increasing investments and production.
2. To play active role to develo p competitive market and production provision
and to make efforts to move ahead to cope international competition.
3. To play the role of active helping hand to monitor the standardization and
promotion of quality of products.
4. To abide by laws and rules and help make payment of tax according to
regulations.
5. To develop an environment of harmonious relationship between investors and
labourers in business world, to help eradicate child labour and act
cooperatively in the areas of social security.
6. To deal in transparent business works to protect the consumers’ rights,
keeping the business code and integrity in tact.
7. To move forward to invest in physical and social infrastructure sectors by
utilizing the encouragement provided by the government.
8. To help the government in formulating private sector related policies.
9. To promote the prestige of private sector at mass by extending co-operation
and showing readiness to participate on the grounds of social morality in
community programmes such as poverty alleviation rehabilitation and
people’s welfare.
4.3.4. The Role of non-government sectors and civil society

Under the extended conceptual framework of civil society, role of non-government
organizations with defined goals possess important place in the process of national
reconstruction. In the context of mobilization of growing participation of people and
encouraging and strengthening local development to promote programmes for the
effective realization of the main objective of Tenth Plan being alleviation of poverty
through women education and empowerment, mainstreaming of indigenous people,
Dalits and disabled and security of helpless people, population management, growth
in income generation and environment protection, the role of non-governm ent sector
of local and national standard and civil society will be as follows:
1. To help achieve the target of poverty alleviation by operating programmes in
prioritized sectors as envisaged in the Tenth Plan.
2. To perform or help perform the works in sectors like social reforms,
population control, campaigns for people’s consciousness, skill development
43
including women education and employment, mainstreaming of indigenous
people, disabled and Dalits and security of helpless people .
3. To conduct programmes of income generation and employment creation
through social mobilization to help promote employment and poverty
alleviation.
4. To participate in monitoring activities by familiarizing local bodies , the
programmes like poverty alleviation, promotion of social consciousness,
environment protection including development performances and promotion
of income generation and social mobilization.
5. To implement people’s consciousness programmes and help ease the supply
of services in remote areas where the reach of government and private sector
is rather limited.
6. To help involve in regional development by increasing the presence of NGOs
in remote and backward areas.
7. To help conduct programmes of national priority by helping locally active
NGOs co-work with INGO’s and private sector.
8. To keep transparent accounts/audit system and abide by rules for
transparency and responsibility in the working style of NGOs.
44
Chapter-5
Economic growth rate,
management and appropriation
of resources and means
Economic growth rate and sectorwise allocation of investment is largely directed to
high, sustainable and wide economic growth, qualitative improvement of social
services, development of infrastructures and targeted programmes to achieve the
poverty alleviation target of the Tenth Plan. The involvement of the private sector
will be encouraged in modern sectors like commerce, tourism, electricity and
communication and information technology to fulfill the said objectives. The focus of
investment policy is to divert the government resources, which it can save with the
involvement of the private sector in the areas it has been investing so far, to social
and other infrastructure development sectors, including targeted programmes related
to poverty alleviation where private sector is least attracted. For the strong economic
structures and over all macro economic stability, the fiscal and monetary policies
would also be reform ed during the plan period.
5.1. Analysis of economic growth and investment

The input output analysis the main basis upon which the projection of the main
indicators of economic growth, investment, employment and others in the Tenth Plan
has been made. The macro models are used for the macro economic structural
analysis to project necessary sectorwise investment, growth rate and other indicators.
Similarly, considering the present situation, the projections are made in two bases,
expected and general. The expected growth rate is the high rate for the Tenth Plan
period in view of the existing condition and investment, and other indicators are
projected accordingly. The alterative economic growth rate of general standard has
also been projected in the plan.
5.2 Economic growth rate

It is necessary to have growth rate of 7 percent of GDP during the Tenth Plan and the
following consecutive two plans in order to reduce the number of people living below
poverty line to 10 percent by 2017 in conformity with the long-term goal projected by
the Ninth Plan. To achieve such growth rate, it is important to lower down the
population growth rate to 1.5 percent annually on the one hand and on the other, the
emphasis should be given to increase productivity, and to raise productive capacity
while utilizing them and the standard of their service and optimum benefit.
45
The annual growth rate of GDP by 3.6 percent is estimated during the Ninth Plan
while the targeted growth rate was 6 percent on average. It is estimated that the GDP
(at factor cost) had Rs. 4029.5crores in the fiscal year 2001/2002, the final year of
Ninth Plan (Table -5). The slow down in the growth rate of GDP was due to declined
productivity especially in industrial and tourism sectors as a result of volatile secur ity
situation, in both national and international scenarios. The first four years of the plan
recorded an average growth rate of 4.6 percent while in the final year the economy
contracted by 0.5 percent.
Although average annual growth rate of more than 7 percent in the Tenth Plan period
is necessary to effectively finance poverty alleviation programs, it seems difficult at
the current volatile political situation. Even if the situation normalizes soon, the
investments cannot be mobilized for more than 6.2 percent growth. It would not be
practical to project production level on the basis of preceding years' GDP levels and
its growth rate as much of the resources need to be diverted to bring the
infrastructures of public utilities in operations which were destroyed severely in the
last few years. It needs great deal of adjustments even to stick to proposed 6.2 percent
growth rate if the suitable structural reforms could not be brought forward in time.
5.3 The projection of alternative growth rate:

It is not possible to achieve the proposed 6.2 percent desired growth rate without
bringing considerable reforms in existing law and order situation. That is why the
economic growth rate have been clarified into two levels of expected and normal rate
in live with the law and order situation.
5.4 Economic growth rate and the basis of resource

allocation
Following bases of resources allocation in different investment sectors have been
taken into consideration to achieve the targeted growth rate of the Tenth Plan.
1. To emphasize on the appropriation of resources in prioritized sectors with quick
returns and with wider effects and to encourage the infrastructure development
towards the industrial and productive areas with higher rate of returns.
2. To bring desired impact on poverty alleviation by developing agriculture as a
leading sector which contributes major share in GDP and has wide ranging
effects in the proliferation of rural employment according to Agriculture
Perspective Plan.
3. To stress in women education and health in social sector and emphasize on
human resource development by widening the access of women in such services
and to facilitate them to move forward in development efforts.
4. To promote private investment in electricity, communication and information
technology, rural energy and other modern sectors of attraction and involve them
more intensively.
46
5. To introduce additional reforms to ease Foreign Direct Investment (FDI), and
also to promote the domestic private investment.
6. By curtailing the unproductive public expenditure of the government, the
resources and means would be used most efficiently. Locally available resources,
means and skills would be expedited and the administrative reforms would be
introduced to make the government transparent, efficient and effective.
7. By strengthening the rights of local bo dies and to promote good governance,
regional investment would be promoted.
8. Strengthen the security of vulnerable people, by mainstreaming backward,
oppressed society and physically challenged population.
9. To increase the national savings by ensuring macroeconomic stability through
money and capital market development
10. To increase production and productivity by promoting the use of rural and other
suitable technology to increase the contribution of rural sectors in economic
growth.
5.5 Normal economic growth rate

The normal economic growth rate of the Tenth Plan has been 6.2 percent. In terms of
sectorwise classification, the estimation ranges between 4.1 percent in agricultural
sector and 7.5 percent in non-agricultural sector (Table 5.1).
A number of important policy reforms had been adopted from the Agricultural
Perspective Plan during the Ninth Plan. But the implementation could not be
effective. The policy of the Tenth Plan puts them in high priority and continue with
additionally available resources and means namely irrigation, agricultural and rural
roads, rural electrification including credit and marketing along with easy supply of
suitable fertilizer, seeds and new technologies. The policy adopted will progressively
support the land reforms process. It is on the successful implementation of these
policies that reform in agricultural sector is expected to meet the proposed 4.1 percent
growth rate.
The government will act as a facilitator to promote economic activities such as
trading, hotels, industries and constructions, where the private sector is more
interested to transfer the labour from agriculture to non-agriculture sectors increasing
employment opportunities in these areas. It is estimated that the annual growth rate is
expected to be 7.8 percent in industries and mines, 7.9 percent in constructions and
7.3 percent in trade and commerce, hotels and restaurants.
In electricity, related areas the annual grow th rate is expected to increase by 11.1
percent during the plan period as this area needs consolidation of past investments,
purposed projects and other permanent sources of powers to strengthen the industrial
environment. Keeping in view of the ongoing projects it is estimated that the
proposed growth rate in gross domestic product may not be difficult to achieve in this
sector.
47
The growth rate in transport and communication is fixed at 7.7 percent. As the high
growth rate in communication has positive impact on agriculture, industries and
tourism sectors, it is felt that extra efforts along with earlier programmes is necessary.
The achievements in financial sectors is expected to be 5.3 percent in the Tenth Plan
as the stress falls not on extension but on reforms and working procedures of the
financial enterprises.
In view of the lower status of social indicators of Nepal as compared to South Asian
Countries, it has been necessary to fulfil the basic needs of human life by achieving
high growth rate in social sector. For this purpose, a growth rate of 8.1 percenthas
been proposed.
5.1: The Tenth Plan's GDP and sectorwise value addition (at constant price of
2001/02; for the growth rate of 6.2 percent)
(Rs. in million)
Sectors Estimated GDP Estimated GDP Annual Average annual
Of 2001/02 Of 2006/07 growth rate of growth rate
Tenth Plan/ during the Ninth
Production Percentage Production Percentage
Percentage plan /Percentage *
Agriculture, Irrigation and 158439.0 39.32 193694.0 35.58 4.1 3.3
forest:
• Non-Agriculture: 244513.0 60.68 350648.0 64.42 7.5 3.9
• Industry mines 34859.0 8.65 50747.0 9.32 7.8 2.0
• Electricity Gases & 8114.0 2.01 13983.0 2.57 11.1 6.1
Water
• Construction 42232.0 10.48 61716.0 11.35 7.9 4.1
• Commerce, hotels & 40391.0 10.02 57449.0 10.55 7.3 1.4
Restaurants
• Transportation and 34664.0 860 50229.0 9.23 7.7 6.0
Communication
• Finance and real 43494.0 10.79 56308.0 10.34 5.3 4.0
estate
• Social services 40759.0 10.12 60166.0 11.05 8.1 6.6
GDP(at factor cost) 402952.0 100.0 544343.0 100.0 6.2 3.6
* At constant price of fiscal year 1997/98
5.6 Capital investment and marginal capital output ratio

The estimated incremental capital output ratio is 4.3:1 for the current plan. The fixed
gross capital investment of Rs 60980 crores is to be made in the Tenth Plan on the
basis of estimated capital/output ratio and the targeted growth rate of 6.2 percent
(table 5.2). Such fixed capital investment will be 13.8 percent to agriculture sector
and 86.2 percent to non-agriculture sector. Of the estimated marginal capital output
ratio 4.1:1 of the Ninth Plan, it increased to 4.5:1 (first four years) due to increase
investment in capital-intensive sectors and lack of corresponding increase in
48
production. It is expected that the efficiency in capital utilization will be increased in
the Tenth Plan through administrative and structural reforms, scientific approach in
project selection, reforms in development administration, control in the leakages of
resources and means, special efforts to be carried in promoting productivity and
prioritization of labour-intensive industries and business and their growth.
Table 5.2 : Gross and sectorwise fixed capital investment in the Tenth Plan (at
constant price of 2001/02 ;for the growth rate of 6.2 percent)
Sector Incremental capital Fixed capital Percentage of total
output ratio* investment amount investment
(Rs. in million)**
Agriculture Irrigation and forest 2.39 84400.0 13.84
Non-Agriculture 4.91 525423.0 86.16
• Industry& mines 2.31 36677.0 6.01
• Electricity 14.68 86147.0 14.13
• Gases & Water
• Construction 0.68 13176.0 2.16
• Commerce, hotels& 2.61 44564.0 7.31
Restaurants
• Transportation and 7.86 122289.0 20.05
Communication
• Finance and real estate 7.13 91301.0 14.97
• Social services 6.76 131270.0 21.53
Gross fixed capital formation 4.30 609823.0 100.0
* At the estimated growth rate of improvements by 5 percent in the Tenth Plan as against the
comparison of available data of past year.
** There may be some differences in the calculated figures after 2 digits of decimal in marginal capital
output ra tio. .
5.7 Allocation of development expenditures

The allocation of development expenditures is made in conformity with the main
objective of poverty alleviation of the Tenth Plan. The projected development
expenditure is to grow by 15.4 percent annually as compared to the development
achievements made in the fiscal year 2001/02 to keep the economy in desirable track
and absorption. Though the projected figure seems to be high, the above mentioned
causes that brought down development expenditure by 17 percent in the F/Y2001/02,
as compared to the previous F/Y the simulated figures comes to 9.3 percent annually.
The actual growth rate of development expenditure will come to around 14.3
percent at current prices as compared to that of F/Y 2000/01 calculated against the
inflationary rate of 5 percent annually. The government expenditure is targeted to the
areas of wide ranging effects and to the sectors where there are high and quick
returns. The government has downsized its activities where the private sector is
active and hence they are encouraged to invest more in those areas. The growth rate
49
of fixed capital investment is estimated to be 10 percent annually during the plan
period. The estimated gross cap ital investment is disaggregated whereby 72.2 percent
will be in the private sector and the remaining 27.8 percent in public sector (table
5.3). Of the total investment of the government 74 percent is directed to
capitalformation.
Table 5.3: The sectorwise distribution of fixed capital investment of the private
and the public sector in the Tenth Plan. (At the constant price of 2001/02, for the
growth rate of 6.2 percent)
(Rs in million)
Sector Public sector Private sector Total
Amount Percent Amount Percent Amount Percent
Agriculture Irrigation and 31806.0 18.74 52594.0 11.95 84400.0 13.84
forest
Non-Agriculture 137930.0 81.26 387493.0 88.05 525423.0 86.16
• Industry& mines 1419.0 0.84 35258.0 8.01 36677.0 6.01
• Electricity Gases & 33337.0 19.64 52809.0 12.00 86146.0 14.13
Water
• Construction 0.0 0.00 13176.0 2.99 13176.0 2.16
• Commerce, hotels & 2012.0 1.19 42552.0 9.67 44564.0 7.31
Restaurants
• Transportation and 34366.0 20.25 87923.0 19.98 122289.0 20.05
Communication
• Finance and real estate 2692.0 1.59 88609.0 20.13 91301.0 14.97
• Social services 64104.0 37.77 67166.0 15.26 131270.0 21.53
Gross fixed capital formation 169736.0 100.00 440087.0 100.00 169823.0 100.00
The projected sectorwise allocation of development expenditure of public sector in
the Tenth Plan is as presented in table 5.4. It is estimated that in the plan period the
development expenditure will amount to Rs.23400 crores. As the agriculture has wide
implications in poverty alleviation, the higher percentage (24.0) of development
expenditure has been to earmarked to this sector. This is high by 5 percentage points
as compared to the actual of the Ninth Plan.
The sectors such as electricity, communication, etc, where private sector is more
attracted, a friendly environment is created to involve them more closely in these
activities. The policy guideline, adopted in the Tenth Plan directs the saving of
government not by moving in such infrastructures, to be used in social sectors like
education, health and drinking water where the governments involvement is of utmost
necessity. In electricity development, the proposed expenditure is brought down to
15.4 percent as compared to 18.1 percent of the Ninth Plan and the complimentary
expenditure is to be made by the private sector. In communication, the main policy is
to develop through private sector. The resource generated through such changed
investment pattern is added in sectors like agriculture, social services and rural
transportation in conformity with poverty reduction strategy. The investment in social
sector is expected to increase by 2.6 percent over the 36 percent of Ninth Plan to
reach to 38.6 percent target. As the policy is to attract the private sector investment in
transport and communication sector, the appropriated development expenditure in this
50
portfolio is only 15.6 percent reducing the development expenditure of the Ninth Plan
by 2.3 percent points.
Table 5.4: The sectorwise allocation of total development investment in the
Tenth Plan (At the constant price of 2001/02; for the growth rate of 6.2 percent)
(Rs in million)
Sector Purposed in Ninth Plan Achieved in Ninth Plan Purposed in Tenth Plan
Amounts Percentage Amounts Percentage Amounts Percentage
Agriculture, Irrigation 67438.0 27.1 32674.0 19.2 56210.0 24.0
and forestry
Non Agriculture 181859.0 72.9 137099.0 80.8 177819.0 76.0
• Industry and 2088.0 0.8 2673.0 1.6 2271.0 1.0
Mines
• Electricity, Gas 46631.0 18.7 30750.0 18.1 36004.0 15.4
& Water*
• Commerce, 3836.0 1.5 3219.0 1.9 3511.0 1.5
Hotel &
Restaurant
• Transport & 43842.0 17.6 29832.0 17.6 36428.0 15.6
Communication
• Finance & Real 329.0 0.1 6628.0 3.9 2746.0 1.2
Estate**
• Social 83026.0 33.3 61136.0 36.0 90386.0 38.6
Service@
• Miscellaneous# 2107.0 0.9 2861.0 1.7 6473.0 2.8
249297.0 100.0 169773.0 100.0 234029.0 100.0
* Including alternative energy.
** Including the investments in financial sector from Ministry of Finance
@ Including the expenditure on drop control project under Home Ministry
# Including the expenditure on economic and revenue administration, general
administration, projects and statistics, science and technology, supply, constitutional
bodies and other various economic sectors.
5.8 Sources of investment and development expenditures
Foreign debt burden has increased due to substantial share of foreign aid components
in the previous plans. Special attention has been paid not to increase the proportion of
foreign aid in the development expenditure in spite of hard-time in the Tenth Plan
along with increase in national saving rate, control in unproductive regular
expenditure, and increase in revenue collection and also to keep the development
expenditure within the sustainability limit .
Of the total capital investment (including cash balance) of Rs. 64070 Crores, the
national saving will finance Rs.50610 Crores (79 percent) and remaining Rs. 13460
Crores (21 percent) by foreign aid in the Tenth Plan. The share of the actual of
national savings in total investment is higher by 3.4 percent points compared to 75.6
percent of the Ninth P lan. The possibility of increase in national investment has
surged up with the adoption of open-economic policy and increase in export and the
increasing remittance from abroad. The proportion of the private sector investment is
51
assumed to increase by 5.6 percent points as compared to the similar investment made
in Ninth plan in the context of increasing role of the private sector and the polic ies
pursued in the Tenth Plan are expected to augment private sector’s participatory role.
In the foreign aid sector the target is to mobilize more grants and raise its contribution
to 40 percent as compared to the past experience of around 35 percent. The
contribution of foreign aid resource in total development expenditure was 56.3
percent in the Ninth Plan which is estimated to be 57.5 percent in the Tenth Plan. In
the same way, the percentage contributions of revenue surplus and internal loan are
estimated to be 21.4 percent &21.1 percent respectively.(table5.5)
Table 5.5: Sources of fixed capital investment expenditure in the Tenth Plan (at
the constant price of 2001/02; for the growth rate of 6.2 percent)
(Rs. in million)
Sectors Amount Percent
Gross Investment 64076
• Fixed capital investment 60982 100.0
- Public sector 44009 (72.2)
- Private sector 16974 (27.8)
• Change in Cash balance 3094
Total Resources 64076 100.0
• National savings 50614 (79.0)
• Foreign Aid 13462 (21.0)
Revenue 32116
Gross Expenditure 50520 100.0
• Regular expenditure 27117 (53.7)
• Development expenditure 23403 (46.3)
Sources of development expenditure 100.0
• Revenue surplus 4999 (21.4)
• Foreign aid 13462 (57.5)
- Grants 5385 (23.0)
- loans 8077 (34.5)
• Internal loans 4941 (21.1)
5.9 The impact of investment and development expenditure on macro

economy in the plan period.
The people will have increased capacity to pay tax and to save in the Tenth Plan
period as a result of increased employment opportunities and target group
development, mobilization of more resources in productive areas, construction of
development infrastructures, prioritization and the selection of projects at the
implementation label. This will help to mobilize additionally revenue and the efforts
to economize the expenditures will also increase the national savings.
The policy of keeping macroeconomic indicators within desirable limits is adopted in
the Tenth Plan. The targeted average growth rate of regular expenditure as a
percentage of GDP will be 11. 0 percent are that of internal loan 2.0 percent, foreign
aid 5.4 percent development expenditure 9.5 percent. T he growth rate in revenue is
postulated to be 13.0 percent and national savings rate at 20.4 percent. The
52
investment ratio is estimated to be 25.9 percent (table 5.6). The resource gap that
exist after revenue surplus and foreign aid will be finance by internal loan. There will
be no adverse effect in economic achieving stability as the internal debt will be
mobilized up to 2 percent of GDP. Efforts will be made to keep the average annual
inflationary rate at 5 percent and money supply (M1) at 11.5 percent.
Table 5.6: The proposed investment, development expenditures and their
sources of the Tenth Plan (at the ratio of GDP*; for the growth rate of 6.2
percent)
(In percentage)
The last year of Average of The last year of
Ninth Plan Tenth Plan Tenth Plan
Gross investment (including change in
cash balance) 24.4 25.9 29.0
• Fixed capital investment ** 23.2 24.6 27.7
- Public sector 10.0 8.0 7.9
- Private sector 13.2 16.7 19.9
• Change in cash balance** 1.2 1.3 1.3
Gross national savings 17.4 20.4 23.1
• Domestic savings 11.6 13.9 16.2
• Net factor income 5.4 6.2 6.5
• Net transfer 0.4 0.4 0.4
Net current accounts (excluding grants
and transfer) -7.0 -5.0 -5.9
• Regular expenditure 11.7 11.0 9.7
• Revenue 12.0 13.0 14.0
• Development expenditure 7.6 9.5 11.5
• Foreign aid 4.7 5.4 5.9
- Grants 2.1 2.2 2.0
- Loan 2.6 3.2 3.9
• Internal loan 2.6 2.0 1.4
* At producers’ cost
** Due to practical discrepancy in the growth rate of change in cash balance in the
available data in the statistical table as it differs in the ratio of fixed capital investment
and change in cash balance. The ratio has remained same with the gross investment.
Table 5.7: The projection of main macroeconomic indicators of Tenth plan (at
the constant price of 2001/02; for the growth rate of 6.2 percent)
(Rs. in million)
Particulars 2001/02 2006/07 Growth Rate
(percent)
Gross Domestic Product (at factor cost) 402950 544350 6.2
Gross Domestic product ( at producers price) 420260 566120 6.1
Gross consumption 371520 474260 5
53
Domestic savings 48750 91860 13.5
National savings 73180 130640 12.3
Gross investment 102550 163970 9.8
Forced Capital formation* 97320 156890 10
Change in cash balance 5230 7080 6.2
Imports of goods for commodity and services 121530 173660 7.4
Exports of goods for commodity and services 67720 101560 8.4
Imports of goods for commodity 105820 142950 6.2
Exports by goods for commodity 51300 73150 7.4
Net factor income 22730 36610 10
Current accounts( excluding transfer and grants) -29380 -33330 2.6
Money supply (M1) 79620 137270 11.5
Consumers price index 1000 1280 5
Revenue 50450 79250 9.5
Development expenditures 31900 65370 15.4
Regular expenditure 49150 55140 2.3
Total foreign aids 19650 33330 11.1
Foreign loan 10950 22100 5.2
Foreign grants 8700 11230 5.2
Internal loan 10950 7930 -6.2
* Due to practical discrepancy in the growth rate of change in cash balance in the
available data in this statistical table it differs in the ratio of fixed capital investment and
change in cash balance. The ratio has remained same with the gross investment.
As the total employment reached 99 lakhs 59 thousands, unemployment was recorded

at 5 percent and semi-unemployement 32.3 percent, if we include the semi-
unemploed in unemployment column, the total number of unemployment will be 17.4
percent at the end of the Ninth Plan. During the Tenth Plan additional employment
opportunity that 10 lakhs 53 thousands is expected to be generated, which will
decrease unemployment to 4.1 percent, semi-unemployed to 22.3 percent and
including both as unemployed, the rate will fall down to 13.5 percent.
5.10 Projection of growth rate

If law and order situation persists as it is it may not be possible to achieve investment
and economic growth as projected. In such a situation the national economy will
remain at low level equilibrium due to reasons such as low possibility of curtailing
regular expenditure and increasing development expenditure, low level of revenue
collection, low flow of remittances from foreign employment, low level of national
saving, low inflow of foreign aid due to the low level of debt servicing capacity and
decline in imports and exports. In such situation, there will be an increase of marginal
capital output ratio by 10 to 15 percent. The possibility of remaining development
expenditure at Rs 20500 Crores at current prices and Rs 17840 Crores at constant
price as compared to the development expenditure of 2001/02 at constant prices, the
percentage of regular expenditure of GDP may increase to 12.3 percent (at factors
cost), the internal loan may reach 2.0 percent of GDP. The average national saving
54
ratio will be 16.3 percent and investment ratio may be limited to 21.6 percent. Thus
economic growth rate will be limited to 4.3 percent. Even to achieve thisgrowth rate,
the foreign aid component in development budget must reach 67.1 percent and the
revenue ratio must be a 12.9 percent. Following table reveals (table5.11-table5. 12)
different assumption of projections .
In case the existing law and order situation continues, the risk of investment in
industries and business will go rise, sharp decline in inflow of foreign capital,
declining the loan-able capacity of the country and due to low of economic growth
rate, the level of internal saving will slow down rapidly. It will be very difficult to
guess actually the resulting growth rate, in such a situation and in the context of
population growth rate at 2.25 percent poverty will widely expand as the per capita
income becomes negative.
Table 5.8: GDP growth and sectorwise value addition (at constant price of
2001/02; for the growth rate of 4.3 percent)
(Rs in million)
Estimated GDP Estimated GDP Annual Average
Of 2001/02 Of 2006/07 growth annual
Sectors rate of growth rate
Production Percentage Production Percentage
Tenth during the
Plan (%) Ninth plan*(%)
Agriculture, Irrigation and
forest: 158439 39.32 181897.9 36.57 2.8 3.3
Non-Agriculture: 244513 60.68 315553 63.43 5.2 3.9
• Industry mines 34859 8.65 45343.8 9.12 5.4 2.0
• Electricity Gases &
Water 8114 2.01 11977.4 2.41 8.1 6.1
• Construction 42232 10.48 55195.5 11.10 5.5 4.1
• Trade, hotels &
Restaurants 40391 10.02 51796.2 10.41 5.1 1.4
• Transportation and
Communication 34664 8.60 45304.5 9.11 5.5 6.0
• Finance and real
estate 43494 10.79 52158.3 10.49 3.7 4.0
• Social services 40759 10.12 53777.2 10.81 5.7 6.6
GDP(at factor cost) 402952 100.00 497450.9 100.00 4.3 3.6
* At constant price of fiscal year 1997/98
Table 5.9: Gross and sectorwise fixed capital investment (at the constant price of
2001/02, for the growth rate of 4.3 percent)
Sectors Marginal Amount of fixed percent of
capital/output ratio* capital investment Gross
(Rs. in million)** investment
Agriculture, Irrigation and forest 2.68 62787.5 13.73
Non-agriculture 5.55 394469.2 86.27
• Industry and mining 2.58 27060.3 5.92
• Electricity , gas and water 16.41 63396.7 13.86
• Construction 0.75 9775.7 2.14
• Trade, hotel and restaurant 2.12 33312.1 7.29
55
• Transport and communication 8.78 93461.2 20.44
• Finance and real estate 7.97 69017.4 15.09
• Social services 7.56 98445.9 21.53
Gross Fixed capital formation 4.84 457256.7 100.00
* At the estimated growth rate of improvements by 5 percent in the Tenth Plan as against
the comparison of available data of pas t year.
** There may be some differences in the calculated figures after 2 digits of decimal in
marginal capital output ratio. .
Table 5.10 : The sectorwise distribution of fixed capital investment of private and public
sectors in the Tenth Plan.(At the constant price of 2001/02; for the growth rate of 4.3 percent)
(Rs in crores)
Sectors Government Sector Private sector Total
Amount Percent Amount Percent Amount Percent
Agriculture, Irrigation and forest 24092 18.61 38695 11.8 62788 13.73
Non-agriculture 105344 81.39 289125 88.2 394469 86.27
• Industry and mining 1066 0.82 25994 7.93 27060 5.92
• Electricity , gas and water 24980 19.30 38416 11.72 63397 13.86
• Construction 0 0.00 9776 2.98 9776 2.14
• Trade, hotel and restaurant 1531 1.18 31781 9.69 33312 7.29
• Transport and Communication 26743 20.66 66718 20.35 93461 20.44
• Finance and real estate 2072 1.60 66945 20.42 69017 15.09
• Social services 48950 37.82 49495 15.1 98446 21.53
Total 129436 100.00 327820 100.00 457257 100.00
Table5.11 The sectorwise allocation of gross development investment in the

Tenth Plan (At the constant price of 2001/02; for the growth rate of 4.3 percent)
(Rs in million)
Sectors Proposed in Achieved in Proposed in
Ninth plan Ninth Plan Tenth Plan
Amount percent Amount percent Amount percent
Agriculture, Irrigation and forest 67438 27.1 32674 19.2 42578 32.9
Non-agriculture 181859 72.9 137099 80.8 135772 76.1
• Industry and mining 2088 0.8 2673 1.6 1706 1
• Electricity , gas and water* 46631 18.7 30750 18.1 26979 15.1
• Trade, hotel and restaurant 3836 1.5 3219 1.9 2673 1.5
56
• Transport and 43842 17.6 29832 17.6 28348 15.9
communication
• Finance and real estate ** 329 0.1 6628 3.9 2113 1.2
• Social services*** 83026 33.3 61136 36 69022 38.7
• Miscellaneous **** 2107 0.9 2861 1.7 4933 2.8
Total 249297 100 169773 100 178350 100
* Including alternative energy.
** Including the investments in financial sector from ministry of finance
*** Including the expenditure on drop control project under Home Ministry
**** Including the expenditure on economic and revenue administration, general
administration, projects and statistics, science and technology, supply, constitutional
bodies and other various economic sectors.
Table 5.12: Sources of fixed capital investment expenditure in the Tenth Plan
(at the constant price of 2001/02; for the growth rate of 4.3 percent)
(In Rs. million)
Sectors Amount Percent
Gross Investment 486530
• Fixed capital investment 457260 100.0
- Public sector 327820 (71.7)
- Private sector 129440 (28.3)
• Change in Cash balance 29280 100.0
Gross Resources 486530 (75.4)
• National savings 366840 (24.6)
• Foreign Aid 119690 100.0
Revenue 291270 (60.9)
Total Expenditure 456250 (39.1)
• Regular expenditure 277900 100.0
• Development expenditure 178350 (7.5)
Sources of development expenditure
• Revenue surplus 13370 (67.1)
• Foreign aid 119690 (28.9)
- Grants 51470 (38.2)
- loans 68220 (25.4)
Internal loans 45290
Table 5.13 The proposed investment, development expenditures and their
sources in the Tenth Plan(at the ratio of GDP*; for the growth rate of 4.3
percent )
(In percentage)
The last Average of The last year of
year of Tenth Plan Tenth Plan
Ninth Plan
including change in cash balance) 24.4 20.8 21.8
• Fixed capital investment ** 23.2 19.5 20.5
- Public sector 10.0 8.4 8.6
57
- Private sector 13.2 11.1 11.9
• Change in cash balance** 1.2 1.3 1.3
Gross national savings 17.4 15.7 16.1
• Domestic savings 11.6 9.1 9.2
• Net factor income 5.4 6.1 6.5
• Net transfer 0.4 0.4 0.4
Net current accounts (excluding grants and
–7.0 –5.1 –5.7
transfer)
• Regular expenditure 11.7 11.9 11.1
• Revenue 12.0 12.4 13.0
• Development expenditure 7.6 7.6 8.4
• Foreign aid 4.7 5.1 5.7
- Grants 2.1 2.2 2.2
- loans 2.6 2.9 3.5
• Internal loans 2.6 1.9 0.8
* At producers’ cost
** Due to practical discrepancy in the growth rate of change in cash balance in the
available data in the statistical table as it differs in the ratio of fixed capital investment
and change in cash balance. The ratio has remained same with the gross investment.
Table 5.14 The projection of main macroeconomic indicators of the Tenth Plan
(at the constant price of 2001/02; for the growth rate of 4. 3 percent)
(Rs in million)
Particulars 2001/02 2006/07 Growth
Rate
( percent)
Gross Domestic Product (at factor cost) 402950 497450 4.3
Gross Domestic product ( at producers price) 420260 417350 4.2
Total consumption 371520 469850 4.8
Domestic savings 48750 17500 –0.5
58
National savings 73180 83070 2.6
Total investment 102550 112580 1.9
Fixed Capital formation* 97320 106110 1.7
Change in cash balance 4240 6470 4.3
Imports of goods and services 121530 141540 3.1
Exports of goods and services 67720 76470 2.5
Imports of goods 105820 120250 2.6
Exports by commodity 51300 59660 3.1
Net factor income 22730 33400 8.0
Current accounts balance ( excluding transfer and +0.1
grants) -29380 -29500
Money supply (M1) 70780 111500 9.5
Consumers price index 1000 1280 5.0
Revenue 50450 67264 5.9
Development expenditures 31900 43420 6.4
Regular expenditure 49150 57650 3.2
Gross foreign aids 19650 29507 8.5
Foreign debt 10950 17930 10.4
Foreign grants 8700 11580 5.9
Internal debt 10950 4290 –17.1
* Due to practical discrepancy in the growth rate of change in cash balance in the
available data in this statistical table it differs in the ratio of fixed capital investment and
change in cash balance. The ratio has remained same with the gross investment.
5.12 The sectorwise allocation of gross development expenditure

Sectorwise allocations of projected development expenditure for achieving estimated
economic growth rate of 6.2 percent and alternative growth rate 4.3 percent have been
the presented in following table. Compared to 6.2 percent growth rate, the
appropriation in agriculture sector is less only by 0.1 percent point for 4.3 percent
growth rate. The investment in electricity is lower by some percentage points and it is
added in transportation and social sectors.
Table 5.15 : Detailed sectorwise allocation of gross development expenditure of
the Tenth Plan (at the constant price of 2001/02)
(Rs. in million)
For the Growth rate of For the Growth rate of
6.2 percent 4.2 percent
S.N Particular Share Share
Amount ( percent ) Amount ( percent )
1 Agriculture, Irrigation & forest 56210 24.0 42578 23.9
a Agriculture 17860 7.6 13523 7.6
b Irrigation 22750 9.7 17225 9.7
59
c Forest 4960 2.1 3755 2.1
d Land reform And Survey 2370 1.0 1794 1.0
i Land reform 980 0.4 742 0.4
i Survey 1390 0.6 1052 0.6
e other agriculture* 8270 3.5 6280 3.5
2 Non -agriculture 177819 76.0 135772 76.1
3 Industry, geology & mines 2271 1.0 1706 1.0
4 Electricity, gas and w ater 36004 15.4 26979 15.1
a Electricity and other energy 36004 15.4 26979 15.1
5 Trade, hotel and restaurant 3511 1.5 2673 1.5
a Tourism 2600 1.1 1979 1.1
b Commerce 561 0.2 427 0.2
c Labor 350 0.1 266 0.1
6 Transport and communication 36428 15.6 28348 15.9
a Road Transport 27418 11.7 21336 12.0
b Civil Aviation 1705 0.7 1327 0.7
c Communication 7305 3.1 5685 3.2
7 Finance and real estate** 2746 1.2 2113 1.2
a Financial Reforms 2746 1.2 2113 1.2
8 Social Service 90386 38.6 69020 38.7
a Education 18800 8.0 14356 8.0
b Health 14000 6.0 10691 6.0
c Drinking water 29220 12. 5 22313 12.5
d Local Development 24700 10.6 18861 10.6
e Other social services 3666 1.6 2799 1.6
i Population and environment 207 0.1 158 0.1
i Women and social welfare 1008 0.4 770 0.4
iii Culture 1080 0.5 825 0.5
iv Housing 1126 0.5 860 0.5
v other 245 0.1 187 0.1
9 Miscellaneous 2473 2.8 4933 2.8
a Science and technology 2300 1.0 1753 1.0
b Supply 1168 0.5 890 0.5
c Revenue and economic 250 0.1 190 0.1
60
administration
d Constitutional bodies 400 0.2 305 0.2
e General administration 160 0.1 122 0.1
f Planning and statistics 495 0.2 376 0.2
Mid and far western special
g program ( including Karnali) *** 700 0.3 535 0.3
h Various economic services 1000 0.4 762 0.4
Total 234029 100.0 17835100 100.0
* Additional appropriation in the priority sectors of long-term development plans.
** Including financial reforms
*** In this allocation additional amount of Rs 30 crores for agriculture program is
included in headings of other agriculture & including this amount, the appropriation in
this heading is Rs 100 crores for 6.2 percent growth rate and Rs 76.2 crores for 4 .3
percent growth rate.
61
Chapter - 6
Macro-Economic Sector
6.1 Savings
6.1.1 Background
Higher rate of savings mobilization is essential for boosting investment necessary to
achieve higher economic growth rate. But at present, the level of domestic savings is
low. For attaining th e targeted economic growth of the Tenth Plan it is necessary to
bring about consistency between domestic saving, and investment. For this,
identification of measures that assist savings to increase is called for. The balance
between savings and investment is a condition that determines the achievement of
targeted growth of the economy.
6.1.2 Review of the Ninth Plan
a) Ninth Plan: Progress against Target
During the Ninth Plan period the GDP at FY 2053/54 (1996/97) at constant
price was envisaged to increase from Rs. 39.16 billion to Rs 53.85 billion
Accordingly, Gross Domestic Savings was targeted to increase by an average
annual rate of 9.3 percent. In the final year 2058/59 (2001/02) of the Ninth
Plan Gross Domestic Savings has reached Rs.48.74 billion at current price and
Rs 38.69 billion at constant price of FY 2053/54. Thus, it increased by an
average rate of 5.4 percent at current price and 0.6 per cent at constant price.
only. Gross Domestic Savings to the GDP ratio in FY 2058/59 (2001/02 )has
been estimated to decline to 11.6 percent, whereas in FY 2053/54 it was about
14.0 percent. (Annex-1, Table 7)
b) Problems and Challenges
The main constraints to savings mobilization are: low level of saving capacity
of the general public, lack of savings habits among the capable ones, and lack
of easy access to saving instruments, and weak institutional frameworks,
among others.
6.1.3 Long-term Prospect
In order to satisfy investment requirements for development, domestic savings will be
made as a permanent and sustainable source. Gross Domestic Savings and Investment
as per cent of Gross Domestic product will me maintained at 30 per cent and 34 per
cent respectively by the Twelfth Plan.
6.1.4 Tenth Plan
a) Objective
62
The objective of the plan is to raise gross domestic savings and support investment
programs to achieve poverty alleviation target.
b) Quantitative Targets
As per cent of GDP gross domestic savings will be increased to 16.2 per cent and
investment/ gross capital formation to 29 per cent by the end of the tenth plan.
c) Strategy
1. Priority will be accorded to institutional saving mobilization thereby adopting
the measures that can generate savings in corporate sector.
2. Emphasis will be given to generate revenue surplus by reducing regular
expenditure of the government. Moreover, initiatives will be taken to
increase savings by reducing expenditures through privatization of
government enterprises.
3. Arrangements will be made to motivate the collection of deposit from the
small depositors by offering pos itive interest rates, and providing easy access
to banking and financial services.
4. Savings will be augmented through the remittances obtained from the
Nepalese from Foreign Employment Promotion.
d) Policy
§ Priority to Institutional Saving Mobilization Program (related to strategy 1)
• Mobilization of financial savings will be ameliorated by the expansion of
banking and financial institutions as well as by creating conducive
environment to bring about diversification in saving instruments.
§ Emphasis on Revenue Surplus through reduction in Government’s regular
expenditure (related to strategy 2)
• Government regular expenditure will be restrained within limit. Measures
will be adopted to increase revenue collection and government savings be
raised by the privat ization of public enterprises.
• As per the suggestion of the Public Expenditure Review Commission,
efficiency will be raised and austerity measures be adopted in
expenditure management. Also, subsidy in government consumption
expenditure be gradually reduced and thereby raising government
savings.
§ Promotion of small deposits by offering positive interest rates and also
facilitating banking and financial services. (related to strategy 3)
• Deposit mobilization will be increased by improving banking services
through financial sector reforms.
63
• Saving opportunities will be created through market expansion of
insurance, provident fund and bond markets.
• Arrangement will be made to make the national saving certificate
accessible to small depositors. Also, deposit insurance system will be
arranged for their protection.
• Emphasis will be given in generating savings by identifying new areas of
investment.
• By controlling the price inflation, the capability and the willingness to
save will be promoted.
§ Promoting Savings through Foreign Employment (related to strategy 4)
• In order to increase income from foreign employment promotional
measures will be adopted.
• Institutional arrangements will be made for the inflow of income earned
by the Nepalese working abroad.
6.2 Revenue
6.2.1 Background
Essentially,, government needs a huge resource in order to alleviate wide -spread
poverty in the country. Government involvement in various sectors like: physical
infrastructure development, social service expansion, maintenance of law and order
situation, guaranteeing welfare to ethnic groups, rural and remote areas development,
etc, and thereby accelerating the economic growth call for adequate domestic
resource mobilization. Therefore, revenue mobilization, which has become a
significant part of domestic resource mobilization, should be accelerated and made
sustainable.
• In the base year 2053/54(1996/97) of the Ninth Plan, the revenue in
proportion to the gross domestic product remained at 10.8 percent, which
increased only to 12.0 percent at the final year of the Ninth Plan
2058/59(2001/02) against the target of 12.3 percent.
• The revenue collection (at current price) remained Rs.30.37 billion in FY
2053/54 (1996/97), whereas it was estimated to reach to Rs.50.51 billion
at the final year 2058/59(2001/02). Thus, during the plan period, the
annual average increase in revenue at current price was 10.8 percent and
at constant price it was 4.9 percent (Annex 1, table 13,14). Similarly, of
the total revenue collection, the ratio of tax revenue and non-tax revenue
64
in FY 2053/54 (1996/97) was 80.4 and 19.6 per cent respectively,
whereas in FY 2053/54 (1996/97) the proportions were 80.1 and 19.9 per
cent respectively (Annex 1, Table 15).
• Negative implications on tourism sector brought about by both domestic
and international disturbances, and deteriorating security situation in the
country affected the economy adversely.
• Narrow tax base, lac k of compliance among the tax payers to pay tax
normally, lack of flexibility in taxation, lack of effectiveness in
administrative machinery in revenue collection, poor professional
competency, leakages in tax proceeds, lack of transparency on existing
tax-laws etc. are some of the problems affecting revenue collection..

In order to increase revenue as a proportion of gross domestic product, development
of a broad- based and sustainable revenue structure is a prerequisite; which would
help chanilize domestic resources for poverty alleviation programs.
6.2.4 The Tenth Plan
a) Objective
The objectives of the Tenth Plan are to increase revenue elasticity by broadening
tax base, maximum mobilization of domestic resources and gradually reducing
dependency on foreign assistance.
• By the final year of the plan, the revenue ratio is targeted to be 14 percent.
• As per cent of gross domestic product, direct tax, indirect tax, and non-tax are
targeted to be 3.5, 8.7 and 2.8 percent respectively.
• The number of income tax payers will be increased to 3,00,000. Similarly,
number of “Value Added Tax” registered taxpayers will be increased to
40,000.
• Contribution from revenue surplus to development expenditure will be
maintained to a minimum of 22 percent by the end of the plan.
c) Strategy
• To bring about effectiveness in revenue mobilization, the tax base will be
broadened through structural reforms. To develop value added tax as a
primary source of domestic revenue, its scope and coverage will be
expanded. Custom tariffs will be further simplified by bringing every
income-generating sector within the income tax net.
65
• Administrative and legal reforms will be prepared to make tax administration
simple, transparent and perfect. The mechanisms designed for controlling
revenue leakages will be used effectively.
• Non-tax revenue will be increased through reforms on income and dividend
received from telecommunication, electricity and drinking water sector
through the cost based pricing. Likewise, reforms will be made in other
sectors for this purpose.
d) Policy :
§ Broadening the tax base through institutional reform (related to strategy 1)
• The direct and indirect tax will be adjusted in consonance with foreign
trade structure, protection of domestic industries, accession to the World
Trade Organization and South Asian Free Trade Arrangement (SAFTA).
• The areas of income generations that have not been incorporated within
tax base will be brought under the tax net thereby adopt ing the policy to
gradually reduce the income tax burden.
• Areas where VAT is waived will be reviewed. Arrangements will be
made to adopt the task of issuance of tax invoice up to consumer level
and to implement it strictly.
• Adjustment will be made in Custom tariffs in the context of World Trade
Organization membership.
• “Public-private sector partnership” will be promoted to increase
participation of the private sector on revenue policy formulation.
• Proceeds realized through privatization of government enterprises will be
used in clearing the liability of the government enterprises and in
repaying the government loans.
• Various awareness and promotional programs will be initiated to bring
potential taxpayers into the tax net.
• An integrated information system will be developed for the regular
monitoring of revenue policy reforms and implementation.
• A permanent revenue board will be established and activated for making
institutional arrangement that assists in providing prompt understanding
on current situatio n of the economy and assist in financial decision-
makings.
§ Setting tax administration simple, transparent and healthy (related to
strategy 2)
• The monitoring capacity of the agencies involved in controlling revenue
66
leakages will be extended and the effectiveness of the monitoring units
that are working at the central level will be increased.
• Professionalism of staff in revenue administration will be enhanced
through regular trainings.
• Revenue laws will be made more transparent and practicable my
removing impediments in the areas of custom tariffs, excise, VAT and
income tax.
• Design and implement performance indicators applicable to specific
units and to staff up to executive level.
• The monitoring process will be made more effective by setting up
permanent revenue police.
• Revenue tribunal will be made active for early settlement of tax
litigations thereby reducing the tax arrears. A separate institutional
arrangement will also be made for the management of the tax arrears that
exist after the decisions made by the tribunal.
§ Non -tax revenue will be increased through reforms in dividends, duty and
loan/ investment. (related to strategy 3)
• Prices of goods and services to be sold by the public sector will be
governed by cost and prevailing market prices with a view to augment
the share of non-tax revenue.
• The dividend policy will be reviewed every two years to help realize an
appropriate rate of return on investment made by the government in the
public enterprises.
• The principal, interest and royalty due from the public enterprises will be
claimed, on a planned basis, as per investment made by government in
those enterprises.
6.3 Foreign aid

6.3.1 Background
The considerable gap that exists between saving and investment and the increased
need for public investment to conduct activities for poverty alleviation and sectoral
programs, foreign assistance has assumed important role in the national economy. In
this context inflow of foreign aid should be made conducive to national needs.
67
During the Ninth Plan (at constant price of 2053/2054(1996/97)) contribution of
foreign aid was targeted to be 58.8 percent of development expenditure (17.2 percent
grants and 41.6 percent loan), while during the plan period the actual figure stood at
56.3 percent (19.5 percent grants and 36.8 percent loan).
b) Problems and Challenges:
• Most of the development projects financed through foreign assistance are
neither able to accomplish the targeted goals nor establish the ownership of
His Majesty's Government and Nepalese people in such development efforts.
• Debt liability is on increase. Total foreign debt in FY 2058/59 (2001/02) has
reached Rs.207 billion, consequent to which debt servicing obligations
(principal and interest payment are also increasing over time.
Maximum utilization of foreign aid to achieve self-sufficiency in resource
mobilization for poverty alleviation and sustainable development is necessary In
addition to this, from longer -term perspective foreign aid is expected to meet
increasing need of poverty alleviation programs.
6.3.4 Tenth Plan
a) Objective
To alleviate poverty and achieve sustainable higher economic growth rate through
effective utilization of for eign aid.
b) Strategy
1. To give appropriate priority to development activities to be implemented
through foreign aid by bringing about improvements in quality, effectiveness
and efficiency of management.
2. To enhance equity based development partnership by redefining the
relationship between His Majesty's Government and donor communities.
c) Policy
§ Increasing the effectiveness of foreign aided development activities (related
to strategy 1)
• Efforts would be made to receive more grant assistance and soft loans.
• Technical assistance would be requested for the implementation of
specific economic and social sectors.
§ The interlinkages between His Majesty's Government and donor
communities would be redefined (related to strategy 2).
68
• To bring about greater impact of foreign assistance and for ensuring
accountability, government’s and people’s roles, leadership, and
ownership will be determined.
• Flow of external assistance from international non-government
organizations will be mobilized as per their quality and also national
requirements.
6.4 Government Expenditure Management

6.4.1 Background
Based on the involvement of the government in economic and social transformation
of the country, prudent management of public expenditure in different sectors is very
essential. For this, austerity measures would be adopted and effectiveness of
expenditure would be strengthened.
Budget manual has been prepared and brought under operation for the purpose of
reducing expenditure, developing ef fective accounting standard, initiating programs
in the Mid-Term Expenditure Framework (MTEF and managing actions related with
price subsidies. Action has been initiated to bring all kinds of assistance from donor
agencies into the budgetary framework. A bill has been tabled into the parliament to
amend Arthik Karyabidhi Ain 1998) for financial transparency, expenditure
management and for maintaining account of government goods.
6.4.3 Problems and Challenges
The deteriorating law and order situation and po litical instability, the tendency of
regular expenditure exceeding development expenditure, lack of performance based
budgetary system, inability to curtail the number of projects, delay in privatization of
government enterprises have been witnessed as the main problems faced during the
process of implementation.
The long-term objective of public expenditure management is to achieve the goal of
poverty alleviation through the flow of national resources and wherewithal into the
prior ity sectors.
a) Objective
To support poverty alleviation efforts through the flow of national resources and
means in the priority sectors.
69
• To achieve the ratio of gross national savings to gross domestic product at
23.1 per cent and that of total investment to gross domestic product and 27.7
percent.
• To limit the ratio of regular expenditure to gross domestic product at 9.7
percent and to attain the ratio of development expenditure to gross domestic
product at 11.5 percent.
c) Strategy
1. Austerity measures will be adopted in the regular expenditure of the
government.
2. Effective administrative and functional mechanism will be set up to help
achieve efficiency in expenditure management.
3. Appropriation of public expenditure, disbursement, expenditure
authorization, decision making process, accounting, auditing, reporting and
dissemination of financial information will be made transparent, prompt and
return based.
d) Policy
§ Austerity in Public Expenditure (related to strategy 1)
• Constant monitoring will be made to check whether or not the activities
have been implemented in line with the financial act, and regulations or
not within the specified timeframe. The machinery assigned for the
purpose will be strengthened.
• Achievement based evaluation system will be effectively implemented.
• Accounting system will be reformed to ensure the operation and
maintenance of the assets generated from government expenditures. Also
the reports will be prepared reflecting the assets and liabilities so as to
arrest the leakages, if any..
• Regulations regarding public procurements will be framed to help curb
irregularities.
§ Efficiency in Expenditure Management (related to strategy 2)
• Sectoral expenditure policy will be framed to ascertain productivity,
efficiency and economy of expenditure on the basis of available means
and poverty alleviation national priority.
• Foreign loan assistance will be reduced in phases and further initiation
will be made to obtain grant assistance for more important development
projects.
• Through the privatization of the public enterprises, government
70
involvement will be reduced gradually. Private sector investment in
modern sectors like electricity and communication will be promoted.
• Financial discipline will be maintained and accounting standards and
information system will be made effective and strong.
• In the selected agencies, system of evaluation of expenditure efficiency
will be adopted.
• Information system on budgetary operations will be improved.
§ Return -based Appropriation of Public Expenditure (related to strategy 3)
• Annual budget/three-year budget will be prepared making them
consistent with the allocated amount for the prioritized sector in periodic
plan and medium -term expenditure framework.
• Objective of the project will be made the basis for budgetary allocation
and effective monitoring will be carried out for the time bound programs.
• Foreign assistance will be directed towards priority sector only. And
while allocating budget the on-going projects will be prioritized so that
implementation of new projects will be initiated based on availability of
new resources.
• Foreign assistance, specifically foreign loan will be channeled towards
prioritized programs and projects. All kinds of expenditures to be
disbursed by donor agencies will be brought into budgetary framework
and will be made transparent.
• Services hitherto delivered by central level agencies will be handed over
to the local levels with emphasis on fiscal management based on the
principle of decentralization.
6.5 Money, Banking and Credit

6.5.1 Background
Policies of liberalization, globalization and privatization pursued in the overall
economic sector during 1990's have resulted in speedy financial liberalization.
Financial sector liberalization and reform program adopted since the Eighth Plan
(1992-1997) have been further extended in the Ninth Plan (1997-2002). The Nepal
Rastra Bank Act, 2001 and the Debt Recovery Act have already been enacted.
However, credit flow has not been sufficient as required by the rural and agricultural
sectors.
There have been endeavors to accomplish the objectives of the monetary policy
through necessary adjustments in bank rate, cash reserve ratio and open market
operations and also by reducing financial intermediation cost of the commercial
71
banks. Financial intermediation augmented through efficient implementation of fiscal
policy and monetary policy has been supportive in attaining overall economic
stability.
6.5.2 Progress review of the Ninth Plan
The main objective of monetary policy in the Ninth plan was to maintain economic
stability. Adequate surplus in balance of payments, maintaining of foreign exchange
reserve in excess of the amount required to cover six months of imports goods and
services and maintaining price stability had been the main policy goals. The Ninth
Plan had set the target of maintaining annual average inflation at 6.5 percent.
Improvements in supply situation especially of food items helped contain price rise
within the target. During the plan period, an average annual surplus of Rs. 6.41
billion (in constant price) in balance of payments had been achieved as against the
target of Rs. 4.4 billion (Annex 1, Table 31).
With regard to broad money supply, an annual average growth target of 15 percent
was set. But the annual average growth of 17.1 percent was witnessed exceeding the
targeted growth by 2.1 percentage points.. However, during the review period, rate of
growth of the narrow money supply reached 15.7 percent against the annual average
growth target of 13 percent. In credit supply, bank credit flow to the His Majesty’s
Government sector, during the plan period, was set to an annual average rate of 3.2
percent, whereas such credit had increased by an average of 15.4 percent. While
growth rate of bank credit to public enterprises and private sector had slowed down
than targeted in the plan against the target of the plan. Bank credit allocation for
public enterprises was limited to a growth rate of 12.1 percent during the review
period against the targeted growth rate of 21.5 percent. Bank credit flow to the private
sector remained at 15.9 percent, lesser than the target rate of 20 percent. As a result,
total domestic credit has increased only by 15.3 percent against the target of 16.1
percent during the review period. (Annex 1, Table 22).
To stabilize and strengthen the financial sector, necessary legal and institutional
reforms in the financial sector were effected in addition to the development of
prudential norms as per the international standard. Rural Micro-Credit Development
Center was established to extend refinancing facilities to the financial institutions
which provide rural micro-credit. Debt Recovery Act has been passed by the
parliament which would be instrumental in reducing bad debts of the banks and
financial institutions.
6.5.3 Problems and challenges
The maintenance of financial stability has been the major challenge Price stability had
been achieved for the first four years of the Ninth Plan. Similarly, balance of
payments had been favorable. However, in the final year of the Ninth Plan due to
adverse effects led by internal and external factors, tourism sector was adversely
affected. Due to domestic security problem, budgetary operation was disturbed
resulting in fiscal imbalance to grow. Against this backdrop, maintaining economic
stability is going to be the major challenge the monetary policy would have to face.
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The long-term objective of monetary policy will be maintaining economic stability in
order to accomplish sustainable economic growth rate.
a) Objective
The prime objective of the monetary policy is to maintain macro-economic stability
by ensuring adequate liquidity in the economy and sufficient credit flow to the private
sector to attain sustainable and high growth rate in the economy supported by price
stability and favorable balance of payments.
b) Macro - Quantitative Targets
• To maintain inflation at an annual average rate of 5 percent.
• Broad money supply to grow at an annual average rate of 14.5 percent.
• Credit to government from the banking system to increase annually at an
average rate of 6.3 percent.
• Credit to the private sector from the banking system to increase at an average
annual rate of 20 percent.
• Total internal borrowings of the government will increase at an average rate
of 16.2 percent.
• Narrow money supply will increase at an annual average rate of 11.5 percent.
• Balance of payments, on the annual average, will remain surplus by Rs. 3.7
billion.
c) Strategy
1. Service standard of banking and financial sector will be enhanced and
stability be maintained. Likewise, payments system will be developed to
make them secured, healthy and capable. Through the promotion and service
extension of the overall banking and financial system, credibility of the
public will be regained
2. Policy and programs of banking, credit and financial institutions will be
designed in favour of rural areas.
d) Policy
§ Stability and service extension of banking and financial system (related to
strategy 1)
• Total autonomy will be given to the central bank in the operation of
monetary policy making it conducive to economic development.
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• In addition to bringing about necessary adjustments in the bank rate and
cash reserve ratio, open market operations will be augmented for short-
term monetary management.
• Credit to the government from the banking system will be reduced
enabling the private sector to utilize major share of total bank credit.
• Conversion of debt instruments and overdraft into the marketable
treasury bills will be continued.
• Initiation will be made to sell the HMG’s development debentures though
auction.
• Inspection and monitoring system will be strengthened to ensure healthy
financial transactions of the non-bank financial institutions inclusive of
savings and credit cooperatives, Employee Provident Fund, Citizen
Investment Fund and mutual funds.
• A system of full security of credit from the bank and financial institutions
will be ensured through effective implementation of the acts, laws
incorporating legal provisions concerning bankruptcy, merger,
acquisition, contract and private property.
• The system of monitoring, supervising and regulating of the financial
sector will be further strengthened.
• Bank and financial institutions under government ownership will be
gradually privatized through reforms in their management.
• Institutional arrangement will be made for making debt recovery of the
financial institutions effective.
• Additional legal and institutional arrangements will be made to develop
Nepal as an international offshore financial center.
• Credit Rating System will be developed for attracting national and
foreign investors.
• Deposit insurance system will be established.
• Educational credit will be arranged in the technical and higher education
in support of human resource development.
§ Encouraging Banking and Financial Services towards Rural Areas
(related to strategy 2)
• In order to increase rural and industrial credit, credit operations of the
Agricultural Development Bank, the Nepal Industrial Development
Corporation, the Employee’s Provident Fund, the Citizen Investment
Fund and the Insurance Corporation will be strengthened and
74
restructured. The operating areas of public investment will be expanded.
With an objective to increase the flow of long-term credit in industrial as
well as in commercial sectors, the establishment of specialized
development banks will be encouraged.
• Encouragement will be made to establish finance companies in
development regions where they are not yet established. At the same time
their scope of service delivery will be expanded, wherever possibl.
• For the development of the cooperative societies, cooperative banks will
be established with necessary amendments in the prevailing cooperative
act. Furthermore, special emphasis will be placed towards maintenance of
Good Corporate Governance.
• For the development of micro-credit as well as minimizing risk elements
the deprived group may encounter while getting involved in micro-credit
business, “Micro Credit Insurance” will be managed.
• Financial intermediary that supply micro- credit will be augmented in
favor of socially and economically deprived groups and women in the
rural sector.
• Rural development banks will be privatized and will be persuaded to
provide banking services in the potential hilly districts.
• Policy will be adopted to gradually phase-out the priority sector lending
programs of the commercial banks. But the credit program for the
deprived sector will be m aintained and continued.
• In order to increase opportunities for income generation and employment
promotion of the deprived and marginal-income groups, flow of credit
will be extended to rural areas through small credit unions, village banks,
Non-government organizations and micro credit agencies
e) Programs and Implementation Modalities
• The services of the rural development banks, small farmer development
projects, micro- credit programs for women and programs of non-
government organizations established with similar objectives will be
extended in a sustainable and effective manner to raise the flow of
institutional micro-credit for the social and economic benefits of the deprived
groups including women of the rural area.
• Since operating cost of the commercial banks and development banks are
found to be higher while providing small loans directly through them in the
rural areas, system of identifying local financial intermediaries will be
managed with priority for providing wholesale banking through commercial
and development banks. Similarly, to create opportunities for income and
employment for the deprived and marginal income groups, village banks,
75
small credit unions, Non-government organizations and micro credit
institutions will be organized
• Various acts have been under operation in the recent years in the context of
implementation of different financial institutions. An act relating to deposit
taking institution will be formulated by integrating these acts and henceforth,
implemented.
• Banks and financial institutions will be allowed to raise capital from the
external financial markets to mobilize long-term capital.
• Debt Tribunal will be established under Debt Recovery Act with the
objective of reducing the amount of bad debt. Moreover, by establishing
Asset Management Company, the amount of bad debt will be reduced
considerably.
• A modern clearing house will be established to promote payments system to
be active, secured and effective.
76
Table 6.1 :Projection of Monetary Situation in the Tenth Plan
(Rs.in million)
S.No Particulars Final Year of Ninth Plan 2006/07

2001/02*
1. Net Foreign Assets 89287 107591
2. Total Domestic Credit 205690 437635

a. HMG 59203 80354
b. Public Enterprises 12249 18589
c. Private Sector 134239 334030
3. Fixed Deposits 146566 305194
4. Net Other Liabilities 68796 99688
5. Narrow Money Supply 79616 137207
6. Broad Money Supply 226182 445129
* Preliminary estimate.
While making projections on total money supply, projections on surplus in balance of

payments targeted towards the source and total credit supply have also been
considered.
6.6 Foreign exchange and Balance of Payments

6.6.1 Background
In order to facilitate the imports of industrial raw materials, capital goods and transfer
of advanced technologies, the stability of exchange rate is a prerequisite. In view of
the growing dependency on foreign resources for economic development there has
been a paradigm shift in the concept of foreign assistance world-wide. As such
“Trade not Aid “ has got prominence. The process of liberalization which
commenced during 80’s has gained dynamism during the late 20th century, resulting
in global economy to be more liberal and integrated. On the whole, the international
trade has become instrumental in activity expansion, growth and maintenance of
stability.
6.6.2 The Ninth plan: Target and Progress
a) International Trade
In the Ninth Plan, export was targeted to increase, on an average, by 12.5 percent.
However, even though the execution of SAFTA and Nepal’s acces sion to WTO could
not be accomplished, the renewal of Nepal-India trade agreement brought about
positive outcome on Nepal's export to India, thereby resulting in total export growth
by 11.1 percent at constant price, which is marginally lower than the targ et. Import,
which has been targeted to increase annually at an average of 8.8 percent, has
decreased by an annual average of 2.1 percent (Annex 1 Table 28).
b) Foreign Exchange and Balance Of Payments
77
During the ninth plan satisfactory performance have been witnessed in the area of
foreign exchange and balance of payments. Trade deficit, on an annual average, has
contracted by 9.4 per cent which is consistent with the plan target to gradually
minimize trade imbalance. Private transfer receipts have supported to reduce the
current account deficit gradually augmenting services and transfer net as envisaged in
the plan. (Annex 1, Table 31). In FY 1997/98 the ratio of current account deficit to
GDP remained at 5.9 percent, In the final year of the ninth plan some progress has
been noticed whereby this ratio has declined to 4.7 per cent. As against the target of
the plan to maintain current account deficit to GDP ratio at 8.5 per cent ( excluding
the government subsidy and Indian Excise refund), it has declined to 7.0 per cent by
the end of the plan.
Despite encouraging achievement in the trade sector, receipts from service sector
were not as expected. In contrast to targeted increase on an annual average by 11.4
per cent services receipts declined by 26.4 per cent on an annual average affected as it
was by domestic as well as external shocks.
Under transfer receipts, net private transfer has increased, on an annual average, by
23.4 percent. During this period, even though there has been some decline in foreign
grants, net transfer income has increased, on an annual average, by 9 percent
compared to the target to increase it by the 6.0 percent (Annex 1, Table 32) .
Under capital account, net foreign capital inflow has declined by 19.1 percent.
Notwithstandin g the target of the Ninth Plan to maintain foreign exchange reserves to
cover 5 months of import of goods and services by the end of the plan such reserves
increased to cover 10 months of imports.
The problems encountered during the implementation of 9th plan were as follows:
• Obstacles created in industrial and tourism sectors due to deteriorating law
and order situation.
• Negligible export to mainland China and Tibet, an autonomous region of
China, in spite of significant inc rease in import from there.
• Abrupt crisis faced by Pashmina industry and the slackness witnessed in
export of woolen carpets.
• Poor implementation of Duty Drawback Scheme relating to export.
• Slackening in the export of Nepalese ready-made garments because of
economic recession in America and lack of competitiveness due to duty free
quota facilities made available to Sub-Saharan African Countries.
• Inability to operate the dry port based on broad gauge railway at Birjung, the
main entrance for foreign trade, even after the completion of its construction,
due to lack of railway pact with India.
78
• Inability to completely channilize into banking channel the convertible
foreign currency earnings made by the Nepalese involved in employment
overseas.
• The inflow of foreign direct investment has not been as expected.
It is essential to bring about stability in exchange rate through sustainable balance of
payments surplus while managing external sector in line with the terms and
conditions of the World Trade Organization and South Asian Preferential Trading
Arrangement (SAPTA). For this, the concepts like: reducing the trade deficit and
current account through diversification of exports, commodity-wise and country-wise,
maintaining the foreign exchange reserve to an optimum level by obtaining a
sustainable surplus in balance of payments through inflow of private foreign capital,
and making Nepalese Currency gradually convertible also into capital account
transaction. The plan had the target to maintain current account deficit to GDP ratio at
less than 4 percent and to maintain the foreign exchange reserve adequate to cover
six months of imports of goods and services.
6.6.5 The Tenth plan
a) Objectives
Main objectives of balance of payments would be: to attract foreign investment
through reforms in foreign exchange and balance of payments and limiting the current
account deficit to a desirable level. To facilitate the imports of capital goods and
support the transfer of improved technologies to bring about dynamism in the
economy. To create conducive climate for investment by maintaining exchange rate
stability.
• To gradually increase the export-import ratio as well as to generate Rs.3.70
billion annual surplus in balance of payments by maintaining a condition
through which major portion of trade deficit could be financed by service
and transfer income.
• To enable export to cover at least 60 percent of the imports.
• Not to exceed the current account deficit above 3 percent of the GDP.
• To maintain the foreign exchange reserve at the level sufficient to cover six
months of imports goods and services.
c) Strategy
1. Country-wise and commodity-wise export diversification would be made for
exports promotion.
2. In the process of providing convertibility to capital account, additional
79
facilities will be offered to the industries operated in the private sector for
mobilizing capital through external sources.
3. Foreign exchange inflow will be encouraged through investments and income
generation.
4. Nepal will be developed as an International Financial Center.
d) Policy
§ Export diversification and promotion. (related to strategy 1)
• Nepalese export-oriented industries will be supported to enable them to
stand competition in the international market Priority will be accorded
to imports of capital goods and raw materials which are not adequately
available in the country.
• Exports will be enhanced by providing special incentives to the
industries producing goods based on indigenous resources and
wherewithal. Additional institutional arrangement will be made to ensure
the quality of such goods.
• Arrangements will be made to retain larger share of tourist expenditure
within the country through development of tourism as the significant
source of foreign currency earnings.
• Study will be done to make necessary raw materials available within the
country itself for the export-oriented and productive industries. Special
facilities will be offered to industries utilizing such products.
§ More liberalization to encourage inflow of capital from external source.
• Existing exchange regime will be reviewed for undertaking timely
reforms.
• Capital account transaction will be made flexible gradually.
§ Encouragement for investment of foreign exchange and inflow of income.
• Initiation will be made for easy access to foreign employment by
identifying markets to explore employment opportunities for the
Nepalese in foreign labor markets. Remittances out of such earnings will
be expanded through the banking channel.
• Productive investment will be encouraged by having institutional
arrangement for the inflow of savings received through earnings of
Nepalese residing abroad.
• Foreign investors will be attracted by proper dissemination of
80
information on benefits that could be received while investing in Nepal
by ensuring the guarantee of industrial security.
• Legal provision will be made to check money laundering for controlling
illegal monetary outflow.
§ Developing Nepal as an International financial center. (related to strategy
4)
• Initiation will be made to develop Nepal as an international financial
center. Acts and regulations will be amended as required and
procedures improved and publicity campaign intensified in its favor.
6.7 Foreign Investment

6.7.1 Background
Foreign investment is necessary in view of the limited financial and other resources
available within the country. It is equally so to speed up industrialization. Foreign
investment is essential because foreign capital, advanced and modern technology,
expertise, and administrative skills can assist in the development of industrial
infrastructure and explore foreign markets for Nepalese products. To attract and
become a destination for foreign investment Nepal would design and offer
competitive programs.
6.7.2 Review of the Ninth plan

According to the data obtained during the ninth plan, it seems that a total of 373
projects have been approved. Total cost of those project amounted to Rs 24.8 billion,
out of which Rs 9.4 billion i.e. 37.9 percent of the total investment has been the share
of foreign investment. It is estimated that in total of 373 projects, 21796 persons have
been employed.
Out of the total approved projects, 46.9 percent were related to production, 26.8
percent to service, 24.1 were percent to tourism, and 2.2 were percent related to
energy.
Of the projects having foreign investment, the number of Indian investors remained
the highest with 30.8 percent share in total followed by American investors with 12.3
percent, Chinese with 11.5 percent and other 40 countries with 45.4 percent.
• Relatively limited domestic market of Nepal, inadequacy of capital owing to
narrow base, and lack of adequate physical infrastructure are the major
constraints.
• Lack of administrative simplicity, delay in decision making process, and
shortages of skilled manpower are other impediments.
81
• Deteriorating law and order situation of the country and insufficient
promotional measures are other factors confronting foreign investment.
6.7.4 Long-term Prospect:
Nepal will be developed as an attractive and secured destination for foreign
investment through timely reforms in policies, legal and institutional frameworks. By
so doing, it is expected to assist in economic and social transformation of the country,
thereby contributing reasonably in the process of poverty alleviation.
a) Objective
The main objective is to develop Nepal as an attractive, secured and reliable
investment des tination.
b) Strategy
1. Along with administrative and legal reforms, the process of inflow of foreign
investment will be made simple, easy and transparent. To solve the problems
encountered by industries with foreign investment, arrangements will be
made for regular monitoring.
2. Foreign investment and Technology Transfer Act, 1992, and Industrial
Enterprises Act, 1992, the existing labor laws, etc. will be reviewed to make
investment environment more conducive. Measures will be adopted to
resolve the problems relating to labor in export-oriented industries.
3. The Board of Investment constituted by HMG will be strengthened and made
effective to supervise, monitor, and coordinate the investment promotional
programs and also to provide necessary guidance.
c) Policy
§ Administrative and Legal Reforms (related to strategy 1).
• Effective arrangement will be made so that the investors can receive
incentives and infrastructure services as provisioned from one specified
place. For this, one-window committee will be activated, strengthened,
and procedures simplified.
• In order to make investment promotional programs competitive, the
processes needed will be made easy, simple and transparent, thereby
providing attractive incentives to the investors.
• The system of investments w ithdrawal will be made simple and
transparent
§ Foreign investment and Investment Friendly Labor Act (related to strategy
2).
82
• Proper studies will be conducted for offering attractive incentives and
facilities at par provided by neighboring and other competin g countries to
attract foreign investment
• Labor act will be made more flexible.
§ Investment promotional programs (related to strategy 3).
• Areas of comparative advantage will be identified based on pre-
feasibility studies. Information materials supportive to investment
promotion will also be provided as deemed necessary.
• Foreign-based Royal Nepalese Diplomatic Missions will be involved in
encouraging entrepreneurs, businessmen and investors of respective
countries to make investment in Nepal.
6.8 Public Enterprises and Privatization:

6.8.1 Background
Over several years in the past, the tendency remained to establish and operate public
enterprises with substantial investment in order to accelerate the economic growth
rate. Many public enterprises encompassing several economic, services and other
sectors especially those which got less attraction from the private sector were set up
with government investment and /or donor supports. However, due to lack of
corporate culture and weak operational efficiency, and outward interference in
decision making processes, the performances of the public enterprises remained poor.
Consequently, the rates of return on investment remained very low. The financial
liabilities the government had to bear in the enterprises went on increasing year by
year. The overall economic and financial conditions of the enterprises continued to
deteriorate. As a result, the public enterprises instead of accomplishing the set
objectives turned out to be burdensome to the national economy.
The objectives of the Ninth Plan were to increase business capacity of the public
enterprises, to bring about reforms in the quality of goods and services produced, to
solicit appropriate adjustments in pricing policies, to arrest leakages and
misappropriations etc. Also, the plan had the objectives to make the capacity and the
shape of the enterprises market-based and market friendly. The goal of the plan was
to gradually privatize the state –owned enterprises by entrusting the private sector to
assume the responsibility of trade and industry development. In reality, the Ninth Plan
could privatize only one public enterprise. At the last year of the plan period some
enterprises were liquidated, some were brought under reforms in organizational
structure thereby reducing the administrative overheads, making them capable to run
at commercial basis.
During the plan period, the examples of unsuccessful privatization were noticed due
83
to returning of two enterprises (that were handed over on the basis of management
contract and lease) back to government. The private sector was unable to operate the
privatized enterprises due to the need of legal action that was deemed necessary to
resolve the issues which emanated because of lack of compliance of conditionalities
agreed upon between the buyer and the seller.
• Absence of mutual cooperation and understanding among the agencies
concerned with privatization and absence of clarity on responsibility of each.
• Lack of involvement of employees/workers and management of the
enterprise during the process of privatization.
• Inefficiency of the system for providing gainful employment to the workers/
employees displaced in the process of privatization.
• Complexity in the work to financial resources and wherewithal required for
the settlement of debt burden and other liabilities owed by the enterprises.
• The valuation system of assets and liabilities of the enterprises always
remained disputed.
• Modality of privatization remaining always disputable and the process of
privatization being more complex and time consuming.
• Absence of business orientation in management, lack of administrative
decision-making process and capability as well as absence of responsibility
and accountability.
6.8.4 Long-term Approach
The long- term approach is to make the economy strong and competent by orienting it
towards market mechanism. For this, public enterprises, which need not be retained in
the public sector will be gradually handed over to the private sector. At the same
time, the objective would be to enable the people to have easy access to goods and
services consumed by them at the competitive price and better quality.
a) Objectives
The objective of the Tenth Plan is to make the economy vibrant, dynamic and
competitive by promoting the private sector by creating conducive environment and
privatizing the public enterprises which need not be retained in state ownership and
management.
At least 15 enterprises will be privatized and handed over to the private sector within
the plan period through privatization of a minimum of 3 enterprises per annum
84
inclusive of those which could not be privatized during the ninth plan.
c) Strategy
1. The nature of activity, scope, status of financial transaction, need for
additional investment, etc. would be the basis for the privatization of the
PE,s. In the process extensive participation will be encouraged to make
privatization competitive and transparent.
2. Even those enterprises, which have to be maintained under the public sector,
will be operated on the commercial principles.
d) Policy
§ Making the process of privatization competitive and transparent. (related to
strategy 1 )
• Priority w ill be accorded to privatize the public enterprises on
competitive area that could attract the attention of the private sector.
• Enterprises that are deemed unnecessary to be operated under public
sector and even fail to attract the private sector will be liquidated.
• General public will be informed through regular monitoring of the works
in progress and also about the compliance / non-compliance of the
conditions of the agreements made while affecting privatization deal of a
given public enterprise. Also they will be informed whether or not the
necessary goods and services have been made available appropriately
after the privatization of those enterprises.
• Improvements will be made in the process of privatization by resorting
to promoting wider participation of the public as much as possible.
§ The public enterprises that need to be retained within the ownership and
management of the government will be run on commercial principles
(related to strategy 2).
• Through continuation in the development of competitive environment,
which has been initiated in areas like drinking water, electricity and
telecommunication, the necessary regulatory machinery will be
developed for the public enterprises in these sectors to promote
investment from private sectors.
• Foreign investment will be promoted in those feasible enterprises which
come under the area of national priority that can bring in foreign capital
as well as modern technology.
• Public enterprises will be encouraged to operate commercially by
providing autonomy to them.
85
6.9 Debt Management
6.9.1 Background
With a view to reducing the imbalance between resources and expenditures, HMG
has been borrowing from domestic as well as foreign sources since the past several
years. The payments of interest and principal against the borrowed amount have
become the primary reason for increase in regular expenditure. There is a condition
under which domestic debt cannot be raised beyond specified percentage of gross
domestic product. Likewise, there are several conditions that have to be fulfilled in
the use of foreign loans. Consequent to these factors there is a big constraint in the
inflow of foreign loan.

At the commencement of the Ninth plan, the total amount of domestic and external
debt outstanding stood at Rs 167.97 billion. Out of this, the proportion of domestic
debt was 21.4 percent. It is estimated that, during the ninth plan, there has been a
gradual increase in domestic and external debt, which has amounted to Rs 276.77
billion by the end of the plan. There has been a slight change in the structure of debt
up to the end of the plan (2001/02 ). In order to measure the impact of debt on the
economy the ratio of revenue to domestic and external debt has been calculated. The
baseline scenario of the ninth plan showed this ratio at 18.1 per cent and at18.2 per
cent at the terminal year of the plan. In the base year debt financing which had
siphoned off 31.1 per cent of regular expenditure increased to 34.1 per cent at the
final year of the plan. In the base year the interest burden of domestic debt was more
than that of external debt. The payment of principal was, however, greater in external
debt than in domestic one. But in the terminal year both interest and principal
payments were greater in external debt than in domestic one.
6.9.3 Long-term Approach
Maintaining macro-economic stability and protecting the country from debt burden,
effective management of domestic and external debt has been the long-term objective
In this context, the long-term approach has been to mobilize domestic resources on a
sustainable basis and be effortful to receive soft loan from the external sector.
a) Objective
• To mobilize domestic resources in consonance with the structural changes of
the economy for sustainable development.
• Government will assume to play the role of a regulator and a facilitator for
effective operation of economic activities.
b) Strategy
86
1. Based on the national policy of involving the private sector in the expa nsion
of economic activities, government will gradually refrain from direct
involvement in economic transaction, thereby controlling the increases in
public debt.
2. In order to check the excessive monetization of the fiscal deficit the overdraft
facilities from the Nepal Rastra Bank to the government will be disbursed at
the minimum level.
c) Policy
§ Controlling debt mobilization in government sector (related to Strategy 1)
• To utilize foreign debt in sectors only with national priority.
• A limit will be set for raising debt for each financial year to keep future
debt service obligations as a fixed proportion of regular expenditure.
• To restrain the internal debt as proportion of GDP below 2.0 percent, on
an average annual basis
• Based on the proper evaluation at the prevailing interest rate structures
initiative will be taken towards repaying the previous debt found costly.
§ Minimizing overdrafts from Nepal Rastra Bank (related to strategy 2 ).
• While financing the budget deficit internally, priority will be given to
raise loans from individuals and non-bank institutions.
• Preventing the use of overdraft as regular source of meeting budget
deficit.
6.10 Capital Market

6.10.1 Background
The medium-term and long-term funds are to be pooled and lent to the private sector
as the source of financing its current and potential economic activities. The need for
capital market development in Nepal is conceived in this context. The eighth plan
established some infrastructure for the development and expansion of capital market.
Accordingly, the system of stock exchange got started during the plan. Additional
infrastructures both physical and institutional were expanded in the ninth plan for the
promotion of the healthy and qualitative market. There is a greater need for the
widening and deepening of the capital market as a support to development and
growth of the economy.

A high level financial service and monitoring committee was postulated to be set up
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in the ninth plan. This was deemed necessary for coordinating the activities of money
market, foreign exchange market, capital market and insurance market and other
components of financial market. A transparent and healthy capital market was to be
developed and supported by the committee but no realization was noted in the plan in
this regard.
The stock exchange has made an arrangement of public issue of shares for the general
public related to those of the listed companies. Likewise, the Nepal Rastra Bank has
established conditions for the banks and financial institutions to sell shares publicly
within the stipulated time. The Stock Exchange Board has prepared a working manual
called “Share allocation manual” which will help attain wide ownership. Nepal Stock
Exchange has prepared a code of conduct to be complied by those involved in stock
exchange activities. This is in consonance with the professional ethics, which needs to
be followed by promoters of the companies, directors, managers, authorities in the
stock exchange, stock exchange business persons, auditors, lawyers, and advisors.
The Chartered Accountants Association has been designing the level of accounting
and auditing standards, which need to be followed as per the international standard.
In the process of regulatory norms to be established the preliminary study has already
been conducted for the amendments and improvements of the stock exchange act
As far as up dating and making the returns and reports transparent to correctly reveal
the situation of the companies, market sentiments, transactions conducted by the
stock exchange dealers are concerned no tangible progress was witnessed in the ninth
plan. The Stock Exchange Board and the Nepal Stock Exchange have published and
distributed free of cost educational and informative booklets for awareness creation in
investment activities. The Radio Nepal and The Nepal Television have been
publishing regularly the share prices on the daily basis. The stock exchange
transaction act is under continuous reform. This is in line with the objective of
establishing central registration system and depository system of the stock exchange
as per the targeted feasibility study and establishing regulatory framework.
As a support to liquidity increase it was planned to disburse fund from the Provident
Fund Corporation, National Insurance Company, Credit Guarantee Corporation,
Citizen Investment Fund to the stock exchange. But no other institutions have
disbursed any fund except the Citizen Investment Fund, which has disbursed some
amount albeit meager.
Public issue of securities were planned to be limited to companies working under
competitive environment and capable to offer better rate of returns. Put in practice,
other categories of companies are also doing this function.
The performances in several fronts of capital market remained far below targets
including the raising of fund, listing of the companies etc.
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• Slow pace of private sector institutional development in the widening of
ownership.
• Companies were witnessed to be credit bias and were found to be less
interested to use share market opportunities.
• Dominance of ordinary shares in the capital market and the virtual absence
of other categories of securities. Many of the industrial and commercial
ventures which issued public shares turned sick.
• Likewise, the dissemination of price related information and other economic
information to the public by the listed companies have been delayed neither
timely annual meetings of these companies have been held. These
shortcomings have resulted in the absence of transparency in the capital
market.
• Infrastructures like standard accounting and auditing practices, credit ratings,
security deposits and are not well developed. These remain as unresolved
issues in the capital market
6.10.4 Long-term approach
The long-term approach of capital market development in Nepal is to avail financial
resources for infrastructure development in the area roads, electricity,
communication, water management etc. by broad based ownership of the people in
the share ownership. In the process the involvement of the private sector has been
highly emphasized. The Nepalese stock exchange market will be oriented towards
globalization. Accordingly, the market will be widened and broadened such that at
least five per cent of the total population will be counted as investors. Likewise of the
total transactions in the market the share of institutional investors will be raised
minimum at 50 per cent and market capitalization price will be raised to a minimum
of 25 percent of GDP.
6.10.5 Tenth Plan

a) Objective
• The participation of the general public will be raised through the media of stock
exchange in projects with private sector involvement and the rate of return will
be made available to them.
• Industrial ventures will be promoted and employment opportunities created by
raising financial resources at reasonable and competitive cost through stock
exchange.
• The medium-term and long-term capital needs of development projects to be

89
operated by HMG, PE,s, Municipalities, will be fulfilled through public issues
of securities. By doing so the the amount of foreign loans will be minimized.
b) Quantitative targets
• The number of people investing in the share capital of the organized institutions
will be raised at leas t to three per cent of the total population of the country.
• Organized institution to raise Rs. 7 billion through primary issues.

• The amount of transactions in the secondary market to reach Rs. 12 billion.
• The value of capitalization in the stock market to reach 15 per cent of GDP.
• Additional 40 companies to be listed in the stock exchange market.
c) Strategy
1. Security exchange market will be modernized.
2. Regulatory system of security exchange market will be made effective.
d) Policy
§ Modernization of the Security Market (related to strategy 1)
• Effective regulatory norms related to organized sector and capital market
will be established as measures to protect the interest of the investors.
• Allocative and operational efficiencies of the capital market will be
enhanced.
• Stock market will be made transparent and reliable.
e) Program and Implementation Framework
• One window system will be established for public issue through the Security
Board. The working capacity of the board will be enhanced.
• Ownership change will be made instantaneously just after the dealing of
security.
• Simple method will be developed for the share issuance and dealings of the
public enterprises which have been privatized.
• A permanent committee will be constituted encompassing agencies i.e.
Ministry of Finance, The Nepal Rastra Bank, The Security Board, and
Insurance Board for developing a healthy and competitive financial market in a
coordinated way. This will ensure the development of regulatory agencies for
future. The secretariat of the Committee will be in the Security Board
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• Based on feasibility studies, stock exchange facilities will be expanded in other
regions enabling savers of those regions to deal in such markets.
• The regulatory benchmark will be established for Security Board and Nepal
Stock Exchange.
• Arrangement will be made to publicize prroceduces in different aspects relating
to stock exchange activities.
• Code of conduct will be in place the security regulators, employees of security
market and also for the director, manager, auditor, advisor of organized
enterprises and security dealers.
• Institutional arrangement will be in place for imparting training on several
aspects of capital market including regular study and research.
• In order to check persons to take undue advantage out of the dealing of
securities and having access on unpublished sensitive information a severe
penalty clause will be enacted.
• In order to authorize buying-selling of securities through power of attorney,

necessary legal provision will be made for the Security Board with the support
of Ministry of Law.
• While privatizing the government enterprises shares will be sold through the
Security Market to the maximum possible extent.
• Excluding the goods to be imported by convertible foreign currency, the
international financial institutions will be encouraged to raise the required
amount for other purposes by issuing debentures in Nepalese currency.
• Nepal Security Exchange Market will be privatized in the process of
modernization and will be developed as self-regulatory agency adopting the
Good Governance Practices.
• Security deposit system will be established to save investors through possible
forgery and fraud in security dealing and for immediate ownership transfer
system of the securities dealing.
• Investor Security Fund will be established to save the investors against
possible loss through the security brokers or to minimize the loss.
• Financial incentive will be granted for the promotion and good governance of
the companies having wide ownership.
• Legal system will be made to promote the process of transformation of
shares, debenture and collective saving program suitable for various investing
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groups.
• Arrangements will be made to enable the dealings of government debentures
through security market thereby presenting the benchmark for returns and
increasing liquidation.
• Legal reformation and development of investment regulatory system, having
security regulatory sectoral-right, will be pursued to encourage the incoming
of Contractual Savings in Capital Market.
• Arrangement will be made for annually submitting “Compliance Report” to
confirm whether the securities issuing organized institutions listed in security
exchange market or permitted to undertake security dealings have complied
to act, law, rules or not.
• The process of entrance and exit of security dealers will be made simple
through the adoption of Prudential Norms.
• Besides providing assistance to JCAN in establishing International

Accounting System, the establishment and operation of Disclosure Review
System in the companies, which have been made public, will be
accomplished.
• Necessary regulation of capital market, market conduction, manpower
development as well as educational training and information for the investors
will be provided.
• The gradual automat ion of the dealings of the security exchange market will
be carried on, on the basis of feasibility.
• Dealing procedure will be developed having the facility to conduct dealings
from the local level and OTC Market will be established through expansion
of Floor Trading existing centrally.
• Inspection of compliance of the listing administration and member and
dealing regulation of those companies listed as self -regulatory body will be
done.
• Central Deposit System will be instituted and applied to make the clear ance of
security account transparent and prompt as well as for the settlement.
6.11 Contractual Saving and Investment

6.11.1 Background
The financial sector of the country is mostly confined to short-term and medium-term
92
deposit and credit transactions. In the process, the commercial banks and some
finance companies have relatively developed. But the contractual saving and
investment institutions have remained undeveloped. In fact, their development would
have helped mobilization of resources for long-term investment and developed capital
market.

The long-term prospect will be to supply capital investment necessary for the
long-term projects conducted through private sectors from financial savings
and investment institutions.
a) Objective
• To provide social security, savings mobilization and investment management
services.
• To mobilize savings of at least Rs. 6.69 billion through the Citizen
Investment Fund.
• To invest at least 50 percent of the total means mobilize through the Citizen
Investment Fund in securities.
• To have dealings of securities through the Citizen Investment Fund, of at
least Rs. 1 billion.
• To arrange the issue of securities through the Citizen Investment Fund worth
a minimum of Rs. 3.50 billion.
• To increase the number of new capital funds.
c) Strategy
1. Contractual savings and investment institutions will be allowed to play
the leading role in enhancing liquidity of security, maintaining balance
between demand and supply of security and managing the price of
security.
2. National and Multi-National investment managers will be encouraged
to operate capital funds.
d) Policy:
§ Promotion of the leading roles of contractual savings and investment
institutions . (related to strategy 1)
• Mobilization as per long term saving investment plans of differ ent nature will
be encouraged.
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• Public awareness will be enhanced in small investors to prevent them from
possible risk involved in direct share investment by encouraging them to
invest in shares through mutual fund.
• Structure, ownership pattern, working area and managerial system in the
institutions under government sector will be reviewed.
§ Encouragement for National and Multi-National Investment Managers
encouraged (related to strategy 2)
• Institutions under government sector will be made private sector-oriented
market friendly.
• Necessary amendments in the legal structure will be made to manage and
operate funds through National and Mult i-National Investment Managers.
• Environment will be created to encourage Multi-National Savings and
Investment Managers establish joint-venture private production and
mutual funds.
e) Programs and Implementation Framework
• Appropriate legal and institutional arrangement will be made for establishing
and operating gratuity and mutual risk bearing capital funds.
• The inspection and monitoring of the institutions under government sector
will be well managed and strengthened.
• The Employees Provident Fund and Citizen Investment Fund will be
encouraged to make loan investments in industrial, infrastructure
development, information technology, communication, hydro-electricity
projects operated through the private sector.
• Reforms will be made in legal structure to make legal structure and
investment policy of the Employees Provident Fund and Citizen Investment
Fund private sector-oriented market friendly.
• Disclosure standard will be set to make the transaction, financial, fiscal and
management status of the Employees Provident Fund and Citizen Investment
Fund and other funds fully transparent.
• The Citizen Investment Fund and Employees Provident Fund will be
activated as the institutional investor in security dealings to manage unusual
fluctuations in security prices and to maintain balance between demand and
supply of security.
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6.12 Insurance
6.12.1 Background
The insurance business propounded with the objective to provide financial returns as
well as security against possible economic, social and natural risks has
metamorphosed by the time. . At present, 18 Insurance companies are operating in the
country. Out of which, 12 are non-life insurance companies, 4 are life insurance
companies and 2 are both life and non-life.
During the Ninth Plan period, it is estimated that the total insurance premium earned
by the insurance companies was increased by 320.4 percent with an annual average
growth rate of 64.1 percent. Similarly, during the period total insurance fund is
estimated to have increased by 123.2 percent with an annual average growth rate of
24.6 percent.
Constrain in the scope of insurance business, lack of association with the overall
financial sector as a means of savings and investment, huge capital outflow as
reinsurance money, unhealthy compet ition among insurance companies, investment
of insurance fund only in traditional instruments, non-transparent transaction of
insurance companies, possible liability of insurance companies not made public, lack
of full confidence of the life-insured with the insurance companies, Non- formulation
of insurance related appropriate legal structure etc. are the problems existing in the
insurance sector.
Major challenge of the insurance sector is to contribute in economic development by
means of the flow of insurance funds in development projects of the private sector
through development and expansion of the insurance sector as the strong medium of
long-term savings and investment by associating it with the overall financial sector
and, to strengthen regulatory system of the Insurance Board.
6.12.3 Long-term vision
The long-term prospect is to make Nepalese insurance sector comparable with the
international insurance market through the extension of innovative polices in
insurance business by providing economic, social security to industrial sector, other
business and general public against possible risks brought about by different factors
like economic, social activities and natural catastrophe.
a) Objective
• To provide economic, social security against the risks occurred through
economic and social activities as well as natural catastrophe.
• To bring about reduction in the outflow of funds through the insurance.
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• To make the insurance business reliable by securing the investment of the
insured in the life insurance.
• At present, the contribution of insurance sector to gross domestic product
(non-agriculture sector) is 1 percent, which will be increased at least to 2.5
percent.
• At present, a total of Rs. 11 billion has been allotted as development fund
through insurance premium, paid up capital and insurance fund, which will
be increased to Rs. 20 billion.
• At present, the insurance fund amounts to Rs 7.24 billion, which will be
increased to Rs 12 billion.
• At present, insurance premium earnings amounts to Rs 2.79 billion, which
will be increased to Rs. 5.5 billion.
c) Strategy
• Insurance will be developed as a powerful medium of financial savings
mobilization.
• Insurance will be strengthened as a business that provides economic-social
security.
• Insurance will be developed and extended as a competitive and reliable
investment sector.
• Insurance will be developed as an important supplier of long-term capital
necessary for development projects.
d) Policy and Program
§ To develop Insurance as a powerful medium of financial savings
mobilization. (related to strategy 1)
• Promotion of annuities schemes will be encouraged.
• The existing investment manual will be made private sector oriented
market friendly to ensure competitive returns to the insured by investing
the amount of life insurance fund in several instruments of money market
and capital market.
§ To develop Insurance as a business that provides economic-social security.
• Necessary arrangement will be made to widen the scope of insurance
sector by operating insurance polices for ensuring the risks prevailing in
the sectors like health, third party liability (means of transportation),
96
credit, deposit and securities etc.
• In the context of minimum public awareness concerning insurance,
educational programs will be launched for increasing extensive public
awareness about the importance of insurance for creating the situation to
benefit small industrialist, trader and general public as well through the
economic social security to be received.
§ To develop Insurance as a competitive and reliable investment sector.
• Re-insurance company will be established through joint ventures with the
foreign insurance companies.
• Comprehensive surveyor package will be prepared and executed to make
claim assessment practical and efficient.
• An Insurance Institute will be established under the Insurance Board to
undertake regular study and research in insurance sector, to provide
training on different aspects relating to insurance sector and to assist in
the development of overall insurance sector.
• National life insurance fund or other alternative arrangements will be
made to save or minimize the insured from the losses to be occurred
through liquidation or dissolution of the life insurance companies.
• Necessary legal and institutional arrangement will be made to strengthen
regulatory process, efficiency and capacity of the Insurance Board.
§ To develop Insurance as an important supplier of long-term capital.
• Appropriate legal provision will be made to reduce outflow of capital
against insurance premium by having the system of insuring national
assets within the country itself.
• Foreign actuary will be gradually displaced through the availability of
highly technical service like actuary within the country itself.
6.13 Price
6.13.1 Background
Price inflation remaining within a certain limit can facilitate to maintain a congenial
environment for investment, keep economic growth high and help alleviate the
poverty. High price inflation can inflict the fixed and low -income group as well as
jeopardize the efforts made for poverty alleviation. Thus, in the tenth plan through the
balanced implementation of monetary and financial policy, the fluctuation in price
caused by demanding party will be balanced. Adverse effect in price will be
97
prevented through reforms in production and supply management. It is essential to
give priority to the monitoring and analysis of price, since through effective
monitoring and analysis of price the orientation of economy can be apprehended.
Since the price regulated by capacity growth seen in competitive environment can
even be lesser than the state-monopoly-oriented price and the distribution system will
gain more prevalence, price determination will be handed over to the market system
based on competition. Reasonable arrangements of policy-wise and legal structure
have become essential towards confirming the competitive environment. Through
this, since the effectiveness in use of means will increase and the distribution system
will be more prevalent, the artificial price inflation or monopolistic intention will be
terminated thereby supporting the extensive target of poverty alleviation through
accessible price system.
Even though the price is determined from the market, in order to make supply of the
indispensable commodity accessible and without jeopardizing the environment for
market price determination through price inflation caused by natural calamities and
other artificial reason, it also becomes necessary to accomplish some tasks to
influence the market. Considering these factors, following targets and strategies will
be adopted in context of price in the Tenth Plan.
a) Objective
The target will be to restrain price inflation within a certain limit with the viewpoint
to provide consistency to economy, to maintain the perfect environment of investment
and to prevent the adverse effect that may befall upon the poor due to price inflation.
Thus, in the Tenth Plan period, it is targeted to restrain the price inflation at 5 percent.
b) Strategy
1. The impact on price will be regarded while implementing monetary and
financial policies.
2. According to the principle of market, price will be allowed to be determined
through management of demand and supply.
3. Price stability will be maintained through development of competitive market
instrument, market monitoring and supply management.
c) Policy
§ Considering impact of implementation of monetary and financial policy on
price. (related to strategy 1)
• Price inflation will be controlled through maintaining the price extension
within a desired limit.
• The impact on price will be considered while formulating policies related
with tax and foreign exchange rate.
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§ Strengthening the demand and supply management. (related to strategy 2)
• Based on the principle of competition, private sector friendly policy and
legal structure will be developed.
• To strengthen the supplying aspect; policy wise, legal and other financial
institutional infrastructures will be developed and strengthened which
promote domestic as well as foreign investment.
• Necessary arrangements will be made to disseminate information about
the market to small farmers/entrepreneurs in order to include them in the
market and to make the market more competitive.
• Necessary outlines will be developed to protect and promote consumer’s
right and interest in context of cost of goods and services as well as
quality including other services.
• Economic activity sector, especially through the extension of areas like
wholesale market, collection center, fair market to have positive impact
on subsistence-oriented farmer from market, gradually will be made more
market oriented.
§ Development of competitive market instrument and price stabilization.
• Besides giving emphasis on development of competitive market
instrument; monopoly nature, attitude to increase price artificially and
situation that hinders the supply management will be checked.
• The process of regular monitoring and analysis of price and regular
dissipation of information will be strengthened.
• If conditions call for the control of price due to some natural catastrophes
or excessive demand, there will be a policy to balance the price through
fluctuation in supply level that effects the market. In this context, policy
will be adopted to keep storage for indispensable good and to augment its
capacity
99
Policy and Program Log Frame- Macro Economic Sector*
Overarching National Objective: Poverty incidence of the Nepalese people (men and women) will be reduced significantly and
in a sustainable manner.
Sectoral Macro Objective: Recurrence of Broad Based Economic Activities.
Objective Strategies Indicators Information Major Programs Risk and

Sources Obstacles
Sectoral • Improve financial policy. • Domestic savings/ratio to reach • Publications 1. Interest rate will be made • Adverse
Objectives: • Improve public expenditure 16.2 percent against the present of Central positive to increase effect in
Consistency management. ratio of 11.6 percent. Bureau of Domestic Savings investment
between • Adopt suitable monetary • Budget deficit not to exceed 5. 5 Statistics. 2. Revenue collection will be • Financial
economic policy. percent of the GDP. • Economic increased by bringing imbalance
resources and • Create congenial • Regular expenditure as a survey, more transparency in • Imbalance
expenditures environment that can attract proportion of GDP will be Ministry of administration. in
foreign assistance. reduced to at least 9.7 percent. Finance. 3. Prudent management application
• Copnsistency of monetary • Revenue surplus to cover 20 • Financial public expenditure will be of means.
policy with real sector. percent of development Report, in place. • Extensive
• Formulate favorable policies expenditure with reform. Nepal Rastra 4. To maintain monetary declination
in relation to foreign trade • Revenue to be a minimum of 14 Bank. stability by controlling in net
and external economic percent of GDP. • Nepal Rastra credit. foreign
relation. • Interrelation existing between Bank 5. Linkage of foreign asset.
• Adopt privatization policy to savings, revenue and • Privatization assistance with plans and • Policy and
flow the facilities and expenditure management based Section, program. programs
infrastructure in competitive on budget system established. Ministry of 6. Make balance of payments of donor
Finance. favorable. agencies.
environment. • M2 to increase only by 14.5
• Security 7. Promote foreign • Imbalance
• Adopt policy to encourage percent.
Board and investment in flow of
the use of internal and • Annual surplus Rs. 3.7 billion in
Nepal 8. Privatize public service net
external public debt in areas balance of payments.
stock enterprises. and
which yield quick and better • Inflation contained at less than 5 9. Make the public debt
returns. percent. Exchange. transfer net
dynamic.
• Policies will be practically put • A rise in the proportion of foreign • Insurance income.
10. Banks and financial
100
Objective Strategies Indicators Information Major Programs Risk and
Sources Obstacles
in use such that state-owned investment in total investment committee system will be made • Attitude of
banks and financial witnessed. and progress second and balanced as Foreign
institutions be able to work in • Flow of adequate resources from report of well as reliable. investors.
deregulated and competitive capital market other 11. To develop and extend the • Limitations
environment. • Comparative contribution made Insurance capital market. of ability to
• Policy will be taken to raise of from contractual savings and companies 12. To develop and extend the procure
financial resources through investment institutions in the contractual savings and national
capital market for the economy. investment institutions. debt and
expansion of economic • Number of customers in 13. To develop and strengthen policy and
activities Insurance business. insurance sector. attitude of
• Adopt policy to increase the • Growth rates of import and foreign loan
contribution of contractual export. donor.
savings/ investment • Strength of
necessary for in providing manageme
resources needed for the nt side
implementation of economic • Public
activities. reliance.
• Pursue policy to develop • Competitive
insurance sector as a potentiality
dependable instrument in of
financing economic activities. Insurance
agencies.
* Quantitative targets based on 6.2 percent of economic growth.
101
Objective Strategies Indicators Information Major Programs Risk factor and
Sources Hindrance
Outcomes/ Policy and Working Policy • Saving capacity of • Economic • To launch programs which can • Institutional
Results • Priority to institutional savings household. survey. assist in raising the income of management
1. Growth in • Improve public enterprises. • Extra savings in private and • Economic agricultural as well as non- for the
Domestic • Effective implementation of public business enterprises. Report of agricultural sector entrance of
savings Medium Term Expenditure • Government savings. Nepal • To develop interest rate as relative external
Framework. • Profit of public enterprises. Rastra deficiency reflecting tool of financial resource.
• Privatization of public • Domestic Savings ratio Bank. means. • Attractive and
enterprises reaching 16.2 percent • Report of • To mobilize financial institution for perpetual
• Minimize government other the extension of micro-enterprises structure of
subsidy. related • To formulate program which can interest rate.
• Administrative Strengthening institutions. bring the remittance obtained from • Availability of
foreign employment into banking sufficient
network. means.
• To make participatory program
based on public-private sector
partnership for the formulation of
revenue policy
• To accelerate the program that
maintains the number of employee
to appropriate level.
102
Sources Hindrance
2. Increase in • Broaden and extend the • Increase in number of tax • Economic • To organize programs like seminar, • Favorable
revenue base of tax. payer-the number registered survey. training, to bring all the income climate for
collection • Increase in flexibility of in income tax and VAT will • Economic generating sectors within the agriculture.
revenue reach 3,00,000 and 40,000 Report of boundary of income tax. • Law and order
• Develop Value Added respectively. Nepal • To adjust tax rates considering situation
Tax(VAT) as the basis of • Ratio of revenue to the gross Rastra foreign trade structure, protection of • External
revenue. product targeted at 14 Bank. industrial enterprises, World Trade sector
• To make tax administration percent. • Progress Organization Membership and situation.
more simple, transparent and • Mannual understandable by report of South Asian Free Market
immaculate. public, about the process and Internal Management.
agency for paying tax will be revenue • To bring substantial program in
prepared. Department order to increase the proportion of
• Ratio of Revenue surplus in VAT in revenue collection.
development expenditure
targeted at 20 percent.
3. Best use of • Assurance of transparent and • Effect of foreign assistance in • Economic • Mobilization of Foreign assistance in • Continuation
foreign effective utilization of foreign employment and income survey. High priority programs through of favorable
assistance assistance. growth. • Economic prioritization of development policy of
• Adoption of policy to make • Share of foreign assistance in Report of programs. foreign donor
grant and loan concessional. priority sector. Nepal • To formulate programs, which can countries and
• Priority to grant rather than • Access of vulnerable group Rastra assist in developing skill and multi-
loan. and less developed remote Bank. technology through available foreign dimensional
area to means. • Report of assistance by increasing the skill and institutions.
• Increase in number of donor competence of local people, to • Continuation
programs culminating in time. agencies contribute in future as well. of the system
• To arrange policy wise management allowing
to promptly solve any problem reimbursemen
related with foreign assistance. t of expense
expended by
Nepal.
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Sources Hindrance
4. Effective • Flow of national resources In proportion to GDP • Economic • To make plans, the major • Arrangement
public and means into priority • National savings 23.1 percent survey. foundation. of Financially
expenditure sector. and Gross investment 27.7 • Economic • To enforce compliance of the accountable
management • Economy in public percent Report of economic rules and regulations act.
expenditure and • Regular expenditure 9.7 Nepal strictly. • Availability of
improvement in the process percent and development Rastra • To flow the means on the basis of foreign
of expenditure management. expenditure 11.5 Bank. effectiveness of investment. means.
• Forward the financial • Internal debt 1.4 percent. • HMG’s
management process based • Foreign debt 3.9 percent. white paper
on decentralization.
• Reduce the need of Foreign
assistance.
• Maintain economic discipline.
5. • Implementation of financial • Monetary extension M2 not to • Monthly, • To bring economic and monetary • Flow of foreign
Maintenan means to assist in economic exceed above 14.5 percent annual and program that extends the credit resources.
ce of expansion. • Adequacy of Foreign economic allotted to private sector through • Budget deficit
monetary • Prevent the deterioration of exchange reserve to suitable report of reduction in credit supplied to situation of
stability Macro economic balance limit through surplus in Nepal government HMG.
during monetary and loan balance of payment. Rastra • To reduce the monetary expansion
extension. • Credit allotted for private Bank and possible through excessive flow of
• To make balance of payment sector less than 70 percent other Foreign asset, Nepal Rastra bank
congruous. of Internal loan. reports. will formulate program to sell
• To maintain money supply • Growth of Annual Credit government debenture and if
within desirable limit. allotted for HMG, by an needed will issue its own
average of 6.3 percent. debentures too.
• Price increase rate remaining
below 5 percent.
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Sources Hindrance
6. Favorable • To broaden and stabilize the • Import to cover at least 55 • Economic • To formulate program that assists • Nat ional and
balance of base of export. percent share of export. survey export in sectoral and objective international
payment. • To associate import with the • Current account deficit not to • Economic diversification. law and order
material needed for export and exceed 3 percent of GDP. Report of • To formulate programs so that the situation.
development • Increase in import of raw Nepal Rastra Foreign-based diplomatic mission of • Lack of
• To make the service and material and capital goods Bank. Nepal may contribute in promoting demand due
transfer sector, transparent rather than consumable goods. • Four-monthly foreign trade. to external
and attractive. • Annual surplus of 3.7 billion in bulletin of • To confirm business institutional economic
• To create and extend industrial balance of payment. Nepal Rastra programs so that the demand of recession.
investment friendly • Condition of foreign exchange Bank. Nepalese goods may reach Economic • Competitive
environment. reserve capable of bearing • Publications ordering unit. capacity.
• To make exchange rate time- import of goods and service for of
congruous. at least 6 months. Federation of
• To attract executive capital Nepal
received in capital account. Chamber
Commerce,
and Industry
and Nepal
Chamber of
Commerce
7. Promotion • To provide additional • Increase in foreign investment • Reports of • To launch programs providing • National/
of foreign incentives and facilities which amount out of total investment Ministry of additional incentives and facilities and international
investment can attract foreign investment amount in comparison to past. Industry, to reinforce legal structure. law and order
. and to formulate legal structure • Identification of additional Commerce • To implement foreign investment situation.
investment policy. areas for foreign investment. and Supplies. favorable programs after identifying • Availability of
• To make administrative • Foreign investment to assist • Statistics of them. facilitating
procedure transparent, easy national investment. foreign trade • To formulate programs to provide agents and
and simple. and balance information to related investor. infrastructure
• Institutional development of of payment • To formulate investment promotion for foreign
institutions responsible for section of friendly programs through Share investment
investment promotion. Nepal Rastra Market.
Bank. • To bring programs to encourage
• Economic foreign investors through diplomatic
survey. missions of Nepal.
105
Sources Hindrance
8. Management • To forward the process of • Quantitative increase in • Report of • To conduct programs related with the • Entrance and
and privatization in competitive number of shareholders. Privatization evaluation of institution to be release of
privatization environment. • Privatization of 15 enterprises unit of privatized, protection of employee time-relevant
of public ent • Not to support monopoly in any during the plan period, with at Ministry of interest, study and analysis of returns labor.
erprises circumstances during the least 3 per year. Finance. etc through governm ent investment. • Concern of
process of privatization. • Write-ups • To make arrangements to empower assistance
• To create share ownership on and reviews commission that studies the provider in
broad base on procedure of privatization and work privatization of
• Enterprises if conducted by privatization efficiency of corporations. institutions
government, will be conducted by experts. • To formulate essential programs by constructed
commercially. the privatization unit for the through
privatization of the enterprises on the foreign
basis of priority and to monitor them. assistance
9. System • To maintain foreign debt at • Level of foreign debt. • Economic • To supply foreign loan in priority • Policy and
congruous manageable level. • Expenditure against foreign survey sector. program of
public • To gradually reduce internal debt service. • To formulate programs to utilize donor
expenditur debt. • Ratio of annual internal debt to foreign loan assistance in economic countries and
e GDP not to exceed 1.6 sector that assists in increasing institutions
percent. productivity and export. • Condition of
• To formulate program that can assist internal debt
in making the revenue and mobilization.
expenditure administration simple and
transparent.
106
Sources Hindrance
10. Banking • To develop balanced financial • Increase in contribution of • Reports of • To arrange the machinery that can • Stability in
and sector capital market, contractual Nepal Rastra assist in maintaining high level of regulatory
financial • To make regulation of financial savings/investment and life Bank, coordination between regulatory condition of
system : sector effective. insurance in long term Security agencies of financial sector. HMG, Nepal
balanced, • To establish coordination investment. Board, • To bring programs, which will help to Rastra Bank,
immaculat between financial means and • Reduction in financial abuse Insurance develop institution management that Security
e and nature of loan/investment. and crime. Committee, can regularly project the demand and Board,
reliable • To develop security -oriented • Business oriented credit of Citizen supply of financial means. Insurance
loan into business oriented banks and financial institutions. Investment • To bring programs to assist in Committee,
loan/investment. • Promulgation of credit situation Fund, reinforcement of regulatory capacity Nepal Stock
• To develop good governance of banks and financial Employee of financial regulatory agencies. Exchange and
system in organized institution institutions. Provident • To establish credit rating system. Institute of
involved in management of • Accretion in production and Fund. • To arrange security funds/ insurance Chartered
mobilization of means and profit of organized institutions. • Reports of programs for the security of the Accountants.
utilization of means. • Implication of accounting Ministry of savers/investors.
• To strengthen saver/investor’s standard. Finance, • To make program that can make the
protection system. • Regularity in project sanction Ministry of management, transaction of banks
and analysis of Industry, and financial institutions as well as
business/assets Commerce activities of regulatory agencies
and Supplies, transparent.
Nepal Stock
Exchange.
• Annual report
of organized
institutions.
• To make coordinated reforms • Management of saver, investor • • To formulate and implement •
in banking and financial laws security fund and insurance Accounting and Book-Keeping
scheme. System according to international
• Incorporation of financial standard.
institutions other that capital
market and insurance related
institutions in regulatory area of
Nepal Rastra Bank.
107
Sources Hindrance
• • • • To establish a system that legally • Indifference of
regulates the process of project general public
formulation, business/asset towards bank
evaluation etc. and financial
• To implement appropriate Institutional system.
Code of Good Governance to develop
Good Governance System
• To study the legal, institutional and
ownership structure of government
finance dealers.
• To bring all the financial instructions
except the capital market and
insurance related institutions under
the regulatory area of Nepal Rastra
Bank.
• To implement program of coordinated
reform in company law, bankruptcy
law including financial law.
108
Sources Hindrance
11. • To create broad share • Ow nership of at least 3 • Publication • To conduct program to encourage •
Development ownership situation. percent of total population in s, reports of organized institutions to issue
and expansion • To develop capital market as share capital of organized Security shares as much as possible.
of Capital important supplier of long-term institution. Board, • To make arrangement to market
Market capital. • Mobilization of a minimum of Nepal shares to public as much as
• To increase the width and Rs. 5 billion from Security Stock possible through security market
depth of security market. market. Exchange. while privatizing public enterprises.
• To make the security market • Transaction in stock • To make necessary legal and
com pletely transparent and exchange market to reach institutional arrangements to
reliable. Rs. 10 billion. encourage organized institutions of
• To increase the liquidity of • Increase in number of public and private sector and
security market. institutional investors in municipality to raise capital by
• To make arrangements for security transaction. means of security.
immediate transference of • At least 40 additional • To set an environment to invest
share ownership. organized institutions being means of contractual savings/
• To associate security market listed. investment institutions and
with the institutions and • At least 50 percent share in insurance funds in security.
organizations of sectoral and security transaction belonged • To make necessary arrangements
international level. to contractual to actualize security transaction
savings/investment outside Kathmandu valley.
institutions and insurance
companies.
• • Market capitalization • • To make legal and institutional •

reaching at least 15 percent arrangements to enhance the
of GDP. participation of institutional
investors in security market.
109
Sources Hindrance
• • • • To conduct programs to encourage •
the organized institutions in
development of different types of
security based on the nature of
savings/means.
• To set an environment to collect
money for non-import local
expenditure through marketing of
debenture in Nepalese Currency, in
the process of investment by
International Finance Corporation
and Asian Development Bank in
Nepal.
• To establish Nepal Security
Exchange Market as Self-
Regulatory institution according to
Non-community concept.
• To make arrangements to easily
avail the status of regulation,
transaction of security and
economic, financial, and managerial
status of organized institution to
general public.
• To make legal, institutional
arrangement to develop Security
Deposit System.
• To implement code of conduct for
security regulators, employees of
security market including board of
directors of organized institution,
advisers, security dealers
110
Sources Hindrance
• • • • To conduct awareness program as •
well as to make the legal action
effective in order to discourage non-
transparent transactions.
• To make arrangements to make the
security transaction possible
through power of attorney.
• To make institutional arrangement
to provide trainings to those
concerned ones (regulators,
exchange market, businessmen,
organized institutions, security
dealers etc) related with the
Security market.
• To make necessary arrangements
for the Security Board to get
membership of IOSCO
111
Sources Hindrance
12. • To develop and promote the • Savings Mobilization of at • Report and • To make necessary legal and • Change in
Devlopme contractual savings and least 6.69 billion by Citizen publication institutional arrangement to policy wise
nt and investment funds as source of Investment Fund. of encourage domestic and foreign commitment of
extension long-term financial means for • Investment of at least 50 Employee multinational companies to promote HMG and
of capital oriented projects. percent of means of Citizen Provident gratuity funds, mutual funds and Nepal Rastra
contractual • Contractual savings and Investment Fund in Security. Fund and risk bearing capital funds. Bank.
savings investment institution under • Citizen Investment Fund to Citizen • To make arrangements to supply • Declination in
and government sector will be manage the issuance Investment means of employee provident fund, cleanliness
investment made private sector-oriented security amounting at least Fund. and citizen investment fund in long- and credibility
institution. market friendly. Rs.3.5 billion. • Reports of term projects like infrastructure of Security
• To enhance the role of • Transaction of at least Rs. 1 Security development, information, Market.
contractual savings/investment billion of sec urity by Citizen Boar Nepal technology, communication and • Policy wise
institution as institutional Investment Fund. Stock hydroelectricity. transformation
investor in the security market. Exchange, • To bring program necessary to of Employee
• To develop different types of publications make investment policy and legal Provident
savings/investment funds. and reports provision of employee provident Fund and
of Nepal fund, and citizen investment fund, Citizen
Rastra private sector oriented market Investment
Bank, friendly. Fund.
Security • To create environment to flow •
Board. means of employee provident fund,
and citizen investment fund in
shares of organized institutions.
• To prepare and apply the
framework of disclosure standard of
employee provident fund, citizen
investmen t fund and other funds.
• To set legal arrangements to
involve employee provident fund
and citizen investment fund as the
main institutional investors in
security trans.
112
Sources Hindrance
• • • • To develop manpower necessary to •
enhance the project property
evaluation capacity of employee
provident fund and citizen investment
fund
113
Sources Hindrance
13. Extension • To extend the area of • Increase in number of different • Economic • To create environment that • Change in
and insurance business. insurance schemes. survey, encourages insurance companies to work-wise
strengtheni • To strengthen the insurance • Increase in number of insured. reports and start off new types of insurance. commitment of
ng of area. • Entrance of additional publications • To perform a study concerning HMG and
insurance • To develop and extend instrument of insurance. of Nepal promotion of annuities schemes. insurance
sector. insurance area as economic, • Comparative increase in bonus Rastra Bank, • To manage legal and institutional committee.
social security provider. to be received by insured in life Insurance arrangement to promote reinsurance
• To secure the investment of insurance. Committee business.
insured in life insurance. • Contribution of insurance and • To formulate legal system that
• To develop insurance area as sector in GDP(Non-agricultural Insurance necessitates the insurance of
an important medium for sector) reached 2.5 percent. companies. domestic property within in the
saving and investment. • Insurance fee reached 5.5 • Reports and country.
billion. Publications • To reinforce institutional system to
• Rs. 20 billion invested from of Security enhance the regulatory capacity of
insurance sector. Board and insurance committee.
• Flow of means of life insurance Nepal Stock • To prepare and apply the disclosure
fund towards long-term Exchange. framework to enhance the
projects and security. transparency of insurance
• Insurance academy companies.
established under insurance • To launch public awareness
committee. programs about insurance.
• Rs. 12 billion insurance fund. • To implement detail package about
surveyor.
• To make arrangement to bring about
timely changes in investment policy of
life insuranc e fund.
• To establish National Life Insurance
Fund or arrange other alternatives.
114
Chapter - 7
Cross Cutting Sectoral Policy
7.1 Poverty Alleviation and Employment

Employment is the foremost means of transforming economic development into an
opportunity to alleviate poverty. Providing employment to poverty-stricken masses
can reduce poverty to make economic development efforts more sustainable. It also
strengthens social and political stability.
Employment is the outcome of investment and development efforts. Although,
investment and level of economic transaction influence economic activities in
subsistence level, they influence the opportunities for employment at a later stage.
Without economic growth efforts mere employment-oriented programs cannot
provide employment opportunities to the whole labor force. Therefore, employment
should be conceived as an important link in the process of economic development
thereby considering that how more employment opportunities can be generated in the
development process. With a view to extend the access of the poor community to the
employment opportunities created by a broad and sustainable economic growth meant
for poverty alleviation, it is essential to increase their competitive capacity through
the development and empowerment.
Poverty is particularly rampant in the rural areas. Poor communities generally exist
among peasants with marginal land holdings, occupational castes, dalits, tribes and
matriarchal households. Targeted efforts are also required to provide basic needs as
well as minimum social services and assurance of security to the backward rural and
destitute groups through the creation and expansion of opportunities for income
generation and employment. If the employment opportunities created by investment
are not well managed and necessary arrangements to increase productivity are not
made, capital will gradually replace labor. Similarly, if the rights and interests of the
labor are not protected and due remuneration is not provided , it deteriorates the
management- labor relations . Such situation can displace labor and adversely affect
investment, leading to decrease in employment opportunities. In order to prevent such
possibility, institutional development is essential to protect labor’s right and interest
as well as to create harmonious relationship with the management.
According to the census of 1998 the population of the country was estimated at
23,151,000. Out of this, the economically active population involved in labor market
has been 10,482,000. By the end of the Ninth Plan, the total figure of employed
manpower reached 9,959,000, whereas the unemployed were estimated to be 5
percent. However, the percent of underemployed has also remained at 32.2 percent.
This in proportion to total unemployed labor will be 12.4 percent. Including the 5
percent of fully unemployed, the total unemployment figure is estimated to remain at
17.4 percent. In this respect, the strategies and activities, which will be adopted
116
during the plan period in the process of poverty alleviation through employment are as
follow:
Strategy
1. To increase opportunities for employment through extension of economic
and social development activities.
2. To promote labor-intensive business in order to increase the access of the
poor to employment opportunities.
3. To launch targeted programs related to income employment and
generating for backward classes and areas.
4. To increase the productivity through training opportunity and adoption of
appropriate technology in order to augment the income for the existing
employment.
5. To enhance entrepreneurship and protection of basic rights and interests of
labor in a balanced way.
6. To extensively utilize the opportunities for foreign employment by
producing skilled manpower.
Policies and Action Plan
Increase in employment opportunities does not mean that the poor will have access to
them. Since, it is difficult to produce manpower for the employment opportunities
resulting from new opportunities and technologies, following policies will be adopted
to facilitate the access of the available manpower especially the poor to such
employment opportunities:
n To increase employment opportunity (related to strategy 1)
• Integrated coordination of skill, capital and market system will be made
available to direct the majority of unemployed people belonging to the
trained, informal and unorganized sector to self-employment.
• Priority will be given to labor intensive technology to increase employment
opportunities. Infrastructures will especially be developed keeping the needs
of the private sector in view. This is expected to encourage private sector
investment for increasing employment.
• Keeping in view the fact that employment will not increase if basic training
demanded by the employment cannot be provided, training programs will be
made more detailed and manageable as per the demands of the market.
• Provision will be made to supply information relating to employment
opportunities through the service labor market information center and ot her
rural information technology service centers.
• Entrepreneurship will be developed for encouraging self-employment. Other
policy measures will be adopted for developing small and medium enterprises
toward this direction.
117
• The system of formulation and evaluation of macro economic policies will be
initiated in the light of the analysis of their effects on employment.
n To increase the access of poor to employment (related to strategy 2)
• Participation of non-government organizations and the private sector will be
included under the guidance of HMG to increase the access of the
marginalized classes and areas to technical education and trainings.
• Provision will be made to provide the access of means to the marginalized
class to increase the employment opportunit y. Programs will be launched for
the upliftment of those emancipated after the abolition of Kamaiya tradition.
• Opportunities for employment will be provided, by increasing the
participation of poor and marginalized class in different types of
infrastructure development programs through public expenditure for
increasing their access to employment.
n To implement targeted program of income generation and employment for
the marginalized class (related with strategy 3)
• Targeted programs will be effectively implemented in association with the
Poverty Alleviation Fund, for vulnerable classes and areas, which have not
been able to enter the mainstream of development.
• Targeted social mobilization procedure will be developed to alleviate poverty
through upliftment and empowerment of deprived and oppressed class.
• Direct support will be provided to the process of poverty alleviation and
increase in employment by contributing in population control, increase in
productivity and economic and social transformation through wom en
empowerment with special emphasis on female education, health and
employment.
n To enhance productivity for the increment of income level of employment.
(related with strategy 4)
• Entrepreneurial programs, skill development and other types of trainings will
be organized for increasing the income level of the existing employment
opportunities through enhancement of productivity.
• The skill-oriented programs will be implemented to increase the productivity
of laborers through joint-participation of management and trade union.
n To maintain labor interest and harmonious relation between management
and labor (related with strategy 5)
• Labor act, regulation, and institutional reformation will be gradually
maintained to protect the rights and interests of the labor in order to fix their
wage rate.
• In line with to the commitment made by HMG in the convention of children
rights, worst form of child labor will be eliminated.
n To promote foreign employment( related with strategy 6)
118
• Opportunity for the foreign employment and the capacity for income
generation will be increased through development of skilled manpower.
• Policy arrangement will be made to manage and secure foreign employment.
• Foreign-based Nepalese diplomatic missions will be mobilized to promote
foreign employment.
Programs
In the Tenth Plan the macroeconomic policies will be reviewed to increase the
employment opportunities . Following sectoral and focused employment and income
generating programs will be launched:
• In order to attain high and sustainable economic growth the macro economic
policies will be reviewed, and necessary legal and institutional reforms will
be made. Economic reform programs, reformation of tax administration,
public expenditure, labor act, project selection process, monitoring and
programs of reformation in government’s regulatory system will be
implemented.
• The agricultural sector will be taken as a lead sector influenced by the market
to increase the rate of development in the rural areas and providing
employment opportunit ies to the majority of the people through increase in
agricultural production and productivity. Since, the increase in agricultural
income will lead to the increase in the demand for labor intensive goods and
services, related programs will be implemented to further increases the
employment opportunities.
• In order to prevent the recessionary effect on economic growth rate due to the
limited domestic market, efforts to export to foreign markets will be
increased to create additional employment opportunities. The creation of an
export processing zone, the promotion of management and technology as
well as skill oriented trainings for increasing competitive capacity through
increase in productivity, timely reforms in labor act, are the programs that
will be introduced to promote export.
• The duty, responsibilities and rights of labor will be clarified to maintain
business transparency of business institutions.
• Foreign-based Nepalese diplomatic missions will be activated to make
regular diplomatic initiative in order to identify prospective site for foreign
employment, necessary skill and the steps to manipulate them, so that such
foreign employment opportunities may be created.
• Foreign employment has become a major source of employment and income
for the last few years. In order to utilize this source to its maximum extent,
programs will be launched to arrange skill-oriented trainings demanded by
foreign employment and to provide credit facility for foreign employment as
well as to strengthen the monitoring system.
• In the rural and remote areas opportunities for self-employment and other
employment will be increased through implementation of different income
119
generating and entrepreneurship development programs with the participation
of national development volunteer s along with different government and non-
government organizations/institutions
Target
Due to increased production and the contribution to employment from different
sectors, additional 1.053 million jobs are expected to be created during the Tenth Plan
while the total employment is expected to reach 11.02 million till the end of the plan.
At the end of the plan the economically active population is expected to reach 11.58
while 4.1 percent of this figure will be fully unemployed. Whereas, the
underemployed will be 22.3 percent and this as a portion of unemployed labor will be
8.6 percent. Thus, at the end of the plan the total unemployed including the fully
unemployed is expected to decrease to 13.5 percent (Table 7.1)
Table 7.1 Projection of Employment, Unemployment and Underemployment Figures
(in '000s)
Particulars FY 2059/60 End of the Tenth Plan
Population 23151 25905

Population of age group 15 and above 13878 15867
Total labor force available in labor market 10483 11582
Total Employed Labor 9959 11012
a. Agricultural sector (Percent) 78.1 70.6
b. Non-agricultural sector (Percent) 21.9 29.4
Total unemployed labor 524 570
(in Percent) 5.0 4.1
Total underemployed labor 3215 2456
(in Percent) 32.3 22.3
Underemployed (in proportion to fully unemployed labor) 12.4 8.6
percent
Total unemployed labor (including fully unemployed) percent 17.4 13.5
7.2 Human Resource Development

Human resource development is indispensable for the social and economic
development of the country. Development of proper human resource is necessary to
be acquainted with the new technologies and to develop them to suit our situation. As
indicated by the Human Development Index 2001, although the standard of Nepal is
not far behind in comparison to South Asian Countries, Nepal lags behind in terms of
the standard needed for development. The infrastructures such as employment,
education, health, social practice required for human resource development have not
reached adequately, particularly in rural area, women, oppressed and other backward
areas. Social practices and beliefs also could not be development-oriented. Special
policies and programs are required for proper development of Human resources in
120
order to utilize comparative benefits of agricultural sector, achievements from
market-oriented economy, opportunities necessary for the development of
management and leadership. Thus in the plan period, human resource development
will be emphasized in order to move forward competitively in the development and
use of science and technology and to push the economy forward by creating
opportunities for comparative benefits.
The activities of private sector in the development of education and health sector have
increased. Private sector has already made big investment in these areas. This on one
hand has reduced the government’s burden, whereas on the other hand has opened
many opportunities for education and health also. The number of those receiving
health and education services through private efforts in different other academic
institutions of the world is increasing day by day.
Strategy
1. To increase the participation of private sector in education.
2. To give high priority to basic education and health service through
government investment.
3. To emphasize on technical and vocational training and affiliate with
employment opportunity
n Increase in participation of private sector in education (related to strategy
1)
• Competitive environment in educational service will be developed
through encouragement to private sector for quality education.
• National education policy will be made private sector friendly.
• Regulatory system will be prepared for the schools of private sector as
well as their monitoring will be gradually made effective. Similarly, the
academic institutions affiliated to academic institution abroad will be
regulated.
n Priority to government investment in basic education and health service
• The allocation of resources will be gradually increased in primary
education and basic health sectors.
• In order to ensure that the children, who will especially enter the labor
market are not illiterate and without skills, the education of the children
of school going groups has been given high priority. In this context,
various programs will be implemented along with the slogan of 'school
admission for all,' especially to promote girls admission rate. Secondary
and higher secondary education will also be promoted with priority to
help produce medium level labor force.
121
•
Special policy will be adopted to deliver health service t o targeted group
based on dispatch system in order to elevate the health standard of human
resource.
• Policy will be adopted to associate literacy and informal education
program with skill development and labor market.
• Policy will be adopted to reinforce local participation-oriented public
awareness to bring about social awakening through gradual change in
social practices and beliefs, which have remained as the obstruction in
human resource development.
• Various programs will be launched to develop the quality of public
schools.
n Emphasis on technical and skill-oriented education. (related to strategy 3)
• Policy will be adopted to prepare technical manpower necessary for
economic activities inside the country as well as technicians for the areas
demanded by the foreign labor market.
• As foreign employment is developing as a major economic activity, in
order to increase its productivity and income earning capacity, technical
trainings will be conducted for them who after S.L.C. examinations are
not able to enter the labor market. Policy will be adopted to conduct
additional programs for those who, after doing S.L.C, want to acquire
medium level technical knowledge and skills in one field as well as to
provide skill in any one subject for those who are studying at the
secondary classes.
• Policy to continuously develop labor force even in the areas, which can
attract foreign investment will be adopted.
• In the context of the dire necessity to develop information technology for
a speedy communication service in addition to its implementation in all
types of technology development and application areas, information
technology will be developed and extended keeping in view its need for
the technology development of other areas too.
7.3 Regional Development and Balance

Although the development concepts adopted for regional balance in the past have
created the idea of allocating more investment to backward regions to some extent,
yet plans, programs and budget reflecting the needs of development and geographical
regions have not been implemented in an appropriate proportional basis.
Consequently, especially the Himal and hilly areas of mid and far western
development regions are comparatively lagging behind in the process of
development. Poverty has also affected these regions greatly. As a result, the
education, health and other social indicators of these regions are much less than the
national average (Table 6.2).
122
Table 7.2. Regional Development Indicators
Heading Eastern Central Western Mid- Far Nepal High Hills The Rural Urban
Region Region Region Western Western Hills Terai Areas Areas
Region Region
Human Development Index 0.484 0.493 0.479 0.402 0.385 0.466 0.378 0.510 0.474 0.446 0.616
(2000A.D)
Women Development Index 0.465 0.476 0.463 0.37 6 0.356 0.452 0.355 0.494 0.456 0.426 0.605
(2000A.D)
Human Poverty (2000A.D)(%) 42 40.7 39.9 43.4 45.3 39.2 46.1 37.2 40.2 41.4 23.9
Average Life Expectancy 62.0 61.3 62.8 53.2 52.1 59.5 49.8 65.1 62.4 58.7 71.1
(2000A.D)
Male nutrition among children 42.8 56.9 55.9 57.6 59.5 54.1 66.1 55.5 50.7 56.3 36.1
below 5 (1996 A.D)
Adult literacy (2000A.D) 56.6 52.9 51.7 49.6 57.6 49.3 55.5 44.5 53.2 52 31
Population without safe drinking 22.3 14.9 16.2 34.5 17.7 20.1 20.8 23.8 16.6 21.9 7.7
water (%)(2000A.D)
Per Capita Income (Rs.)(1999) 1073 1713 1022 861 899 1237 898 1262 1267 1094 2133
Source: Nepal Human Development Report, UNDP 2001
123
According to the Human Development Report the gap among far western region and
mid-western region with other regions has further widened during 1996 to 2000.
Women development index which was prepared on the basis of indicators like
education, health, average life expectancy and property ownership has also shown
weak positions of high hills, far western and mid western regions. Therefore, in the
context of regional development during the plan period, it is necessary to invest
comparatively a huge amount especially in far western, mid-western and high hilly
regions for the fulfillment of income generation and basic needs.
Since the economic and social interrelationship of the economy has not been strong
and integrated, there has been insufficient flow of economic activities and services
from the development centers of regional level and other market centers to rural
areas. No significant contribution has been made from the economic and social
infrastructures made in such centers on the creation of employment and income as
well as the extension of service and facility necessary for human development.
The emergence of additional economic and social problems in different development
and geographical regions is due to the increase in economic and social imbalance
between those regions owing to the absence of proper utilization of the resources and
means present in those regions and the existence of poverty. As a result some regions
are lagging far behind in terms of development.
Strategy
1. To increase the participation of native people of concerned area in the
regional/local level decision-making process.
2. To develop infrastructures like transportation/communication to reinforce the
economic interrelation between interregional and rural/urban region
especially to mainstream the backward regions into the efforts of
development.
3. To direct the allocation of resources and means towards reducing regional
imbalance.
n People’s participation in decision -making process. ( related to strategy 1)
• Participation of the concerned region will be increased in formulation,
implementation and monit oring/analysis of the projects operated in
regional/local level. Arrangement will be made to coordinate the
development and construction activity carried out in local level through
participation of local bodies.
• In order to increase the use of raw materials and other natural resources
available at regional level, private sector will be encouraged into
production and processing business.
• The regional offices will be reformed strengthened as agencies for
coordination/monitoring and evaluation of development and construction
activity of regional and local level. They will also be extensively
involved in district level project formulation.
124
n Inter-regional economic relation development. (related to strategy 2)
• Policy in line with development concepts of the economic sector will be
adopted in order develop the development regions and geographical
areas.
• The policy of supplying basic services (drinking water, electricity, health,
education, etc.) to areas and settlements lying close to completed roads or
roads under construction, which connect the mountainous, hilly and Terai
regions as well as to increase the economic activities through utilization
of indigenous resources, means and skills, will be adopted.
•Road extension and transport facility will be used to establish inter and
intra-regional relationship. In order to increase the economic effects of
services and facilities available from market centers to the rural areas as
well.
n Regional distribution of means. (related to strategy 3)
• Non-government organizations will be encouraged to venture
comparatively less developed regions.
• Emphasis will be given to develop indigenous resources, skills and
utilization and production system on the basis of regional comparative
advantage while formulating plans of specific sector.
While formulating regional programs and investment plans, regional feasibility and
the main existing programs have especially been considered in the light of the above
policies. For the overall development of the regions and for the mountainous, hilly
and Terai regions following programs will be emphasized in the Tenth Plan.
Mountainous region
The major causal factors for the backwardness of the northern high hilly areas in
terms of development seem to be sparse population, acute poverty, low utilization of
productive capacity, weak basic health and education facilities as well as weak
transport access. However, in this area there are possibilities for high-value
agricultural crops, herbs, sheep and goat farming as well as tourism development.
Among the areas of high hills, especially far western and mid-western regions are
more backward and, therefore, investment should especially be focused in these areas.
For the development of this region, programs are adopted to give continuity to the
policy of connecting all district headquarters of remote regions with roads
considering the access to transport as the major criterion for poverty alleviation; to
give special emphasis to high value crops, herbs and livestock in high hills of the
northern area; to increase access to educational sector; to conduct high priority
program for the development of education, agriculture and infrastructure in Karnali
Zone; to arrange additional resources by giving priority to the projects of far western
and mid-western regions in comparison to other projects in project prioritization and
to forward the concepts of rural employment and security by putting forth the
programs of security and development in a effective way.
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Hilly Areas
The main problems of hilly areas are: high population growth, unemployment, and
migration to the Terai or the foreign countries in search of employment, rapid soil
erosion, acute poverty, food shortage, absence of transportation, low literacy and
meager agricultural productivity. But there are great possibilities for non-seasonable
vegetables, citrus fruits , livestock farms, herbs and forest-based industry in this
region.
Thus, to develop this region particularly in the north south road corridor, emphasis
will be given to fruits, vegetables, milk and other high value crop production.
Agricultural pocket development and small farmer oriented irrigation will be
extended. Especially literacy will be emphasized in education. Programs
emphasizing the construction of co-roads linking the hills with the Terai, community
forest for forest development and prioritization of the deprived classes as well as
lease forests will be implemented.
The Terai Region

The main problems of the Terai are high migration pressure from other regions, high
population growth, low agricultural productivity , absence of agricultural market
mechanism and irrigation facilities. Due to the potentiality for development with
abundant availability of market for commercial production by virtue of its closeness
with the districts of the neighboring country, availability of plenty of underground
water for irrigation, presence of many natural ponds, suitable soil and climate for the
production of foodstuff and cash crops, this area has tremendous potentiality to
develop industry, foodstuff, cash crops, pisciculture and livestock.
For the development of this region, special emphasis will be laid on underground
water for the development and expansion of irrigation. Special emphasis is give n for
the development of industries, fish farms and cash crops under private sector. As the
development of adjoining hilly districts is the means of controlling migration to the
Terai and developing the country's internal market, programs will be operated in
order to reduce the tendency of migration from the hills to the Terai through the
development of appropriate technologies, income generating occupation and transport
in adjoining hilly areas.
In order to maintain the regional balance and effective development, program will be
more focused towards strengthening of regional offices in the context of project
formulation and implementation for which the strengthening of regional level
monitoring and evaluation have been considered necessary, maintaining the notion of
strengthening the north-south economic relationship while constructing the road,
emphasizing the local development feasibility while extending the regional level
technical education, emphasizing the promotion of agriculture for increasing rural
employment as well as for labor intensive technology and food for infrastructure
development thereby creating additional rural employment. Regional balance will be
considered as one of the important criteria of project prioritization. Offices in regional
level will be brought under the integrated structure so as to incorporate and monitor
development programs in regional level.
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7.4 Productivity Enhancement and Management
Development
It has become indispensable for a country like ours with limited means and resources
to produce best quality products and services by using scarce resources. In the present
context of meager production against available potentiality, high production cost and
minimal utilization of capital, it is equally essential to enhance nation’s capital
investment efficiency through campaign to increase productivity to alleviate poverty
by raising living standard of general public.
Strategy
1. To enhance productivity in both agricultural and non-agricultural sectors.
2. To strengthen the productivity related management.
n Emphasis on productivity increase in both agricultural and non-
agricultural sectors. (related to strategy 1)
• Productivity in agriculture, industry and service sectors will be increased
by extensive utilization of studies, research and experiments carried on in
the field of science and technology.
• Public awareness will be reinforced towards productivity increase. For
this infrastructure, institutional development and consolidat ion, publicity,
sample exhibition will be implemented with priority.
• The causative factors of productivity will be identified and its basic
aspect will be reformed. In this context, long-term productivity policies
in different sectors will be designated and coordination among various
economic sectors will be established to make them complimentary to
each other.
• Incorporation of productivity related subject in curriculums of academic
and different training programs will be stressed and necessary means and
materials for this will be made available.
• The quantity of wasteful goods will be reduced from productive
utilization of means and resources and the concept of green productivity
will be gradually developed to reduce adverse effects on environment.
n Strengthening the managerial aspect related with productivity increase.
• Those commercial sectors, which need to be prioritized to increase
productivity, will be identified and special productivity promotion
programs will be implemented in these sectors. Especially through
emphasis on productivity increase and high-level management in
industrial production and other export oriented industries total quality
management standardization system including ISO 9000 and ISO 1400
will be gradually made compulsory.
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• In order to increase the competitiveness of the economy, the study,
development and utilization of appropriate productivity improvement
techniques will be encouraged. Emphasis will be give to the development
of managerial aspect and qualitative manpower to increase productivity.
• The standard manual, basic statistics and information system of various
sectors’ productivity will be developed.
• Initiative from the non-government organizations and private sector
towards management development will be encouraged.
7.5 Private Sector Development

Background
Even though the history of development of economy in participation with the private
sector has been very old in Nepal, since mid 80’s the strategy of promoting private
sector through diverting th e investment of government under structural reform
program from those areas, which attract private sectors has been adopted. In this
process, private investment was encouraged, even in the banking sector under the
government monopoly, especially in the form of joint-venture bank. Investment from
private sector was encouraged according to the economic liberalization policy
adopted in 90’s and overall reform has been made in policy, legal, procedural and
administrative structures, which have been considered as hindrances in the
development of private sector. In the process of development of market-based
economic structure, by limiting the role of government only as a promoter and
facilities of the private sector, the investment of private sector has been increasing in
different areas of economy through amendments like: withdrawing the government
investment from areas of government involvement, adopting flexible and simple
investment approval process through amendments in policy and acts/laws that are
deemed as barriers in the promotion of private sector, making decisions about
investment by private sector itself, fixing the price through the market itself by
eliminating the government intervention in the market. In the competitive situation
created from national economy-global economy affiliation, the leadership role of
private sector remains the major condition for best mobilization of available resources
and means through development of open market oriented economic infrastructure.
Therefore, in order to transform the open and market-oriented economy and its
achievements by making them more extended and stable into an accomplishing
strategy for poverty alleviation, it has become essential to forward additional work of
reforming policy, law, administrative proced ure and infrastructure which have been
seen as hindrances in the development and expansion of private sector.
Review of the Ninth Plan

The process of policy, legal and administrative reforms executed since the Eight Plan
period with especial importance to private sector in order to create the environment
for the flow of private sector investment towards economy has continued even in the
Ninth Plan. Reform programs were continued in every private sector attracted areas.
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Private sector have been involved while formulating policies/regulations and plans,
providing encouragement rather than protection for trade and industrialization and
making the private sector capable of utilizing the opportunities and facing the
challenges offered after the formation of South Asian open market policy
(SAPTA/SAFTA) and accession to the World Trade Organization. Similarly, policy
and program based tasks are conducted to remove government’s existing involvement
in the ownership and management of public enterprises, to execute programs related
to financial sector reform. Apart from this, policies have been reformed and laws
related with tax, to develop private sector friendly tax administration through
adjustments in tax and custom rates including procedural and administrative reform.
Reforms have been made in foreign investment approval process and visa system.
Even though, in the initial three years of the Ninth plan, the activities and contribution
of private sector seem to have increased tremendously, but in the final two years of
the plan period, private sector investment could not be encouraged as expected due to
political instability seen within the country and the consequential deceleration it has
brought in the direction of economic progress, speed of privatization according to the
commitment of the government, inactiveness towards identification and solution of
the problems seen in promotion of private sector investment and rise in incidence of
murder, violence and terror within the country. Similarly, due to economic recession
seen in the world, the incidence in United States on 11th of September and the impact
of economic depression brought by it, on the export and tourism sector of Nepal as
well as some income/property related polices adopted within the country, the
environment for investment has become more obscure.
Further economic problems will be visible in the country if the task of economic
reforms could not be rapidly extended with the involvement and participation of
private sector itself through reformation in law and order situation in the country in
order to create private sector friendly environment. Thus, timely solution of the
following elements, which have been seen as the hindrances in the development of
private sector, is necessary.
1. Deteriorating peace and security situation of the country.
2. Political instability and policy differences between big political parties.
3. Languid speed of the economic reformation programs, especially the steps
taken towards the promotion of private sector and the lack of extensive
publicity of the reforms already executed.
4. Minimal participation of private sector in policy and legal reforms and lack of
private sector's trust on such polices, rules and regulations.
5. Lack of expected simplicity and transparency of the investment/ incentives
and facility system.
6. Lack of improvement in government’s regulatory capacity.
7. Absence of development of institutional infrastructure necessary for the
development of private sector.
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8. Inadequacy in development and expansion of financial sector. Unavailability
of adequate finance, capital market, skilled manpower and basic services
essential for private sector.
9. In effectiveness of the privatization programs.
Long term prospect

The role of His Majesty’s Government will be focused as policy-maker, monitor and
facilitator through development of private sector as the center point of overall
economic activity. Private sector will be made a direct partner in the overall economic
activity. For this, necessary strategy will be adopted to manage policy and laws to
create suitable environment for the development of skilled, effective, responsible and
capable private sector and to develop systematized corporate culture in private sector
Objective of the Tenth Plan

Since private sector plays an important role in the movement of poverty alleviation
by maintaining wide, stable and high economic growth through best mobilization of
available resources and means making the economic sector of the country strong,
healthy, accelerated, competitive and more tied up with external economy, the
objective of the Tenth Plan would be to develop private sector friendly financial
structure.
Strategy
Following strategy will be implemented in the Tenth Plan for the development of
private sector.
1. Emphasis will be given for the maintenance of investor friendly environment
through assurance for progressive economic reforms and policy stability.
2. The entrance and exit of private inv estment in those areas will be facilitated
by defining the role of private sector in every area of economy.
3. Competitive capacity will be enhanced by providing equal incentives and
facilities in all areas of investment.
n Policies under strategy 1
• Macro economic reforms including sectoral reforms will be made more
extended, stable, and reliable.
• Various awareness programs will be implemented to change the attitude
towards private sector and to establish this as the main carrier of
economic development.
• Ambiguo us method and procedure will be resolved and transparency will
be adhered through reforms and procedural simplification in regional and
sub-regional policy and law in participation of private sector in
coordination with open and market oriented economy.
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• For the development of private sector, necessary standard fundamental
infrastructural development, financial system, human resources
development and development of other services will be carried on.
• Capital market will be developed an d extended.
• For the promotion of private investment, especially to create conducive
environment for the foreign investment, streamlining in investment
regulating laws, reliable and transparent implication of laws and
availability of standard legal, accounting and book-keeping services will
be emphasized. Effective security will be provided to the industries
established within the country.
• Private sector will be encouraged to adopt accounting system based on
international standard according to the principle of Corporate
Governance.
• Assistance will be provided through policy reforms to enable the
implementation of ISO-9000, ISO-1400
• The process of privatization of public enterprises will be accelerated.
• Sectors where the participation of private sector only is not possible will
be identified and the government-private sector partnership will be
developed. While effectuating such partnership, arrangements will be
made to clearly defining the rights, liabilities and duties of involved party
prior to entering into the contract.
• Productive industries, services, social sector, tourism and trade sector,
information/technology and communication sector, including primary
sectors namely, water resources, financial sector, roads, irrigation,
drinking water, and all the other sectors, which attract investment of
private sector will be opened for private investment.
• Through improvements in industrial policy and foreign investment
promotion policy and laws associated with it, the investment of private
sector will be encouraged to enter the sectors of comparative profit in a
simple and easy way.
• The complexities seen in the processes of granting permission and
registration needed for the regulation of industry/business will be
removed and thereby making the processes simple and transparent.
• In order to create environment in which the investor can make decision
on hair down about investment, sectors of comparative profits will be
identified and comfortable entrance of private sector in those areas will
be confirmed.
• Reforms will be made in labor and company laws to allow the investor to
announce bankruptcy and to withdraw the investment on the basis of
business condition. Sim ilarly, new laws will be formed and old ones
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related to merger and acquisitions, bankruptcy law system, contract
management, dispute arbitration and mediation reformed.
• Emphasis will be laid on privatization of private sector attracting public
enterprises and those public enterprises which cannot be operated
profitably will be annulled or liquidated.
• In order to develop competitive financial structure through flow of
investment in areas having of comparative advantages, the facilities and
incentives that were being endowed upon industries/business will be
equalized sectorwise.
• Policy will be implemented to provide equal facilities and incentives to
domestic and foreign investors as well as to provide the declared facilities
in an unobstructed manner.
• Administrative transparency and simplicity will be emphasized through
timely reform in acts related to income tax, custom and value added tax
making them more comprehensive.
• One-window service system will be made effective in order to provide
the services and facilities meant for investors exclusively from a single
location.
• Passbook system in duty draw back scheme, provided for export-oriented
industries, will be reformed; bonded warehouse and bank guarantee
system will be made more effective.
• For those private enterprises, which are not possible to be privatized
immediately, emphasis will be laid on their commercial operation in the
market in a competitive way through reforms in their management.
7.6 Nutrition
In human resource development, nutrition occupies an important place. Anemia,
deficiency of Vitamin “A” and Iodine are its major problems. Consequently, the
inadequacy of nutrition is adversely affecting physical and mental development.
Therefore, the major objective of nutrition program will be to develop healthy labor-
tore and human resources through improvements in nutritional level and
micronutrient deficiency.
To achieve the above-mentioned objective and quantitative target, following major
strategies will be pursued.
Strategy
In the context of malnutrition as another major problem in a poor country like ours,
promotion of nutritional aspect contributes to the production of healthy labor through
reinforcement of physical and mental capacity. This consecutively contributes in high
economic growth. Normally, in the poor class of the society due to malnutrition,
problems like anemia, deficiency of vitamin “A” and iodine keep on adversely
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affecting the physical and mental development. Improvement in nutritional level
contributes to social developmental aspect as well. Substantial contribution can made
towards poverty alleviation by implementing nutritional program as a targeted
program based on practice of food varieties existing in geographical areas, life style
and society. In this context, the major strategies of this sector are:
1. Emphasis on production of nutritional foodstuff and right utilization of
available foodstuff.
2. Develop public awareness about importance and availability of nutrition.
3. Arrangements to supply micronutrients to eliminate their deficiency.
n Production of foodstuff and its right utilization (related to strategy 1)
• In order to bring about improvement in nutritional level through increase
in production of nutritional food, capacity of food safety store in local
level will be expanded and distribution system will be improved.
•In order to prevent the adverse effect in nutritional level, quality standard
of consumable foodstuffs will be improved and information about the
importance of balance diet will be disseminated as well as the usage of
low -quality standard foodstuff will be discouraged.
n Public awareness about the importance of nutrition. (related to strategy 2)
•
Public awareness will be aroused through extensive advertisement about
the importance and availability of nutrition.
• In order to improve nutritional level, children will be educated about
nutrition from primary level and the tiffin-feeding program in school
level will be extended. Besides, public awareness about nutrition will be
increased through trainings and seminars in local level.
n Management and supply of nutrition. (related to strategy 3)
• Programs for micronutrients will be formulated in accordance with the
international commitment and micronutrients (protein, vitamin “A”,
iodine, iron etc) will be supplied in highly problematic areas and legal
arrangements will be made for the sale and distribution of iodized salt as
well.
• Immunization vaccine will be administered to the children to maintain
their nutritional level. Nutritional level of pregnant and breast-feeding
mothers will be examined and arrangements will be made for treatment
service.
• In order to conduct the nutrition related program, conducted by various
bodies, in an integrated manner and to advance the task of information
dissemination, monitoring and evaluation etc in a coordinated manner,
national nutrition coordination committee will be strengthened through
inter-sectoral institutional development.
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• Private and non-government sectors will be encouraged to participate in
nutrition program.
• Targeted program will be implemented to uplift the nutritional level of
community whose nutritional level is infirm.
In this context following targets are fixed:
a) To reduce malnutrition
• To reduce the incidence of malnutrition (under-weight for age) of children
under 5 years from 48 to 30 percent.
• To reduce the incidence of stunting (retarded growth against age) from 50 to
40 percent.
• To reduce the incidence of wasting or acute weight loss (i.e. low weight for a
normal height) from 10 percent to 6 percent.
• To reduce the incidence of malnutrition of women (leanness) to 13 percent.
b) To minimize the deficiency of Vitamin “A”
• To reduce the incidence of nig ht-blindness in school children from 1.1
percent (1998) to 0.1 or to eradicate it.
• To reduce the incidence of night blindness in women from 4.8 percent (1998)
to 2.3 percent.
c) Deficiency of Iron
• To bring the incidence of anemia in children from 78 percent (1998) down to
48 percent.
• To reduce the incidence of anemia in women from 70 percent (1998) to 45
percent.
d) Deficiency of iodine
• Since the incidence of deficiency of iodine is found in the women of the
Terai, improvements will be made to reduce the deficiency of iodine in
women and children and to make complete improvement within the period of
Tenth plan.
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Chapter - 8
Development and Social Peace
8.1 Background
After the reinstatement of the multi-party democracy in the country, satisfactory
progress has been achieved in the sector of various social and physical
infrastructures; however poverty alleviation could not bear the expected fruit. A
large fraction of poor and backward class has not been incorporated in the
mainstream of development. Present violence and terrorism acts have slowed down
the development process and obstructed the process of providing basic services as
well. Similarly, many industrial institutions have also been closed. This has caused
negative impact on the employment opportunity. Its repercussion has been felt mostly
in the poor, backward and deprived class.
There is a challenge in judicially operating various economic and social development
programs by including all the races, groups, communities, occupation and regions of
the country, and to provide the returns of development to all, especially to the
underprivileged, oppressed, dalits and backward groups and regions. If this could not
be accomplished, social and economic disparity will increase. Therefore, government
should accelerate the development process by initiating comprehensive reforms in the
implementation of the development programs. The government should also take
short-term and long-term measures to avail necessary services to the public at the
prevailing context as well.
The causal factors behind the inability to incorporate majority of the population
through government services and development outcome are political instability, poor
implementation, irregularities and leakages . Poverty is further increasing through
violent activities. In this context the current dissatisfaction should be eradicated by
terminating the prevalent socio-economic disorders. Similarly by empowering and
mainstreaming the backward groups and regions, it is urgent to initiate reforms in the
implementation aspect of the development programs and to increase public
participation by assuring adequate security in development programs.
8.2 Steps taken for reforms and the challenges

To strengthen the weak implementation aspect, one of the biggest problems and a
challenge of Nepal’s planned effort, allocation and prioritization of resources in
programs/projects has already been done based on the mid-term expenditure
framework during the formulation of the Tenth Plan. Certainty of budget for the
projects/programs of first priority and high performance level, use of Log Frame for
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effective monitoring system, implementation of immediate action plan, allocation of
grants to local bodies on the basis of poverty based standards, operation of basic
services like primary education, health, agricultural services expansion through local
bodies etc . are some of the corrective actions that have already been initiated.
In the process of reform, handing over the management of primary schools to local
community and the appointment of teachers by the local school management
committee have already been started. Similarly, activities like : handing over of
management of sub-health post to local communities and monitoring of such health
post to be done by district health office and VDC, public notification of budget
allocated to DDC, VDC, health posts and schools, publication of budget allocation
and expenditure details by the concerned local bodies at the end of each trimester,
initiation of expenditure tracking to find out whether allocated amount reaches the
actual expenditure point and preparation of anti-corruption strategies have been
completed.
Bonded Labor has been eradicated and National Dalit Commission has been formed
to improve social disorders and National Women Commission has been formed to
enhance gender-equality. Laws have been reformed for effective control of
corruption. Local Self-governance Act has provided necessary legal framework for
empowerment of local bodies. Land reform programs for enhancing the access of
landless farmers and various programs for bringing the backward group and sector
into the mainstream of development have been conducted.
In the reform process, some reform activities like playing the role of private sector
friendly facilitator through assurance of good governance; and recruitment, transfer
and promotion based on the efficiency and performance by developing transparent
administrative mechanism have already been initiated.
Since the indolence in progress monitoring and evaluation of project implementation
has affected the implementation aspect, monitoring and evaluation process needs to
be activated and strengthened. As it seems that, regular monitoring and evaluation of
poverty was needed in order to bring improvement in the policies and programs
relating to poverty based on evaluation, programs have already been introduced to
this end.
The most challenging tasks have been the reconstruction of social, economic
infrastructures destroyed by the viole nt activities, operation of various income
generating programs aimed at the displaced and affected households and availing
basic government services to violence afflicted areas. For this, it is necessary to
mobilize the NGOs and civil society in maintaining security and implementing
development programs and providing other social services in an integrated and
effective way for the implementation of integrated security and development
programs along with such services and other development programs. More zeal is
required to inculcate the notion in people that HMG is spirited to provide necessary
services and to conduct development works in rural and remote areas through
increased participation of local agencies .
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Since it is necessary to assure law and order within the country to create an
environment that incorporates all the regions and groups in the mainstream of
development through all means of integrated efforts, the series of murder violence
and terrorism prevalent in the country needs to be brought to an end. Along with this,
it is also extremely important to strive into solving the problem of poverty and
unemployment.
8.3 Objective of the Tenth Plan

To embrace all the groups, communities and regions in the development process by
institutional and policy reform s in the economic and social sector, and to make
arrangements so that the benefits of the development reach in all regions and groups
of the country in a justified manner.
8.4 Strategy
Due to the inability of the outcomes of development to reach the targeted groups, the
income and employment status of the impoverished group hasn’t been uplifted and as
a result of which there is growing discontent in the society, which has resulted into
social unrest. In this context, following programs are expected to contribute national
strategy of good governance and target group-oriented programs:
• Identification of poverty-oriented and result-oriented development programs
• Bringing the dalits and deprived group in the mainstream of the security.
• Making the basic services and income generating programs accessible to the
targeted groups .
• Reconstruction, repair, rescue of physical infrastructures destroyed by the
violent activities.
• Mobilization of security and development in a coordinated manner .
This will help to create an environment for achieving high and sustainable economic
growth via the reinstatement of the mindset of comprehensive peace. In this context,
major strategies of the sector are as follows:
1. Emphasis on poverty-oriented programs and result-oriented economic
management.
2. Mainstream the socially negleted, dalit, deprived and backward groups such
that they would have access to the development efforts and its benefits.
3. Making sure that the basic services and income generating pr ograms reach
the public at low cost and on time.
4. Rehabilitation of people affected by violence and reconstruction of destroyed
physical infrastructure.
5. Operation of security and development in a coordinated way.
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6. Strengthen the implementation aspect via good governance.
8.5 Policy
§ Emphasis on poverty-oriented programs and result-oriented economic
management ( related to strategy 1)
• Reform annual/medium term expenditure framework by annual appraisal
of the Tenth Plan, whose only goal is poverty alleviation.
• Making the plan result oriented by integrating it with the medium term
expenditure framework.
• Institutionalization of poverty monitoring system . Specify the target by
estimating achievement of the budget allocated to annual and medium
term.
• Making arrangement of releasing the allocated amount in line with
performance Indicators.
• Initiate a system of expenditure tracking to monitor whether the allocated
amount has been spent on the real work and region.
• Making the poverty alleviation programs and projects more effective by
evaluating them and strengthening the HMG initiated “immediate action
plan” for improving the program implementation and accountability.
§ Mainstreaming the disadvantaged and deprived, and backward group in the
development process ( related to strategy 2)
• Initiate programs to increase the representation of traditionally neglected
groups in the regions where there is government involvement.
• Increasing the representation of women, dalit and indegeneous group in
agencies with political representation.
• Operation of special development package programs with priority for
backward caste, group and region and initiate a system of special
monitoring for such programs.
• Initiation of experimental programs to issue identity cards to provide
minim um services to the people of hard core poverty in the district after
identifying them.
• Augment and strengthen programs to increase the access of the backward
groups to education.
• Make the factors of production, assets and employment (income
generating regions through micro-credit, micro enterprises, community
forest, food security/land management package, food for work, skill
development and other programs) accessible to the women, poor and
backward groups .
• Make the National Dalit Commission, National Women Commission and
Human Rights Commission more effective.
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• Adjustment in the grants given to local bodies according to the poverty
mapping.
• Assist to provide basic services by involving volunteers.
• Implement targeted programme by NGO’s and Community agencies
through Poverty Alleviation Fund.
• Make arrangement of a concessional package for food availability and
production increment for food security.
§ Strengthening and Expansion of basic services and facilities. ( related to
strategy 3)
• Priority to basic services and facilities in the National Programs (primary
education, primary health care and drinking water).
• Estimate the investment required to provide basic services according to
the population, accessibility and poverty level and encourage the
allocation of budget according to such estimate.
• Effectively provide the basic services to the entire public through
arrangements to gradually transfer such services from local agencies
themselves . Make arrangements to appoint teachers/health workers in the
education, health etc sectors at the local level.
• Initiate a system of “Participative Poverty Monitoring” to monitor by the
public themselves to see whether such services have been reached at
household level or not.
• Operate labour-intensive income generating programs.
• Provide consultancy services to disseminate information regarding
employment.
• Implement Food Security and Agricultural Production Programs on a
priority basis.
§ Rehabilitation and Reconstruction of Violence affected people and
infrastructures (Related to st rategy 4)
• Rehabilitation of people affected and displaced by the prevalent violent
activity in the country.
• Rehabilitation of children involved in child labour.
• Expedite the activity of reconstruction and repair-maintenance of
structures of administrative, educational and health organizations that
were destroyed by the violent activities.
• Initiate employment and income generating programs and special skill-
development training programs for the people affected by the violent
activities with special priority to women.
§ Coordination of security and development (related to strategy 5)
• Provide security-shield to megha projects.
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• Operation of mobile posts in coordination with the security agencies .
• Coordination of development/construction activities and other servic es
with the security-shield.
• Involving the local NGOs and consumer groups in the development
works .
§ Effective implementation of good governance. (Related to strategy 6)
• Prepare and implement action-plan relating to corruption eradication
strategies.
• Strengthening of the institutions that are involved in the abolition and
prevention of corruption.
• Public notification of quarterly disbursements, expenditures and
achievements of district level projects.
• Maintain the participation of locally active NGOs and community
organizations in the formulation and implementation of local level
programs.
• Handover the local units, which operate service oriented programs related
to primary education, health, agriculture promotion etc at the local level
to the local agencies, endowing them with the responsibility to operate
them.
• Devolute fund by identifying additional sectors, on the basis of the
principle of Financial Decentralization, to the local agencies that operate
district-level programs which were operated till the dat e by the center.
• While considering the poverty level of the country, it seems impossible to
alleviate and monitor poverty by local and government agencies only.
Thus, NGOs will be actively involved in such tasks.
• Formulate and implement training programs and action-plan to reinforce
and protect human rights.
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Chapter - 9
Agriculture and Cooperatives
9.1 Background
Given the available natural resources of Nepal, agriculture is the strong basis to
alleviate poverty through sustainable economic development and strong rural
economy. Unless there is departure from the low use of technology by its extensive
use to raise the productivity per unit and be competitive in the production aspect,
agricultural development cannot be accelerated. . Therefore, it has been felt necessary
to increase the yield of the sources of the agricultural production by the integrated use
of the inputs and services as envisaged in the Agricultural Perspective Plan for high
and sustainable growth (in the production and productivity of the agricultural sector).
Likewise, there is need of production and commercialization of high value crops and
commodities based on domestic and external markets. In this context, it is necessary
that the crop livestock and commodity specific pocket area has to be gradually
expanded and transform them into commercial agricultural growth centre.
A package of infrastructure development, agricultural technology dissemination and
training, agricultural credit and marketing services should be ensured in the
commercial agricultural growth centres. It is also necessary to make production,
processing and market system sustainable by increasing the participation of private
sectors, cooperatives, non-governmental organizations and women in the possible
areas.
In rural areas, it is also equally necessary to consolidate the small economic
capabilities of the poor and weaker section based on the cooperative principles. The
collective strength and effort of the poor and weaker section has to be expanded and
mobilized to activate rural economy by developing agro-enterprise, local skills,
industry and business promotion activities. So, after reviewing the Ninth Plan the
Tenth Plan is put forth on the backdrop of these situations.
9.2 Review of the Ninth Plan
a) Major achievements of the objectives and the programmes

• In the context of important contribution that the agricultural sector could play
to reduce the poverty line to the level of 32 percent by the end the 9th plan,
the target for agriculture sector to raise gross domestic product was set to 4
percentages whereas the actual growth has been 3.3 percent on an average.
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The main reasons for such lower growth rate as against the plan expectations
are: Inadequate growth in the irrigated area and use of fertilizers, less
development expenditure than targeted, unfavourable weather condition
during the first and last year of the plan and decline in the value of the
agricultural harvests.
• In the Ninth Plan, the agriculture and cooper ative sector was allocated with
Rs 21 billion 520 million (according to the price of F/Y 2053/54) whereas
only Rs 9 billion 447 million was appropriat ed and actually Rs 9 billion 490
million has been expended. Accordingly, 44 percent of the allocated amount
has apportioned and 95 percent of it was spent. However, it is seen that only
42 percent of the allocated amount was spent. Thus it was seen that there has
been some problems in the apportionment and expenditure.
• It was intended to increase the annual average production of major food
grains by 5.18 percent. The incremental production of 1.847 million metric
tons during the plan period was targeted. However, there has been
incremental production of 852 thousand metric tons in the period. The targets
in cash crop like mustard, jute, tobacco could not be achieved as intended.
However, the condition of potato production is satisfactory. There had been
more than targeted production in cardamom, spices, honey and mushroom.
The production and expansion of the vegetable and citrus fruits are
satisfactory but there has not been commercial area expansion of apple as
intended. Although the infrastructure developm ent of cocoon (seeds comb)
and source far 35 species of silkworm was developed there has been no
improvement in the sericulture area expansion and cocoon production. There
has been good progress in the field of tea estate expansion and production. A
tea policy has also been introduced for the expansion of the tea production.
The cropping intensity (bali saghanta) was targeted to 174 percent from the
base year's 162 percent mark; however, it reached only 168 percent during
the 4th year of the plan.
• In totality, the supply of the production inputs was not satisfactory. Nepal
Agricultural Sectoral Performance Review, 2002 on the basis of limited
statistics especially in the Terai areas, shows the use of chemical fertilizers to
the level 58 kg/ha. The official statistics shows that the use of it was only 31
kg/ha. The supply was 42 percent in comparison to the set target. The
institutional annual supply le vel of improved seeds lagged far behind the base
year. The average area of major food crops covered with the improved seeds
seems to be 75 percent according to the target of the plan but there has not
been significant improvement in the quality of the seeds. There have been
some rebates for high value commodities on electricity tariff of cold storage
and concessions on packing materials. Likewise, the establishment of honey
processing plants by the private sector have been achieved as per the plan.
However, development of a Nursery Act for quality plant production could
not be made.
145
• In the area of plant protection, a total of 560 farmers school were conducted
and 14667 farmers were provided training in integrated pest-management.
Some date expired toxics insecticides (poisons) have been repackaged
according to the international standard.
• Regarding the development of market, 21 small market centres including the
wholesale market have been built and after making the market committees
the established markets have been handed over. But there has not been any
concrete work on local market (Hat) and export promotion front.
• Distribution of fishling (bhura) has been met as per the target and the use of
rivers source for the fish production has been initiated. However, to
strengthen the economy of the poor people by providing them ponds and
water logging areas on lease could not be expanded.
• In order to improve the approach and the working style of the agricultural
development programme agricultural extension service has been going
towards the role of service provisioner /promoter from the service provider.
In the changed context, the agricultural extension service extended in the past
only by the governmental agencies has been oriented towards agro business
promotion and also started making provision for the involvement of other
partners on contract or partnership. So as to make the agricultural extension
service productive, the trend has been seen in identifying productive sectors
and conducting projec t-based pocket programmes. At present 42 thousand
mt. of milk has been collected and processed every year collected from the
private sector whereas in the past it used to be only 32 thousand and the
processing capacity utilization has reached up to 44 percent now. During the
plan period the collection of milk by the Dairy Development Corporation has
reached up to 58 thousand mt. and the processing capacity utilization to 182
percent. But the problem of milk holiday still exists at the farmers level. As
the poultry farming business turned into an industry the annual growth rate of
poultry products reached 5.23 percent. The target of dairy, meat and egg
growth rates were 5.56, 6.22 and 7.22, respectively. However only 2.72 2.75
and 5.02 percents were achieved. The programmes to hygienic meat market
management and tannery business promotional program by setting up private
slaughterhouse and cold stores could not be operated.
• Under the poverty alleviation program, altogether 3077 families (2183
families for goat rearing and 894 for poultry farming) were included in the
program. Altogether 12600 poor farmers' families were involved under
income generation program in goat rearing, poultry farming and pig rearing
in which 26 percent of the participants were the females.
• Under the Hill lease hold forest and pasture development program, 10725
marginal farmers have been involved in the income generations activities
through forage development and livestock. Due to the extension of the areas
like field grass -Jai, Barsim stylo the cost of production of animals and
animal based products have been reduced and there has been a good
146
beginning in the production of the grass seeds.
• Among the major cattle diseases, rinderpest, and footrot diseases have been
eradicated. Animals Health and livestock Service Act 2055 (1993) and
veterinary council Act, 2055 (1993) have been introduced. For the prevention
of the contagious diseases, quality control of the livestock and their products,
and to provide quality health services to the animals. Although Nepal has
been self -sufficient in the production of PPR and swine fever vaccination
program against PPR has not been expanded massively.
• Under the research, the technology of surface seeding of Barsim grass has
been developed. Six varieties of Jai grass for the high hilly areas and 8 for the
mid hill and Terai have been recommended. To meet the shortfall for the
grass during the winter season, a technology has been developed to prepare
nutritious diet from the locally available plants. The technology to rear the
hybrid calves by feeding yogurt feed and grass has also been developed.
Among local animals: Lulu, Achhami, Khaila Terai and Pahadi in Cows;
Lime, Parkote, gaddi in Buffalo; Lampuchhare, Kaage, Baruwal, and
Bhyanglung in Sheep; Terai Khari, Sinhal and Chyangra in Goat: Chwanche,
Hurra and Bampudke in pig; Saakini and Ghatikhuile in poultry have been
identified as indigenous. The preservation of Lulu and Achhami cows, which
are on the verge of extinction, has been started.
• For the development of food processing technology 22 types of technology
packages for vegetables, fruits, and animals products have been introduced.
Under the biotechnology, the experimental study of producing malt and
alcoholic substance by using barley, has been completed. Likewise,
production technology on soya-sauce and lactic candy have been completed.
Skill training to more than 1200 food entrepreneurs have been provided.
• No concrete decision has been taken to improve the central structure of the
cooperatives. The Cooperative Act has been amended and by laws formulated
for the establishment of cooperative bank. Quality coffee has been produced
after the establishment of Coffee Processing Centre in the District
Cooperative Association in Gulmi and has been exported to Japan. The
infrastructure for vegetables and consumer market place has been built in
Chitwan.
• The National Cooperative Federation has been importing and distributing the
chemical fertilizers. Different cooperatives have transactions of about Rs
171.4 million worth of agricultural inputs in ayear. As per the policy of
constituting voluntary and autonomous cooperative societies and associations
in the local, district, central and national level. There have been one national
cooperative federation, 3 specific single purpose central cooperative
associations, 121 district associations and 7064 primary cooperatives by the
end of the fiscal year 2058/59.
• Agricultural Inputs Corporation has been spited into Agricultural Input
147
Company and National Seed Company Limited. This has opened
privatization process of the corporation.
b) Problems and challenges faced in the implementation of the

Ninth Plan.
The overall analysis of the agricultural sector has revealed that low production and
productivity are the issues. The internal cause is also responsible for it. The
fragmentation of land, use of marginal land for cultivation, low adoption of the
available technology, lack of appropriate technology and limited access to the market
are some of the primary causes. Besides these, the problems and challenges being
faced are as follows:
• In adequate apportionment of the development expenses as aimed by
Agricultural Perspective Plan and lack of improvement in the environment on
the release and utiliz ation of apportioned amount.
• Inadequate effort in attracting private sector investment in the
commercialization of agriculture.
• Even though fertilizer trade was liberalized and private sector was allowed to
trade in the fertilizer, the supply of chemical fertilizers was not enough in the
remote areas.
• The development of pocket areas was not as desired and export promotion
centres not developed properly.
• Expansion of shallow tubewells remained below expectation.
• Not enough investment in the agricultural road development.
• Lack of commercialization and competitiveness in the local production
system.
• Commercial livestock farming not treated as priority sector agricultural
industry.
• Inadequate of development of infrastructure for livestock and fisheries'
research. Likewise infrastructure for food quality control insufficient and
technology developed from the research not adequately disseminated to
appropriate places.
• No concrete improvement in the central structure of the cooperatives and no
qualitative development in the institutional development, entrepreneurship,
resource mobilization and transect on aspects even though there has been
increase in the number of cooperatives and associations.
9.3 Long term Perspective

The main objective of the Agricultural Perspective Plan is to grow the economy, and
raise standar d of living buy reducing poverty through the increment in income and the
employment, to develop additional infrastructure for commercialization and
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development of comparatively gainful products and production system,
diversification of the agriculture by cultivating high valu e crops, create conducive
environment for the participation of private sector and farmers groups and reduce
poverty by increasing agricultural production and employment opportunities.
Therefore, it has been focused to concentrate on limited no of priority areas where
economic growth rate can be accelerated. Based on such approach of APP subsistence
agriculture has to be transformed into commercialization and develop the strong basis
for industrialization.
9.4 The Tenth Plan:

a) Sectoral objectives:
• Reduce poverty by increasing production, productivity and income in the
agricultural sector and contribute to food and nutritional security.
• Contribute to the sustainable production and growth by adoptive research and
development of the technology to be used in agriculture, protect and use of
agro-biodiversity and balance the environment by reducing pollution from
the use of external inputs.
• Develop internal market and promote export opportunities by promoting agro
based industries and enterprises with the participation of cooperative and
private sector.
b) Major sectoral quantitative targets:
Followings are the targets under expected economic growth:
• To contribute in the reduction of poverty from the present 38 percent to 30
percent by the F/Y 2006/07.
• Annual growth rate of the agricultural sector to raise to the level of 4.11
percent from the present 3.3 percent.
• To raise per capita food availability (including potato & pulses) to 286
kg/person from the present 264 kg/person by fiscal year 2006/07. Likewise,
sugar will reach 9.03 kg from 8.7 kg now and oil 2.30 litre from 2.16. The
availability of meat will be 9.94 kg from the present 8.5 kg, milk to 50.85
litre from 47.05 litre, vegetables from 66.74 kg to 79.15 kg; fruits from 16.17
kg to 17.89 kg and fish to 1.87 kg from 1.5 kg now.
• The availability of food grain per person will reach only 269 kg from the
present 264 kg under normal economic growth rate and the availability of
other edible foods also could less accordingly in proportion.
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The main agricultural production and annual economic growth target*
S.No Agricultural Weightage Unit Level Expected growth rate Normal growth rate
Products Of base
year Level at Growth Weighed Annual Level Growth Weighed Annual
058/059** the Percentage Growth * Average at the percentage Growth * average
final year final
of the 10th year
plan of the
10 th
plan
1. Food grain 33.67 Thousand 7254 8700 119.34 40.38 3.70 8240 113.3 38.1 2.53
Metric ton
2. Pulses 2.72 Th. m. ton 250 280 112.18 3.05 2.32 2.71 108.3 2.9 1.58
3. Cash crops 6.87 124.02 8.52 4.40 115.9 7.9 3.0
a.Sugarcane 1.37 Th. m. ton 2248 2600 115.66 2488 110.69 1.51
b. Oilseeds 1.50 Th. m. ton 135 160 118.62 152 112.72 1.69
c. Tobacco 0.19 Th. m. ton 3. 80 4.1 107.89 4.0 105.38 0.2
d. Jute 0.13 Th. m. ton 16 20 125.00 19.0 117.07 0.15
e. Potato 3.68 Th. m. ton 1380 1800 130.43 1667 120.78 4.44
4. Horticulture 15.80 126.83 19.67 4.48 116.26 18.4 3.06
Fruits 10.07 Th. m. ton 480 585 121. 87 12.27 552 114.93 11.57
Vegetables 5.73 Th. m. ton 1780 2300 129.21 7.40 2135 119.95 6.9
5. Other crops 3.05 146.88 4.48 7.99 132.02 4.02 5.45
a. Bees m. ton 155 200 129.03 186 119.83
b. Silk m. ton 31 62 200.00 52 168.3
c.Mushroom Metric ton 100 160 160.00 141 140.98
d. Spices Th. m. ton 124 172 138.71 157 126.44
e. Tea Th. m. ton 7 10 142.86 9 129.7
f. Coffee Metric ton 90 100 111.11 97 107.59
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Products Of base
final year final
of the 10th year
plan of the
10 th
plan
6. Total crops 62.11 122.52 76.10 4.15 114.83 71.32 2.80
7. Animal Product 27.66 127.22 35.19 4.93 118.59 32.80 3.37
a. Meat 10.27 Th. m. ton 199 260 130.65 13.42 241 120.93 12.43
b. Milk 15.84 Th. m. ton 1159 1400 120.79 19.13 1323 114.2 18.08
c. Eggs 1.55 Crore unit 54 92 170.37 2.64 80 148.06 2.29
8. Fish 0.99 Th. m. ton 35 49 140.00 1.39 6.96 45 127.31 1.26 4.75
9. Forest and 9.24 103.99 9.61 0.79 102.72 9.49 0.54
Others
Total 100 122.29 122.29 4.11 122.29 114.87 2.81
Other main
programs
Quality control Number 30 30 25
of food
products
Inspection of Number 1850 1850 1572
food industry
/licensing
Agri market Number 10 10 9
cooperatization
Wholesale/ Number 21 21 18
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Products Of base
final year final
of the 10th year
plan of the
10 th
plan
collection
central market
construction
Agricultural Number 458 2230 2000
ex periment
Foundation Metric ton 515 2150 1930
and breeder
seed
production
Use of kg/ha 31 66 66
chemical
fertilizer
* Detail Presentation given below are based on expected growth projection only.
** Base year 2058/ 2059 = 100
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c) Main Strategies
As the agricultural sector has high contribution in the gross domestic product and
more than 80 percent of people are dependent on it for income and employment, the
growth in the production and productivity in the agricultural sector plays a very
important role in reducing poverty by achieving sustainable and high economic
growth. With the development in this sector there will be improvement in the food
and nutrition status of in people and as such will contribute to the implementation of
overall social development strateg ies as well.
Likewise, the programs related with the poor and small farmers and the operation of
integrated agriculture development programs in remote areas like Karnali will help in
the implementation of national strategy for the targeted programme. To bring about
effectiveness in planning monitoring and evaluation system in the agricultural
extension programmes through the adoption of the participatory mechanism and
devolution to the local bodies will contribute to achieving the overall strategy of the
good governance. Enhancement of production capacity for foodgrain and livestock in
Terai and fruits, off season vegetable and live stock in hilly and high hilly areas
would contribute to the overall balanced development of Terai and Hilly area. In this
context, the strategies adopted in the sector are the following :
§ Strategies related with objective 1
1. Disseminate and use the available agricultural technology massively.
2. Increase accessibility of agricultural inputs and credit for agricultural
production.
3. Commercialize and diversify agriculture.
4. Operate agricultural support services even with use of partnership and
contractual arrangements.
5. Activise planning monitoring and evaluation effectively.
§ Strateg y related with objective 2
6. Sustain agricultural development by developing agricultural technology
and by protection, promotion and use of agro-diversity and environment.
§ Strategies related with objective 3
7. Support the promotion of agricultural market and related infrastructure
development by mobilizing cooperative and private sector as well.
8. Promote cooperative and contract farming.
d) Policies and work plan
On the basis of the sectoral objective and strategies, the following policies and work
plan will be followed.
§ Disseminate and use the available agricultural technology massively
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(Related to Strategy 1)
• Agriculture technology dissemination and use will be expanded massively
and oriented to commercialization though group mobilization
• The agricultural sector will be given the lead role and pushed ahead to
alleviate poverty and achieve a sustainable and high economic growth rate.
The period of the Tenth and Eleventh Plans will be declared as the
Agricultural Decade in the context of successful implementations of
Agriculture Perspective Plan.
• In Karnali zone and other remote districts, which face food shortage,
agricultural extension and research programmes will be conducted in an
integrated manner to raise income generating activities like animal
husbandry, vegetable seed, horticulture and herbal farming programmes as
local food grain production
• Emphasis will be laid on women's skill development and business
enhancement by including them in the mainstream of agricultural and
livestock service promotion.
• To minimize the prevalent level of malnutritution, programmes will be
conducted to identify the nutritutional value of food items and increase of
related agricultural production, development of nutritious food mix from the
local products and mobilization of community nutrition programme.
• The agricult ural technology dissemination method will be integrated to
increase production and productivity of agriculture through increased use of
modern agriculture technology and research. Reforms will be made to ensure
service delivery effectively to the farming by devolving gradually the
agricultural and livestock service programmes at the local level.
• In order to supply the product on inputs through the farmers and
entrepreneurs at the local level assistance will be provided for the
development of local resource centres which will be engaged in the
production/business of the necessary agriculture inputs and services. To
support the underprivileged and small farmers' groups and the remote areas,
community based organization or the trained rural agricultural/livestock
entrepreneur will be provided financial and technical support for the
agricultural/livestock extension program.
• The rural youth who have a minimum qualification of having passed S.L.C.
will be given agricultural/livestock occupational training to develop them as
the rural level entrepreneur for their self-employment.
§ Increased access to the necessary agricultural inputs and credit for
agricultural production (Related to Strategy 2)
• Emphasis will be given to provide irrigation to increase the output of the
154
agricultural sector by integrating the ground, surface, drip and sprinkler
irrigation and rain water harvesting according to the local geographical
potential. In this regard the minor irrigation programme will be made more
widespread. Increase in the cropping intensity and generating employment
opportunities for the target group will be expanded through the intensive use
of the available irrigated area.
• The supply system of chemical fertiliser, improved seeds, improved breeds
and saplings will be strengthened.
• Together with strengthening the present institutionalised system of credit
delivery for making agricultural credit accessible and simple, micro credit
will be made available through local banks and other rural institutions.
• The livestock insurance programme will be expanded and the insurance
program on high value commercial agricultural crops will be initiated
gradually.
• The Integrated Pest Management (IPM) will be promoted for the minimum
use of pesticides and production under organic farming will be emphasized.
§ Commercialization and Diversification of Agriculture (Related to Strategy
No. 3)
• Reflecting the geographical uniqueness, and regional potentiality an
integrated package program will be launched to develop the appropriate
commercial pocket areas in the Terai, mid -hills and high hills Herein, special
emphasis will be given for the increased production of high-value fruits,
vegetable, milk and meat.
• Targeting the demand of necessary vegetable, fruits, meat and milk products,
etc of the agricultural market centres and urban areas, which are developing
from the internal and external market point of view. In the periphery of north-
south highway and the areas around the other roads and irrigated areas
pockets will be expanded for increasing the production of high value
agricultural and livestock products. Special emphasis will be given on the
crop diversification and commercialization leading to the Agriculture
Development Centre. In this respect, the districts, near urban areas, and
linked with road transportation facilities will be developed as supply centres.
• As fish production can be a major area for income and employment
generation of the low income group, the promotion of fishery program will be
emphasized by the utilisation of the rivers, lakes and public ponds. The fish
research and distribution centres will be strengthened and developed as study,
research and training centres .
§ Implementing agricultural support service program also in cooperative and
contract services (Related to Strategy 4)
155
• The participation of His Majesty's Government and community based
organisations, non-government organisations and the private sector will
be expanded gradually according to the concept of contract and
cooperative farming to enhance the participation of the private sector in
the agriculture and livestock extension services. Similarly,
institutionalised development will be made to encourage cooperative and
contract farming.
§ Effectiveness on planning monitoring and evaluation (Related to Strategy
5)
• Agriculture Perspective Plan implementation and monitoring will be
strengthened by activating the agricultural development committees from
the centre to the district level. Apart from the monitoring and evaluation
of the government program the activities of the farmers and the
entrepreneurs will also be brought in the information stream for analysis
in totality in the real sense.
§ Agricultural technology development, agricultural bio-diversity and
environment conservation, protection and use (Related to Strategy 6)
• By focusing on Adoptive agricultural research for commercial
agriculture, research will be geared towards the development of
necessary integrated technology packages, management of the soil
fertility and the development of the competitive production technology
system for reducing the production costs. Records will be maintained for
the seeds produced in different regions. The improved varieties of the
same will be developed and disseminated.
• For sustainable production and productivity increase in food production,
horticulture and animal husbandry sectors, the private sector will be
encouraged for the research, study, conservation, promotion and the use
of bio-technology. Identification of bio-diversity and its registration
process will be pushed ahead.
• Emphasis will be given for environment conservation and pollution
reduction.
§ Support for agricultural market promotion and infrastructure development
• To expand agricultural and livestock markets, the construction of

infrastructure like agricultural road, suspension bridges, pulling and
gravitational ropeway etc. will be made on the basis of local
participation. Agricultural market information system also will be
developed through the local cooperatives. The construction of wholesale
market, weekly market and its collection centres and the establishment of
cold stores and its management will be promoted. Special emphasis will
also be laid on the dissemination of technology for the reform of village
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level small agricultural processing and storage system.
• The private sector and the cooperatives will be attracted for the
processing and the development of livestock related industries to ensure
sustainable market to the agricult ure and livestock products. Through the
utilisation of the modern information technology, market management
and agricultural information will be supplied to the rural areas. For this
purpose, the necessary promotional assistance will be made available.
• On the basis of mutual understanding working relationship will be
developed through interaction between the producers and the
industrialists.
• For the promotion of the agricultural business the increased participation
of the cooperatives will be encouraged to supply the seeds, providing
micro credit and for collection, storage and sales of the produced goods.
• Commodity Policy will be formulated to make the private sector more
participatory to substitute imports and increase the commercial
production of exportable agricultural and livestock products. To increase
exports a food code of conduct, according to the provision of World
Trade Organization, will be prepared and implemented and quality
control certification and adherence will be made more effective and
convenient.
• To give certainty to the supply of quality hybrid seeds and chemical
fertilisers to the farmers, the distribution system will be made reliable,
competitive and transparent according to the market process.
§ Encouragement to cooperative and contract farming (Related to Strategy 8)
• Cooperative training and education program will be expanded in the
regional level.
• Cooperative and contract farming will be encouraged with a policy to
ensure ownership and use of the land.
e) Program and Implementation arrangement
§ Food Security
• Based on the agro-ecological environment, programs for the production
of food and cash crops in the Terai, fruits, vegetables, vegetable see ds,
sericulture, honey farming and animal husbandry which yield high
returns will be made more widespread so as to enhance food security,
employment and income generation so as to create strong foundation for
food security. In the potential districts extensive pocket areas for the
production of fish, meat, milk, eggs, vegetables and fruits will be
developed and also made export oriented.
157
• The cooperatives and private sector will be encouraged in programs to
participate for popularizing the use of organic fertilizer, balanced and
appropriate use of chemical fertilizer, production of organic fertilizer
from the waste generated in the agricultural market sites and so on. For
environmental conservation and pollution control, assistance will be
provided to reduce the use of pesticides and to the integrated crop
management.
• To increase production in the agricultural sector groundwater and small
surface irrigation together with the conservation, construction and
renovation of canals and water reservoirs will be given special emphasis.
Special focus will be given to the use of various types of irrigation
systems in the hills like minor surface, water harvesting, drip and
sprinkle.
• In food deficit remote districts the production and use of locally
important and export potential crops (oat, Niger seeds, herbs, medicinal
plants) will be given special emphasis.
§ Dissemination
• Pocket package program will be launched on the locations specific
priority crops/commodities identified by Agricultural Perspective Plan.
Such pocket areas will be expanded and finally developed as special
agricultural production zones. Considering the possibilities of export
promotions and the import substitutions crops/commodities produced in
such developed pockets, necessary infrastructure development
programmes will be implemented in an integrated way.
• The experienced and leader farmers engaged in various specialised
profession in the agricultural sector will be developed as the resource
farmers and they will be made instructors for the farmers to farmers
diffusion work. Integrated crop protection management system will be
expanded.
• Strengthening agriculture, animal and pasture development farm,
laboratory, training centres , semen bank, etc., the district level programs
will be provided with the technical services. These resource centres
would supply services and quality materials for the multiplications of
seed/breed multipliers at the local level.
• Arrangement will be made for quality entrepreneur training to support
the milk and meat processing industry.
• Support will be provided for poverty alleviation to the promotion of
crops and commodity which do not require much land like honey bees
and mushroom.
• To enhance the knowledge, level of skill and to raise the standard of
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living of the women and the farmers of the underprivileged community,
on-site training will be provided though mobilization of specific
programs.
• Bio-gas technology will be promoted through the institutional
mechanism of farmers group and their committees.
• To develop the Centre of Excellence the regional livestock service
training centres will be equipped to provide training on various subjects.
Similarly, the infrastructure will be developed and strengthened for
conducting training in the regional training centre in Biratnagar for meat
processing, grass seeds in Janakpur, milk processing and artificial
insemination in Pokhara, poultry farming in Nepalgunj, goat rearing in
Dhangadhi, fishery in Janakpur, horticulture in Kirtipur, sericulture in
Khopasi and honey bee related training in Godavari, Lalitpur. The full
use of available local level infrastructure will be given importance in this
context.
• Animal health laboratory will be operated in the district level and disease
surveillance will be conducted through them.
• PPR and foot and mouth disease control, quality improvement in anti-
rabies vaccine production, Japanese encephalitis and junotic diseases
surveillance and control, monitoring of residue antibiotic in poultry
product and the increase in the capacity of private animal health business
will be undertaken.
• For food industrialization, consultation training and other services will be
provided to the optimum use of agriculture related food production and
for the promotion of food industry business, processing, use of post-
harvest technology, commercial development of cold store technology.
Technology package based on high value crop will be prepared,
nutritious food items will be developed and popularise them and
experimental studies and skill development programs will be conducted.
• To enhance the entrepreneur quality of the farmers and for the quality
improvement of appropriate technology used at the entrepreneur level,
quality improvement will be made in all the curricula and programs
related to agriculture training.
• Based on the projects initiated in the Ninth Plan the projectization will be
adapted with necessary refinement and will be conducted in a result-
oriented manner in all the major agricultural activities.
• The families of J.T. and J.T.A. will be encouraged to open agrovet where
they are posted to provide services to the farmers.
• The productivity of local birds and animals will be increased by
identifying appropriate technology for reducing production costs as to
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regards animal feed, animal breeding and animal health.
• The commercialization and increasing productivity of fishery will be
given importance. To increase the income of the low income group and
community the public ponds and other water reservoirs will be utilized
under the fishery program.
• By developing convenient technology for the increase of quality meat
production, the private, farmers group, cooperative and community
organizations will be encouraged to rear calf, lambs, buffs and heifers.
The small dairy farm that collect and process milk will be supported.
§ Research, Farm/Stations Centre, Resource Development Centres and Bio-
diversity
• As approved by the Bio-diversity Convention, the agro-ecosystem
approach will be implemented by formulating coordinated policy with
the help of the concerned agencies. By registering the agro-biodiversity
the related patent rights will be established. The gene material of birds,
animals and grass will be conserved, promoted and utilized to the
optimum level. The quality of organic material and veterinary will be
regulated and improved.
• Agricultural research will be focused on the Agricultural Perspective
Plan's prioritised high value crop/commodites which have location
specific, comparative advantage. It will also be directed in solving the
problems seen in the specific crop/commodity pockets. In this context,
the agricultural research will focus on the farmers' burning problems like
reducing production costs, increasing the fertility of the soil and solving
the problems seen in the hybrid variety. Emphasis will be laid on
production technology for hybrid and aromatic variety of paddy which
give higher yield and are suitable to the climate. Technology generation
on hybrid maize variety with protein, improved variety of wheat using
anther culture, high return providing saffron and button mushroom and
export technology for ornamental flowers will also be emphasized.
• To make research and dissemination complimentary to each other, the
out reach research programs of Nepal Agriculture Research Council will
be integrated with the concerned district's agriculture development
programmes in the command areas of the research farm/stations. The
national agricultural research and development fund will be mobilised
according to competitive grants system. The fund will be mobilised for
research targeting the problems of the poor farmers and laying priority on
the agricultural commodity and subject area in the geographical sub-areas
as pointed out by the APP.
• To increase the knowledge of the agricultural technicians of every area
engaged in the government programs and to make research,
160
dissemination and human resources development complementary, policy
will be formulated so that the gazetted agricultural officers will be
encouraged to spend some part of their yearly work time for research,
dissemination and training.
• Resource centres will be developed as per agro-ecological zones to meet
the needs of the agricultural production areas. The resource centres will
provide the necessary technical pack up support to the district
development committee to conduct the agriculture/livestock services
program.
§ Commercialization of agriculture and the market development
• The market information system will be institutionally developed by
strengthening the existing local markets and developing new markets in
feasible areas.
• Encouragement will be provided for the establishment of small industries
for yak cheese production in the Himalayan region.
• Agriculture extension services will not be limited to the production but it
will focus on commercialization based on comparative advantage,
agricultural business promotion and effective market information
delivery.
• To strengthen the establishment of agriculture related industry, the
related crop will be developed and expanded in the industry's impact
area. Programs like cold storage management, technology dissemination
and agricultural credit will be implemented in a coordinated manner with
the industry and district agricultural development program.
• The farmers and farmers' groups will be mobilized for the construction of
collection centres and cellar stores in the production area. In the feasible
areas, required credit will be made available at confessional rates for the
construction of multi-chambered cold storage. The rebate on customs
will be made available when necessary on the import of equipment and
tools for the cold storage. Likewise, assistance will be provided for the
construction of Cold Chain as necessary for industrial crop which are
exportable.
• Minimum customs duties will be levied on the tools and equipment
necessary for animal slaughter house and slaughter site.
• Competitiveness of livestock raising farmers, entrepreneurs and
industrialists will be enhanced by giving recognition as priority
agricultural industry and concession to commercial animal husbandry
and livestock related industry.
• To solve the present problem of milk holiday, support will be provided
161
for the establishment of small milk processing plant by the farmers'
group or the private sector. Open market policy will be adopted for the
price of milk and milk products.
• Different alternative will be explored and analyzed to identify
competitive edge of national products and support needed to that for
increase in production by analyzing national and international market
situation.
• The integrated agricultural information technology development and
dissemination will be made to integrate agricultural production and
products marketing from the production area to the market site. The
greater participation of the cooperatives, the private sector and women
group will be encouraged in market management and operation.
• Emphasis will be given for the infrastructure development at market site.
In market sites where the infrastructure development is complete they
will be fully utilised and its management will be strengthened. In the
feasible sites, according to requirement, the market infrastructure
development will be made with local initiative. To strengthen the market
site, the information flow regarding the market situation and
opportunities will also be made more effective.
• Technical support will be provided in cooperative or group basis to make
the sales and distribution of agricultural produce more simple and
profitable and.
• In the context of Nepal's entry into World Trade Organisation, related
research and laboratory networks will be strengthened to maintain
competitive quality/standards for the promotion of the export of
agriculture related products and processed food items.
• Agro-business promotion programs will be conducted by providing
support services related to market development, market information flow,
processing industry and industrial farmin g.
• Arrangement of necessary assistance from various bodies will be made
for the collection, processing and transporting to the market for
agricultural and livestock products which are exportable.
• Emphasis will be given to the development of commercial pocket by
providing support for production, collection, quality enhancement
grading, packaging, processing etc. on the special crops having export
prospects like tea, coffee, cardamom, ginger, garlic, chilly.
§ Agriculture, Forest and Environment
• Based on agro-ecological potentials, the government farm and station
will be interlinked with resource centres to conduct specific commodity
162
based research and development. Using Sloping Agriculture Land
Technology in the steep and sloping land in the hill region, eco-farming
and eco-tourism development will be encouraged under contract or
cooperative management.
• With the functional coordination of the forestry sector the barren lands
within the forest area will be made available to the small farmers on lease
thereby establishing forest nursery, aforestation works, growing grass
and medicinal herbs and plants so that assistance could be provided to the
implementation of animal husbandry programs through the resource
generated by such grass and fodder.
• The use of by-products of animal and animal related industries and
reduction in environmental pollution will be encouraged.
• Agricultural related production program in the watershed management
areas will be conducted in a coordinated manner with the soil
conservation programme. Public land, community forest, land along the
roads and cannals will be utilized to undertake grass and fodder
production program.
§ Institution al System and Good Governance
• For the achievement of the target indicated by the Agricultural
Perspective Plan on prioritised production inputs (agriculture roads, rural
electrification, chemical fertiliser, irrigation credit and technology), the
relation and coordination among the agencies involved in their supply
and development will be strengthened. In this regard, arrangement will
be made according to the program as per the commitment of the
concerned agency to be implemented in an integrated manner in the
specified location.
• According to the provision of the Agreement on the Application of
Sanitary and Phytosanitary Measures (SPS) institutionalised development
will be made and the Act and regulations will be implemented in an
effective way. Also, the capacity of the crop and animal quarantine will
be increased.
• By maintaining standard in food production, import, export and
distribution, consumer right will be protected. Coordination and
participation will be mobilised among the related agencies like the local
administration, municipality, related Office of the Attorney General,
chamber of commerce and industry and consumers' forum for the
protection of the rights of the consumers in quality control and
standardization process. The food quality standards control system will
be made according to the WTO standard. For this the necessary
institutional system will be developed.
• Steps will be initiated for the establishment of an international level
163
regional centre to develop fishery and related activities of the domestic
species of fish found in the Himalayan region.
• Support will be provided for the establishment of national nutrition
laboratory and strengthening of national nutrition coordination
committee.
• The farm/station and laboratories of the agriculture, livestock and food

technology sectors will be developed as a strong resource centre in an
integrated manner as per the need of geographical sub-regions so that the
supply of qualit y and standard agricultural/livestock resource material
and services would be ensured. The training programs of the agricultural
and cooperative sectors will also be linked with the integrated resource
centres for the development of production system and making then
agricultural business promotion oriented. In order to fulfil the demand of
Human Resource and Research Capability enhancement, an Agricultural
University will be established and study, research and teaching centres
will be developed as per geographical and regional specialization.
§ Institutional System and Good Governance
• The institutional set up for the food analysis will be run effectively in the
manner so as to ensure their credibility to provide service activity. For
this, arrangements will be made to develop action policy and the accredit
private sector food laboratories. Steps will be taken to strengthen
laboratories and establishment of referral laboratory, provisions will be
made to develop mechanism for the certification by laboratories set up in
the private sector. This apart, provision of laboratory training and food
processing techniques will be developed.
• Support will be extended to consolidate the agro processing industries.
This will be done by developing the group system that covers the steps
starting from the production to the distribution of in the pocket areas of
identified commodities.
• A thorough review of the central network of the cooperatives will be
made to determine its status and thereby chart out the appropriate
moda lities and also consolidate the database systems. The local group
having viable prospects will be converted into cooperatives and
appropriate poverty alleviation programmes through cooperative
facilitation will be implemented.
• The non-governmental organizations will be encouraged to encompass
the existing community based organizations/groups rather than forming
new ones while implementing the programmes.
• The staff number will be streamlined in order to curtail the administrative
expenses. This will be done keeping in view the recommendations of the
164
Public Expenditure Review Commission. The Centre For Agriculture
Business Promotion will be established from within the existing posts in
the Ministry. The Centre will be entrusted with the responsibility of
carrying out the agro-economic analysis, management of agro statistics,
analysis of the demands of the agriculture entrepreneurs and bring about
improvements in the policy front.
• The Junior Agriculture Technicians (JTA), will be enhanced by providing
3 months upgrading of capacity training for human resource
development. For those willing to work as agricultural technical assistant,
the person concerned needs to have the appropriate agriculture training or
must have passed the intermediate level in agriculture. Provisions will be
made to give priority to PHD degree/master degree holders in animal
husbandry or agriculture when it comes to making recruitments in the
posts requiring a person to work as an agricultural expert or Agriculture
research scientist.
• The efficiency of the local bodies and the private sector will be stepped
up in order to implement the agricultural programmes based on the spirit
of decentralization.
• Regional Cooperative Training Centres will be established and steps will
be initiated to establish the required infrastructure. The central
cooperative training centre will be instructed to focus on trainer’s
training.
• Technical and other support will be provided to farmers for the setting up
of at least 25 Mt. capacity warehouse and seed-processing unit and seed
Testing Laboratory. Such facility will be provided to those entrepreneur
farmers producing seeds in exportable quantities from a single pocket
area.
• The programme of soil mapping will be expanded after examining the
soil fertility in different parts of the country. The government, different
cooperatives and the private sector will be jointly mobilized to deliver
soil testing services. Technology related with geographic information
system will be used to prepare the soil database.
• The government as well as the private sector will be mobilized to ensure
regular supply of chemical fertilizer during the period of tenth plan. The
Chemical Fertilizer unit at the Ministry of Agriculture And Cooperatives
will be mobilized for its regular monitoring. An appropriate system will
be identified and implemented for the continued supply of chemical
fertilizer.
• The Agriculture Input Company Limited and the Diary Development
Corporation will be privatized.
§ Involvement Of Private Sector, Cooperatives, Partnership And Contractual
165
arrangements.
• The agriculture and livestock development programme will be
implemented in partnership or contract with different cooperatives,
farmers or farmers’ groups or their committees. For this a system of open
competition will be adopted.
• Focus will be laid on income-based employment through the expansion
of sericulture that flourishes on mulberry. This will be carried out by
community participation under the programme of consolidating the areas
having promising export potential.
• The participation of the private sector will be encouraged in the delivery
of veterinary services and artificial insemination.
• The supply of forage and fodder will be increased through the effective
utilization of community forestry area. Besides , the productivity of the
community pasture will be increased.
• The business of production and marketing of potato seeds in the private
sector will be well managed through the setting up of a regional and
national level institutions by involving individual entrepreneurs or
institution. The scientific approach of tissue culture and true potato seed
will be implemented with priority in the irrigated areas not having storage
facilities.
• A policy to seek widespread participation of the cooperatives and the
private parties will be taken up to promote the availability of quality
improved seeds. The small farmers’ group/community based organization
in the remote settings will be encouraged to take up this kind of job by
providing technical support to them. Seed self sufficiency program in the
district will be expanded
• Loans and other forms of assistance will be ensured to the concerning
parties that will be mobilized to simplify the demand for meat and its
supply. The resource centre for the consolidation of the business in goats
and castrated goats will be strengthened and set up at the joint initiative
of the farmers’ group, cooperatives and the private parties.
• Increase in the supply and demand of meat will be facilitated by
developing resource centres for buying and selling of buffaloes and goats
through the management of farmers groups, CBOs, cooperatives or the
private sector. Agriculture credit, animal health services and other
technical services will be ensured in these resource centres. This policy
approach will also be followed to establish small milk collection and
processing centres with chilling facilities to meet the marketing needs of
the milk.
• Programmes to raise fodder plants will be launched in both of the above
166
areas, which will later be distributed to the farmers. Animals like buffalo
calf will be reared and sold in the premises of the milk processing and
chilling units. The promising animals raised will be sold in the nearby
community for breeding purposes. The construction programme, artificial
as well as natural insemination programmes in the command area will be
monitored also thorough these resources centres.
• The expertise of Agricultural Technicians (JT) and junior Agricultural
Technicians (JTA) who are not employed and are looking for jobs will be
tapped and such manpower will be mobilized for different agricultural
programmes run under the Poverty Alleviation Fund.
• Emphasis will be given to the development of contract farming in order
to maintain a balance between industry and production. This will be
carried out by linking the industrial crops with the agriculture based
industries. Additional job opportunity will be created by enacting the
appropriate regulations for giving out barren land for contract farming
and thereby stepping up agricultural productivity.
• Awareness raising programmes on cooperative, partnership and contract
farming will be launched. This apart, environment will be created to
deliver even the government services through the provision of contract or
partnership basis.
§ Agriculture Decade
• As agriculture has a pivotal role in the overall economy of the country.
The programs under Agriculture perspective plan (APP) will be launched
in campaign by declaring the tenth and eleventh Plans as the agriculture
decade. Special emphasis will be laid on the improvement of the
organizational structures and the fulfilment of the necessities to bring
about effectiveness in the implementation aspects. Provisions will be
made in the manner so as to inspire the government and non-government
institutions to support agricultural development in priority basis.
• The task of increasing food productivity in the food scarce areas of the
country will be taken ahead in the form of a massive campaign through
the use of quality inputs in agriculture. This in turn would contribute
towards ensuring food security and poverty alleviation. Commercial
production pocket programmes in agriculture that can contribute to
overall productivity will be identified and launched to produce export-
oriented commodities and to produce the needed raw materials used by
the native agro based industries and commodities that substitute import.
• The service of the experts available at the centre will be mobilized up to
the grassroots level for efficient monitoring and evaluation. A system of
involving the beneficiaries in the monitoring and evaluation of the
program project work will be initiated.
167
f) The Priority of the Programmes Run Under Government
Investment
Programmes like integrated agriculture development in Karnali zone, setting up of
milk processing centres with chilling facilities, setting up of centre for rearing heifer
and goat fattening for meat, practicing fishery in the local public ponds and water
bodies such as rivers and lakes, production of high value agricultural crops and their
market promotion will be launched in priority.
This apart, steps will be directed towards promoting contract and partnership farming
and promotion of biotechnology in agriculture. The synopses of the agriculture and
cooperative programmes that are to be launched during the tenth plan period have
been listed below on priority basis. The elaboration of the detailed programme and
budget is given in section 9.1 of the plan.
Summary of the Projected Budget For The Proposed Programmes/projects
Priority Program me under Expected Rate of Growth under General Growth rate
Number Percent
Amount Percent Amount Percent
P1 34 1264.0 70.8 1078.3 79.7
P2 23 379.0 21.2 274.0 20.3
P3 22 143.0 8.0 0 0
Total 79 1786 100 1352.3 100.0
NB: The figures are in 10 millions
g) Legal and institutional reforms and their imple mentation

arrangements.
• Provisions will be made for the production and distribution of quality
fruit seedlings through the enactment and implementation of the Nursery
Act.
• Fishery Seed Act and Regulation will be drafted and implemented and
the required improvisation will be made in the Act for fishery quarantine
• In the context of joining the World Trade Organisation, the required
amendments will be made to the Plant and Animal Quarantine Acts and
check posts will be set up in additional exit points to make the services
more effective and service oriented. The existing quarantine check posts
will be strengthened. The Food Act and Regulations will be reviewed and
adjusted accordingly to increase the export of agro products and
processed foodstuff after Nepal joins WTO.
• Necessary amendments will be made in the Quarantine Act to ensure that
the vectors of different diseases do not get transmitted in the process of
exporting and importing the eggs of bees and s ilkworm.
168
• A laboratory will be established and strengthened at the central level in
order to implement the Insecticide Act and Regulation.
• Legal basis will be prepared for the market regulation and effective
implementation of the agriculture market
• Policies will be made to ensure increased supply of animal fodder
through the community and leasehold forests. Certification and
Endorsement policies for the seeds of different grasses (fodder) will be
activated.
• The local as well as the value added tax on the cross border movement of
animal based products will be waived in order to attract private sector
investment in the animal and poultry bird based industries that could
substitute imports and at the same time promote exports. A policy of
forging partnership with the private sector, local bodies/institutions for
the setting up of industries related with powder milk, baby food and
condense milk will be adopted. Similar policy will hold in the case of
setting up of slaughter houses.
• The Food Act Regulations will be amended and directives will be issued
for the well managed monitoring of quality control works. The
responsibilities of the local bodies will be clearly spelt out as regards
quality control of foodstuff.
• Act will be put into place to ensure the supply and management and
quality control of chemical fertilizer. Effective implementation of the
National Fertilizer Policy will be made in order to ensure the supply of
fertilizer and to make the distribution system transparent, competent and
trust worthy.
• The existing practice of providing support and granting subsidies to
farmers will be amended following a thorough review on the background
of commercial and subsistence agriculture and with a view to incorporate
the interest of poor and marginalized groups.
• The system of insurance will be introduced to minimize the risk in the
commercial production of birds and animals and cash crops. The needed
improvement in the policies will be made to ensure the development of
agriculture cooperative entrepreneurship. Likew ise the enterprise
development plan for Agriculture Cooperatives and unions will be
formulated and implemented accordingly by bringing improvement in the
policies for cooperative enterprise development.
• In order to support livestock enterprise the supply system of quality feed
will be strengthened. Programs like market inspection and
implementation of the good manufacturing practice(GMP) in the feed
industry will be made effective.
169
• The capacity of the government bodies, cooperatives and capacities of
other sectors in the sector of seed processing and storage will be tapped.
A policy to attract foreign investment in the production and trading of
seeds will be introduced.
h) Expected Achievement
§ The projected additional contribution of agricultural production in the
final year as compared to the base year
• During the tenth five year plan period, it is projected that there will be
additional production of 1.44 million metric ton of cereals, 30 thousand
metric ton of lentils, 13 thousand metric ton of oil crops, 352 thousand
metric ton of sugarcane and 420 thousand metric ton of potatoes.
Similarly in the sector of animal husbandry, there would be additional
production of 241 thousand metric ton of milk, 61 thousand metric ton of
meat and 308 million no of eggs.
• There will be an additional production of 104 thousand metric ton of
fruits and 520 thousand metric ton of fresh vegetables.
• There will be an additional production of 14 thousand metric ton of fish
including from different fishery development centres
• There will be an additional production of 31 metric ton of silk by the end
of the tenth five year plan
• There will be an additional production of 45 metric ton of honey from
bees
• A total of 13750 members from 1375 farmers group (10 from each
group) will directly benefit from the production and processing activities.
They will experience that their capacities to utilize and moblise fiscal as
well as physical amenities and will witness a substantial growth. They
will then be able to involve themselves in non-agricultural sectors after
starting to make some savings.
• Sixty thousand members will be given training on cooperative
management, auditing and enterprize promotion through the cooperative
education and training programme. This would enable to involve them in
bringing about growth in the local productions after they are involved in
the market orientation to be given by the cooperative system.
• As it would not be practical to specify the targets related with production,
productivity, cropping intensity and area of far ming, the estimation of
achievements has been hence presented in the logical framework.
§ Contribution to be made to poverty alleviation, employment generation and
human resource development
• It is estimated that there will be an additional participation of 80 thousand
farmers in the production of vegetables and another 80 thousand in the
production of fruits. This will provide additional employment
170
opportunities and contribute to poverty reduction of 160 thousand
farmers.
• The income level of 13 thousand farmers will be enhanced because of the
activities carried out in the development of fisheries. It is estimated that
nearly ten thousand additional farmers will be benefited through silk
farming and 6,150 farmers will be benefited from bee keeping.
• A total of 97,000 additional farmers will be benefited from potato
farming during the Tenth Five-year plan period. There will be an
increased participation of 32,500 farmers in animal husbandry, which
will contribute substantially in poverty alleviation.
• The skills of farmers and technical supporters will be enhanced during
the tenth plan period and rural youths will have the opportunity of long
term self employment Training in the sector of agriculture and animal
husbandry.
§ Contribution to the regional development and balance
Crops: It is expected that there will be the commercialization in the
farming of cereals, lentils, cash crops and industrial crops in Terai.
Food security will be enhanced in the mid and upper hills.
Fruits: Income and employment opportunities in the high and mid hills
will grow because of the increased horticultural activities.
Fisheries: The development of fishery will take place in different parts of the
Tarai districts. This apart, there will be the protection and
enhancement of cold water fishes in the mid and high hills.
Potatoes: A great deal of contribution will be made to the food security
situation in the food deficit hilly areas through the commercial use
of tissue culture technology for enhancing the production of
potatoes.
Silk: As the consumers of silk will be the rich and well off people, there
will be a flow of resources from the urban areas to the rural areas.
Poultry and Animal Husbandry: The income in the urban areas will be
transferred to the rural areas through the means of animal
husbandry and poultry.
§ The decentralization of programmes as per the spirit of the Local Self
Governance Act
• The agricultural extension programme will be gradually devolved to the
districts from the beginning of the year of the plan 2059/60.
• The dis trict based cooperatives and unions will run programmes on
community services and business promotion activities by forging alliance
with the local autonomous bodies and by mobilising local resources.
§ Contribution To Gender Equity Through the Programmes and Policies
171
• The involvement of women in the agricultural programmes on an average
will be 40 per cent while it will be more than 60 per cent in programmes
such as vegetable farming, horticulture and silk farming.
• The participation of women in different programmes will increase
because of the enhancement of the skills and expertise of women
cooperatives and the women groups in different cooperatives.
§ Role of Government, Non -Government And Private Sector
• Contract and partnership programmes will be launched to enhance
involvement of private and non government sector by implementing
programmes that are run under government sector. The private sector will
be further encouraged in the production and distribution of production
inputs like seeds, seedlings, fishlings, chicks, goats, vet services, soil test
services and chemical fertilizers. The government institutions will have
their role more as facilitators regulators and monitors rather than the
implementers of the programmes.
• The Agriculture research and development activities will be launched in a
competitive bidding system by encouraging private sector participation.
9.5 The probable obstacles and risk in implementation

and output realization.
• Continuity of policy and investment in conformity with the priority accorded
to the agricultural sector.
• Need based development of human resources.
• Market Fluctuation.
• Adequate enthusiasm of the private and non-government sectors.
• The availability of healthy seeds, seedlings fertilizer and other agricultural
inputs in the market mechanism.
• Functional Coordination among the bodies affiliated to the agriculture sector
9.6 Log frame

When preparing the sectoral objectives, strategies, action policies and logframe of the
plan, the Interim Poverty Reduction Strategy Paper of HMG/N and the three year mid
term expenditure framework programme have been used. The first part of the
logframe consists of the major objectives and the strategies and working plans to be
followed therein to achieve the objectives. This is followed by the separ ation of all
the programmes into major sub programmes for which the policies, projec ted
achievements, indicators, sources of information along with the risks involved have
been presented. The detailed information on the main programme has been presented
in the annex number three.
172
Policy and Program Logframe-Agriculture & Cooperative*
Sectoral macro objective: The contribution of Agriculture Sector will increase considerably and sustainably in the course of
economic development and poverty reduction.
Objectives Strategy Indicators Sources of Major programs Risks and Obstacles
information
The entire • Widespread expansion and • The growth rate of the • The four 1. Development of programme for
• Fluctuation of
productivity and utilization of the available entire agriculture sector monthly and growing cereal, fishery cash crops
Market
income growth agricultural technology. will be 4.11 per cent, food yearly review and other high value crops.
rate of the • Increasing the access to credit grains (3.70 per cent), and progress 2. Development of livestock services. • Continuity in
agricultural and agricultural inputs needed for cash crop (4.4 per cent), report of the 3. Development of agro forestry. investment and
sector will be Agricultural production. fruits and vegetables Ministry of 4. Food technology development and priority to
witnessed by • Diversification and (4.48 per cent) Fishery Agriculture quality control of food stuff and agriculture
high and commercialisation of agriculture. (6.96 per cent), Meat • The National animal products. development
sustained • Running agriculture service and (5.49 per cent) Eggs Agriculture 5. Development of programme for
growth through support programmes even on the (11.24 per cent) and milk Statistical Book the production, storage and
the use of basis of contract and (3.85 per cent) published marketing of milk, fish and meat
improved parternership • Increasing the per every year. products.
agriculture • Making the system of monitoring capita food grain • The yearly 6. Development and extension of the
technology and and evaluating the projects more production from the progress report desirable technology for small
promotion of effective existing 264 Kg to 286 Kg to be prepared farmers’ group and rural ogro
market. • Making agricultural development • Increasing the by the National industries.
more sustainable through the availability of sugar from Planning 7. Planning, monitoring and
development of agricultural the existing 8.7 Kg to Commission evaluation programme.
technology, agro bio-diversity and 9.03 Kg and cooking oil • Periodic study
protection of environment from 2.16 litres to 2.30 research
• Providing support to the liters. The availability of reports
consolidation of agriculture market meat will be increased
through the mobilization of the from the existing 8.5 Kg
private and government sectors to 9.94 Kg. And the
• Encouraging cooperative and availability of milk will be
173
Objectives Strategy Indicators Sources of Major programs Risks and Obstacles
information
contract farming increased from the
existing 47.05 litres to
50.85 liter. Increasing the
availability of vegetables
from 66.74 Kg to 79.15
Kg and increasing the
availability of fruits from
16.17 Kg to 17.89 Kg and
fish from 1.5 Kg to 1.87
Kg.
Note: Quantitative targets based on 6.2 growth rate (detail in Annex 3)
174
Annex 9.1 : Programmes and Estimated Amount
(Rs. in million)
Serial Prioritised Programme Under Under
No: expected general
Growth Rate Growth Rate
First priority programme/projects
1 Farmers’ canal renovation and maintenance 250 250
2 Rain Water Harvest 150 100
3 Other forms of Irrigation (Sprinkle, Drip, Paddle etc.) 100 100
4 Agriculture Market Information facilitation and Market Development 200 150
5 Production and Distribution of saplings of apple, citrus and mango 250 200
6 TPS/Tissue Culture of Potato (Production promotion) 150 100
7 Promotion of Buffalo, bull and goat rearing 120 100
8 Agricultural perspective Plan Monitoring And Technical Coordination 100 70
9 Management of Chemical Fertilizer 500 450
10 Promotion of Pasture and Animal Feed 40 20
11 Breeder Seed production and distribution (grass) 100 50
12 Control of Epidemics including PPR 300 240
13 Food analysis And regulatory Service 80 60
14 Poverty alleviation through the small food processing equipments and
technology 100 50
15 Developing self reliance on cereal seeds promotion in the private
sector 250 150
16 Production of vegetable seeds (Foundation) 100 80
17 Production and distribution of fish seed 60 50
18 Increasing productivity of Honey and promotion of commercial
entomology) 60 50
19 Production of Silk worn seeds and orchard management 120 100
20 Production of foundation and breeder seed (cereals, horticulture and
animal husbandry 300 300
21 Poverty alleviation through cooperative facilitation 120 100
22 Agribusiness Promotion Committee, agriculture statistics and
economic analysis 120 100
23 Agriculture decade programme formulation and analysis 50 13
24 Laboratory facilities for soil, seed, breed, crop and animal health
protection and regulation 400 300
25 High priority extension program (agro development in Karnali-400/400 3020 2390
million, small scale milk processing and heifer and goat fattening
250/200 million, fish farming in water logging areas rivers and lakes
30/40 million high value crops 750/600 million, poverty alleviation
through animal husbandry and poultry750/600 million, market
promotion-500/350 million, promotion of programme in partnership
and contract 140/50, promotion of biotechnology230/120 m illion
26 Artificial insemination 150 150
27 Agriculture Extension 0 0
175
28 Crop diversification 1500 1500
29 Livestock extension Services 800 800
30 Research on agronomy, fishery and livestock 1000 1000
31 Expansion of tea, coffee spices cardamom zinger 1400 1200
32 Integrated Crop Management (Cropping intensity and sustainable soil
management) 250 150
33 Promotion of Seeds and Certification of plant quarantine 350 300
34 Production of Silk cocoon and expansion of production area 50 30
Total 12640 10783
Percentage 70.77 79.74
35 Second priority Programmes
Agriculture research programme and management of competitive
research system 50 40
36 Agriculture Research Council 300 250
37 Plant Protection And Management 70 50
38 Agriculture Information and Communication 80 80
39 Co-operatization farmers of groups 30 30
40 Agriculture training(Including that for rural level Agriculture/livestock
and poultry worker) 400 300
41 Increasing Productivity of fish and expansion of area 100 50
42 Development of Apiculture resource centre 100 50
43 Promotion of cooperatives and small agro processing 150 100
44 Cooperatives education training expansion 150 100
45 Middle level manpower development 300 200
46 High level manpower development (including agriculture university) 100 100
47 Development of local resource centres 750 520
48 Crop zoning and technical support to land consolidation. 100 70
49 Market research and support to agro business promotion 500 300
50 Collection and protection of horticultural germ-plasm 30 20
51 Orchid Management 100 80
52 Monitoring of technical services 50 30
53 Production of medicine and regulatory services 50 50
54 Coordination of Livestock Services and Monitoring 100 80
55 Food quality control and nutritional promotion and regulatory services 50 40
56 Expansion of deep and swallow tube well through agriculture 200 180
57 Agricultural biodiversity Protection and management 30 20
Total 3790 2740
Prioritized programmes under the third phase (Probable
Programmes) 1430 0
Percentage
58 Other market related of the programme
176
59 Other animal husbandry related of the programme
60 Other animal farm centres
61 Other animal health services
62 Other food quality control
63 Other agro nomical development
64 Other vegetables, potatoes and spices development
65 Other fisheries programes
66 Other plant protection
67 Other Entomology programme
68 Other sericulture
69 Other researches
70 Janakpur Agriculture Development Project
71 Soil Testing
72 Hill leasehold forestry development and development of pasture
73 Development of Cooperatives
74 Protection of biodiversity and coordination
75 Agriculture Research And Development Fund
76 Other training and development of manpower
77 Institutional Development
78 Other agriculture and livestock extension
79 Other Agriculture plant monitoring and evaluation
Total 1786 1352.30
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Chapter – 10
Forest and Soil Conservation
10.1 Background
The forest sector has been providing opportunities in developing agriculture, tourism
and environment. But due to the increasing population and the necessity having of
development projects, pressure has been building up in this sector. In order to
maintain the ecological balance forest area should cover at least 40 percent of total
land area. It is hence crucial for Nepal to stop the existing 39.6 percent of the forest
sector from anymore. To develop forest sector through people's participation there
should be timely improvement along with the effective implementation of the
programs as envisaged by the Master P lan for Forest Sector (MPFS). Conservation,
promotion and proper use of forest, management of soil and watersheds, conservation
of plan resources , herbs and bio-diversity can help in the economic activities of the
nation. From this the opportunities for livelihood can be increased.
In order to enhance contribution of forestry sector to the national economy it has
become necessary to make forest management participatory, simple and effective by
mitigating the problems of degradation of forest, soil erosion, and decrease in bio-
diversity, poverty and unemployment. It has been clearly felt that forest sector should
play a very vital role in the social development by enlisting participation of women,
poor and backward people in conserving the forest and wild animals. Keeping the
above mentioned realities and by removing the weaknesses seen in the
implementation of the plan in making significant contribution in reducing of the
poverty the Tenth Plan for forestry sector has been formulated.

A. Target and Major Achievement of the Program
In the beginning of the Ninth Plan no of Community Forest user Groups managing
the forest reached to about 12,000 groups from 5316 by the end of the plan and about
8 hundred 50 thousand ha forest is being managed by the groups. There has been
qualitative improvement in the forest in the area. Nepal has been successful to
identify herself as the country of community forestry. Conservation of forest,
environment, bio -diversity and sustainable management as well as community
development works have been carried out through community forestry. Democratic
exercises in the local level, gender , and social equality, social empowerment and
transformation and institutional development of the community have been initiated
through the Community Forest Users Group.
• Leasehold forestry programme was initiated w ith a view to support in the
livelihood of the people below poverty line During the plan period 1086
180
leasehold forest groups were formed and 9070 families have received 7378
ha leasehold forest.
• The soil and watershed conservation program has covered sub-watershed
area in 55 districts of the country, which has maintained environmental
balance by minimizing the water -induced disasters as flood, landslides, soil
erosion etc. Chure watershed program has been initiated in the 13 districts of
the Kingdom. Following the principle that users are the center of the
management of the resources a system has been developed to transfer the
responsibility of the implementation of the program to the users group, which
automatically incorporated locals in the program .
• During the plan period expansion of protected area increased to 18 percent.
The user empowerment and various income generating programs have been
initiated in the buffer zones of Terai area. His Majesty's Government has
signed the Cartagena Protocol on Biosafety passed by the convention bio-
Diversity (CBD). The access to the genetic resources and the preparation of
the policy and bill regarding the benefit sharing and the national strategy and
implementation of plan is in the final stage. To conserve the bio-diversity
through forest management program outside the conservation area in Terai,
programs related to Terai Arc Landscape have been implemented. During this
plan five buffer zones management plan and seven National Parks have been
completed.
• The works like conservation, protection and data collection of the non-timber
forest products and research of wild seeds and survey of the forest has been
undertaken. The establishment of 12 plant resources Conservation Research
Centers and five types of Technology Development works has been
accomplished. Likewise, the feasibility study for the establishment of 5 herbs
centers has been completed. During the same period awareness raising
program regarding the herbs at 25 remote districts and establishment of herbs
nursery at 10 places have been conducted.
B. Problems and challenges

• Open market system could not still be commenced in the sale and dis tribution
of timber and fuel wood.
• To solve the problem of resource crunch in the management of forest the idea
of introducing Revolving Fund has not yet been commenced, hence the
problem still remains to exist.
• In spite of the fact that the Government has the policy of attracting the
participation of the private sector and the joint venture in the management of
national forests, their participation has not been encouraging in the
development of national and private forestry sector. It is because, the
development of forestry sector is a biological process and it needs a long
gestation period.
181
• Since there has not been any progress in the Applicable Technological
Package which can be implemented at the farmers level in conducting the
plan resource and herb development program with the aim to income
generating employment and industrial development, there has been no
significant help in lessening the poverty. Professional training could not be
conducted to develop the manpower for non-timber forest products.
Although the tasks registration of agro-bio diversity is being continued, the
task to register bio-diversity to gain access to WTO by securing Patent and
Intellectual Property Right has not yet been done.
• Although there has been some work in the institutionalization of the
monitoring system the task of disseminating the directives, information and
data has not yet been completed. No clear review of the Ninth Plan could be
made as there has not been any institutional development in indicators and
monitoring system which show effectiveness in the inter -sectoral co-
ordination program.
10.3 Long-term Vision

The long term vision of the forestry sector is to meet the basic needs of the people
such as fuel wood, fodder and other forest products regularly, to promote food
production by bringing effective coordination between the forestry and agricultural
sectors and to protect country's territory from soil-erosion, flood and landslides,
desertification and other environmental imbalances . With respect to this vision, the 21
year long term Master Plan for Forestry Sector starting from 1989 will be reformed as
time demands for the purpose of conserving and promoting watershed areas,
ecosystem , genetic resources and for the management of forest as well as to promote
enterprises based on forest products so that it will have positive impact on country's
national economy. To enhance economic growth sustainable by conserving and
promoting forests is another long term vision of forestry sector.
To ensure that forest cover is not lessened further from 39.6 percent as envisaged in
the principle and program of the Master P lan for Forestry Sector and the Agriculture
Prospective Plan, programs should be increased in order enhance the empowerment
and management capacity of the government, nongovernmental organisation, local
communities and the forest users so that it increases the productivity and utility of
forests and acknowledge forest sector for the broad-based economic growth.
10.4 The Tenth Plan

The main thrust of the forest sector is to support national objective of poverty
alleviation by ensuring people's participation needed for sustainable development of
forest sector in the management of forest, plant resources herbs, watershed
management and bio-diversity conservation along with increasing employment
opportunities through the development of the forest based industries.
A . Sectoral Objectives:
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1. To ensure regular supply of forest products and the support in maintaining
environmental balance by developing forest, plant resources, watersheds and
by conservation of bio-diversity and development of forest based industry.
2. To support poverty alleviation by creating employment opportunities for the
poor, women and backward section through the participatory development
programs.
B. Sectoral and overall principle quantitative targets:

Program Unit Quantity
Expected Normal Growth
Growth
1. Community and private forest program
1. 1 Groups formed 2500, operating plan District 75 75
prepared and forest handover 3000,
creation plan revision 4000 management
of users' groups and cooperative 2500
1.2 Promotion of silviculture technology, plot place 500 425
identification and commencement of
program
1.3 Development of forest based industries Number 500 500
within the community forestry for poverty
alleviation.
1.4 Technological assistance, skill and Number 750 630
awareness development concerning
private forestry.
2. National and leasehold forestry
program
2.1 Institution of 1500 User groups among
people below the poverty line in Hectares 6500 6500
leasehold forestry, management plan,
handover and review.
2.2 Hand-over of leasehold forest to Number 25 25
intuitions. District 75 75
2.3 District strategy on forest managed by
government, drafting of forest action plan
and hand-over Place 4 3
2.4 Bio-diversity conservation by building
corridors and Terai Arc
3. Herb and non-timber forest management
3.1 Plant resource conservation Number 5 4
management (Gene Bank)
3.2 Herbal and scented oil processing units Number 10 15
development and their expansion
3.2.1 Public Sector Number 15 -
3.2.2 Private and non-government sector - -
3.3 Formulate and enforce National Policy 5 5
on Herbs.
4. Soil Conservation and watershed
management
183
4.1 Community integrated watershed Sub-Watersheds 110 100
management Number
4.2 Support from local bodies to integrated VDC/Number 110 100
efforts
4.3 Watershed management in higher Chure District 4 4
region
5. Genetic resources and biological
conservation program.
5.1 National parks and wildlife reserve action Number 25 25
plan 6, Buffer zone management plan 6,
National Park Management 9, Reserve
Management 4
5.2 Implementation of Terai Arc Program. Place 4 4
5.3 Feas ibility study of Ghatal Conservation
Area Times 1 1
5.4 Genetic pool resources archives VDC All All
5.5 Publishing Nepal Flora Number 15 15
5.6 Sustainable forest products collection
and management of Bio-diversity. District 30 25
5.7 National Biosafety Framework use and
development. Custom point 12 12
5.8 Development and Management of Development
Botanical Gardens Region 4 4
6. Research and Dissemination Programs
6.1 Research on forest and plant resources Number 73 60
6.2 Drawing up communication and publicity. Times 1 1
7. Human Resource Development Program
7.1 Human Resources Development and Times 1 1
management, strategy formulation and .
implementation.
8. Policy and Legal Framework Reform
Program.
8.1 Revision of Master plan for Forest Sector Times 1 1
(MPFS).
8.2 Revision and Reforms of Acts & Times 1 1
Regulations of Forest, soil conservation Times
and NTFP
8.3 Formulation and implementation of Times 1 1
department level directives on program
implementation
8.4 Formulation of regulations and Times 1 1
directives.
9. Institutional reforms, organizational and Times 1 1
management study, reforms and
recommendations
10. Monitoring and evaluation program
10.1 Formulation and execution of M&E Percentage 100 100
strategy & MIS at different levels.
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C. Main Strategies
In order to exploit the opportunities from the forest, the existing challenges will be
met by controlling the encroachment of the forest area, and by effective management
of forest The scientific management will promote economic benefits from the forest,
support in tourism promotion by utilizing the protected area, support in agricultural
production in the protected farming system through the soil-conservation program,
support to the forest based industries through the supply of herbs, fodder and lokta
wood, support in the protected area through the development of forest sector in
Chure and the buffer -zone area help in raising the income and employment
opportunities which ultimately supports meeting the broad-based economic growth
strategy of the Tenth Plan. In the same way community forest program is expected to
contribute in the national strategy of social inclusion by means of establishment of
local institutional based of Community Forest User Group (CFUG) for forest
management; support to public health by improving environment conservation;
decrease in incidence of flood and air pollution. Expansion of the leasehold forestry
program is expected to contribute in national strategy of promotion of targeted
program by increasing the income and employment of the poor by means of
upgrading the shrub lands and providing then with the forest land in lease basis.
Effective monitoring and evaluation process through local participation and
implementation of the participatory programs in forest management and soil-
conservation will help contribute in macro-level strategy of good governance. The
main strategies are as follows.
§ Strategy related with objective no. 1
1. Protect forest, vegetation, insects, wild animals and bio-diversity and
genetic resources.
2. Enhance local participation in soil and watershed conservat ion by giving
special emphasis to Shivalik range conservatio n.
3. Scientific management of the government managed forests. Carry out
scientific management of collaborative forest on experimental basis in
suitable areas among the national forests by forming groups of local
community. Timber to be provided to the forest based industries as raw
materials.
4. Give special emphasis on the development of eco-tourism by proper
management of the forest, wild life and vegetation in the leasehold forest
handed over to institution or entrepreneurs.
5. Strengthening forest and vegetation research, monitoring, evaluation,
information and data dissemination system.
§ Strategy related with objective no. 2
6. Increase the opportunities for the livelihood of people below poverty line
by expanding the leasehold forest.
7. Develop community leasehold and cooperative forests and increase the
access of the deprived people, women and Dalits (Backward People).
185
8. Sustainable man agement of the valuable non-timber forest products,
utilize and promote the participation of the private sector and export.
D. Policy and Strategies:

Following policy and strategies will be implemented under the sectoral objectives and
strategies .
§ Conservation of forest, wildlife and bio-diversity (related with strategy-1)
• Forest encroachment control policy will be introduced to reach a balance
between environment and development, for which 40 percent of the land
area should be covered by the trees . In districts also forest conservation
and management program will be encouraged, where the forest area and
quality of the forest will be enhanced.
• The forest resources will be used optimally to raise revenue and national
productivity. Stress will be given in the setting of industries based on
agricultural forest.
• Conservation of bio-diversity by setting up the base for sustainable
development through monitoring of the landscape, participatory forest
and soil-erosion management. Process will be initiated to register bio-
diversity resources as prescribed by W.T.O.
• By propagating Nepal's contribution in conserving global environment,
more resources, as provisioned in the international pollution agreement
will be ploughed in the conservation and development of the forest and
non-timber forest products, hence supporting the poverty alleviation
efforts.
§ Special Emphasis on shivalik Area in Soil and watershed conservation
(Related with Strategy-2)
• Priority will be given to the management of integrated watershed for the
conservation of ground water and soil along Chure Bhawar and Terai
area by coordinating with agriculture and water resources sectors.
Likewise, in the districts where soil and watershed program is already in
operation, integrated watershed management and agricultural forest
program shall be applied by identifying sub-watershed areas and focusing
on local participation and labour.
• To control floods, encroachment of river bank and decrease in the
productivity of the land in Terai and inner Terai forest and soil
conservation program will be extensively launched with special emphasis
on Chure area.
§ Stress on Scientific Forest management (Related with Strategy 3)
• Emphasis will be given to the scientific management of the forest and
raw materials will be provided to the forest based industries . Experiment
will be carried out in the scientific forest management through the
participation of the local people in inner terai. Agricultural forest and
186
herbs development program will be incorporated in the scientific forest
management to promote employment.
§ Focus towards Participatory Forest Management and Eco-tourism (Related
with Strategy 4)
• Emphasis will be provided to the programs like participatory forest
management and eco-tourism in the protected Buffer Zone.
• For the sustainable development of forest sector, shrub lands will be
leased to the private sector for long-term with the view to produce forest
product and promote tourism. Private participation shall be encouraged
by making necessary legal provision for the rearing of herbs, high value
deer, musk deer, stag and wild boar and birds etc.
§ The effectiveness of research of forest, vegetation dissemination,
monitoring and evaluation ( Related with strategy 5)
• Research and survey programs will be enhanced to promote new
technology and devices for the management of the forest, wildlife, plant,
timber & non-timber forest products and watershed management. Special
emphasis shall be accorded to the dissemination of information which
raises awareness
§ Focus towards leasehold forest to promote employment opportunity for
backward people (related with strategy 6)
• Community forest and leasehold forest development program will be
focused to improves environment at the local level and to create
employment opportunity for backward people by the promotion of
business based on forest and fodder. Community forest and Leasehold
Forest will be focused towards high hill and hill areas.
§ Improved access of the poor, women and the backward people towards
community forest extension.(Related with strategy 7)
• Programs will be carried out in an integrated manner through the
programs such as Community Forest and Leasehold forest in order to
raise and the livelihood opportunities of poor, women and deprived
people by means of expanding the base for broad-based economic
development; social empowerment; gender equity; social justice and
good governance.
• With the continuation of community forest development and
identification of its related problems, they will be solved. To solve the
problem observed in the distribution of forest products among the
community groups , amendment and monitoring in the process of
formation forest users groups will be made effective.
§ Sustainable management of the valuable non-wood forest products and
export promotion (Related with strategy 8)
• By giving special emphasis to herb production, processing and market
management as the main source of employment increment in high hills
187
and hills, export promotion and income generation, National Herbs
Development Program will be enhanced with the participation of the
industry, commerce, agriculture, forest and health related units and non-
governmental organizations and private sector.
• Emphasis will be given on research and development of plans resources.
By conducting research and collecting information on suitable
technology of valuable but endangered herbs, emphasis will be given on
conservation and sustainable management of such species. The private
sector will be encouraged in herb production, processing and its export.
E. Implementation arrangement
• Active participation of the poor, women and backward section of population
will be sought in the plan formulation process, decision making process,
implementation of program and monitoring of the forest sector for
conservation, management and proper use. Along with this, the public sector
experts can also be used and arrangement will be made to implement these
types of scheme with the consent of the related bodies. To, achieve direct
contribution of the forest sector by means of livelihood opportunities to
alleviate poverty, the policies and programs of the forest sector will be
effectively implemented and to provide pragmatic form to the broad
perspective of autonomous management, the program will be implemented
through the local level groups by helping them develop their competency.
§ Community and Private Forests

• As per the spirit of the Master Plan for Forest Sector (MPFS) and giving
due importance to the success story of community forestry programme,
programmes will be carried out through democratic exercise of Users
Group of local community so that monitoring of community development
program as well as social, economic and gender equity could be
maintained. By giving priorities to the program which help develop the
capacity of the users' groups managing the forest resources, continuity
shall be accorded to hand over the community forest based on capacity
necessity and wishes of the local people. The establishment, operation
and development works of the local forest industries based on forest
products will be encouraged.
• In order to extreme definite role of the poor, women and backward
people and their equal participation in the community and private forest
development program, and to raise access and control benefit sharing,
programs will be implemented for income generation by forming the sub-
committee of the said class.
• The government working as the facilitator will encourage the private
forest and forest entrepreneurs. In the management of the employment
188
oriented private forest, the private sector will be supported by providing
technical services.
§ National and Leasehold Forest
• Policies will be reviewed and amended to check the dwindling forest and
deteriorating forest quality. To make available the timber and log to the
people, emphasis will be given to utilize the dead and fallen trees in the
forest. The policy not allow ing forest area for exchange, new settlement,
construction of physical infrastructures and right to use will be followed
very strictly.
• Management of the forest in the terai shall be carried out by formulating
district level strategic plan, considering the spirit of MPFS and the forest
Act, forest location, peoples, aspirations, capacity and justification. Then
only community forest, leasehold forest, religious forest, protected forest
and government managed forest to be developed in terai will be managed
by peoples, participations. In such program gender issues, social reforms,
land use planning bio-diversity and distribution of revenue together with
forest management will be incorporated. Regular monitoring of the
management of such forest will be carried out.
• Integrated forest management system will be carried out in partnership
with the loc al communities in government managed forest.
• The area of land where forest encroachment issue has already been
settled, will be handed over, if that is feasible, as lease-land to the people
below poverty line for forest development and management. In co-
ordination with agriculture sector and if that is feasible such lease land
will be developed as agro-forest which helps to contribute to poverty
alleviation.
• In order to increase the livelihood opportunities for the people below
poverty line and to raise their economic, social and human competence,
expansion of the leasehold and community forests through separate
leasehold forest within the community forest users group will be carried
out. Appropriate process and technology will be developed to operate
special leasehold forest in the hills for the benefit of the people below the
poverty line. Leasehold forest will be handed over to the private and
non-governmental sector through open competitive bidding on the
condition that they produce raw materials for local industries, enhance
employment opportunities, earn foreign exchange and environmental
protection and for the sustainable development of eco-tourism and non-
timber forest products.
§ Non-timber forest, Plant Resources and herbs
• With a view to develop non-timber forest products and plant resources in
all types of forests by the proper use of the forest area, plant resources,
research and development programs shall be implemented. Non-
governmental organizations, community bodies and private sector will be
189
encouraged for the development of non-timber forest products. Non-
timber forest product programs will be implemented on priority basis by
incorporating the community leaseh old forestry and integrated watershed
and management certifications process will be introduced to develop
institutionally the competitive trade related with forest produce. For the
sustainable use of the herb sources the National Herbs Development
Program will be implemented on priority basis. A National level Herbs
Development Committee at the centre level will review the long-term
implementation, coordination and monitoring.
§ Soil and Watershed Conservation
• Soil and watershed conservation program mes will be gradually
implemented throughout all over the kingdom. To minimize the poverty
by increasing the forest and agricultural products. The watershed
management programme will be implemented by adopting the traditional
knowledge and skill and scientific management along with the people's
participation. Programs shall be implemented in partnership of NGOs and
users groups. For the sustainability and durability of big irrigation and
hydro projects the integrated watershed management program, especially
in Chure region, will be implemented by mobilizing even the investment
for such projects. By giving continuity to the management of sub-
watershed in mid-hills to raise land productivity high priority will be
given to implement the upper Chure watershed management program .
• By giving emphasis on the people's participation, labour and technology
to minimize soil erosion and for the conservation of the river bank,
encouragement is accorded to plant perennial crops. Emphasis will be
given to develop Sloping Agriculture Land Technology (SALT) at
suitable watershed areas by striking coordination between the respective
agencies and the participation of the farmer's users group.
• In order to attain maximum benefit from limited resources, central and
district level program will be carried over with the integrated approach on
priority basis and with peoples participates in the area where watershed
program has already been implemented by consolidating the watershed
coverage into 15-25 sq.km. area. Economic and technical assistance will
be provided to the projects selected by the user's groups on priority basis.
Long-term strategy will be formulated by including technical, economic,
social and practical aspects of the soil and watershed management.
§ Bio-diversity
• Conservation of the biodiversity and the sustainable use will be given
emphasis on the base of people's participation and landscape as well as
the time of the programs of conservation, promotion, management and
utilization of forests are formulated. Bio-diversity and local indigenous
knowledge will be registered. Priority shall be provided to the integrated
conservation, promotion and development of rare and endangered plants
and herb species as recommended by the scientific community
190
comprising the representatives of the local bodies and communities . For
the integrated, coordinated and balanced development of the forest sector
programs, by encouraging groups, individuals and associations in wildlife
farming and research programs and process to improve the standard of
life of the women, poor and backward communities shall be implemented
through the conservation of bio-diversity.
• The proposed Nepal Biodiversity Strategy and Implementation Plan will
be approved and implemented gradually on priority basis. By promoting
public awareness on wildlife conservation, the wildlife farming and
related works will be encouraged, help ing poverty alleviation by
generating employment. The long term development of the forest
resources and the conservation of rare wildlife and plants will be done
through bio-diversity corridor and connectivity.
§ Forest Research
• Action oriented system will be adopted in forest research. The
information dissemination system required to maintain the ac hievement
and quality of the programme as per the Communication and Extension
Strategy will be developed.
• The programmes like choice of technology, exhibition venues and the
action oriented research shall be expanded on the basis of people's
participation to make technology transfer more effective. Information and
Communications policy shall be made and implemented effectively with
a view to classify the forest policy, concept and the process of
information dissemination. To have effectiveness in the forest
management technology transfer and facilitation governmental, NGOs
and community level manpower will be trained to enhance their
capabilities . Programs of Dissemination and technology transfer will be
implemented at the local level. Representatives from poor, women and
backward section will be selected for training, seminar, visits and
workshops to help their develop cap abilit ies.
§ Institutional arrangement and good governance
• Continuity will be given to the system in which the plan will be
formulated after thorough discussion at the local level. Full governance
shall be given to the system in which there will be direct participation of
forest user groups and all stake holders. Timely improvement in the policy
and in the laws will be made to clarify the role of government, private,
NGOs and local sectors. For the institutional development and good
governance, special trainings for empowerment and for resolving the
controversial issues the stakeholders are encouraged to implement
awareness and income generating programmes.
191
• Policy to encourage the service of the professional NGOs, private sector
and competent users group to ensure supply of manpower and to maintain
the quality of the implemented programs shall be adopted.
• To ensure easy access of essential forest products to the people living in
Terai and high hills are far from forest a practical mechanism shall be
worked out and into adopted.
• Human resource development policy and information and communicate
policies will be formulated and implemented.
• By speeding up the process of decision making in forest management, the
implementation of programs like utilization of forest products and forest
development will be more effective.
• Present institutional system will be made ef fective to make timber easily
available to the general public .
• The timber corporation will be gradually transferred to the private sector
during the plan period. Open market policy shall be adopted in the sale
and distribution of timber.
§ Gender Equality
• Effective participation of women in the management of forest and use of
forest resources will be increased. To discourage the existing gender
inequality in the access and control of economic and social resources, the
participation of women in the leadership level shall be effectively
increased by raising awareness about the gender equality in all forest
related and community related development programs.
• The aspect of gender equality will be taken into consideration in the
trainings on human resource development in forestry sector and policy
will be followed to increase the number and quality of such training.
F. Program and projects conducted by government in priority basis

• Poverty alleviation program shall be implemented with top priority through
the herb and non-timber forest development program, the conservation of
upper Chure watershed and Shivalik range and leasehold forest programs.
Following are the program/projects the ministry of Forest and Soil
Conservation shall be implementing in the tenth plan in the order of priority.
Program and estimated budget is given in appendix 10.1
(Rs.in million)
Order of priority Program No. Expected Growth Rate Normal Growth Rate
Amount Percentage Amount Percentage
Ka (P1) 6 2750 55.4 2115 56.3
Kha (P2) 3 1490 30.0 1130 30.1
Ga (P3) 4 720 14.6 510 13.6
192
Total 13 4960 100 3755 100.0
G. Role of government, NGOs and private sector

• Program like in community forest, leasehold forest, formation of user's group
and mobilization, management of government managed forest, human
resources development, training and dissemination of information,
management of national parks and wildlife reserve and bio-diversity
conservation and promotion programs will be implemented on feasibility
basis with active participation of private sector, community based
organization and NGO.
• Co-operation will be extended to the users groups in the task of raising public
awareness, enhance the capacity of local user groups and in income-
generating activities and programs and activities like training, seminar and
research will be conducted by the NGOs.
• Development and extension of private forest, management of industries based
on forest products of the private sector, sale of timber and non-timber forest
products, herb production and processing and activities related to forest
products including forest enterprises run by private sector as well as other
activities based on forest products will be provided continuity and additional
development and extension activities in this field will be done by private
sector.
H. Development budget allocated by government

His Majesty's Government shall spend 4.96 billion rupees during the tenth pla n as
development expenditure in forestry sector.
I. Aspects of policy, legal and institutional reforms

• Necessary legal reforms shall be undertaken, by keeping in mind the local
community's welfare, to ensure the sale of forest products on competitive
basis and according to the open market policy.
• By adopting extensive and official consultation the mid-term review and
timely reforms shall be done in the implementation of master-plan for
forestry sector.
• "Forest-sector Development and Management Fund" and "Bio-diversity
Revolving Fund" shall be formed for the effective implementation of the
programs as set by the master plan to make forestry sector' self sufficient.
• To manage the forest by forming the sub-group of women and deprived,
groups within community to forest user groups to work for their own welfare
and provided legal ground to manage forest shall be created by reforming the
Forest Act.
193
• For the proper use of the forest resources as per the growing demand,
necessary legal reforms shall be undertaken to attract the private and joint
investment in the supply of forest products and in forest product related raw
materials. There will be transparency in the sale of the forest product.
Farming of non-timber forest species for the management and development
of market, setting up nurseries, community afforestation, forest enterprises
and agro-forestry, collection of forest products derived from the national and
leasehold forests, management, transportation, enterprises and trade, reven ue
and restriction shall be reviewed before policy reforms and legal adjustment
are undertaken. Non-timber forest products' management policy shall be
introduced to encourage the forest related enterprises based on herb
cultivation, private entrepreneurs and institutions and community cooperative
bodies and users groups .
• Rules and directives shall be formulated and enforced so as to develop
resource utilisation process to be transparent and established a comparative
system. Necessary policy, program, rules and laws shall be formulated and
enforced from the very beginning of the plan period to protect from the
possible adverse effect of Living Modified Organism LMOs and Genetically
Modified Organism (GMO) in human health, bio-diversity and environment.
• The existing rules and regulations shall be updated to efficiently implement
the international treaties and agreements concerning forestry and
environment.
• A national policy for the sustainable management of wetlands will be
formulated. Timely reforms on the rules of National Parks and Wildlife
Conservation and Regulations of Buffer Zones shall be undertaken.
• Necessary legal ground shall be formulated so that Community Forest Users
Group, other interested community and individual person will have authority
to breed the wild life. Necessary legal ground for forest conservation and
management on the basis of people's participation for the conservation of
forest, plant watershed and bio-diversity of Mahabharat range of Mid-hills
shall also be formulated. Legal reform s shall be undertaken regarding the
community forestry in the buffer zone.
• For the extensive management of the watershed according to the concept of
coordination, participatory and sustainable development and to strengthen the
integrated management of watershed and to institutionalize the users' groups,
the existing soil and watershed conservation Act shall be reformed as user
oriented management system.
• In the context of improving the forest development master plan evaluation
shall be done on the basis of workload and accordingly the role of Forest and
Soil Conservation Ministry and departments under it shall be reviewed
according to the principle of decentralization.
• For the development of human resources under Ministry of Forest & Soil
Conservation policies and programs shall be formulated and implement ed
194
with timely reforms that all the stakeholders of forestry sector can taken the
benefits of their expertise. A training unit shall be established under district
forest office for human resources development at district level.
• A data and information dissemination system shall be evolved to make
monitoring and evaluation more effective. Local, district, regional and central
level organizations will be strengthened.
10.5 Expected Achievements

§ Contribution of forestry Sector in gross domestic product
• There have been no studies at official level to assess the contribution of
forestry sector in gross domestic product. However, the informal reports
show that forest is contributing massively in the GDP. Therefore studies
shall be conducted to assess the contribution of forestry sector in the
national economy and by accounting the in stock. The rise of stock and
contribution from this sector will accounted in regular data base system
which gives the clear picture of this sector contribution in GDP of the
country.
§ Contribution on poverty alleviation and human resource development.
• Capacity of government, non-government, local and other stakeholder
institutions shall be enhanced by organising training, seminars on human
resources development resource management, skill development and
gender disparity and, other social development program. As a result,
about 5 lakh household users of poor, women and people from backward
section of the population shall be benefited.
• 253,000 households from the community forest development program
and 25,680 household from the leasehold forestry development programs
i.e., altogether 278,680 households shall have the opportunity for income
generation activities.
§ Contribution to employment and income generation
• Employment equivalent to 44 lakh and 27 thousand workdays shall be
generated from community forestry creating 7,250 jobs and 4,880 jobs
likely to be created after the implementation of collaborative forest
management plan, the total jobs being in the range of 12,130. Likewise,
the implementation of soil and watershed management program shall
create jobs worth about 34 lakh 27 thousand workdays in the village area.
§ Contribution of forest in regional balance
• Community forestry development program me and soil and watershed
conservation program shall be implemented in all the 75 districts.
Likewise, leasehold forest development program shall be extended to
create more employment opportunities for the poor and the deprived
section of the society. Programs concerning the conservation of bio-
diversity shall be implemented even outside the protected forest areas.
195
Collaborative forest management programme shall be introduced in 11
districts of terai.
§ Forest area and local autonomous rule
• According to the Government's policy of developing the forests with
participation of local users groups, about 20,000 consumers groups
including community forestry users group, leasehold forest groups,
watershed conservation group and bio-diversity conservation groups will
be involved in village level by the end of the tenth plan. Since these
groups have direct access in formulation of plan, decision making,
implementation, monitoring and evaluation in partnership with the
stakeholders a great contribution shall be provided in the conservation
and promotion of forest, development of villages, social empowerment
and in the local autonomy rule.
§ Contribution to be provided to the poor, women and backward section of
the society
• In the activities to be initiated by 20,000 groups which shall be working
at the local level as mentioned in the plan the involvement of poor,
women and backward section shall be significantly increased in decision
making, plan formulation, implementation and monitoring and
distribution of dividend. Besides, the group's participation shall be
enlisted in the program of governmental, non-governmental and private
sector for development. Since priority is to be provided to the poor,
women and backward groups in training, seminars, visits, empowerment
and income generating activities the forestry sector shall significantly
contribute in the poverty alleviation of such groups such by the end of the
Tenth Plan.
196
Policy and Program Log frame—Forest and Soil Conservation
Overarching National Objective: Poverty incidence of Nepali People (men and women) & significantly reduced at a sustainable
manner.
Broader Sectoral Objective: Provide appropriate contribution of forest sector in poverty alleviation by conservation, promotion and
proper use of forest and environment
Objectives Strategy Indicators Information Source Main program Risk & Obstacles
Intention (Sectoral • Conservation of forest, plants, insects, wildlife, • Growth in supply of • Quarterly and 1. Community and • Policy, legal
Objective) bio-diversity and genetic resources. forest products. annual review private forest and
• Increase local participation in soil and • Opportunities for income and reports of program. institutional
Conservation of watershed conservation with special emphasis generation to 278,680 Forest and Soil 2. National and reforms.
forest and soil by on Shivalik range. households through Conservation leasehold forest • Continuity of
public participation, • Collaborative forest management to be community and Ministry. development foreign aid and
supply of growing experimented for trail in suitable areas by leasehold forests. • Program and program. grant.
demand of forest forming user groups. Avail timber to wood • Rise in local populations evaluation reports 3. Herbs and non-
products by industry as a means of raw materials. employment. of projects. timber forest
promotion and • Emphasis on development of eco-tourism sector • Management of • Reports of forest management
management of by proper management of forest, wildlife and government managed research and program.
forest, conservation vegetation in the area where forests are given forests in Terai with the survey . 4. Soil -conservation
of bio-diversity, on lease to the institutions or enterprises. formation of collaborative • Collection, and management
environment and • Strengthen forest and plant research, forest groups . With the processing and program.
genetic resources, monitoring and evaluation, information and data formation of community sales statement 5. Genetic resources
management and flow system. and collaborative forest of herb and bio-diversity
proper use of • Develop livelihood opportunities to the deprived groups and their processing conservation and
valuable non-timber people living below poverty line by expanding management, 12130 company.. forest research and
products and help leasehold forest. people get employment survey program.
contribute in poverty daily. 6. Plan monitoring
• Expand community, leas ehold and collaborative
alleviation by • Growth in conservation and evaluation
forest and in such forest, participation and
supporting in soil of bio-diversity, non- program.
access to poor, women and deprived
fertility and increase communities to be raised. timber forest products
in income and • Sustainable management and utilization of and soil.
employment.
valuable non-timber forest product, promote
investment of private sector and promote
export.
197
Appendix 10.1 : Program and Estimated Budget
(Rs. in million)
S. N. Programs and projects Expected Normal
growth rate growth rate
P1 Programs
1 Community and Private Forestry Program 1780 1352
2 Poverty Alleviation through National and Leasehold
Forest 270 203
3 Implementation of National Forest Operation al Plan 180 130
4 Herbs and non timber Forest Development program 140 110
5 Upper Chure watershed management and other
Shiwalik range conservation program 360 300
6 Project Monitoring and Evaluation program 20 20
Total 2750 2115
P2 Programs
7 Forest Research & Survey and Publicity Program 130 100
8 Genetic Resource and Bio-diversity conservation 910 690
9 Lower hill district soil and watershed conservation 450 340
Total 1490 1130
P3 Programs 720 510
10 Other district soil conservation program
11 Other National and leasehold forest program
12 Organizational, policy and legal reform program
13 Human resource development program
Total 4960 3755
198
Chapter - 11
Land Reform And Management
11.1 Background
Land is widely accepted as the primary means of increasing productivity and a major
asset in our social and economic set up. The task of land utilization and management
has to be taken ahead in a sus tainable manner to ensure multifaceted and dynamic
development based on the physical nature of the soil and other factors like texture,
capacity and quality. In the context that the size of land ownership is shrinking, it has
become necessary to devise plans for boosting land productivity and accordingly reap
maximum benefit and establish the land rights of those people who are directly
associated with the land. Steps need to be initiated to ensure the efficient management
of the new land ceilings that have been announced while there is an equal degree of
urgency to make available the remaining land to the marginalized sections of the
society with the view to alleviate poverty. The Tenth P lan has been prepared
following a thorough review of the Ninth Plan.
11.2 Review of the Ninth Plan:

a) Achievements of the major target and programmes
• There was satisfactory progress during the Ninth Plan period in the sector of
re-survey of land, survey of land missed out earlier, tracing of maps,
digitization of maps and the development of a network for the required
control points for the purpose of preparing maps .
• Steps have been initiated to establish land information systems in
Kathmandu, Bhaktapur and Kaski while in the run up to prepare a central
archive of the land records and land maps, task of systematic filing of the
ammonia prints of land from fifty districts has been completed at the center .
• Works were carried out to put an end to the dual land ownership system , and
the national land utilization programme was introduced. This apart, visible
progress was achieved in improvising on the land ownership structure,
abolishing the system of bonded labour in farms and thereby distributing land
to the bonded labourers who were freed. Other areas witnessing progress
included promoting the skills of the bonded labourers and rehabilitating them
and introducing programmes that sought to establish the rights of the landless
to the land.
• For the effective land management and to carryout surveys, there has been a
progress as per the goals in producing required number of skilled manpower.
200
b) Problems and challenges encountered during implementation
• Failure to implement innovative technologies, no access to land for the
economically marginalized communities , and the existence of dual land
ownership system ,fragmentation of agricultural land and the failure to
effectively implement the land utilization policy.
• Weak system of updating statistics related to land ownership, land resource
and land utilization.
• The rehabilitation of the landless turned out to be complex
• Availability of skilled manpower, resources did not commensurate with the
entry of modern technology into the country.
• Shortcomings and absence of amendments in the existing regulations. Lack
of on site supervision to bring about the needed coordination.
11.3 Long Term Policy

The long term policy of the land reform and management sector is to bring about
social justice and good governance and contribute in achieving the national goals of
poverty alleviation through the development of an effective, trustworthy and
qualitative land utilization and management system in the country.
11.4 The Tenth Plan

a) Sectoral objective
1. Efforts would be directed towards striving for an efficient, service oriented
and informative land administration system based on modern technology.
2. Increase the access of those whose skills and labour are directly linked with
the farm and thereby contributing towards reducing poverty by establishing
and rehabilitating the target group.
3. Initiating steps to preserve, consolidate and manage historical, religious
heritage and Guthis through the mobilization of the local community.
b) Primary Quantitative Targets

The major quantitative targets of the land reform and management sector are
presented in the table below:
Table 11.1
S. N. Programmes Target
Unit Number
Expected Normal
201
Sub sector: Survey:
1. Cadastral Survey Hectare 250,000 212000
2. 76 sheets for Digitizing maps, additional 2000 Sheet 23501 20000
sheets for preparing large size maps of metropolis,
350 sheet for updating, reprinting and publication of
land maps, new edition of administrative and other
maps 75 sheet, producing trig sheet for cadastral
survey 21,000 sheet
3. Altitude point survey Km 1000 850
4. Strengthening geodetic network (including Point 850 720
Gravitational survey)
5. Strengthening Survey section
a. Building
construction Number 12 10
b. Map records and other renovation
Districts 50 42
6. Conducting land consolidation programmes Hectares 1000 1000
7. Developing geographical information system Percentage 100 100
Sub sector: land use plan
8. Updating land-use maps (1:50,000 units), develop District 75 75
district level database, preparing land-use zoning number
directory of the district, preparing district profile
Sub sector: Land -information and archives
9. Establishment of the Land-information system Percentage 100 100
10. Computerization of land parcels in Kathmandu, Office unit 5 5
Bhaktapur and Kaski districts and enabling for
providing computerized services
11. Digitizing maps and other related particulars in the Plots 1.6 million 1.3 million
computer
12. Scanning maps District 75 75
numbers
13. Scanning field books Pages One million 800
thousand
Sub sector: Land -management (land revenue archives etc.
14. Renovation of damaged office buildings, Percentage 100 100
prepare and implement national land policy,
enact laws for contract/ cooperative, farming,
delivery of service through one window policy,
prepare land evaluation norms, formulate
integrated land related act and implement
them
15. Managing the new provision of land ceiling, Percentage 100 100
distribute excess land and developing basis for
progressive taxation.
16. Construction of office building number 20 17
17. To sort out the dual ownership of land by districts 75 75
updating land records and improving the
overall office management
Subsector: Skill development of freed bonded labourers and rehabilitation
18. Task of providing land to the landless Family 13000 13000
completed number
202
19. Food for work programme, equivalent to six Percentage 100 100
thousand metric tons of food
20. Skill Oriented Programme and primary Number of 26000 22000
education to children participants
Sub sector: Gutthi management (Within land management)
21. Preservation of historical and religions heritage Percentage 100 100
and developing a computer data base of Guthi
records.
Sub Sector: Producing different types of manpower related with land management
22. Conducting short term and long term survey Number of 888 800
training on varied topics related with land participants
management
23. Conducting training and research on land Percentage 100 100
management
c) Major Strategies
The land reform and management program has greater importance as an institutional
base of agricultural development. Activities such as preparing topographical maps,
availability of information and statistics, development of land utilization policy, land
management services, arranging for the proper rehabilitation of the freed bonded
laborers (Kamaiyas), protection of land ownership and increasing the access of the
real agricultural laborers to farmland, control of land fragmentation, management for
land pooling etc would make the investment in agriculture very effective and thereby
increase productivity and contribute to sustain economic growth.
The implementation of the appropriate land ceiling policy would in turn bring about
the judicious distribution of land. This apart, the programme to rehabilitate the freed
bonded labourers would enable the growth of income and employment opportunities
among the targeted beneficiaries . As these kinds of programmes also contribute
towards poverty alleviation, they would in turn contribute to consolidate the national
strategies for the targeted programmes.
Effective land administration and land information systems would also contribute in
strengthen ing the national strategy for good governance. In this backdrop, the
strategies of this sector are as follows:
§ Strategies Related With The First Objective
1. Preparing land use and national land polices .
2. Developing the desired legal framework for contract and cooperative
farming with due consideration to maintaining the feeling of land
ownership and land use.
3. Strengthening of the statistical system of land ownership, land utilization
and land resources.
4. Updating topographical maps and developing the required manpower for
land management.
5. Discouraging land fragmentation
§ Strategies Related With The Second Objective
203
6. Initiating steps to ensure efficient management for the settlement of
Kamaiyas and working to bring about improvement of their lively hoods
through their skills development program.
7. Seeking to implement and manage the new provision of land ceiling and
preparing the grounds for the formulation of progressive taxation system
in order to discourage people from holding land unproductively.
§ Strategies Related With The Third Objective
8. Mobilizing peoples ’ participation for the management of Guthi.
d) Policy And Action Plans

The following policies and action plans will be adopted on the basis of the following
sector wise objectives and strategies.
§ Preparation of Land Utilization and National Land Policy (Related With
Strategy 1)
• A National Land Policy will be chalked out, which will govern all the
activities related with land. Similarly, an integrated Act related with land
will be formulated and implemented.
• A land utilization action plan will be implemented to discourage the non-
agricultural use of fertile land.
§ Making arrangements for the desired laws related with contract and
cooperative farming (Related with strategy 2)
• To release from the problem of keeping land under follow or
unproductive holding, steps will be taken to develop necessary legal
framework that ensures owner's right and encourage to release land for
contract or cooperative farming without any hesitation.
§ Strengthening the statistical system on land ownership, and land utilization
and land resources (Related with strategy 3)
• Changes on lan d use will be monitored and land resource maps and
statistics will be updated. At the same time the National Geographic
Information Systems will be developed in order to ensure the smooth
flow of such information.
• Records on land will be protected and strengthened by keeping additional
records at the center level also. The land records will be systematized on
the basis of land information system and a system will be developed that
can provide separate record on the women land -owners.
§ Updating of survey maps and development of manpower for land
management (Related with strategy 4)
• All kinds of maps will be updated by giving priority to the areas having
more economic transactions
• The land management training programme will be strengthened.
204
§ The fragmentation of land will be discouraged (Related with strategy 5)
• A provision will be developed and implemented that will bar people from
buying land beyond a standardized land area to discourage the
fragmentation of land.
§ Management of Kamaiya settlement and development of their skills
(Related with strategy 6)
• Proper arrangement for the settlement of the landless and the freed
Kamaiyas (bonded laborers) will be made and skill oriented trainings will
be organized to enhance their inc ome generating capabilities .
• In order to improve land ownership pattern the land that is surplus after
imposing the new provisions of land ceiling will be given to the landless
and economically marginalized sections of the society.
§ Management of land Ceilings and discouragement for unnecessary holding
(Related with strategy 7)
• a) In order to bring about positive land ownership pattern progressive
tax system will be carried out by developing appropriate norms.
§ Mobilization of the local community to manage Guthi (Related with
strategy 8)
• a) The local community will be mobilized to ensure the management
and protection of the Guthis and the records of the Guthi property will be
well maintained.
e) Implementation Arrangement
The following arrangements will be made for program implementation during the
Tenth Plan period :
§ Survey
• The survey of land will be carried out on a scientific basis and the land
records will be updated regularly. Similarly, survey licensing for private
parties will be introduced.
§ Land Use
• Survey maps, land information and statistics related to the land use in
different districts will be developed. Similarly, the land maps and
guidelines for all the districts will be prepared and implemented in a
particular area in the form pilot program.
§ Land Information
• All the land records and the land information system will be digitalized
or kept in the computer updated regularly so that anybody looking for
information on a particular plot or area of land will have immediate
information. Necessary legal arrangements will be made to provide
services to the people through computer system .
205
• A central archive related with land records and survey will be developed,
computer based data will be protected and the archive will be gradually
integrated with the central record management under land information
system. The required manpower will be created to meet these needs..
§ Land Reform And Management
• A national land policy will be formulated and implemented. Different
land related Acts and regulations scattered in different areas will be
integrated with necessary improvement into a single land management
Act and will also be implemented.
• The surplus land acquired after implementing the new land ceiling will be
judiciously distributed among the deprived farm labourers, landless,
landless squatters marginal and such all farmers, Dalits and indigenous
communities.
• Land consolidation will be carried out in a spontaneous participative
manner in order to increase the productivity of land. Steps will also be
initiated to encourage cooperative farming. Land consolidation based on
Sloping agriculture land technology in the hilly areas will be encouraged
while these will be based on the physical improvement of land in the
Tarai plains .
• Though dual land ownership has been legally banned, it is still prevalent
in practice. Hence it will be removed through time bound programmes .
• Improvements will be made in the land records system. Land
management services will be provided on the basis of one window policy
by bringing about an improvement in the physical facilities and
organizational structure of the institutions providing land management
services
• Basis for the categorization of land will be made more realistic and
scientific . Norms and standards on the valuation of land will be designed
for development of objective oriented and realistic evaluation system .
§ Manpower Production:
• The land management training center will be strengthened and the
required manpower will be produced apart from holding refresher
training courses.
• Efforts will be directed towards launching package training programmes
through the land management training center. The trainers will be capable
of carrying out land survey and record keeping related activities and
minor construction, repair and maintenance in the rural areas. Utilization
of such manpower in rural areas will be encouraged.
§ Skill development and rehabilitation of freed kamaiyas.
• Programmes such as health, education and awareness campaign
206
programmes, skill development and their rehabilitation programmes will
be launched in an integrated and coordinated manner for the freed
Kamaiyas.
§ Management of Guthi:
• Peoples’ participation will be sought at the local level in order to carry
out the conservation of traditional and religious heritage together with the
management of temples and Guthis. The Guthi Sansthan will be
developed as a coordinator, monitor and facilitator for this task. In
addition to this, Guthi archive at center level will be established and
recording system will be computerized.
f) The priority order for the programmes run at the government

level
The order of priority for the programme on land management and reforms to be
implemented by the Ministry of Land Reform and Management is given in the table
below. The estimated budget and programmes for this sector has been given in the
Annex 11.1.
Order of Number of At expected growth rate Normal growth rate
Priority Programmes
Amount in Percentage Amount in Percentage
Rs. crore Rs. crore
P1 7 111.0 46.8 83.64 46.6
P2 1 68.0 28.7 51.84 28.9
P3 3 58.0 24.5 43.92 24.5
Total 11 237.0 100.0 179.4 100.0
g) Institutional And Legal Impro vements

• Laws will be enacted so as to guarantee land ownership and utilization for
contract or cooperative land use.
• A national Geographic Information System will be established to support
coordination and the dissemination of geographic information.
• National Land Policy and Act on integrated land management will be drafted
and implemented.
• Acts that forbid a buyer to purchase land below a standardized parcel will be
enacted
• Relevant law will be enacted to give validation to the computerized land
records and maps.
• One door service delivery arrangem ents will be made by instructing
institutions related to the land management services.
h) Investments To Be Made From The Government’s Side

• The development budget amounting to 2.37 billion rupees has been
earmarked for this sector in order to run programmes under the T enth Plan.
207
i) Achievements Expected:
The following achievements are expected to be made through the launching of
different sub sector programmes under the land management and reform programme:
• Land management will be made simpler , efficient, transparent and service
oriented.
• The researchers as well as the government including local bodies and non-
government organizations will have access to important and reliable
information related with land.
• The management of land ownership record will be made scientific and a
central archive will be in place
• The task of updating refinement and production of land maps and their
periodic review would contribute to bring about national development
• Infrastructure for the development of geographic information system (GIS)
will be developed where GIS consumers will have access.
• There will be an increase in the supply of trained manpower for land
management. This will in turn serve to open up more scope for employment
opportunities.
• Those whose labour and skills are directly linked with the land will have
ready access to the land. It will contribute towards poverty reduction in
different parts of the country.
• Land fragmentation will be discouraged. There will be sustainable utilization
and management of land. This will in turn contribute to boost productivity.
• The task of processing of the elimination of dual ownership cases on land
will be completed.
• Land ownership will be protected and good governance will be ensured
through the improvements in land management and scientific strengthening
of land records .
• The freed Kamaiyas will be equipped with skills and they will have access to
employment opportunities . Their rehabilitation will provide them security and
the access to housing facilities, education and drinking w ater.
• The land maps will be updated on the basis of modern technology and will
become more reliable.
• There will be initiation on people’s participation in the management of the
Guthiis.
• The national land policy and the integrated land management Act will be
formulated and enacted.
j) The role of the government, private and non-government

sectors :
The following provisions for contract farming, cooperative farming and partnership
programmes will be made in the process of delivering services on the basis of the
above mentioned programmes and projects in the process of forging coordination
208
between the private and public sectors.
• For the task of preparing survey maps, provisions will be made to award
license to private parties as well. Additional revenue will be collected by
providing technical support to private parties for preparing survey maps.
• The land under different Guthis will be managed in partnership with and
participation of the private and non governmental sectors as well.
• Emphasis will be given to the mobilization and participation of the non-
governmental organization for contract and cooperative farming.
11.5 Risk and obstacles that could impede achievements of

output
• Availability of adequate resources and budgets required to keep abreast with
the latest technological developments.
• The balance between the retiring trained manpower and the manpower
needed to replace them
• The coordination among agencies related with the handling of land
information and land administration
• Timely improvements in the management
11.6 Log frame

The logframe portraying the major programme highlights and the strategies to be
pursued for achieving the stipulated goals has been presented below . The elaborate
plans are presented in Appendix three.
209
Logframe Portraying Policy And Programmes For Land Reform And Management
Overarching National Objective: Poverty incidence of the Nepalese people (men and women) will be reduced significantly and in a
sustainable manner.
Broader Sectoral Objective: Well managed land utilization, land – information system and land management and
increase in the productivity of agriculture, forest and industry sectors.
Objective Strategy Indicator Sources of Main Programme Risk and
Information obstacles
Sectoral Objective: • Preparing land use and national land polices. • Land use maps, survey and • Four 1. The national land • Delay in
Making land • Developing the desired legal framework for land categorization and monthly and policy formulation & drafting and
management very contract and cooperative farming with due directives available. yearly implementation. endorsing the
effective and consideration to maintaining the feeling of • The attitude on leaving land reviews and 2. Land information needed
increasing the ready land ownership and land use. barren decreased contract and reports and achieves regulations
access of those who • The statistical system of land ownership, cooperative farming increased. provided by systemized.
have skill and labour land utilization and land resources. • Increase in the utilization of the Ministry 3. Rendering effective
directly linked with • Updating topographical maps and agriculture, forest, housing and • Land services related to
the land and developing the required manpower for land industrial sector as per their utilization land management
marginalized people. management. categorization maps and 4. Preparing land use
• Discouraging land fragmentation • Availability of land records in directives plan.
• Initiating steps to ensure efficient the computer • Periodical 5. Rehabilitation of
management for the settlement of Kamaiyas • Law has been passed to study freed Kamaiyas
and working to bring about improvement of reduce fragmentation reports (bonded laborers)
their lively hoods through their skills • The settlements of ex -bonded and their
development program. laborers has been made employment
• Seeking to implement and manage the new systematic and they have been promotion.
provision of land ceiling and preparing the getting skill development
grounds for the formulation of progressive training
taxation system in order to discourage • Guthis managed through
people from holding excess land. peoples’ participation
• Mobilising peoples’ participation for the
management of Guthis.
NB: The quantitative goals are based on the projection of economic growth rate at 6.2 per cent
210
Appendix 11.1 : Programme And The Estimated Budget
(Rs. in
million)
S.N. Name of Programmes At expected At normal
Programme in the first priority list:
1. Land-Information and archives. 130 99.1
2. National Land Use and Land Policy 100 76.3
3. Security of land records and their strengthening. 430 317.8
4. Management of new provision of land ceiling and
development of basis for progressive tax ation 100 76.3
5. Strengthening of survey section 100 76.3
6. National Geographic Information Infrastructure 170 129.6
7. Rehabilitation of freed bonded laborers (Kamaiyas) and
employment skill development 80 61
8. Total 1110 836.4
Programmes in the second priority list
9. Cadastral survey 680 518. 4
10. Total 680 518. 4
Programmes in the third priority list (possible projects) 580 439. 2
11. Land Management Training Center
12. Geodetic survey
13. Topographic survey
14. Total 2370 1794
211
Chapter - 12
Agriculture and Rural Credit
12.1 Background
Agriculture and Rural Credit play very important role in poverty alleviation and in the
creation of employment in the villages by promoting agricultural and other business.
There have been enough achievements as targeted from the agricultural and rural
credit programmes. Lack of easy access to receive loan, inadequate institutional
expansion, lack of security, excessive indirect expenditure to receive loan and high
interest loan have been observed as the obstacles in the development of this sector. To
create opportunities for income generation activities and employment by removing
these obstacles it is necessary to make agricultural and rural credit system easily
accessible to the general public.

The Ninth Plan had adopted the policy of creating opportunities for productive
employment by gradually increasing the investment of financial institutions to the
deprived sector, enhance the ac cess of poor and women in agricultural credit, manage
easy distribution of credit and expand the livestock insurance. To increase the
availability in agriculture and rural credit, the government subsidy in irrigation and
fertilizers was to be gradually decreased, and strengthen the existing institutions to
promote private and non-governmental organizations, mobilize capital from internal
and external sources were also included in the policy of the plan. Following are the
progress of the plan period:
1. The credit target set by the Ninth Plan in chemical fertilizers, shallow tube wells,
animal husbandry, promotion of high value crops, agro industries and processing
and fisheries and for other agricultural programs from Agricultural Development
Bank, Commercial Bank and Rural Development Bank was Rs. 35.25 billion;
however it reached up to Rs. 53 billion in the current price i. e. Rs 34 billion from
ADB, Rs 11 billion for Commercial Banks and Rs 8 billion from Rural
Development Bank. (Table 12.1)
2. Improvement in legal and regularly management has been carried out to increase
the micro-credit .
3. In the context of increasing the access of women in the management of micro-
credit by expanding the rural banks working area in terai and hilly areas Rs 908
crore has been invested as loan from the rural development bank and other micro
small financing institutions following the rural bank system. Moreover, about 233
thousand women of 965 VDCs in 42 districts have been organized into groups.
212
The rural development banks have expanded their branches in 20 hilly districts
during the period.
4. A per the policy of expanding the priority sector lending during the plan period
the tea cultivation, micro–hydro project costing less than Rs. 10 crore, loan to
rural development banks and micro- credit institutions like cooperative and non-
agreement organizations from the commercial banks, handing out loan upto Rs 40
thousand to blind and the handicapped and credit to encourage use of solar power
and areas of minim izing environmental pollution have been included into the
program.
5. The compulsory loan issuance to the deprived section of the population has been
raised from Rs 15000 to Rs 30,000 and made it 3 percent of the total investment.
Under the program of Productive Credit to Rural Women (PCRW) and Micro
Credit Program for Women (MCPW), the credit from the NRB to the
participating financial institutions was Rs 13 crore in the first three years of plan
period and at the closure of the program in the fiscal year 057/058 the investment
stands at Rs 43 crore.
6. Financial Intermediary Act 2055 had been already enacted to expand flow of
credit also from the non- governmental organizations working in the field of
financial intermediation. Moreover, since the Ac t did not have the provision to
allow institutions to commence saving schemes , amendments were effected
during the winter session of the year 2058 as to regularize the unlimited liability
of the parliament of the institutions.
7. Agriculture Development Bank has issued Rs 34 billion loans for various uses.
The bank has given continuity in simplifying the policy of loans disbursement
under the package program s. Moreover, the bank has set up a small farmer's
development bank during the period by converting 107 small farmers
development program into cooperative institutions.
8. Rural Micro Finance Development Centre Ltd (RMDC) has been set up in the
month of Mangsir 2056 with a view to provide wholesale to the credit institutions
which work in the micro credit operations under the ownership of NRB and
capital participation from the commercial banks.
9. Cottage and small industry credit fund set up to provide self-employment to
people trained by cottage and small industry department and cottage and small
industry development committee has issued loans amounting to Rs 2 crore 66
lakhs and 22 thousand.
10. Livestock insurance policy was implemented in 68 districts but the insurance
based on the standing crops could not be introduced.
11. Encouraging par ticipation from the private sector in the small credit transaction
was observed during the period. Four development banks have been set up from
the private sector to run micro finance activities. To raise the access of micro-
credit from the non-governmenta l organizations and saving and credit cooperative
bodies about Rs 5 crore 23 lakhs loans from rural self reliance fund has been
issued through 129 cooperative institutions and 48 non-governmental
organizations during the review period.
213
12. Cooperative tha t has got permission from Nepal Rastra Bank to run limited
Banking activities was 37 in number during the plan period.
12.3 Existing Problems

There is still a lack of coordination in the issuance of agricultural and rural credit due
to failure in institutional efforts in integrated and coordinated implementation of
programs during the Ninth Plan. Although there has been rise in the number of banks
and financial institutions, the present institutional mechanism is not adequate to
reach the loans to the targeted groups . The relocation of branches of Nepal Bank Ltd,
Rastriya Banijya Bank and Agricultural Development Bank during the latter years
due to the deteriorating law and order situation has an adverse effect in the issuance
of loans in the village areas.
It has been felt that the spread rate is high in the overall financial system. The gap in
spread rate is high in agriculture and rural credit. As such, receiv ing appreciable
results from the investment became a challenge . Although commercial banks had to
channel certain part of the fund towards the priority area and to the deprived section
of the people it was not implemented seriously. Due to lack of effective monitoring
and supervision the loan repayment of the ban ks and financial institutions have not
been satisfactory.
There has been effect on targeted issuance of agricultural loan due to the non-
implementation of the package program as envisioned in the Agricultural Perspective
Plan. There has been expanded use of different materials which help in the rise of
agricultural productivity. In the use of shallow tube wells that play a very important
role in groundwater irrigation system, there has not been rise due to anomalies in the
policy and lack of budget. The transaction in rural and agriculture credit has not yet
been adequately simplified.
There has not been effective mechanism to monitor the flow of credit. Only 13.5
percent of credit from all the banking and financial institutions ha d been used in
agricultural and micro- enterprises during the plan period. Due to the lack of
coordination between rural credit institutions and other institutions the duplication
could not yet been avoided. Although there has been some progress on livestock
insurance as per the agreement with credit deposit insurance and credit guarantee
corporation, the task of crop insurance has not yet been initiated.
12.4 Tenth Plan

a) Objectives
1) Mobilization agricultural and rural credit in an integrated manner to help rise
in gross domestic product by increasing the agricultural productivity
2) The outreach of microcredit is to be increased to check the rampant rural
poverty by involving maximum number of deprived people in production
214
oriented and income generating micro enterpr ises.
b) Strategy
Agriculture and rural credit play a very important role in alleviating poverty by
increasing economic activities and opportunities for income generation and
employment in the rural area. As majority of the farmers are small farmers the micro
credit has a special importance on it . Although various institutions have been
involved in availing the credit for agriculture and rural development programs, the
coordination in the implementation process has not been effective. Despite the
demand of credit , the flow of the same has not been enough especially to the small
farmers and deprived people. The entrepreneurs have not been taking initiative for not
being able to get guarantee of the credit availability. Collateral has been a problem in
the credit availability for the deprived people. The targeted programs have been seen
as an attraction in solving such problems. Since the social aspects too are involved in
the programs related with rural micro credit they can provide valuable support in
development and increment of social consciousness. In this context, the major
strategies in this sector have been formulated as following.
§ Objective No.1 related strategies
1. All the banks and financial institutions involved in agriculture and rural
credit shall be mobilized through a single coordination system by
formulating a policy to avail institutional credit of alleviating the rampant
rural poverty.
2. Agriculture Development Bank shall be mobilized as the main institution
to meet the required of agricultural credit in the rural area. Commercial
banks and other development banks too shall be mobilised to avail the
institutional agricultural credit . Such type of credits will be short,
medium and long term in nature.
3. Income and employment shall be raised by involving women and
unemployed rural youths in productive credit.
4. Regular monitoring shall be done to evaluate the target and progress of
agriculture and rural credit . Nepal Rastra Bank shall be mobilized as the
main body in this aspects.
5. Since the resources from existing bank and financial institutions are not
enough to meet the excessive demands of agriculture and rural credit, a
long term fund shall be mobilized in Nepal Rastra Bank in the form Rural
Self-Reliance Fund.
§ Objective No.2 related strategies
6. To increase the outreach of micro-credit to the deprived people there shall
be improvement in the institutional mechanism to expand the credit flow
as much as possible through the micro finance institutions in the rural
area.
215
7. The policy to gradually handover the ownership of Rural Development
Bank which are in Break Even Point (BEP) or in better position to the
private sector shall be adopted. This process shall be initiated in western
rural development banks and gradually applied in the other parts. The
policy to provide first priority to deprived women debtors shall be
followed while privatizing the banks.
c) Policy and Work Plan

§ Agriculture and Rural credit Flow through Single Coordination System
(Related with No.1 Strategy)
• Agriculture and Rural Credit shall be developed as one of the main some
for poverty alleviation.
• Realizing the necessity of agriculture and rural credit, "Agriculture and
Rural Credit Flow Program" will be initiated through a single
coordination system by involving commercial banks, development banks
and other financial institutions and their ongoing investment resources in
a co-ordinated manner .
§ Mobilization of ADB as the main source for the agricultural and rural
credits (Related with no.2 strategy )
• The compulsory investment by commercial banks in the priority sector
lending System (12 percent of the total credit ) in agriculture, cottage
industry and service oriented enterprises shall be gradually reduced by
the second year of the Tenth Plan and completely removed by the end of
the plan. Agriculture Development Bank shall be strengthened as the
main institution to flow the agriculture and rural credit .
§ Increased access of the deprived people in the micro-credit (Related with
no. 3 Strategy)
• The deprived population will be encouraged to take income and
employment generating activities, and their access to micro-credits will
be enhanced.
• The credit of rural development banks which have been made available to
the deprived women in the past in different income generating activities
shall be further expanded.
• Small Farmer Cooperative (SCFLs), Saving and Credit Cooperatives
(SACCOPs) and Financial Intermediary NGOs /INGOs along with the
existing rural development bank shall be mobilized extensively to
increase the access of micro-credit to rural areas. Moreover, the
collective insurance of micro- credit at the farmers level shall be
gradually expanded.
216
• To increase the access of institutional credit in the rural areas the
institutional system of bulk credit shall be strengthened. The institutional
system to supply bulk credit to rural development bank and other
financial institutions which work in the micro-credit shall be strengthened
during the plan period. For this finance shall be made available through
Rural Micro Finance Development Centre Ltd-(RMDC) and other
sources.
• The existing limit of 3 percent credit to the deprived groups by the
commercial banks will be maintained and the areas within this sector will
be reformed as per the need.
• The policy to encourage institutional presence in micro credit shall be
adopted. The current permit system enforced by the Nepal Rastra Bank
shall be simplified after the review in order to encourage private sector
and individuals who would like to work in the area of micro credit.
• In the present context of minimum presence of commercial banks in the
rural areas the institutions working as financial intermediaries and saving
and credit cooperative bodies shall be allowed to work as the agents of
the commercial banks .
§ Privatization of Rural Development Banks (Related with no.4 Strategy)
• The service of rural development bank in the hilly areas shall be
expanded. In this context, there shall be necessary reforms in the current
rural banking system prevalent in terai. The rural development banks
operating in breakeven or better shall be gradually handed over to the
private sector. This process will be initiated through the western rural
development bank by giving priority to the deprived women debtors of
the bank.
§ Mobilization of Nepal Rastra Bank as main monitor in agriculture and
rural credit (Related with no. 5 strategy)
• Continuing the five year structural reform programs initiated by Nepal
Rastra Bank during the plan period the rural development bank under the
NRB shall be operated according to the productivity standard set by the
high level coordination committee.
• There shall be a system of control and regular monitoring of the savings
and credit cooperative institutions which have been directly helping in
the rural credit. Nepal Federation of Saving and Credit of Cooperative
Unions (NEFSCCOU) and central level institutions of National
Cooperative Federation shall be mobilized for this purpose.
§ Loans to educated unemployed youths through project as collateral
(Related with no. 6 strategy)
217
• Credit programmes based on education certificate and projects as
collateral will be mobilized for the unemployed agricultural graduates
and technicians and unemployed rural youths to employ them in
productive and income generating enterprises unemployed youth who
have received skill oriented training shall be issued loans on project
collateral to set up micro enterprizes.
• The loan scheme initiated by the commercial banks to rural and deprived
youths who strive for foreign employment and to the people from the
Maoist insurgency affected area shall be given continuity. The policy to
regard such loans as loans handed out to the deprived people shall be
maintain ed.
§ Guarantee to Credit investment through Investment Fund (Related to no.7
strategy)
• Institution working in micro-enterprises through Rural Self Reliance
Fund, Rural Saving and Cooperatives, intermediary institutions and the
investment of ADB such as in tea and fruits will get medium and long
term credit as and when needed. The fund shall receive a fixed amount
from His Majesty's Government and the Nepal Rastra Bank on annual
basis. Moreover, the fixed amount which should have been invested by
commercial bank and financial institutions in agriculture and rural credit
shall be deposited in the fund if the same is not issued as loans.
12.5 Programs
1. The total need of credit in agriculture and rural sector shall be fulfilled at
the rate of 52.76 percent from Agriculture Development Bank, 23.62
percent from commercial banks and related institutions, 11.81 percent from
rural development banks, and rest 11.81 percent from institutions working
in micro-financings and other institutions (Loan projection is on table 12.1)
2. The loans to be issued to the deprived sector by commercial banks
maintained at the current level (3 percent of the total loans). Loans up to
Rs. 100 thousand issued through the Commercial banks to anyone going
abroad for employment shall be included in this scheme itself and
monitoring shall be done accordingly.
3. In case of the banks and financial institutions (except those involved in the
micro credit) which do not have branch network in the rural areas provision
shall be made for direct financing and indirect financing with a view to
involve them in the scheme. The fixed amount of financing to be borne by
such development banks and financial institutions can be done through
rural development banks, saving and credit cooperative institutions and
through micro finance institution which have been licensed to work as
financial intermediaries . The share capital of commercial banks and
218
financial companies shall be deemed as part of the loans under the scheme.
4. The social mobilization cost needed for the activities related with micro-
credit to the governmental and private sector institutions which do not
mobilize deposits, arrangements will be made to provide lump-sum amount
in the annual basis through the poverty alleviation fund. This provision
shall be executed as per the recommendation of the high level coordination
and direction committee for the rural development bank of the central bank
.
5. Various agriculture and rural credit programs, micro-credit programs,
educational, social, health, community and public awareness oriented
programs of different institutions of the government shall be operated from
one window as far as possible for coordination. Arrangement will be made
for necessary coordination from the poverty alleviation fund.
6. Apart from the policy provision under the agriculture and rural credit
programs the concerned cell of the Nepal Rastra Bank shall be mobilized to
conduct regular monitoring, evaluation and study. A high level agriculture
and rural credit policy making committee under the coordination of the
central bank shall be formed at the outset of the Tenth Plan with the
representation from ministry like Agriculture, Industry, Finance and
agencies like National Planning Commission, Agriculture Development
Bank, Nepal Bankers' Association, Nepal Financial Institutions Association
and at the most two representatives from other related agencies for the
policy decisions conducting needed studies and ensure that coordination.
The Secretariat shall be at the central bank. The committee shall also decide
on the scope of agriculture and rural credit .
7. Under the Community Ground Water Irrigation Sector Project (CGISP)
financed by the Asian Development Bank, credit will be made availa ble
from NRB for self reliance fund and for deprived and marginal farmers in
the 12 Terai districts of easter n and central development region in
collective guarantee without collateral for 10,000 shallow tube wells
through partner financial institutions (PFIs). It is expected to irrigate about
40,000 hectares of land and serve about one thousand deprived and
marginalized farmers as beneficiaries .
8. To increase the access of the credit to the weak, deprived and marginalized
people of the society, the blind, handicapped persons . The provision of
credit amounting to 40,000 rupees shall be continued to fund income
generating and employment oriented activities on basis of the project as the
guarantee. The flow of the credit from the commercial banks shall be
deemed as the loans to the deprived people and as such monitoring shall be
done. The loans if issued by other financial institutions, besides the
commercial bank, shall also be regarded as the loans under agriculture and
rural credit scheme.
9. The institutional development will be made for the collective insurance of
219
the loans issued as micro-credit in the prioritized rural areas to the benefit
of the small farmers. The micro-credit institutions shall be encouraged for
this purpose.
10. The loan investment under Third Livestock Development Project financed
by the Asian Development Bank shall be deemed under agriculture and
rural credit scheme throughout the project period (2002/2003 )
11. The loan investment under the program implemented by IFAD supported in
poverty alleviation project in western terai (PAPWT) districts shall be
deemed as loans under agriculture and rural credit scheme.
12. Since the staff working in financial institutions involved with agriculture
and rural credit program need capacity enhancement trainings, the high
level agriculture and rural credit assessment committee in the central bank
will identify such needs and manage the same. The national training
institutes will get a priority to provide the training where national capability
exists.
13. To support the poverty alleviation programme, the deprived and
marginalized farmers will be encouraged to take part in an income
generating activity, for which at least one credit per family will be
mobilized, that will result an additional coverage of 100 thousand families
through credit.
14. The agricultural industries related with the priority commodities of
Agricultural Perspective Plan will be encouraged to set up their plants in
the rural area long-term credit needed for industries will be provided with
normal interest rate through Agriculture Development Bank, commercial
banks and financial institutions . Provision shall be made to avail
refinancing from the central bank for such loans.
15. The provision of Nepal Rastra Bank Act-2058 concerning the refinancing
provision shall be amended to support agriculture and rural credit program.
16. Agriculture Development Bank, commercial banks and rural development
banks on the basis of their assessment shall be activated to provide the
credit for small, medium and marginal income group of farmers through the
provision of total annual production credit on simplified basis to procure
fertilizers, seeds, pesticides and agricultural tools needed for then during
the plantation period.
17. With a view to enable the farmers to receive suitable price for their
products medium sized godowns, cold storages shall be set up as
cooperative bodies and the necessary amount of money for the means of
transportation such as tractors, bullock carts etc. shall be managed as loans
from commercial banks and financial institutions at reasonable interest
rates. This will help develop the spirit of cooperative principles.
18. College and small scale industry credit flow program established to provide
credit to the trend persons by the Department of Cottage and Small scale
220
industry and board will be expanded to rural areas and made further
effective.
12.6 Agricultural and Rural Credit Projection

Agricultur al and rural credit flow in the Ninth Plan has been given in table 12.1. On
the basis of policy and programs to be adopted in the Tenth P lan it is estimated that a
total of 1.75 billion rupees shall be invested in agriculture and rural credit from the
bank and financial institutions. The detailed projections has been given in tables 12.2
and 12.3
221
Table 12.1 : Status of Agriculture and Rural Credit flow during the Ninth Plan
(Rs in crore)
Fiscal Year Total
S.N. Description 1997/98 1998/99 1999/2000 2000/01 2001/02*
1 Agriculture Development
Bank 4430 5560 7140 8090 8870 34090
2 Rural Development Bank 600 860 1170 1490 4050 8170
3 Investment in Agriculture
from Commercial Bank 1420 1800 2140 2670 2770 10800
4 Investment in cooperative
and NGOs from Rur al
Self-Reliance Fund 8.5 7.8 20.1 19 52.3 107.7
5 Production Credit and - -
Micro-Credit for Women -50 -50 -30 -130
6 Investment of Cottage
Small and Industries
Credit Fund -5.3 -4.2 -8.8 -3.9 -4.4 -26.6
7 Community Ground Water - - -
Irrigation Investment -
Tube well Investment -3.4 -8.8 -12.2
Total 6458.5 8227.8 10410.1 12269 15742.3 53167.7
* Preliminary estimates
Note: Since credit of S.N o.5 and 6 might have been included in S. No 1,2 3 they are not
included in the total.
Source: Nepal Rastra Bank Micro Credit Department and Small and Cottage Industry
Department.
Table 12.2: Projection of Rural and Agriculture Credit in the Tenth Plan
(R s. In million)
2059/60 2060/61 2061/62 2062/63 2063/64 Total Percentage
2002/03 2003/04 2004/05 2005/06 2006/07
Agriculture 52.8
Development Bank 9124 9924 10705 11437 11962 53152
Commercial Bank and 23.6
other financial
institutions 3350 3950 4660 5400 6440 23800
Rural Development 11.8
Bank 1670 1980 2330 2700 3220 11900
Other micro financial 11.8
institutions 1670 1980 2330 2700 3220 11900
Total 15814 17834 20025 22237 24842 100752 100.0
Projection Basis:
1. Projection is based on current prices. 2. Projection of ADB as projected by itself.
3. Projection of other banks and institutions has been according to the proposed program of the tenth
plan.
4. As per the statistics of upto Paush 2058 of the fiscal year 2058/59 the growth rate has not been
normal so it is not accepted as the base year.
222
Table 12.3: Investment projection of Agriculture Development Bank during the
Tenth Plan (purpose wise)
(Rs in million)
2059/60 2060/61 2061/62 2062/63 2063/64 Total
Objectives 2002/03 2003/04 2004/05 2005/06 2006/07
1. Food and cash crops 2011 2353 2653 3001 3104 13123
2. Buy and Sales 2040 2120 2200 2250 2300 10910
3. Agri. tools and
mechanization 1176 1350 1428 1452 1743 6906
4. Irrigation 141 151 161 161 161 775
5. Biogas 124 145 170 199 210 848
6. Agri. and cottage
industry 1541 1616 1744 1911 2100 8912
7. Godown and cold
storages 27 32 30 30 30 149
8. Livestock Poultry and
pisciculture 1785 1850 2000 2100 2200 9935
9. Fruits 105 123 125 131 141 625
10. Tea and coffee 174 184 194 204 214 970
Total 9124 9924 10705 11437 11962 53152
Based on Agriculture Development Bank projection.
223
Chapter - 13
Culture, Tourism and Civil Aviation
13.1 Background
Nepal is well known as the main tourist destination in the international arena due to
its natural beauty, unique culture, incomparable heritage and innumerable special
tourist destinations. Even a small reform in culture and tourism sectors, the country
can earn more foreign currency and generate employment and other opportunities
thereby contributing to overall economic growth. The development and extension of
village tourism creates livelihood changes, employment and other opportunities and
helps in achieving regional balance and poverty alleviation. From the perspective of
comparative advantage, tourism and supporting sectors such as culture and civil
aviation play a crucial role in the national economy. To make the travel of locals and
foreigners simple safe and comfortable, promotion and development of air
transportation system is necessary. Development of domestic air transportation can
contribute to effective nationwide communication and developmental programs.
In 1972, a ten-year tourism master plan was prepared for tourism sector in order to
provide a clear direction on policy reform and development work. In 1984, the master
plan was amended for a period of two years with a special priority in promotion and
institutional issues. Apart from these, a number of working plans targeting special
issues were also implemented. Despite remarkable success 1998 could not be
sustained due to the opportunities created by Visit Nepal internal peace and security
and other factor.
Nepal, the only Hindu kingdom and birthplace of Lord Buddha, has incomparable
traditions, prosperous culture, awe-striking customs and rich heritage. Conservation
and promotion of the history of brevity and warriors, and uniqueness of Nepali
society in itself is an issue of major importance.

13.2.1 Targets and achievement
To establish tourism and culture sector as one of the important sectors of the national
economy, the Ninth Plan had targeted the development of forward and backward
linkages, and conservation of existing and proposed World Heritage Sites and their
promotion as tourist destinations. Similarly, it had targeted to tie up conservation of
the national heritages to income earning opportunities and their institutionalization
through community management. Effective marketing of Nepal in the international
arena to establish it into a major tourist destination, development of traditional arts
into an industry to create new employment opportunities, increase in income and
224
foreign currency earning, and to channel the benefits accrued from the tourism sector
to the rural areas were the major targets of the Ninth Plan. The programs
implemented during the Ninth Plan period had mix results.
“Visit Nepal Year 1998,” was launched as a national campaign for the first time for
the development of the tourism sector. It play ed a crucial role in generating awareness
on tourism, drawing attention and local investment on tourism related areas, bringing
new tourism destinations to the forefront , promoting tourism contacts worldwide and
re-establishing Nepal’s tourism image in the world. New aviation agreements were
reached with the friendly countries and existing ones were renewed adding a number
of air seats and air routes.
During the plan period, with the help of international donor agencies, various
infrastructures were added in the hilly and the most busiest local airports. Similarly,
improvement in runways, addition of more equipments, improvement of the standard
of Tribhuvan International Airport, expansion of parking area and terminal buildings,
strengthening of the fire extinguishing services among others were achieved during
the plan period.
Despite a sharp decline in the arrivals of the South Asian tourists towards the middle
of the Ninth Plan Period, overall number of the tourists visiting Nepal grew due to the
addition of four international airlines’ services in Nepal. The domestic airlines were
given permission to start their services abroad. In the area of institutional
development, Nepal Civil Aviation Authority was set up and Tourism Department
was dissolved to establish Nepal Tourism Board with the participation of the private
sector. Cultural issue was brought under the tourism sector and the ministry was
renamed as the Ministry for Culture, Civil Aviation and Tourism .
The World Buddhist Conference was convened in Lumbini. Significant construction
works and reconstruction of Mayadevi temple started in the area. Lumbini area has
also been enlisted in the new World Heritage list. Similarly, the improvement of the
physical infrastructures and renovation works of other areas enlisted in the World
heritage list such as Swoyambhu and Changunaryan and purification of water of the
Bagmati river in Pashupati area has also been completed. The maintenance works of
Gorkha Palace and three other historical palaces of the Valley have been completed
as targeted. In order to conserve the cultural heritage, users' groups have been formed
in some districts in coordination with the local bodies .
Against the target of 10 percent growth in tourist arrivals and 20 percent growth in
foreign currency earning during the plan period, the achievement has been as follows:
225
Yr. Tourist Arrival Foreign Curr ency Generation
(in numbers) (US $in million)
Achievement in % Achievement in %
Achievement
Achievement
to previous
to previous
Compared
Compared
Compared
Compared
to target
to target
Target
Target
year
year
1997 420,000 421,857 101.4 7.2 213 115.9 54.4 -0.6
1998 462,000 463,684 101.4 9.9 255.6 152.5 59.7 31.6
1999 508,200 491,504 96.7 6.0 306.7 168.1 54.8 10.2
2000 559,020 463,646 82.9 -5.7 368.1 166.8 45.3 -0.7
2001 614,922 361,237 58.74 -22.1 441.6 140.2 31.74 -15.9
Total 2,564,142 2,201,928 85.9 1585 745.3 47.0
The average day of tourist stay in Nepal, during the Ninth Plan period, was targeted at
13 days, however, in the first three years of the plan period the figure was 10.49,
10.76 and 12.28 days respectively . The average stay-day declined to 11.88 and 11.93
respectively. During the last two years of the plan period. Likewise, per day income
from a tourist was expected to be US$ 60; however, in 2001 the figure was only US$
39.6. Similarly, in 2002/03, the Ninth Plan targeted to provide direct employment to
111,329. The achievement, at the end of 2001, however, is only 80,000 employments.
Contribution of this sector in the total foreign currency earnings and Gross Domestic
Product has been 12 percent and 3.1 percent respectively.
1. In recent years, the tourism sector has been affected by the following major
incidents:
• The suspension of the Indian Airlines flight following the hijacking of
one of its flights that took off from Kathmandu.
• The different circumstance following the tragic incidence in Royal Palace
Out June 2001.
• The 11 September 2001 attack on America, and the Afghanistan war .
• The frequent bandhs and strikes announced by political parties, and the
nation-wide imposition of emergency.
2. Lack of development of new tourist spots, and inability to orient tourist
services forwards rural areas .
3. Lack of co-ordination in programs and actions between private sector and
government and within the private sector despite the establishment of Nepal
Tourism Board.
4. There is an absence of analysis and estimation of the portion of the revenue
generated from the tourism sector that stays inside the country, status of the
development of the cost-based quality tourism, direct and indirect
employment, use of established infrastructure, and necessity of investment.
226
5. Availability of air seats have been constrained due to the termination of
Europe sector flights by Royal Nepal Airlines and reduction in the number of
scheduled flight by international airlines and the failure of the Nepal’s private
sector airlines to operate international flights.
6. Life rescuing services, communication mediums and fire control services
have not proved to be reliable. There is only one international airport in the
country, in which big aircrafts cannot land since it is situated inside the hilly
valley. If they manage to come it is only in much lower speed and lesser load.
7. Due to lack of financial resources, the conservation, preservation and
campaigning of living heritage like cultural, historical and memorial sites
have been inadequate. Similarly, due to lack of adequate quality up-gradation
of the heritage sites and violation of standard practice in the renovation works
of areas and monuments enlisted in the World Heritage Site, they have
reached at endangered level for being de-listed from the World Heritage Site
lists.
8. Involvement of local communities in managing the heritage sites and making
such management self-reliant has been moving at snail’s pace.
13.3 Long term vision

Based on past experience and realities, the following long-term vision has been
adopted.
1. Developing tourism factor as an important part of the national economy and
re-establishing the country globally as a prime destination.
2. Expansion of earning from the tourism sector to rural areas through
qualitative improvement of tourism related services.
3. Emphasis on cultural tourism by conservation and proper management of
living heritage, world heritage sites and monuments of national importance.
4. Making international and domestic air services simple, efficient, safe, and
reliable and developing convenient road networks in tourism areas.
15-Year Projection
S. No. Particulars F.Y. 2072/73 (2015AD)
1. Tourist Arrival (in thousands) 1,219
2. Earning of foreign Currency (in million US$) 635
3. Contribution to GDP (%) 4.1
4. Employment: Direct (in thousands) 150
Indirect (in thousands) 200
5. Regular flights operated to Nepal by International airlines (in Number) 22
227
13.4 The Tenth Plan
a) Objective :
The effective and prioritised implementation of the programmes in the tourism sector
that has already emerged as an important organ of the national economy, will not only
contribute to national economy but will also provide benefits to foreign tourists as
well as increase the income generating and employment opportunities . In view to this,
following objective have been set forth in the Tenth Plan.
1. Sustainable development and qualitative promotion of the tourism sector.
2. Conservation and preservation of historical, cultural, religious and
archaeological heritages and enhancing their practical utilization.
3. To render air transportation services easily accessible, secure, standard, and
reliable.
b) Quantitative Targets:
Emphasizing to recover the opportunities of the Ninth Plan Period the following
annual quantitative targets have been fixed for the Tenth Plan period:
S. N. Particulars 2058/059 situation F.Y. 2063/64

(2001) (2006)
1. Tourist Arrival (in thousands) 365 516
2. Tourist stay period (Days) 11.93 13
3. Foreign Currency earning (in million US$) 140 205
4. Earning per tourist per day (US$) 39.6 60
5. Contribution to GDP (%) 3 3.0
Employment: Direct (thousands) 80 100
6. Indirect (thousands) Not Available 125
7. Regular international flights (numbers) 13 17
8. Availability of one-way air seat in 1,000 1,200
international sector (thousand)
c) Strategy
Development of the tourism sector assists the overall development of the national
economy and generates foreign currency; it also helps in the economic development of
the hilly region that has low agricultural productivity and creates employment in the
region.
The hilly and backward regions are blighted with unemployment and poverty; at the
same time, they are bestowed with astonishing natural beauty and enormous potential
for mountaineering and white-water rafting that calls for greater emphasis in the
development of tourism in this area. This will also promote social justice in
development. The quality of civil aviation is equally important when considering the
228
development of the tourism sector. Similarly, culture is the treasure of the country and
its development and conservation will promote the fame and identity of the country; at
the same time, it also helps in the overall social development of the country and the
development of the tourism sector.
n Strategies related to objective one
1. Besides the established tourism markets, less risky tourist destinations
will be promoted. Likewise, Nepali tourism will be promoted in the
neighbouring countries.
2. By increasing the use of locally produced goods and services, local
retention of the money spent by the tourist will be encouraged. Women
and backward communities will be encouraged with special priority in
such activities .
3. Tourism activities in the recently opened (previously banned) and other
potential areas will be enc ouraged through infrastructure development
and domestic tourism will be established as an economic alternative.
4. Eco-tourism will be promoted and Nepal will be developed as one of the
major destinations for eco-tourism.
5. Competitive and collaborative capacity of non-governmental and private
sectors associated with the tourism sector will be enhanced.
n Strategies related to objective two
6. To encourage involvement of non-governmental sectors in management,
preservation and utilization of cultural, religious, archaeological and
natural heritage in accordance to decentralization policy.
7. Study, conservation and preservation of literature, art and culture will be
done.
n Strategies related to objective three
8. The airport and airlines service with necessary infrastructure will be
developed to ensure domestic and international travel.
9. Private sector will be involved in airport construction, operation and
long-distance airlines service.
d) Policy and action plan

n Promotion of tourism market in neighbouring countries (related to strategy
1)
• Implementation of sub-regional plan and program in co-operation with
the South Asian countries.
• Priority to neighbouring countries in promotion activities .
• Foreign diplomatic services, any agency representing His Majesty
Government abroad and individual or organization with business
relationship will be mobilized in promotion and publicity activities.
229
n Retention of maximum amount of money spent by tourists in local areas
• Increasing employment opportunities through protection of local skills
and its commercial use.
• Emphasis on the use of local locally produced goods and services .
• Offer clean environment, qualitative service and courteous behaviour.
• Preparation and implementation of the code of conduct and improvement
in the quality of residence, travel, entertainment etc.
n Establishing domestic tourism as an economic alternative (related to
strategy 3)
• Implementation of a strong and reliable security system for the safety of
domestic as well as international tourists.
• Development of the infrastructure related to tourism sector such as road,
communication, drinking water, health etc in coordination and help of the
ministry, and related implementing agencies .
• Execution of various activities in an integrated manner through the
establishment of regional tourism centres (hub).
• Expansion of mountaineering, trekking, and other adventure tourism in
new areas through participation of the local bodies and non-governmental
organizations.
• Mountaineering tourism will be made more attractive by allowing to
summit new or less used mountains and adoption policies for
mountaineering through promotional subsidy, low price or free of cost.
• Exploration of new areas including incentive, convention, sports, village
tourism and practical development of available tourist heritage.
n Promotion of eco-tourism (related to strategy 4)
• To implement priority programs such as environmental protection,
garbage management, alternative energy, employment generation and
awareness raising activities, coordination among the governmental, non-
governmental and private sector will be enhanced.
• Special monitoring will be done to check pollution in protected areas like
trekking, mountaineering and other environment-sensitive areas.
n Involvement of tourism related government, non-government and private
sectors in a coordinated manner (related to strategy 5)
• Implement Destination Nepal Campaign 2002-03 with priority.
• Carryout institutional reforms of Nepal Tourism Board and Civil
Aviation Authority of Nepal.
• Operationalize and or fully privatize Royal Nepal Airlines Coorporation
with joint investment of government and or domestic /foreign agencies.
230
n Protection, promotion and management of cultural, religious,
archaeological, and natural heritages (related to strategy 6)
• Play a role of a facilitator in promoting positive attitude of people
towards cultured tourism to support tourism service.
• Archaeological survey, exploration, protection, and excavation of the
areas of national importance will be carried out.
• Protection and conservation of cultural uniqueness and religious tradition
that supports tourism sector.
• Mandatory implementation of guidelines for the protection of the areas
under world heritage and of archaeological importance.
• Participation of the local, non-governmental and private sector in the
protection and promotion of the heritages to make such activities self-
reliant and income generating.
n Study, protection and promotion of literature, arts and culture (related to
strategy 7)
• Legal protection and recognition of works of various literatures, writers,
musicians, artists etc and encouragement to new talents.
n Creation of necessary infrastructure for the domestic and international
travel (related to strategy 8)
• To render air travel less risky and secure, a satellite-based
communication system will be established, developed and expanded.
• Construction and expansion of existing facilities in the international and
domestic airports such as hangers, communication facilities and other
necessary technical equipments and coordination of skilled technical
manpower to provide a secure environment for landing and take off.
• To make air service regular and reliable the quality of existing airports in
remote areas will be upgraded and new airports will be constructed.
• Renewal of international air agreements and encouragement to new
agreements.
• Creation of necessary infrastructure and service in the domestic airports
to start flights to neighbouring countries.
n Participation of the private sector in construction, operation and
management of long-distance air service (related to strategy 9)
• Beginning of a construction work of a well-facilitated international
airport in the Terai area.
• Encouragement Promotio n of regular or chartered international flights.
• Maximum use and enforcement of air routes in the Nepali sky.
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13.5 Program and implementation mechanism
The following programmes will be conducted in this sector:
1. Nepal Tourism Board will, in coordination with social organization, NGOs
and educational institutes, conduct programs at local levels to enhance public
awareness towards tourism .
2. Local bodies’ involvement will be emphasized in developing new tourist
spots. Under the initiative of the NTB, and the participation of the private
sector, publicity and promotion works will be done.
3. To make the tourist’s travel safe and well-managed, various government
recognized agencies like travel and trekking will be encouraged to coordinate
travel programmes. While traveling in the rural areas, a mechanism will be
set up for registration at various points of travel and travelers will be put into
close contacts with the local bodies and security agencies . To provide health
and communication services in rural areas concerned bodies will coordinate
accordingly.
4. NTB will setup Tourism Centre (hub) and the set programs will be integrated.
5. Private sector will be involved in the management of pollution and garbage
problem in the urban areas and their participation will be coordinated with
concerned municipalities to implement the programs.
6. Code of Conduct will be prepared and mandatory implemented to discourage
unhealthy practice and competition. NTB will monitor the services provided
by the concerned parties and will enforce reward and punishment system on
the basis of service delivered.
7. Establishment of an umbrella institution incorporating all organizations and
sectors related to the tourism sector will be encouraged so that they can
participate in the activities starting from the policy to the implementation
level and raise collective voice and problems of their sectors.
8. Natural, archeological, religious, cultural and touristic places will be
categorized and a certain portion of the income generated from the use of
these places will be mobilized for future development of the local areas
through local and non-government bodies such that they become self-
sufficient and sustained. In the management of such areas, local user jump
communities and tourism service providers will be involved.
9. Participation of local women and backward community will be encouraged in
the conservation of physical infrastructures and living heritages.
10. A permanent body comprising of tourist-sector, private sector and
intellectuals will be constituted to review successful programmes and make
Destination Nepal 2002-2003 a grand success.
11. Organizations or individuals will be appointed as representatives of Nepal in
foreign countries with the help of embassies and consulates for tourism
promotion activ ities.
232
12. Promotional strategy will be adopted to use the less risky tourist destinations
as per the changing time and context. While promoting and campaigning
Nepal, NTB will mobilize national and foreign tour operators and friends of
Nepal.
13. Satellite based navigation system for aviation safety will be graduated
established in airports through Civil Aviation Authority of Nepal.
14. Short-distance international flights to neighboring countries will be started
through establishment of customs, immigration and other necessary facilities
and services in some domestic airports.
15. Construction of second international airport will be commenced in the
appropriate place of the Terai region. In case of HMG’s inability to mobilize
financial resources, construction works will be carried out through the
participation of national or foreign private sectors.
16. During the Plan period, joint venture operation or total privatization of
RNAC will be completed after its organizational structure is restructured.
17. RNAC will expand its service through commercial agreement with other
prestigious international airlines .
18. Information and data will be updated to reflect the current state of culture,
tourism and civil aviation sector; similarly, track record of the international
activities related to the field will be kept informed.
13.6 Policy level, legal and institutional reforms
1. Local bodies and private sector will be involved, in accordance with the
decentralization policy, in the conservation of natural resources and in
providing quality service to tourists. To make such bodies and organizations
competent, necessary technological and other assistance will be provided.
2. Weaknesses in the policy level and institutional reforms initiated in the last
few years in the area of tourism and civil aviation will be assessed and
timely reform in acts, laws, regulations will be initiated and institutional
structures will be strengthened.
3. Existing aviation and tourism policy will be amemded and cultural policy
will be formulated.
4. Suitable standards will be enforced in the area of culture, tourism and civil
aviation and inappropriate committees will be dissolved.
5. Necessary amendments will be made to Civil Aviation and Culture Acts;
Copy Rights Acts will be formulated and a register’s office will be
established.
6. Necessary amendments will be made in existing policies, laws and
implementation process to make the arrival and departure of international
airlines easy, transparent and attractive.
7. To provide industry status to the tourism sector and provide all the service
and facilities that the industry sector is entitled to, His Majesty Government
233
will bring new programs and packages to attract new activities in the tourism
sector.
8. To develop and promote tourism sector unhindered, a long term (20 years)
master plan for tourism sector will be formulated and implemented.
9. Various development and promotional activities will be executed in
accordance with the master plan for major religious, historical and cultural
sites (Lumbini, Pasupati, Janakpur etc).
13.7 Programs for implementation and their priority

During the plan period, 13 programs on tourism, 12 on culture and 9 on civil aviation
with total of 34 will be implemented. The priority evaluation is attached in annex
13.1. The total estimated development expenditure for the implementation of the
programs is presented below on a priority basis.
(In 10 million rupees)
Area Priority Prog. Normal case growth rate Lower Case growth rate
No. Amount % Amount %
Culture A (P1) 1 515.9 47.8 451.6 54.7
B(P2) 6 354.1 32.8 314.7 38.2
C(P3) 6 210.1 19.4 58.8 7.1
Total 13 1080.1 100 825.1 100
Tourism A (P1) 1 1419.8 54.6 1183.3 59.8
B(P2) 6 982.3 37.8 736.8 37.2
C(P3) 5 197.6 7.6 59 3
Total 12 2599.7 100 1979.1 100
Civil Aviation A (P1) 2 858.8 50.4 813.6 61.3
B(P2) 4 476.3 27.9 420.2 31.7
C(P3) 3 369.7 21.7 92.9 7
Total 9 1704.8 100 1326.7 100
Grand total 34 5384.5 4130.9
13.8 Expected Output

Expansion and development of tourism sector especially to new and rural areas will
bring regional balance by creating non agricultural employment opportunities and
will improve living standards of rural people as well as help in poverty alleviation
campaign.
Usages of locally provided services and facilities by tourists will provide employment
to unskilled, semiskilled labourers and as well help in preserving local art and culture.
It will also benefit women and the backward class.
The investment of a fixed portion of revenues generated from tourism sector at the
local level through the participation of non-governmental organization and local
234
bodies will create regional development and enhance a sense of ownership among the
locals in the tourism promotion programs.
Tourism sector is a key component of economic development since competition is
relatively low in this sector and foreign currency can be earned from within the
country. Its contribution to the GDP has remained 3 percent.
Tourism has proven to be a strong area for the development of the hilly and remote
area which is often overlooked by the development planners due to high cost of
development.
In the context of growing attraction of local communities towards tourism sector and
increasing participation of local bodies in tourism activities, planned development of
the tourism sector will certainly be beneficial for rural areas.
13.9 Role of HMG and other agencies

The involvement of the private sector, local community and non governmental
organizations in the management of heritage sites will be further enhanced with an
aim to bring about a change in the present practice of depending solely on public
spending in the area of cultural preservation and promotion.
Continuity will be given to the present practice of HMG’s withdrawal from
commercial activities and limiting its role in infrastructure development and to that of
an efficient regulator.
Since a significant portion of the revenue generated will be spent in local areas, it will
not only encourage the participation of tourism entrepreneurs but also the
participation of active and conscious local communities.
The present practice of covering all the expenses of the NTB through the fund
collected from tourists will be maintained. Collected money and the fund contributed
by the private sector will be spent on tourism promotion campaigns as well as in the
conservation of heritage sites .
Up-gradation and standardization, improvement of international aviation services,
international flight routes, management operation, training etc will be done through
Nepal Civil Aviation Authority. Whereas, flight safety, bilateral and multilateral air
relations, and formulation and amendment of national level policies etc. will be
HMG’s responsibility.
To generate skilled and capable manpower in the tourism sector and training activities
will be conducted through Nepal Tourism and Hotel Management Academy;
moreover, private sectors will also be mobilized to carry out the activities in an
integrated manner. Higher educational institution and regional mountaineering
academy will be established in tourism sector. The works of the Taragaon
Development Committee will be implemented as an unique and an exemplary model
in the field of tourism and social service.
13.10 External Risk Factors in implementation.

Development of the civil aviation sector is the prime and first necessity of the tourism
235
sector. For this purpose, appropriate and standard airports, reliable and safe flight
services are required. In this context, as there is a minimum chance of building
international airport by mobilizing domestic resources, participation of foreign and
private capital become imperative.
To increase the tourist arrival, efficient and competent international airlines service is
required; therefore, bilateral air agreement with the concerned countries to increase
air seats is necessary. Since the addition of the international airlines service will be
temporary in nature, empowering the national airlines is necessary, for which
privatization of RNAC is the utmost need. Tourist arrival is affected by the factors
such as international financial situations, world events, negative publicity, tension in
the neighboring countries, endemic and epidemic diseases, law and order situation,
environment, pollution, waste management and attitude towards tourist. Travel
advisor y for their nationals by foreign embassies also affect this sector. The Travel
Advisory issued by the foreign embassies also impact the tourism sector. All
concerned bodies and institutions should remain alert to these issues and remain
active to address them.
13.11 Log frame

The summary policy and programmes log frame has been given below and is
illustrated in detail in the Annex three.
236
Policy and programmes log frame : Culture, Tourism and Civil Aviation
Overarching National Goal: Poverty incidence of Nepalese People (men and women) will be reduced significantly and in a
sustainable manner.
Sectoral Goal: Substantial contribution of Industry, commerce, and supply management in the economic and social development of
the country
Objective Strategies Indicators Sources of Major Programs Risks and
Information Obstacles
Sectoral Goals: • Development of less • 7.2 percent annual • Agencies 1. Programs to create public • Economic
Rational and exemplary use of risky tourism spots and growth in tourist under awareness towards tourism fluctuation
national resources, upgradation of promotion of tourism in arrival totalling to MCTCA and importance of cultural in the
civil aviation service, standard neighbouring countries. 516 thousands. and other heritages. internationa
promotion and massive public • Maximum portion of the • Annual 8 percent • Ministry of 2. Emphasis in the visit of the l market.
participation for sustainable money spent by growth in foreign Home and Increase tourist travel to • Security
development of tourism. tourists will be retained currency earning immigration new tourist destinations. and health
in local areas. Women totalling to USD department 3. Tourist travel to be made situation
and people from 205 million. . comfortable, secure and within and
backward communities • Contribution to • Ministry of safe. neighbourin
will be involved with GDP to reach 3 Finance 4. Ensuring quality g countries.
priori ty in such percent. and Nepal development of tourism. • Guarantee
activities. Rastra of foreign
• Per tourist per day 5. Facilitating cultural and
• The infrastructure of income of USD 60. Bank. religious tourism airlines’
the newly opened and • Average tourist • Ministry of development through operation in
alternative tourist Land conservation of heritage, Nepal.
stay day to 13
destinations will be days. Refom and promotion and publicity to • Diplomatic
developed and tourism "Guthi" make it a supporting sector ties
will be established as • Creation of 100 for development.
Sansthan. between
an alternative to thousand direct
employment and • Royal 6. Re-establishing country's Nepal and
economic activities. international image by foreign
50 thousand Nepalese
• Eco-tourism will be Embassy successfully organizing countries.
237
given priority and indirectly and destination Nepal 2002-
Nepal will be employment Consulates 2003 campaign.
developed as one of annually. . 7. Air travel to be made safe
the major destinations • Availability of 17 air • Department and reliable.
for such destinations. services in the of Wildlife 8. Commencement of
• Governmental, non international sector and international flights from
governmental and and 120 thousand National domestic airports.
private sector will be air seats annually. Parks and 9. Beginning of the
involved in a King construction of the second
coordinated manner so Mahendra international airport.
as to improve their Trust for
competitive capacity. 10. To avail sufficient air seats
Nature in international seats.
• Participatory program Conservati
on. 11. Privatization of the Royal
based on the principle Nepal Airlines Corporation.
of the decentral ization • Private
will be designed in tourism 12. To generate skilled
order to conserve, entreprene manpower in cultural,
promote and manage urs. tourism and civil aviation
sector.
the cultural, religious,
archaeological, and 13. To formulate master plan
natural heritages. in the area of culture,
• Conservation, tourism and civil aviation
sectors as well as timely
promotion and study of
amendment of policies,
literature, arts, and
culture acts and regulations.
14. Updating the database and
• Ensuring a safe and
information that reflect the
reliable air service for
current scenario in culture,
domestic and
tourism and civil aviation
238
international travel with sector.
the construction of
airport with the
necessary
infrastructures.
• Participation of the
private sector in
construction,
management and
operation of airports
and operation of long-
distance airlines.
239
Table 13.1 : Program and Estimated Budget
Culture
In million rupees
S. Programmes and projects Normal case Lower case
N. growth rate growth rate
First priority A(P1)
1. Conservation of World Heritage sites
• Master Plan and conservation of monuments enlisted 40.9 3.66
in the World Heritage sites (except Pashupati and
Lumbini)
• Pashupati Area 285.0 25.50
• Lumbini, Kapilbastu and Ramgram area 190.0 16.00
Total 515.9 45.16
Second Priority B (P2)
2 Policy, Act, Regulation and Institutional Reform 02.8 02.5
• Cultur e policy act, regulation, and master plan
preparation
• Copy Rights, establishment of registrar office and
coordination with WIPO
• Transfer of guthi and monastery management works
• Preparation of archaeological guidelines
3 Existing projects for excavation and conservation 1.35 1.20
• Completion of Karebihar excavation and publish
report, and its conservation
• Excavation and conservation of Devghat-Mani
Mukundasen Pachadebal
4 Conservation and management of the religious and 24.39 21.68
archaeolog ical heritage sites
• Completion of renovation works of Gorkha Durbar
renovation & conservation completion.
• Renovation and conservation of the temples,
monuments, pilgrimage sites of religious and
archaeological importance.
• Conservation of the following pilgrimage sites: Janaki
temple and Dhanushadham, Devghat area,
Swargadwari, Haleshi Mahadev, Pathibhara, Bahara
Chhetra etc.
5 Development of Aavilekhalaya, Museum and 5.69 5.06
Laboratories
• Establishment of Gorkha Museum based on master
240
plan
• Development of Museum, Aavhilekhalaya and
Laboratories
6 Conservation and promotion of lively culture 12.2 10.9
• Technical and financial assistance in the conservation
and promotion works done by the local authorities.
7 Kavre Integrated Development Project ** 24.8 22.0
Total 354.1 314.7
Third Priority C (P3) (Probable projects) 210.1 58.8
8 Archaeological conservation, exploration, research
and excavation
• Excavation and exploration of Ramgram, Gotihawa,
Chandolpur Kapalvastu, Kichakbadh Jhapa, Khokshar
Saptari.
• Survey, exploration, study and research of historical
and archaeological forts, monuments sites etc.
Record keeping of these cites and preparation of the
master plan for their conservation
9 Survey, Research and Renovation of the important
National Heritages
• Survey, exploration, study and research of historical
and archaeological sites, monuments etc. Record
keeping of these cites and preparation of the master
plan for their conservation
• Conservations of famous pilgrimage sites
10 Participatory development of museum and culture
• Establishment of museum with the participation of the
private sector to conserve traditional musical
instruments, attires, ornaments, currency, idols, epics
and arts.
11 Cultural Promotion
• Cultural exchange with different countries
• Cultural exchange between different areas within a
country.
• Promotion and publicity of Devghat, Halesi Mahadev,
Sworgadari, Pathibhara, Khaptad, Janakpur etc.
• Production of audio-visual materials
12 Development of language, literature, arts, and
241
culture
• Assistance to local bodies in the study, research and
conservation of language, literature, arts, and culture
that is at the verge of extension.
• Publication of a dictionary of the national language.
• Publication of the works of the famous literatures .
• Training to emerging talents and assistance to private
sectors in such works and organization of
com petitions.
• Economic subsidy to conserve traditional rituals and
rites
• Economic assistance to National Talents Trust Fund
and concerned organizations
• Lord Budda International Peace Prize
• Investment and loan to Cultural Corporation
• Esta blishment of Universities
• Hindu University
• Buddhist University
Grand Total 108.01 82.52
* Established under Ministry of Education
** Full French grant
242
Tourism
In million rupees
1. Development of touristic areas
• Ecotourism project: Development of Kanchanjanga, 138.60 115.52
Makalu, Barun, Dolpa, Humla remote area development,
Palpa environmental reform, Lumbini infrastructure
upgradation and airport infrastructure development (suketar,
tumlingtar, surkhet, misinechaur and simikot)
• Tourism model village: shree antu, dhanushadham, tanahu, 3.38 2.81
khaptad, jumla.
Total 141.98 118.33
Second Priority B(P2)
2 Policy, acts, regulation and institutional reform 1.16 0.87
• Revisit and improvement of tourism policy
• Institutional evaluation and amendment in tourism related
acts
• Documentation, research and training
• Formulation of tourism master plan
3 Development of Tourism infrastructure 64.00 48.00
• Link trail, road
• Suspension bridge
• Communication networks among trekking and
mountaineering agencies.
• Electrification of resorts and camp sites
4 Second Tourism Infrastructure Project** 16.11 12.09
5 Tourism Promotion 9.80 7.35
• International contact
• Destination Nepal Campaign*** -
• Program for promotion of religious and cultural tourists*** -
• Special promotion in neighbouring countries*** -
• Tourism market diversification*** -
• Tourism market promotion*** -
• Domestic tourism promotion*** -
• International promotion and publicity*** -
• Production of publicity and promotion materials*** -
• Mobilization of royal Nepalese Embassies and diplomatic -
agencies***
6 Expansion of tourists security and facility 1.56 1.17
• Simplification of visa and emigration procedures and
making travel comfortable
• Improvement in security management
7 Project to conserve touristic, religious, and cultural 5.60 4.20
heritage
Total 98.23 73.68
243
Third Priority C(P3) ( Possible projects) 19.76 5.90
8 Tourism activities expansion
• Trekking routes renovations
• Cable car
• Funicular rail
• Rafting etc.
9 Environmental protection and tourism development of
Himalayas, mountains, lakes, ponds, and open public
places
10 Tourism Human Resources Development
• Establishment of regional tourism training centre
• High -skilled manpower development and training
• Establishment of higher level educational institutions
• Establishment of regional level mountaineering training
academy
• Mobilization of private sector in human resource
development
11 Investment in Tourism Sector
• Setting procedure for foreign direct investment
• Investment in areas lacking tourism promotion
• Identification and production of the items consumed by the
tourists
12 Hub Centre establishment in Ilam, Jumla and
Mahendranagar
13 Rural Tourism Development
• Tourism Programs for Poverty Alleviation: Kanchanganja,
Solukhumbu, Lamtang, Chitwan, Lumbini, Dolpa****
• Rural Tourism Development: Terathum, Kavre, Nuwakot,
Tanahu,
• Sakhu, Khokana, Lakuni, Kakani, Ghale Gaun Lamjung,
Junbasi
* Including Asian Development Bank ’s Rs 1.1 billion loan assistance
** R s. 178.9 million loan assistance from Asian Development Bank
*** To be implemented by Nepal Tourism Board
**** A grant assistance from UNDP, DFID and SNV
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Civil Aviation
In million rupees
1. Construction of additional international airports 57.38 54.36
Feasibility study and agreement with private sector
(acquisition of land)
2 Strengthening Tribhuban International Airport 28.50 27.00
Tribhuban International Airport improvement project* -
Development and extension of satellite-based radar system**
Total 85.88 81. 36
Second Priority B (P2)
3 Reforms in policies, acts, regulations, and institutions 0.17 0.15
Institutional evaluation and amendment in civil aviation
related acts
Review and improvement of air policy and formulation of
airlines service policy and acts.
4 Upgradation of airports for medium scale international 27.20 24.00
flight ***
5 International air route development and airlines security 3.26 2.87
programme
6 Construction of Hangers 17.00 15.00
Total 47.63 42.02
Third Priority C (P3) ( Possible projects) 36.97 9.29
7 Feasibility study of new domestic airports and
construction
Studying the possibility of new airport
Construction of new airport
Making the runways concrete
8 Airlines Development Program
Strengthening international airports
Reliable airlines service in remote areas (subsidy)
9 Airlines agreement and international contacts
Improvement in air agreements and new agreements
Ratifications of Conventions and Protocols
International Civil Aviation institution (grant)****
Grand total of the Culture, Tourism and Civil Aviation 538.45 413.09
sectors
* Full ADB loan- Loan investment in CAAN
** Born by CAAN
*** Involve private sector also
**** Amount to be born by Nepal as per air safety and other agreements.
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Chapter - 14
Industry, Commerce and Supplies
14.1 Industry
14.1.1 Background
Despite some changes brought about by the policies and other reforms initiated in the
past, the contribution of the industrial sector in the Gross Domestic Product (GDP)
has not exceeded 10 percent. In terms of industrial units, still more than 90 percent of
the industries fall under small and cottage industry/(cottage and small scale)
categories. Such industries have contributed over 76 percent of employment in the
industrial sector, and 50 percent in value addition. Thus, there is a huge potential for
using the development of small-scale and cottage industries as important means for
poverty alleviation.
In this context, there is a need to develop micro enterprises and small scale industries
and to extend them to the village level. There is also a need for policy level, legal,
institutional and procedural reforms to expand and diversify the products of the
industrial sector through the active participation of the private sector. Moreover, the
quality of the industrial products needs to be improved and be competitive in the
international market.
a) Targets and Achievements
Despite initial positive results witnessed after the promulgation of Industrial Act,
Foreign Investment and Technology Transfer Act and other procedural reforms
initiated within the framework of open and liberal economic policies, the pace of
industrialization was severely affected by the deterioration in the law and order
situation and weaknesses in institutional coordination and lack of effectiveness in
service delivery.
The Industrial Production Index gradually declined due to deteriorating industrial
security during the Ninth Plan period and eventually plummeted to 2 percent in the
fiscal year 2001/2002.
However, due to high rate of growth in the industrial production in the initial years
which was 37. 65 percent, the average growth rate at the end of the fiscal year was
13.2 percent. The average targeted growth rate for the Ninth Plan period was 13
percent.
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Similarly, the annual industrial value added is expected to be 3.9 percent against the
initial target of 9.1 percent. Likewise, the total contribution of the industrial sector in
the GDP has remained less than 10 percent against the target of 14 percent. The
industrial sector has generated additional 151000 employment opportunities against
the target of 350, 000, which is only about 43 percent of the target.
Table 14.1 : Industrial product, annual value added and contribution to GDP
Particulars Ninth FY FY FY FY FY Average
Plan’s 1997/98 98/99 99/00 2000/01 01/02 growth
average rate for
growth five years
rate
target
Growth rate of 13.0 37.65 13.9 6.1 6.3 2.0 13.2
Industrial Index (base
year 1885/86) +
Industrial sector’s 9.1 3.42 5.29 7.2 3.6 - 3.9

Annual value added 0.06
rate ( percent)+
Contribution of the 14 9.8 9.8 9.9 9.8 9.2 9.7

industrial sector in
DGP( percent) +
Source: (+) economic survey 2002/03
On the industrial investment front, the total investment target was Rs. 35 billion for
the plan period, assuming the average annual domestic investment of Rs. 2 billion and
Foreign Direct Investment (FDI) of Rs. 5 billion. However, the total investment at the
end of the plan period was only Rs. 24 billion, including Rs. 9 billion of FDI.
The Plan has exceeded its target of training about 1,00,000 people for the expansion
of micro, cottage and small scale industries. The total number of trained people has
been 112, 676. Similarly, it has also exceeded its target in standard and measurement
promotion programme. The standard of 697 products has been fixed as against the
target of 675. Likewise, against the target of 4000, the physical and chemical analysis
of 6622 products has been completed.
The industrial and scientific measurement target of the products has also been
exceeded. This service is extended to over 585 products against the target of 265
products.
Against the target of monitoring the industrial pollution 1020 times, it has been
monitored 1163 times and more than 3598 products have been provided with the
quality inspection certification though the target was only 2500.
The achievements in some other areas have, however, been less than the target. The
analysis service has been extended to only 5819 products as against the target of 7500
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and only 701 products have been given standard certification though the target was
756.
Despite the target of mineral exploration, including metal and non-metal, in more
than 6, 335 square kilometers, the total mineral exploration was completed only in
5,100 square kilometers. Similarly, only about (1000 meter) (33.33 percent) was
drilled for exp loration as against the target of 3000 meters. Despite the target of
21,300 square kilometers of geological exploration, engineering and environmental
geological study, and remote sensing study under the geological survey and research
only 12,410 (58.26 percent) square kilometers have been studied. The target of
publishing 9 geological colour maps has been fully achieved. Similarly, the National
Seismological Centre has worked for 34,731 station days against the target of 36,865
station days. The target of establishing four network stations in Karnali has also been
met. Out of the target of studying 250 square meter s under the Polio-seismisity, 135
square kilometers have been studied.
b) Problems and challenges
Major internal reasons like, deteriorating law and order situation, high investment in
industries yielding low value addition, lack of control in quality standard coupled
with international reasons such as economic recession and terrorist attacks had
negative implications in industrial production. This led to a serious decline in the
production of exportable items and in turn export resulting in rise in unemployment
rate. Moreover, failure to develop industries based on viability and comparative
advantage, low inflow of Foreign Direct Investment, limited expansion of industries
in the rural areas, weakness in competitiveness, absence of forward and backward
linkages, and lack of industrial development base on domestic resources, human
resources and raw materials are the major problems of this sector.
Among the major exportable items, the export of high-quality carpets woven out of
traditional wool was adversely affected by the use of low-quality wool, export of
inferior carpets, smuggle in the export of Nepali wool and child labour issues. Due to
the lack of timely initiative, the country could not obtain more quotas from the US
and European markets for gradually developing garment industry. With the expiry of
the Multi-Fiber Agreement on December 31, 2004 and in the absence of the
alternative market, garment industry is likely to face a serious problem in the future.
The end of the Agreement will force the garment industry to look for international
markets based on its competitiveness. It is important to create necessary
infrastructure, investment-friendly environment, reduction in the cost of readymade
garments, promotion of quality products, and timely import of the required raw
materials to meet the future challenges.
Despite the implementation of a number of policy and procedural reforms to promote
private sector, the country has yet to create a private sector friendly environment. It is
necessary to develop a competitive and open market and make the role of the private
sector decisive in realizing the national development and attaining optimum results.
For this, it is also necessary to initiate timely reform of the macroeconomic policies
such as tax, customs, revenue, and domestic and foreign investment consistent with
248
the open and market-oriented economy, and mobilize the participation of the private
sector to the optimum level.

The long-term vision of this sector is to make the areas of comparative advantage
more competitive, and promote and strengthen the role of the private sector while
minimizing the negative impac t on environment to achieve a sustainable industrial
development in the long run. Similarly, the long-term goal of this sector is to enhance
production and productivity and to create investment-friendly industrial environment.

a) Objectives
1. To increase the contribution of the industrial sector in GDP by promoting and
facilitating the private sector.
2. To contribute to poverty alleviation goal by increasing the income and
purchasing power of the rural people through employment generation in the
micro, cottage and small-scale industries.
3. To increase industrial competitiveness by attracting FDI and adopting
appropriate technology.
b) Sectoral and macro level major quantitative targets
1. Achievement of 7.8 percent annual average industrial growth rate.
2. Total industrial investment of Rs. 40 billion in the plan period, including
annual domestic investment of Rs. 5 billion and foreign direct investment of
Rs. 3 billion.
3. Creation of additional 250, 000 employment opportunities in the industrial
sector.
c) Strategy
Industrial sector plays an important role in economic development of the country,
besides reducing the employment pressure in the agriculture sector by providing an
alternative employment opportunity. It also has a role in bringing about a structural
change and creating a regional balance in the development process.
The industrial sector can contribute to achieving broad-based and high economic
growth rate through the use of locally available means and resources. For the
development and expansion of the industrial sector, industries of national priority and
comparative advantage should be developed; competitiveness of the established
industries should be enhanced; and industrial productivity and quality should be
improved through channeling domestic and foreign investment.
249
Similarly, to meet local needs and to create income earning opportunities in the
backward rural areas, an integrated programme should be launched to develop skills,
entrepreneurship, ni vestment and technology for the industrial promotion. If such
integrated programme is connected to the market and the access of special targeted
groups is enhanced, it can contribute significantly to poverty alleviation. The
following are the strategies to achieve the goal.
§ Strategies related to objective no. 1
1. The government will play a role of a facilitator, regulator, communicator
of information and monitoring agent to create an enabling environment
for the private sector to take a lead role in industrial development.
2. Industrial production will be enhanced through identification of industrial
sectors that have comparative advantage and competitive edge and also
by creating necessary infrastructures.
3. Intellectual property will be protected and its entrepreneurial use will be
promoted.
4. Special attention will be given for the sustainable development of
infrastructures, entrepreneurship and skills to develop micro, cottage and
small scale industries based on local agro-forest resources.
§ Strategies to attain objective no. 3
5. Based on Industrial Perspective Plan, an industrial implementation action
plan will be prepared and implemented.
6. Foreign Direct Investment will be promoted to expand the base of the
industrial capital.
d) Policies and action plan

§ Government will play a role of facilitator and regulator to create an
environment for the private sector to take a lead role in industrial
development (related to strategy 1)
• Investment will be promoted by creating social and physical
infrastructure wherever there is a potentiality of industrial development.
• One-Window System will be made more effective and developed as a
service-oriented unit that would be active, efficient and functioning
according to calendar of operation.
• The garment, woolen carpet, pashmina and handicrafts industries will be
promoted and expanded at the regional level under the regionalization
concept of these industries.
250
• Further reforms will be initiated in eliminating the legal, procedural and
policy level obstacles to private sector investment in industrial sector.
Investment climate will be improved so that private sector itself can make
the investment decision.
• Existing labor laws will be reformed and made flexible to connect the
welfare and interest of investors and workers to industrial production.
• Special program will be initiated to rehabilitate viable sick industries.
• A number of measures will be taken to make the industry and business
more competitive by cutting down the cost of production and
transportation, administrative hassles and red-tapism.
§ Identification of the industries of comparative advantage and improvements
in professional production (related to strategy 2)
• Emphasis will be given to identify the areas of comparative advantage.
• Industrial promotion will be launched in accordance with WTO, SAPTA
and SAFTA.
• Domestic and foreign investment will be attracted in exploration,
development and management of national mineral resources.
• The already developed basic services in Biratnager-Dharan, Birgunj-
Hetauda, Rupandehi-Butwal corridors will be encouraged to be used in
industrial development.
§ Protection of intellectual property rights and its promotion in professional
use ( related to strategy 3)
• Based on the World Trade Organization concept, the laws and regulations
related to the intellectual property rights will be updated and
implemented.
§ Establishing the micro and small scale industries based on local agro-forest
resources (related to strategy 4)
• Local bodies and private sectors will be mobilized to develop suitable
human resources, concessional loan, and technical service necessary for
the promotion of micro, cottage and small scale industries.
• Micro and small scale industries will be encouraged to work as sub-
contracting to big industries.
• Various promotional programmes will be launched in rural areas to
develop entrepreneurship and skills to promote investment in industries
based on local resources.
251
• The micro, cottage and small scale employment-oriented industries will
be developed and expanded by strengthening financial, institutional and
technical supports.
• To develop entrepreneurship among rural women, the access of
entrepreneurial women will be enhanced in the operation and
management of food processing industries.
§ Action plan based on industrial perspective plan (related to strategy 5)
• The obstacles in the development of the industrial sector will be
eliminated by prepared industrial perspective plan and related action
plan. An effective protection system will be put in place to make
industries competitive and to create an industrial base.
• Industries will be encouraged to be established outside the urban area and
emphasis will be given to the development of environment friendly
industries.
• Small, medium and large-scale industries that can take advantage of the
trading relations with neighbouring and other countries will be developed
and expanded.
• An environment will be created to establish backward and forward
linkages between all scales of industries, and such industries will be
encouraged to adopt professional management.
• The environmental impact of industries will be minimized.
• Extension and institutional reform of employment-generating industries
will be encouraged.
§ Promotion of Foreign Direct Investment (related to strategy 6)
• A mechanism will be developed and expanded to smoothly mobilize fixed
and working capital from financial institutions for establishing industries.
• High priority will be given to industries of national importance and that
can create regional balance and necessary facilities will be provided to
promote investment in the backward and underdeveloped regions.
• Security environment in the industrial sector will be enhanced. Foreign
Direct Investment will be attracted and encouraged to invest in the areas of
comparative advantages.
• Local know-how and other relevant technologies needed for industrial
development will be promoted.
e) Policy level, legal an d institutional reform s and provision s for implementation.
252
• Industrial Act and other Acts will be updated timely for the long-term
development of the industrial sector.
• Action Plan will be prepared based on Industrial Perspective Plan
formulated for the long term development of the industrial sector.
• Complementary relationship will be established between Mineral Act,
Forestry Act and Local Autonomy Act to expedite the operation of
industries based on mineral resources.
• Since Nepal is already a member of the World Intellectual Property
Organization (WIPO) and a signatory to Paris Covenant on Protection of
Industrial Property and has already applied for the World Trade
Organization membership, an institutional arrangement will be made under
the Depar tment of Industry to protect industrial properties.
• The scope of One Window system constituted to provide the necessary
facilities to industries from one spot will be reviewed and strengthened
through decentralization process.
• Concerned parties will be provided up-to-date product-wise and subject-
wise information related to the industrial sector, and the managerial
capacity will be enhanced by gathering, processing and disseminating up-
to-date information.
f) Programmes and Projects
The summary of the prioritized programmes related to industrial sectors
prepared on the basis of prioritization process of Policy Action Matrix is given
below.
Table 14.2 : Summary of program prioritization
(Rs. in millions)
Priority order no. of programs At expected growth rate At normal growth rate
amount percentage amount percentage
A (P1) 2 1444.3 63.6 1326. 4 77.8
B (P2) 1 219.4 9.7 195. 0 11.4
C (P3) 13 606.9 26.7 185. 0 10.8
Total 16 2270.6 100. 0 1706. 4 100. 0
14.1.5 Expected Achievements/Outputs

a) Expected additional contribution to Gross Domestic Product
To achieve the average growth rate of 6.2 percent at factor cost during the plan
period, the agriculture sector is expected to grow at an average of 4.1 percent and
non-agriculture sector at an average of 7.3 percent at the constant price of fiscal year
253
2002/03 of the non-agriculture sector, the contribution of the industrial and mineral
sector is estimated to be 9.32 percent.
b) Contribution to poverty alleviation and human resource development
The development and expansion of the industrial sector by attracting domestic and
foreign investment and the development of industries of national priority and
comparative advantage; improvement in the competitiveness of the established
industries along with the enhancement in industrial productivity and quality can
contribute to creating a broad based and high economic growth rate.
Similarly, to meet local needs and to create income generating opportunities in
backward rural areas, an integrated programme should be launched to develop skills,
entrepreneurship, investment and technology needed for industrial promotion. If such
integrated programme is linked to market and the access of special targeted groups is
enhanced, it can contribute significantly to poverty alleviation.
The development, utilization and extension of local raw material, local skill and
technology and upgrading them as per market demand, through trainings , can
contribute to poverty alleviation and human resource development.
c) Employment generation and other contribution
There is a possibility of creating additional 250,000 employment opportunities in
industrial sector through the improvement in industrial production and productivity,
reform in industrial management, promotion of employment generating industries and
exploration of minerals by attracting domestic and foreign investment.
d) Gender equality
Women’s skills will be enhanced through technical education and skill development
programme and the technical assistance and soft loan available in this process will
enhance economic opportunity, employment and earning of women resulting in better
gender equality in the society.
14.1.6 Possible obstacles and risks in implementation and attaining
results
• No improvement in law and order and security situation
• Absence of policy level stability
• Uncertainty in domestic market
• Adverse international situation
14.1.7 Output Monitoring indicators
• Industrial statistics that reflect industrial registration, operation and status;
progress report such as production, employment, raw material, consumption
of electricity and fuel, and policy and procedures related to various aspects.
• Statistical report that monitors macro indicators on productivity improvement
and quality management on labor, capital, total factor productivity growth
254
and national and international quality certifications (ISO 9000, ISO 14000),
quality circle establishment and whether things are done in accordance with
the rule of environmental friendliness.
14.2 Trade Sector
14.2.1 Background
Trade sector has an important role to plan in the economic development of the
country. With the objective of expanding foreign trade, the policy and programmes
are directed towards making the Trade sector liberal and market-oriented. The
shortfall in export in comparison to the import in Nepal has created an adverse
impact in the balance of trade.
Though export to India has increased significantly due to Nepal-India Trade Treaty,
trade deficit with India remains unabated mainly due to a few number of exportable
items to India. Trade should be diversified country-wise and product-wise and
economic liberalization should be aimed at export promotion and import competing
rates at higher level.

The construction of dry port has been completed during the Ninth Plan period. During
the same period, an export promotion seminar was held in Kathmandu aimed at
expanding Nepal’s foreign trade to various countries and to familiarize Nepal’s
trading image in the international markets.
The simplification of trade between Nepal and India has enhanced industrialization
in Nepal. With a view aim to promote export of readymade garments and make it
sustainable an agreement has been reached with the European Union in 1999 and a
number of initiatives have been taken to enhance the quality of the products.
Concentration of export trade in a few items and destinations, dependence on the
import for raw materials, weak forward and backward linkage among the items in
export list, widening annual trade deficit, and lack of development of infrastructures
are among the problems faced by trade sector.
Failure to fully use the alternative transit route via Kakarbhitta-Fulbari-Banglaband to
expand foreign trade is one of the major challenges. Similarly, failure to expand trade
with China despite huge business potential is another weakness of the country's
foreign trade regime. Since the country has not been able to use the Dry Port
constructed in Birgunj, this has also adversely affected the competitiveness of the
country's foreign trade.
14.2.3 Long term vision

255
The trade sector will be integrated to the globalization process and will be made
competitive and market-oriented to develop it as a strong foundation of the economy.
a) Objective
The major objective of trade sector is to integrate import to industrial development
and to promote export so as to increase the overall contribution of the trade sector to
the GDP. Similarly, another objective of this sector is to enable people at all levels to
utilize the gains of domestic and foreign trade through maximum participation of the
private sector under the liberal, competitive and market-oriented economic
environment.
b) Major quantitative targets

a. Export of about Rs. 320 billion worth of merchandise goods
b. To reduce the trade deficit to 12 .1 percent of GDP at the lower growth rate
and to 12.2 percent of GDP at normal growth rate in 2006/07 from 12.7
percent of GDP at 2001/2002.
c) Strategy
Policies and programs will be oriented towards making the trade sector liberal and
market-oriented to speed up foreign trade. In the face of growing trade deficit that has
already started to have adverse impacts on the Balance of Payments (BoP), special
emphasis will be given to diversification of the exports both commodity wise and
country wise, maximum use of local raw materials in domestic industries,
strengthening of forward and backward linkages of exportable items and integration
of the trade sector to globalization process.
The trade sector can contribute to achieving a higher growth rate if the trade is
promoted and diversified under the leadership of the private sector in a competitive
and market-oriented economic environment. Similarly, income earning and
employment opportunities can be created for marginalized group through the
promotion of micro and small enterprises and through an integrated program to
improve skills, entrepreneurship, investment and technology transfer. This will
significantly contribute to poverty alleviation. In this context, the following will be
the major strategies of this sector.
1) Policy level changes will be given continuity to promote the participation of
the private sector and to make the overall trade sector open and competitive.
2) Necessary arrangements will be made to obtain the WTO membership.
3) Import trade will be integrated with industrial development and internal trade
will be made more market-oriented.
256
4) Special emphasis will be given to identify new exportable products of
comparative advantage and improve their quality.
5) Various promotional programs will be carried out with the participation of
the private sector and the capacity of institutions that can play a role in export
promotion will be enhanced.
d) Policies and work plan

§ Continuation of policy level change (related to strategy one)
• Long term action plan will be designed and implemented based on the
study of long-term Trade and Export Policy through the participation of
the private sector.
• To promote the participation of the private sector in trade, existing laws
will be improved and procedural simplification will be made.
• The role of the government will be limited to that of a facilitator,
regulator and evaluator.
§ Membership of the World Trade Organization (related to strategy two)
• Necessary preparation will be done to obtain the membership of the
World Trade Organization (WTO).
• WTO member countries having trading relations with Nepal will be
approached to create an environment for an early accession of Nepal into
the WTO.
• Necessary preparations will be done to study and minimize adverse
impacts of Nepal’s accession to the WTO, especially in the area of
industry and commerce.
§ Integration of import trade with industrial development (related to strategy
three)
• Areas of comparative advantage will be identified and environment for
investment will be created in those sectors to develop import trade as a
component to the industrial sector.
• Small and medium scale processing industries will be established to process
and export locally available natural and other resources.
• Participation of the private sector will be promoted to make the internal
trade market oriented.
§ Emphasis on export promotion ( related to strategy four)
• The interrelationship between agro, forestry and other service oriented
257
industries will be promoted to increase the export of exportable items.
• Emphasis will be given to quality production of agro-based industrial
goods at the local level and their export to create employment in the rural
areas .
• Competitiveness of exportable items will be enhanced by promoting
foreign investment and technology in the area of competitive advantage
based on study of demand and supply of goods in the international
markets.
• The procedural impediments to product-wise and country-wise
diversification of foreign trade will be gradually simplified.
• Using the opportunities that has emerged in the area of hydro-power,
computer software and labor markets in the national interest, their export
will be emphasized.
• Emphasis will be given to the use of dry ports, two of which are already
in use and the third one whose construction has been completed in
Birgunj. Export promotion zones will be established nearby these dry
ports with the participation of the private sector. Besides the traditionally
used ports, new ports will also be identified.
• Feasibility study will be carried out to establish Special Economic Zones
to support the industrial and trade sector.
• The competitiveness of the trade sector will be enhanced in harmony with
SAARC, SAPTA and SAGO agreements.
• Emphasis will be given in the quality promotion of traditionally
developed exportable items such as woolen carpets, ready made
garments, pashmina and handicrafts.
§ Emphasis on promotional program and institutional capacity enhancement
• Institutional capacity of governmental, non-governmental and private
institutions involved in the collection, processing and dissemination of
information related to export promotion will be enhanced.
• With the participation of the private sector, organization of trade fairs,
participation in international trade fairs, identification and promotion of
exportable items of comparative advantage will be given additional
emphasis.
• Various agencies working in the area of trade will be restructured to
provide service under one umbrella.
258
e) Policy level and institutional reform
• To make foreign trade more simple, reliable, and cost effective, reform will
be made in the area of laws, regulations, procedural and coordination
activities. In addition, Trade Policy 1992 will be improved and various
treaties and agreements will be implemented gradually.
• To create necessary environment for market development, an integrated and
participatory co-operative programs among various institutions will be
implemented. For this, organizational management will be strengthened and
export promotion will be carried out in a co-coordinated manner.
• The policy to mobilize Nepalese foreign agencies (like embassies, trade
consulate offices etc) in promoting FDI for industrial development in the
country will be made effective.
f) Programmes and Policies

The summary of prioritized programmes related to trade sector during the Tenth Plan
period is summarized below on the basis of prioritization process of Policy Action
Matrix .
Table 14.3 Summary of fixed priority
(Rs in millions)
A (P1) 1 543.6 96.9 413. 1 96.8
B (P2) 1 10.6 1.9 07.1 1.7
C (P3) 3 06.7 1.2 06.7 1.5
Total 5 560.9 100. 0 426. 9 100. 0
14.2.5 Expected Outputs

a) The contribution of the trade sector in GDP is expected to rise with trade
diversification and export promotion.
b) The liberal, competitive and market-oriented economy in the leadership of
the private sector will contribute to poverty alleviation and human
development.
c) Creation of 250, 000 employment opportunit ies.
d) Export promotion and quality enhancement programmes through the
participation of scaltered private sector entrepreneurs and coordination of
various agencies is expected to have positive impacts on rural development.
e) Gender equality will be promoted through the development of
entrepreneurship of rural women in the operation and management of food
processing industries.
259
14.2.6 Possible obstacles and risks in implementation and
achievements of targets
• Ups and downs in the international market
• Adverse change in policies in foreign countries
• Cumbersome accession process to WTO
• Instability in public policies
• Adverse law and order situation
14.2.7 Output monitoring indicators
• Export-GDP ratio
• Contribution in foreign currency reserve through export sector
• Improvement in trade deficit
14.3 Supply sector

14.3.1 Background
There is an indispensable relationship between consumption and supplies of goods
and services. Supply management has an important role to play in ensuring easy
availability of quality consumer goods and services at a cheaper rate to common
people. Similarly, it also has to play a role in ensuring the regular supply of goods
and services to poverty-stricken, remote and rural areas and maintaining a smooth and
overall flow of goods and ser vices between producer and consumers.
On the one hand, there is a need for regulating the supply situation through
competitive market, on the other hand, there is also a need for encouraging the private
sector for supplies and market management in the ar eas that are weak and backward
areas in terms of social, economic, educational indicators and where people cannot
exercise their choice. In such sectors there is a compelling need to manage the supply
situation through the government machinery with the involvement of the non-
governmental organization and civil society.
A reliable food security management is equally needed to cope up with the natural
calamities and unforeseen emergencies. Keeping these facts in mind, there is a need
to put in place a credible, qualitative, easily accessible, and dynamic supply system.
To achieve this, a working plan, institutional mechanism, effective implementation
system based on a suitable policy should be developed.

The Ninth Plan had aimed at regular and smooth supply of essential consumer goods,
monitoring these goods to protect the interest of consumers, and storage of minimum
required food items at the regional level to ensure food security. The Plan had also
mentioned that the government would play the role of a regulator and would control
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the black marketing and creation of artificial shortages of essential goods.
To monitor the market price, monitoring official has been app ointed in all 75 districts
as recommended by Consumer’s Right Protection Act 1997 and Consumer Protection
Regulation 1999. The transportation subsidy is still in place to ensure that there is no
shortage of foods in the remote hilly districts.
Subsidy on price and transportation has been given to ensure the supply of iodized
salt in the remote and semi-remote areas. Relevant information has been disseminated
through the electronic and print media. A minimum support price has been fixed by
Nepal Food Corporation to purchase food grains.
Over 30,000 metric tones of food stuffs have been stocked as per the food reserve
program of the Ninth Plan 4000 metric tones of food for SAARC Food storage Stock
and additional 40,000 storage tones for National Food Security Stock have been
provisioned. The petroleum reserve capacity of Nepal Oil Corporation have been
expanded to 70,000 kilolitre from 30,000 kilolitres against the target of 100, 000
litres. Likewise, 57, 791 quintals of iodized salt have been supplied to 13 remote and
9 semi-remote districts against the target of 70,031 quintals.
b) Problems and challenges
The major challenges in this sector include the following: Lack of coordination
among agencies that deal in supply price, quality, weight, and cost; absence of
smooth and result oriented structure and procedures in public corporations; and
absence of scientific management for keeping the necessary stock of food and
petroleum products. There is also lack of a mechanism for calculation of production
cost and a system for gathering export-related information, information bank. There
is a further need for making the import of Liquefied Petroleum Gas and other
petroleum product more transparent and effective. Poverty and backwardness in
remote areas, low production of essential consumer goods, limited market
development in those areas, maximum impact of border price in the domestic market,
and failure to effectively implement the acts related to consumers’ rights are other
major challenges.

Necessary basis will be created conducive to the private sector to play leading role.
Regulatory and monitoring role will be recorded to the public sector. Likewise,
necessary mechanism will be designed to develop partnership between the private
sector, non-governmental agencies and civil society for a reliable management of
supply system. By developing necessary infrastructures and institutions, supply
system will be made easily available, reliable, credible, and qualitative to meet the
need of people and the nation.

a) Objectives:
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1) Reliable and easily accessible supply of essential commodities through the
private sector.
2) Effective monitoring of prices and quality of essential goods and services and
protection of consumers welfare by containing black-marketing and artificial
shortage.
3) Necessary arrangement for food security.
b) Major sector-wise and macro-level quantitative targets

• Regular monitoring of prices of daily essential commodities.
• Supply of 13,200 metric tones iodized salt in 22 remote and semi-remote
districts by providing transport subsidy.
• Necessary arrangement for the import of 800 thousand metric tones of
iodized salt required during the plan period.
• 35000 metric tones of food will be supplied and distributed in remote
districts.
c) Strategy
Supply system has an important role to play in maintaining the regular supply of
goods between producers and consumers as well as supplying daily essential goods to
remote areas, villages, and areas affected by natural calamity. The government will
play a role of a regulator and facilitator for a disciplined and well functioning supply
system through private sector and cooperation between non-governmental
organizations and civil society. In this context, following will be the strategies in this
sector.
§ Strategies related to objective no 1.
1) The system of fixing prices through market system will be further
strengthened.
2) In order to maintain a regular and easily accessible supply of daily
essent ial goods, an information system regarding production, import,
export, and selling prices will be developed.
3) For the sale of daily essential goods, fair-priced shops will be
established. Consumer co-operatives will be promoted.
4) Monitoring will be strengthened with the involvement of the private
sector to check monopolist tendency, artificial shortage and
obstructions in the smooth supply of goods.
5) Special attention will be given to maintain regular supply of food to
food-deficit areas and to the poor. Transport subsidy will be provided
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to supply food to the remote districts.
6) Buffer stock will be maintained to address the shortages of food,
petroleum products etc due to natural calamities or other reasons.
d) Policy and Action Plans
§ Supply of essential consumer goods and construction materials (related to
strategy 1)
• The supply of iodized salt will be arranged through various agencies in
22 remote and semi-remote districts and the import and sales of salt will
be arranged in other districts.
§ Easy availability of essential commodities and construction materials
• Necessary supply of food items in remote areas will be maintained
through Nepal Food Corporation and other agencies. Easy availability
will be maintained to ensure food security.
§ Arrangement of fair-price shops (related to strategy 3)
• Consumer groups and cooperatives will be promoted to open fair -price
shops for sales and distribution of necessary goods.
§ Checking the monopolistic tendency, artificial shortage, rent seeking and
obstruction in the supply system (related to strategy 4)
• Emphasis will be given to create a competitive environment with the
participation of the private sector in the supply of goods.
• Regular monitoring will be done and necessary mechanism for
eliminating monopoly be in place to end artificial shortage.
• For the protection of consumers' right, various programs will be launched
to raise public awareness to maintain quality and effective monitoring.
§ Regular supplies in the food deficiency areas. ( related to strategy 5)
• Regular monitoring will be made regarding demand and supply situation
of goods daily necessity and construction materials and this information
will be disseminated as necessary.
• Provision of buffer stock will be continued as a market stabilization,
measure to ensure food security and maintain stocks.
§ Checking the shortage of goods due to natural calamities or other reasons
• Arrangements for additional supplies of goods, medicines and clothing
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will be made for natural disaster-prone areas.
d) Policy level, legal, and institutional reform and mechanism for implementation
Regular study will be conducted for timely reform in policies to ensure the supply of
quality goods and services by strengthening the participation of the private sector in
supply system.
Long-term supply policy will be formulated with the participation of the concerned
stakeholders. Recommendation committees will be set up and the recommendations
will be implemented especially to upgrade the existing Consumer’s Rights Protection
Act 2054 and Consumer’s Rights Protection Regulations 2056. Acts, regulations,
circulations and directives related to supply system will be collected and published.
All the monitoring and evaluating agencies will be brought under an umbrella to the
possible extent.
e) Programs and Projects

Since there is a lack of coordination between the market monitoring and evaluation
programs and the programs implemented by the Department of Commerce, necessary
coordination and implementation works will be done through the Program Monitoring
and Implementation Division of the Ministry of Industry, Commerce and Supplies as
provisioned by Consumers Rights Protection Act 2054.
To implement effective reform programs, a detailed report of the program and cost
will be prepared and its implementation will be completed within next five years.
Within the Tenth Plan period, four programs/projects will be implemented in the
supply sector. The programs are presented below in priority order in the following
table.
Table 14. 4: Priority fixation summary
(Rs. in Million)
A (P1) 1 930.8 79.7 740.4 83.1
B (P2) 1 225.6 20.2 149.5 16.8
C (P3) 2 11.5 0.1 00.8 0.1
Total 4 1167.9 100.0 890.7 100
14.3.5 Expected Output
a) Contribution to poverty alleviation and Human development
b) Creation of employment opportunities
c) Contribution to regional development and regional balance
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14.3.6 Possible risks and obstacles in implementation and achievement
of targets
• Lack of financial resources
• Absence of relevant law and institutional arrangements.
• Lack of transparency and good management in supply system.
14.3.7 Output monitoring indicators

a) Following indicators will be used to monitor whether the programs were
available as per the goals.
• Regular availability of goods and services within the fixed time frame and
at an adequate quality.
• Increase in the capacity of buffer stock
• Price Index trends
• Reaction of consumer groups
14.3.8 Programs and estimated budget for industry, trade and supply
sector for the T enth Plan has been given in the matrix below.
14.3.9 Log frame
The overall log frame for Industry, Trade and Supply has been given below. Detail is
given in Annex 3.
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Policy and Program Log Frame— Industry, Commerce and Supply*
Overarching National Objective: Poverty incidence of Nepalese People (men and women) will be reduced significantly and in a
sustainable manner.
Sectoral Goal: Substantial contribution of Industry, commerce, and supply management in the economic and social development of
the country
Sectoral • Government will play a role of a regulator, • Employment • Ministry of 1. Programs to promote export • Ups and
Objective: facilitator, information disseminator and a situation in industry Industry, oriented industries based on Downs in
Improvement in monitoring agency to create an and commerce commerce, local and foreign raw materials. international
supply system environment for the private sector to play sector supplies and its 2. Programs to promote market
along with a lead role in industry and commerce • Contribution of line agencies industries, commerce and • Policy
increased sector. industry and progress report services based on foreign consistency
competitiveness in • Intellectual property will be protected for commerce sector to and other reports. investment. of
the industry and commercial purposes. GDP 9.32%. • Central Bureau of 3. Programs to promote small and government
commerce sector. • Sustainable development of infrastructure, • Diversification of Statistics’ cottage industries based on • Law and
entrepreneurship and skills to establish exportable goods Industrial Census traditional skills and arts. order
micro and cottage industries. • Sector -wise in report 4. Programs to develop and situation
• Encourage foreign capital to enha nce export. • Reports of Ministry expand micro industries in • Reform in
industrial capital base. • AIncrease in of Finance, Nepal rural areas. labour law
• Accession to World Trade Organization aailability of Rastra Bank and 5. Programs for geological survey • Foreign
membership manufactured goods NPC and exploration of minerals and Trade
• For export promotion, new products of of Nepali origin in • Ministry of development of industries Relations
comparative advantage will be identified, the international Labour’s report based on minerals.
quality of exportable goods will be market • Report of the 6. Programs to make the
improved, and new export destination will • Absence of shortage Trade Promotion commerce and trade sector
be identified. of essential goods in Centre . liberal and competitive.
• Monopoly will be eliminated in supply the various parts of • Special Survey 7. Programs for regular,
management and availability will be the country. reports qualitative, and accessible
increased. supply of necessary goods.
* Quantitative targets based on 6.2 per cent growth rates ( details in annex 3)
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Table 14.1 : Program and estimated budget
Industry
(In Rs. million)
S.N. Programs/Projects Normal Case Lower Case
First Priority (P1)
1. Cottage and small scale industries promotion program,
27districts 614.2 564.1
2. C ottage and small scale industry promotion program,
committee-48 districts 830.1 762.3
Total 1444.3 1326.4
Second Priority (P2)
3. Cottage and Small scale industry development committee,
centre 219.4 195
Total 219.4 195
Third Priority (P3) (Possible Projects) 606.9 185
4. Cottage and small scale industry training centre
5. Industrial Entrepreneurship Development Academy
6. Environmental sector support program
7. Geological survey and research project
8. Minerals exploration and development project
9. National Seismological Center project
10. Industrial promotion project
11. Nepal Standards and Metrology Project
12. Industrial statistics system reform project
13. Petroleum Exploration Project
14. Industrial Energy Management Project
15. Technology transfer and development project
16. Company Registrar’s Office Strengthening Project
Grand Total 2270. 6 1706. 4
Commerce
In Rs. million
First Priority (P1)
1. Export processing zone 543.6 413.1
Percent 96. 91 96. 77
2. Trade information and Export Facilitation Project 10.6 7.1
Percent 1. 89 1. 66
Third Priority (P3) 6.726 6.73
Percentage 1. 2 1. 58
3. Export Promotion Fund
4. Nepal Multi-modal Transit and Trade facilitation project
5. International Exhibition Hall Project
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Grand Total 560. 93 426. 9
Supplies
In Rs. million
First Priority (P1)
1. Distribution and sales of food in remote areas (Nepal 930. 78 740. 4
Food Corporation)
2. Cretinism Disease Control Project 225. 6 149. 5
Third Priority (P3) 11.472 00.76
3. Consumer Rights Protection Program
4. Price Monitoring Project
Grand Total 1167. 9 890. 6
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Chapter 15
Labour and Transport
Management
15.1 Labour management
15.1.1 Background
Creating opportunities for income generation and employment is indispensable for
poverty alleviation. Skill enhancement training, human resource development,
improvement in the investment environment and promotion of private sector industry
and commerce are the major prerequisites. It is equally imperative to maintain
industrial peace by creating harmony between the management and labourers to
establish cordial relationship and to improve occupational health and safety for
advancing the process of industrialisation in a healthy way.
In this context, maximum number of Nepalese youth needs to assimilate in the
mainstream of economic development through their skill development and providing
domestic and foreign employment opportunities. Similarly, it is essential to update
the labour administration to consolidate the rights, interests and protection of the
labourers of industrial enterprises and other sectors. A policy on making both
employees and the management more responsible for increasing production and
productivity is also required.
On one hand, there is a need for appropriate labour policy to attract private sector
investment and it is also equally important to train the management for Best
Management Practices on the other hand. If women’s skill is enhanced through
vocational and technical training and their capacity is built, women’s involvement in
income generation will increase, which will ultimately contribute to the gross national
income.
A. Targets and achievements
Following are the achievements of the Ninth Plan:
• Of the targeted 26,158 people, 25,139 people have been trained.
• 230,720 Nepalese are involved in foreign employment.
• Labour Market Information on 11 districts has been prepared.
• Factories of organised sector have been inspected for 5,232 times.
• Informal population education has been provided to 30,000 people.
• It is estimated that a total number of 9,959,000 manpower employment has
been created
The legal jurisdiction and responsibilities related to labour has expanded notably as
per the policy on labour administrat ion, Act and laws, but there has been no
implementation of the provisions relating to labour laws as expected due to lack of
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manpower expansion and development of infrastructures.
Similarly, incompatibility between the demand and supply of skilled manpower in the
market, lack of required level of communication between the labour administration
and management, absence of good relations and mutual trust among the labour
administration, management and labourers, and lack of improvement in industrial
relations in most of the industrial enterprises due to absence of organisational
management as provided by the law are other problems.
The Tenth Plan envisages developing labour force that can be supplied to the
domestic as well as the international market in the context of globalisation and
liberalisation for which required number of competent, skilled, creative, competitive
and high quality manpower will be developed by calculating the necessary labour
force in different sectors of the economy.
Similarly, the Tenth Plan has the long-term vision of promoting industrial peace,
healthy and safe working environment and enhancing the dignity of the labourers
thereby assisting in poverty alleviation.

A. Objectives
1. To safeguard the rights, interests and social security of labourers and to
maintain industrial peace by ending exploitation of labourers.
2. To consolidate and manage labour market information and to produce skilled
manpower thereby helping in poverty alleviation.
3. To create an environment to help Nepalese labourers get employment
opportunities in foreign labour markets.
B. Quantitative Targets
Normal case Lower case
1 No. of people trained in various skill and vocational subjects 20,000 17000
2 Collection of labour market information in various districts (no.) 25 25
3 Study, research and workshop on labour and training sector (no.) 5 5
4 Foreign employment promotion tour (no.) 10 10
5 To send youths to various countries for employment to raise the 5,50,000 5,50,000
contribution of this sector to the national income (no. of youths)
6 To provide informal education and to operate day child care 15 12
centres for the elimination of child labour (no.)
7 Collect samples of smoke, dust, light, heat and poisonous 300 255
substance from industrial enterprises and formulate national
standard relating to them
8 Inspection for elimination of child labour (frequency) 2000 2000
9 Additional manpower of employment generation 10,53,000 10,53,000
C. Strategy
The conventional skills have not been able to meet the increasing and special type of
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demand of the labour market due to the use of new technologies emerged in course of
the development activities. The supply of skilled labourers not only creates
opportunities for income generation and employment, but also positively helps in the
entire production process thereby contributing to maintain better and sustainable high
growth of economic activities.
Similarly, conducting various vocational education training and awareness generating
programs for skill development of labourers, providing loans to self -employment-
oriented particularly low income group labour force, making them capable of utilising
the employment opportunities available in the domestic and foreign labour market,
establishing labour trust and improving the relations between labourers and
employers among others bring changes in the social and economic condition of
labourers.
Production of skilled labourers creates employment opportunities in both domestic
and foreign employment market environment for access and it will contribute
significantly to poverty alleviation as well. Similarly such programs can be
introduced as targeted programs. In this context, the main strategies of this sector are
as follows:
n Objective- 1 related strategy
1. Labour related legal provisions shall be timely amended to make labour
administration more effective and the rights and interests of labourers
will be protected as per the International Labour Organisation labour
standard.
2. Communications between labourers and management shall be
encouraged regularly to promote harmonious industrial relations.
n Objective- 2 related strategy
3. Employment will be ensured through managing information on labour
market and by organising vocational and skill development training as
per the demand of the domestic and foreign labour market.
n Objective-3 related strategy
4. Loan assistance shall be extended to the low income groups in order to
utilise the foreign employment opportunities to the best possible extent.
D. Policies
n Effectiveness of labour administration (Related to Strategy 1)

• Necessary Acts, laws, practice code, guidelines, directives and standards
shall be formulated in order to promote occupational health and safety at
workplaces in industrial enterprises.
• Emphasis will be laid on the protection and promotion of physical and
mental health and protection of lab ourers involved in industrial
enterprises.
• Labour related laws, process and institutional aspect will be reformed as
273
required to safeguard the rights and interests of labourers and to create an
environment for investment. Labour Act will be timely amended.
• Establishing bilateral mechanism in every enterprise will create
environment conducive to resolve field level disputes at workplaces
justifiably.
• Trade unions will be encouraged in such a way that it helps in promoting
enterprise by developing them as organisations protecting the occupational
rights and interests.
• Indicators of remuneration and labour wage will be formulated and
updated.
• Laws related to social security of labourers projects will be implemented
formulating.
n Promotion of harmonious industrial relations (Related to Strategy 2)
• The provision of inspection shall be made more effective and organised.
• A central labour trust will be established in order to promote cordial
industrial relations.
n Vocational and skill development training programs (Related to Strategy 3)
• Statistics on labour will be collected and published and labour mar ket
information system will be consolidated.
• Vocational and skill development training will be conducted in a
coordinated manner.
• Information on employment potentials of non-agriculture sector will be
disseminated regularly.
• Vocational and skill development training as per the demand of the labour
market will be organised targeting the residents of remote areas, ethnic
communities, indigenous people, women and backward communities
including the residents of other areas to develop manpower as per the
demand of the domestic and foreign employment market, and their
employment is ensured.
• Short-term skill and entrepreneurship development program in rural areas
will be implemented in integrated manner to contribute to poverty
alleviation substantially through generation of self -employment.
• Skill-oriented training will be imparted to Nepalese youths in order to
replace foreigners working in industrial enterprises for a long period.
• Skill development and vocational training centres, involved in producing
manpower as per the demand of the labour market, will be strengthened
and expanded. Researches, training, seminars, labour training, and
education programs on industrial relation, labour administration, labour
productivity growth and management will be made more organised and
effective.
n Encouragement to foreign employment (Related to Strategy 4)
274
• In order to utilise the practical and occupational skills of retirees from
foreign employment in opening up small industries and developing
entrepreneurs, entrepreneurship development and refreshment training in
existing legal provision and market potential will be provided along with
soft loans.
• Micro-credit enterprise program will be conducted to provide self-
employment to those receiving training from skill development training
centre and vocational training centre.
• Loans will be extended to those who are unable to go abroad for
employment due to lack of fund. Youths from economically backward
communities and from remote areas will be involved in this scheme.
E. Policy, legal and institutional reforms and their implementation provisions
Institutional reforms will be made to render the labour administration, training,

manpower development, foreign employment and occupational health and safety
of factory labourers and factories more effective.
F. Budget allocation as per the priority of programs and projects

The summary of the programs and projects of this sector in the Tenth Plan are as
follows:
Rs in million
Priority basis No. of Normal case Lower case
programs Amount percent Amount percent
A (P1) 4 167.3 57.3 130.1 58.6
B (P2) 2 124.4 42.6 91.5 41.2
C (P3) 2 00.4 0.1 00.4 0.2
Total 8 292.1 100.0 222.0 100.0
G. Possible constraints and risks of implementation and targets achievement

• If there is inadequate information on labour market.
• If there is industrial instability.
• If there is a lack of adequate means and resources, manpower and experts in
labour offices.
• Lack of tripartite coordination.
H. Achievement monitoring indicators
• The condition whether the trained people are employed or not.

• Attraction of trainees towards training.
• Increase in domestic production boosted by alleviation of poverty.
• Rise in industrial production fuelled by prevalence of industrial peace.
• Increment in productivity due to improvement in occupational health and
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safety of factory workers.
15.1.5 Expected achievements

• Some 20,000 Nepalese youths will be trained and employed and it is
expected to make additional contribution to Gross Domestic Product during
the plan period.
• As the involvement of skilled manpower in paid jobs, self-employment and
foreign employment generates economic benefits, it will help in reducing
poverty.
• Training will contribute to developing manpower.
• Skilled manpower can find jobs in labour market.
• As training centres have been expanded to various regions of the kingdom,
people of all regions will have opportunity to learn skill and it will contribute
to balancing regional development.
15.2 Child Labour

15.2.1 Background
Although Nepalese children have been assisting in household tasks traditionally due
largely to economic depravity, child labour has emerged as a major and sensitive
issue in recent years as they are us ed in various economic activities as labourers.
According to a study report, there are about 2.6 million child labourers in Nepal of
which 2 million are estimated to be of 5 to 14 years age group.
Mainly, child labour in Nepal is found to be involved in the following areas:
• Work on agricultural land, herding cattle.
• Work as domestic helper.
• Work in service sector like hotels, restaurants, buses and tempos.
• Work in various factories.
• Involved in immoral activities like drug abuse and sexual exploitation.
The following progresses have been made during the Ninth Plan period in eliminating
child labour:
Of the total target of inspecting 2,900 carpet factories, 2,726 factories were inspected
and it was found that out of the total labourers working in carpet factories 0.61
percent was child labour. Action has been taken against the factories employing child
labour. Such child labourers have been rehabilitated with the assistance of various
non-governmental organisations.
Day child care and informal education have been provided to 200 children of carpet
labourers on average annually by establishing 3 day child care centres. Similarly,
informal education has been provided to the children of carpet labourers by opening
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two day child care centres each in six districts with the help of His Majesty’s
Government of Nepal and the International Labour Organisation.
To raise awareness against child labour in various places of the country, publicity has
been generated through newspapers, magazines, posters, pamphlets, radio and
television.
Child Labour (Prohibition and Regulation) Act, 2056 has been formulated.
International Labour Organisation convention no. 138 relating to fixing minimum age
for employment and convention no. 182 relating to eliminating the worst forms of
child labour have been ratified.
A National Steering Committee has been formed with an objective of coordination
while conducting programs related to child labour elimination through various
governmental and non-governmental organisations and about 73 programs for the
welfare of children have been conducted.
Problems and Challenges

The following major problems were faced while conducting programs related to child
labour elimination:
• Lack of coordination in conducting programs related to child labour
elimination and poverty alleviation despite the fact that child labour is
directly linked with poverty and income generation.
• Lack of enough awareness on child labour elimination.
• Inability to conduct sufficient programs focusing on the child labourers of
unorganised sectors and remote areas.
• Inability to introduce effective programs for rehabilitating child labourers
displaced from various industries.
• Failure to strengthen and make capable district labour offices due to lack of
means and resources.
• Failure to provide skill-oriented training to the labourers of unorganised
sectors and to conduct programs that create opportunities for self-
employment and failure to impart training focused on child labour prone
families.
• Lack of coordination among institutions like educational, health, agricultural,
land reform, trade unions and non-governmental organisations which help in
child labour elimination, in introducing effective programs to end child
labour.
• Lack of cost/effect study of programs conducted so far by various
governmental and non-governmental organisations targeting child labour
elimination and lack of monitoring and evaluation of those programs.
• Lack of transparency in conducting programs aimed at eliminating child
labour even by international non-governmental organisations.
277
• Absence of initiation to provide alternative primary education to the children
having no access to school education.
• Inability to provide education, health and safety for the child labour involved
in carpet, transport and agriculture sectors and lack of apprenticeship training
to child labourers of 14 to 16 years age group.

The Tenth Plan envisages to eliminating child labour within 10 years by massively
expanding the income generating and self -employment programs along with the
programs related to education, health and safety particularly focussing on raising
awareness among the child labourers of remote areas working in unorganised sectors
and their parents.

A. Objective
• To eliminate most of the worst forms of child labour existing in various sectors
in Nepal.
B. Quantitative targets
• To alleviate 90,100 worst forms of child labour in 35 districts implementing

The Master Plan.
Types of child labour Number

Bonded child labour 14,150
Child porter 28,450
Street children 2,900
Domestic helpers 40,850
Child labour working in mines 400
Carpet child labour 3,350
Total 90,100
C. Strategy
Children are the competent citizens of the future. If they are deprived of the
opportunity to get education, well-nourishment and to grow up in a fearless
environment due to child labour, the future manpower will be unproductive.
Basically, children from very low income families, suffering from family torture,
adversity and having no guardians turn to be child labour.
Besides, lack of sensitiveness of the employers of such children has also worsened
the condition of child labour. Elimination of child labour, incorporating the low
income group families, which contribute to child labour, into poverty alleviation fund
278
and various sectoral group-targeted programs, development of child labour
elimination related care centres, rehabilitation, education, awareness and capacity
building and consolidation of organisational management will benefit the targeted
groups.
This apart, it will also contribute to poverty alleviation and to the national strategy of
developing infrastructures of social development. In this context, the following
strategies have been formulated for this sector:
1. Programs related to child labour elimination will be integrated with poverty
alleviation programs.
2. Provision will be made to eliminate the worst forms of child labour within
next five years and all forms of child labour within next 10 years.
3. Emphasis will be laid on enhancing capacity of the employees of the
concerned ministries, departments and offices related to child labour
elimination to implement the child labour program effectively.
4. A high level Central Coordination Committee will be constituted in order to
coordinate the programs related to child labour elimination.
D. Policies
n Programs related to child labour elimination (Related to Strategy 1)

• Various targeted programs will help in promoting the employment of the
guardians of poor and child labourers.
• Instead of the existing practice of introducing programs to organised sector
only for ending child labour, programs will be extended to unorganised
and poor communities in the plan period.
n Provisions on eliminating child labour (Related to Strategy 2)
• Opportunity to education will be given to children and assistance will be
extended to rehabilitate the children working in various factories and
industries as child labour.
• Programs contributing to child labour elimination will be incorporated in
the sectoral programs of the government, local bodies and non-
governmental organisations which are actively contributing to eliminate
child labour.
• For the effective implementation of Child Labour (Prohibition and
Regulation) Act, 2056, regulations relating to the Act will be formulated.
• District Children’s Welfare Committees will be activated and empowered
and emphasis will be given on conducting awareness programs about child
labour elimination by mobilising people through such committees.
Appropriate awareness generating programs will also be carried out in the
urban areas where child labour is prevalent.
• Skill development training centres, labour offices and other government
279
offices will be directly involved in eliminating child labour by
incorporating programs that contribute to end child labour to their regular
programs.
• Inspection of child labour will be given continuity. Similarly, arrangement
will be made for the day care and informal education for child labourers
and the children of working parents through Child Development and
Rehabilitation Trust.
• Private sector, industrialists and trade unions will be actively mobilised to
eliminate child labour.
n Effectiveness of child labour programs (Related to Strategy 3)
• Capacity building programs will be conducted for the employees of the
government and non-government sectors working in the field of child
labour elimination.
• The collection, analysis, monitoring and evaluation of information and
statistics on child labour will be consolidated, collected and networked.
n Coordination of programs on child labour elimination (Related to Strategy
4)
• A high level central coordination committee comprising representatives
from all sectors and bodies will be constituted in order to convene the
programs related to child labour elimination in a coordinated manner by
reviewing the role of various committees pertaining to the elimination of
child labour.
• Emphasis will be laid on activating the role of district child welfare
committees and the local bodies through programs related to child labour
elimination conducted at various places.
E. Policy, legal and institutional reforms and provision for their

implementation
• A master plan has already been formulated to eliminate child labour. The
National Steering Committee will be further consolidated in order to render the
programs run by concerned government agencies, international organisations
and international non-governmental organisations related to elimination of
child labour more effective. Required sub-committees will be formed to
coordinate programs at the implementation level.
• Child Labour (Prohibition and Regulation) Act, will be implemented. Nepal
has already ratified the convention no. 182 of the International Labour
Organisation. In this context, necessary amendments will be made to Child
Labour (Prohibition and Regulation) Act to make it compatible with the
convention and a separate regulation will be formulated and enforced.
• Laying emphasis on studies and researches relating to child labour, special
efforts will be made to make information dissemination more effective and
organised. Besides, the district child welfare committees through the central
child welfare board will be mobilised to make monitoring and evaluation of
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periodic programs on child labour elimination.
• In order to coordinate the programs related to child labour elimination at
implementation level, various programs of different governmental and non-
governmental organisations related to child labour will be integrated into the
child welfare committee and the programs will be carried out through the
committee.
F. Budget allocation for Projects/Programs on priority basis

The priority based projects/programs in this sector in the Tenth Plan are as
follows:
Rs in million
Priority order No. of Normal growth rate Alternative growth rate
A (P1) 7 33.3 57.1 27.8 66.9
B (P2) 1 25.0 42.9 13.8 33.1
C (P3) 0 0 0 0 0
Total 83 58.3 100.0 41.6 100.0
15.2.5 Expected Outcomes
The following outcome will be achieved during the Tenth Plan as a whole:
• A separate policy will be formulated on child labour.
• Most of the worst forms of child labour will be eliminated.
• Rehabilitation centres will be established for child labourers and informal
education will be imparted through them.
• Laws related to child labour will be implemented more effectively.
• Local bodies and child welfare committees will be actively mobilised while
conducting various programs for the elimination of child labour. And it is
expected to help in decentralisation and institutional development.
15.3 Transport Management

15.3.1 Background
It has been imperative to make transport service reliable, safe, non-polluting and
public service-oriented, and to improve the quality of the service through better
management and consolidation. Institutional strengthening and reforms are necessary
to strengthen and enhance capability for the administrative and technical aspects of
transport and well-equip them.
A. Building construction of the Department of Transport Management has been
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completed, construction of Transport Management Office building of Bagmati
zone has been commenced and computer networking in the Department of
Transport Management and the offices under it is ongoing. Reform process has
been begun after commissioning Kathmandu Traffic and Transportation Study
and Load Carrying Capacity of roads.
The Plan had targeted to carry out study on scientific research on accidents, black
spots, sketching accident-prone spots, opening accident prevention centres in 6
places and transport safety centres in 36 places with a view to preventing road
accidents, but they could not be realised.
However, a high level National Transport Safety Committee, a central level
Transport Safety Management Monitoring Committee and Transport
Management Committee at zonal level were constituted during the Ninth Plan.
The Plan had targeted to control pollution in Kathmandu and other major cities,
and Nepal Emission Standard 2000 and Euro-1 Standard have been implemented.

• Budget not appropriated as per the requirement.
• Excessive rise in the number of vehicles compared to the existing road facility.
• Increasing pressure of traffic compared to the load carrying capacity of the
existing road resulting in growing road accidents.
• Lack of bus stops and parking facility in urban areas.
• Lack of necessary monitoring during the movement of vehicles.
15.3.3 Long-term Vision

The long-term vision of the Tenth Plan is to develop a reliable, low cost, safe, non-
polluting and self-dependent transport system thereby contributing to the
development of economic, social, cultural and tourism sectors, among others, of the
kingdom.

A. Objective
The prime objective of the Tenth Plan is to develop a reliable, low cost, safe, non-
polluting and self-dependent transport system and to make the transport service
affordable and qualitative.
B. Quantitative Targets
• Permanent and mobile inspection mechanism will be set up in the Kathmandu
Valley and highways in order to regulate traffic on highways and roads as per
the load control and management system.
• Traffic and transport management directives will be implemented in order to
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consolidate transport management.
• Railway service will be operated under Company Act and will be extended
from Janakpur to Bardibas.
C. Strategy
Programs like standardising and well-managing vehicular movement involving the

private sector in the operation and management and making transport service low cost
and more effective are expected to contribute to the development of the private
sector. If transport service can be better managed in the rural areas link ed with road,
the local produces could have access to market and would be a base for industrial
development and raise the income of the rural populace, which in turn helps in
Similarly, pollution control programs will have positive impact on public health and
contribute to the social development strategy. In this context, following are the major
strategies of this sector:
1 Transport service will be made reliable, standard and safe by better
managing the vehicular movement throughout the kingdom.
2 Vehicular pollution will be reduced in Kathmandu Valley and other major
cities by adopting various pollution reduction measures.
3 All records will be updated through computer networking in order to
consolidate transport management. A well-equipped inspection and
monitoring system will be developed and implemented in order to reduce
road accidents.
4 Alternative means of transport will be sought and promoted.
D. Policies
n Safe transport mnagement (Related to Strategy 1)

•
Bus parks, parking for other vehicles and bus stops in Kathmandu and
other urban areas will be better managed.
• Transport service in Kathmandu and other urban areas will be made
reliable and safe. Bottlenecks will be removed.
• Traffic management system will be improved to reduce road accidents.
• Difficulty in rural life will be eased through better managed transport
service.
n Vehicular pollution control (Related to Strategy 2)
•
Nepal Emission Standard 2000 will be effectively implemented in order
to reduce vehicular pollution.
• Emphasis will be given on raising awareness among the people about
vehicular pollution control.
n Consolidation of transport m anagement (Related to Strategy 3)
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• A well-equipped inspection and monitoring system will be developed and
implemented in order to reduce road accidents.
• All information like vehicle registration, renewal, tax payment record,
route permit and check pass will be computerised at the Department of
Transport Management and Transport Management Offices, which can
be easily accessed.
n Alternative transport m anagement (Related to Strategy 4)
• Railway service will be operated and expanded under the Company Act
by carrying out feasibility study for expansion.
• Feasibility study of sea route will be made.
• Ropeway and trolley bus services will be expanded and operated by the
private sector.
E. Budget allocation based on the priority of programs/projects
The prioritised programs/projects of this sector in the Tenth Plan are as follows:
Rs in million
Priority order No. of Expected growth rate Normal growth rate
A (P1) 1 042. 0.9 04.2 1.1
B (P2) 0 0 0 0 0
C (P3) 4 477.1 99.1 369.7 98.9
Total 5 481.3 100.0 373.9 100.0
F. Possible constraints and risks
• Unavailability of expected budget.

• Increasing pressure of traffic beyond the load carrying capacity.
• Slow speed of vehicles in urban areas and lack of bus stops, parking facility
etc.
• People’s indifference to following traffic standard.
G. Monitoring indicators
• Improvement and expansion of transport administration.
• Organised transport servic e in Kathmandu and other urban areas.
• Reduction in road accidents.
• Reduction in pollution in Kathmandu and other urban areas.
• Construction of infrastructures like bus parks, parking lots and bus stops in
Kathmandu and other urban areas.
• Department of Transport Management and the offices under it to be
networked.
• Participation of private sector in the management and operation of railway
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and ropeway.
15.3.5 Expected outcomes

• Efficiency of Transport Management Offices will be enhanced.
• Decision making process will be prompt once the Department of Transport
Management and Transport Management Offices are networked.
• Road accidents will decrease.
• Feasibility study of East-West Electric Train Service will be completed.
• Participation of the private sector in the management and operation of railway
and ropeway will increase.
15.3.6 Programs and Estimated Budget of Labour and Transport

Management are given in chapter 15.1.
15.3.7 Log frame

The summary of logical framework of transport management sector is given below.
Its detailed structure is given in annex 3.
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*
Policy and Programs of Log Frame- Labour and Transport Management
Overarching National Objective: Poverty incidence of the Nepalese people (men and women) will be reduced significantly and in a sustainable
manner.
Sectoral objective: Creating an environment conducive to economic activities through cordial labour relations and to contribute to the larger
national policy of poverty alleviation through the elimination of child labour and consolidation of transport management.
Objective Strategies Indicators Sources of Information Major Programs Risks and
Obstacles
• To manage labour • The rights and interests of labourers will be • Ratio of more • Household Survey 1 To establish a separate • Lack of enough
force and to ensured as per the standard set by the skilled labourers in (Nepal Life Standard Department of Employment information on
guarantee the International Labour Organisation through international labour Survey) Promotion and occupational labour market.
rights of labourers timely amendments to labour laws. market. • Records of Department health and safety centre. • Industrial
and to raise their • Communications between labourers and • Fixation of minimum of Labour. 2 To increase employment instability.
productivity and management will be encouraged to standard of • Records of Department opportunities through • Lack of tripartite
income. promote cordial industrial relations. occupational health of Transport conducting vocational coordination.
• To eliminate child • Employment opportunities will be increased and safety. Management, Transport training. • Lack of
labour. by conducting vocational and skill • The number of Management Offices, 3 To disseminate information coordination
• To make transport development training as per the demand of disputes in traffic police and on labour market. among
service affordable the domestic and international labour industrial Department of Roads. 4 To formulate minimum government
and qualitative by market by managing information on labour enterprises. • Reports of the Ministry standards for occupational agencies on
rendering market. • The number of day of Labour and Transport health and safety. policy.
transport • Loans will be extended to low income child care centres. Management and 5 To carryout programs to
sustainable, groups in order to utilise the foreign • Percentage of child Ministry of Population prevent child labour.
reliable, safe and employment opportunities optimally. labour. and Environment. 6 To consolidate the
self-reliant. • Child labour elimination programs will be • To end worst forms • Department of Transport administrative and physical
integrated with poverty alleviation of child labour Management and means related to transport
programs. within next five Transport Management management.
• Emphasis will be given on enhancing the years and to Offices. 7 To increase the involvement
capacity of the officials of the concerned eliminate all forms • Traffic police, of the private sector in the
ministries, departments and offices to of child labour associations of expansion of various
make child labour eradication programs within next 10 transporters, sectors of transport.
effective. years. passengers. 8 To conduct programs to
• The standard, safety and quality of • Reduction in road • Emission survey. reduce road accidents.
vehicular transport will be enhanced and accidents.
better managed. • Reduction in
• Vehicular pollution will be reduced. pollution in
• Means of alternative transport will be Kathmandu Valley
sought and promoted. and other urban
areas.
* The quantitative targets are based on 6.2 percent economic growth (Details are on annex 3)
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Chapter 15.1 Programs and estimated budget
Labour Management
In Rs million
S.N. Programs and projects Normal case Lower case
P1 programs and projects
Industrial development programs 7.2 5.6
Vocational training centre programs 117 91
Foreign employment programs 9 7
Occupational health and safety programs 34.2 26.6
Total 167.4 130.2
Skill development training 115.9 85.3
Employment exchange service 8.4 6.2
Total 124.4 91.5
P3 programs and projects (Possible projects) 0.38 0.38
Percentage 1.3 1.7
Micro-credit to trained manpower
Entrepreneurship development program for retirees from
foreign employment
Grand total 292.2 222
Child Labour
In Rs million
1. Informal education to child labour and their guardians 4. 5 3.8
2. Awareness building against child labour 4.5 3.8
3. Skill-oriented training to the guardians of child
labourers0.90 9 7.5
4. Information system on child labour 1.8 1.5
5. Effective implementation of legal provisions relating to
child labour 9 7.5
6. Micro-credit to the families of child labourers 4.5 3.8
7. Programs to eliminate the worst forms of child labour 0 0
Total 33.3 27.8
8. Operation of child labour elimination and child labour
reform projects in woollen carpet factories 25 13.8
Total 25 13.8
Grand total 58.3 41.5
Transport Management
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In Rs million

1 Com puter networking of transport related documents 4.2 4.2
Total 4.2 4.2
P3 programs and projects (Possible projects) 477.1 369. 7
Percentage 991.3 988. 8
2 Railway service reform, consolidation feasibility study
and expansion
3 Expansion of trolley bus service
4 Expansion of ropeway service
5 Building construction
Grand total 481.3 373. 9
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Chapter - 16
Electricity Development
16.1 Background
The availability of electricity contributes significantly to the overall development of
the country on one hand, and its consumption reflects the economic condition of the
nation on the other. Therefore, it has become highly important to harness the
abundant water resources to generate electricity for the development of the kingdom.
Nepal, known as a highly potential country for generating hydroelectricity, has a
theoretical potential of generating 83,000 megawatt electricity and real production
capacity of 527.5 megawatt. The public sector generates 412.5 megawatt and the
private sector produces 115 megawatt, which comes to be 0.63 percent of the total
potential of electricity generation.
As electricity plays a crucial role in the balanced development of agriculture, industry
and other sectors, it is necessary to supply power at reasonable price and its effective
consumption is also equally important. It is undisputable that electricity expedites the
process of balanced development. As the development of electricity calls for a huge
investment, it is necessary to seek investment from various sources and to make best
use of the existing resources.
Currently, the urban population is consuming most of the electricity. But majority of
people live in the rural areas and most of the agro-industries, irrigation and cottage
industries are also concentrated on the rural areas. As the overall development of the
nation premises on the development of the rural areas, balanced development can be
achieved only through creating opportunity for equal consumption of power in the
villages and the urban areas.
Generating electricity from comparatively low cost hydroelectricity projects not only
raises national production, but also fetches economic benefits for country from
exporting power. Besides, hydroelectricity, a non-polluting natural energy, replaces
fuels like oil, coal and gas and saves foreign currency and helps in reducing air
pollution.
It is expedient to implement bilateral and regional cooperation in the development of
hydroelectricity placing the national interest atop as the development of hydropower
is potential to accelerate both the national and regional economic development of
Nepal. Implementat ion of the concept would help in economic development,
industrialization, flood control, environmental protection and in creating employment
opportunities besides benefiting the downstream nation in profit sharing.
The investment from the private sector in hydroelectricity was remarkable in the
Ninth Plan and the Tenth Plan also encourages investment from the private sector in
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hydropower. It will create an opportunity to invest a reasonable share of government
means and resources in the social and rural development. Attracting the private sector
to hydropower development as per the Hydroelectricity Development Policy, 2058,
will apparently help in reducing poverty and backwardness either through joint efforts
of the government and the private sector or through unilateral efforts of any one
party.

Targets and Achievements
As shown in table 16.1, the production capacity of hydropower and solar energy
achieved so far is satisfactory compared to the target of the Ninth Plan. The
contribution of 144-megawatt Kali Gandaki A Hydropower Project is remarkable to
achieving the target. Similarly, the extension of transmission lines of 33/11 KV,
substations of 132 and 66 KV and 11 KV and 400/230 volt distribution lines,
(according to National Census 2058) 40 percent people are estimated to be benefited
by the end of the Ninth Plan.
The real consumers of electricity have been calculated counting the people
consuming electricity from alternative source and those who are not the direct
consumers of Nepal Electricity Authority. It is estimated that out of 40 percent, 33
percent have been using the power from the national grid and the rest 7 percent from
alternative sources of energy.
By the end of the Eighth Plan, electricity was available to about 800 Village
Development Committees (VDCs) and 57 municipalities of 72 districts. Till date the
facility is available in about 16,000 VDCs and 58 municipalities of all the 75 districts
of the country. Power generated from the national grid is available in 57 districts.
By the end of the Eighth Plan period, the highest demand for electricity was 300
megawatt which has shot up to 426 megawatt by the end of the Ninth Plan. Currently,
per capita electricity consumption is 60 kilowatt-hour. The average electricity tariff
effected from 14 May 1996, a year before the beginning of the Ninth Plan, was Rs 5
per unit. The tariff was raised on 16 November 2000 and on 17 September 2001 and
the current average tariff per unit is Rs 6.81.
Table No. 16.1 Ta rgets and Achievements of the Ninth Plan

Area Unit Target Achievement
Hydropower installed capacity megawatt 538 527.5
Solar energy installed capacity megawatt 60 57
Transmission line (132, 66 and 33 KV) km 3,926 4,324
Capacity substation at higher level MVA 862 881
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(132and 66 KV)
Substation capacity of 33/11 KV MVA 650 393
Distribution line (11 KV and 400/230 volt) km 6,067(additional) 8,400
Number of consumers thousand 828 878
Benefited people percentage 20 40
Problems and challenges

The problems and challenges faced during the implementation of the Ninth Plan are
as follows:
• It has become necessary to amend the Electricity Act, 2049 in order to revise
the royalty that the government receives as per the Hydroelectricity
Development Policy, 2058, and to rectify the shortcomings.
• It has been felt that the private sector has been facing difficulties in
accelerating the growth of electricity development due to the inefficiency of
the one window policy.
• Non-fixation of wheeling charge and lack of proper management of grid code
have been creating problems in power development.
• There has been difficulty in recovering the due tariff from government
agencies, corporations and municipalities.
• Both the public and private investors have not invested enough in
transmission and distribution system compared to the production of
electricity.
• Lack of investment has hindered the use and expected development of
hydropower.
• There has been a seasonal imbalance between demand and supply of
hydroelectricity as majority of the existing hydel projects are run-of-river
type.
• Although efforts have been made to stem leakage in the existing system, it
has not been satisfactory.
• The coordinated use of all alternatives of power has remained a challenge due
to the topography of Nepal which has made it difficult to provide electricity
to all Nepalese.
• Given the purchasing power of the majority of people, the current electricity
tariff is very high and to bring it down is a challenge.
16.3 Long-term Vision

Prime Objective
The long-term vision of this sector is to expand hydroelectricity through
appropriate harnessing of water resources thereby raising the life standard of the
Nepalese in a sustainable way.
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Vision
In order to achieve the prime objective, the following concept will be adopted:
• Coordination will be established among peaking run-of-river, run-of-river
and reservoir projects in order to make power supply reliable. Emphasis will
be given on developing low cost small and medium hydroelectricity projects
to supply power at an affordable rate.
• Priority will be given to run small hydroelectricity projects with people’s
participation through cooperatives and users groups and non-governmental
organisations.
• Policy will be reformed in order to attract the private sector to electricity
development thereby promoting investment and rendering the participation of
the private sector competitive and transparent. Similarly, necessary
amendments will be made to the provisions of the existing laws.
• Emphasis will be given to one window policy for efficient and effective
implementation of projects.
• In order to make electricity export effective and institutional, infrastructural
reforms will be made for developing electricity as an exportable item.
• Rural electrification program will be made effective.
• Industries and transport service consuming maximum electricity will be
developed and electricity demand management will be encouraged.
• Policy to involve foreign and domestic investors in electricity development
will be adopted and environment conducive to investing in power sector by
the local capital market will be created.
• The existing single buyer and seller system of electricity market will be
turned into multi buyers and sellers system. Nepal Electricity Authority will
be unbundled gradually for this purpose.
Targets
The long-term targets of this sector will be as follows:
• To raise the consumption of electricity to 3.5 percent from the existing 1.4
percent of the total power consumption of the country.
• Initiatives will be tak en to export 22,000 megawatt electricity generated from
the development of Pancheshwor, Karnali and Saptagandaki multi-purpose
projects.
• Hydroelectricity projects will be constructed to generate 2,230 megawatt
electricity, out of which 400 megawatt could be exported.
• Electricity will be supplied to 63 percent people through national grid and 17
percent will be covered from alternative sources of energy.
• Per capita electricity consumption will be raised to 180 kilowatt-hour.
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16.4 The Tenth Plan
A. Objectives
The following objectives have been set for the electricity sector to reduce poverty
in a sustainable manner in the Tenth Plan.
1. To produce electricity at low cost harnessing the existing water resources.
2. To supply reliable and high quality electricity at reasonable price throughout
the kingdom by integrating economic activities.
3. To expedite rural electrification so that it could contribute to the rural
economy.
4. To develop hydroelectricity as an exportable item.
The following targets have set for achieving the objectives of the Tenth Plan.
• Hydropower projects will be constructed to supply 842 megawatt electricity,
out of which 70 megawatt could be exported.
• Additional 10 percent people will be supplied electricity through the national
grid for which power will be supplied to 2,600 Village Development
Committees through the national grid and additional 5 percent people will be
supplied power through alternative sources of energy.
• Per capita electricity consumption will be raised to 100 kilowatt-hour.
C. Strategy
Power sector plays an important role in the development of industry and commerce,
increasing employment opportunities, and in the social and economic development.
Rural electrification contributes significantly to modernisation of agriculture,
supplying power to households and ground water irrigation in the Terai at low cost.
And it helps in raising agriculture productivity, production, income generation and
economic development.
Electricity relieves women of difficult jobs and helps in protecting them from in-
house pollution. Similarly, it helps in distance learning and communication in the
rural areas. Therefore, electricity helps in the economic and social development of the
rural areas and in dispensation of justice. In this context, the following are the main
strategies of the sector:
n Strategies related to objective No. 1
1. A comprehensive approach will be adopted while developing and
managing hydroelectricity as per the vision of developing water
resources in an integrated manner for the development of the nation.
2. Electricity will be developed through the investment of the private sector,
public investment or jointly.
293
3. Water resources will be developed and managed on the basis of the
command areas of rivers.
4. Policy on transferring the unforeseen risks to the sector bearing at the
lowest cost, be it the private or public sector, will be adopted.
5. According top priority to national interest, environment-friendly and
highly beneficial small, medium and large scale projects of all types will
be constructed.
6. Nepal Electricity Authority will be commercialised and unbundled
ultimately.
7. Hydroelectricity will be expanded to the rural areas on the basis of social
justice.
8. As hydroelectricity can help in national and regional economies, policy

will be adopted on producing hydropower with bilateral and regional
cooperation.
9. Investment-friendly, clear, simple and transparent process will be
adopted in order to increase the participation of the private sector for
internal consumption and export of electricity.
10. In order to increase electricity exchange between Nepal and India, inter
transmission link will be developed to connect with India’s electricity
grid.
D. Policies and Work Plans

n Comprehensive approach on developing and managing hydroelectricity in
the context of national development. (Related to Strategy 1)
• Emphasis will be laid on mobilising internal capital market while
investing in power sector.
• Priority will be given to Nepali labour, skill, resources and means while
developing hydropower projects.
• An institution will be established to produce required manpower for
hydroelectricity development, to enhance the capacity of the people
working in the field and to provide training within the country. The
institution will also be used for making studies and researches on
hydroelectricity.
n Developing power with private, public or joint investments (Related to
Strategy 2)
294
• Legal and procedural reforms will be made in order to encourage private
investment in power sector.
• Joint investment of the private and public sector will be made in the
hydropower projects in which private investment alone is not possible.
• Various programs will be carried out to promote foreign investment in
power development.
• Hydropower potential will be optimally exploited to meet the domestic
demand. For this purpose, hydropower projects appropriate to the
prevalent electric ity system and other reservoir projects will be
constructed with priority.
• Emphasis will be given on involving the private sector in the production,
transmission and distribution of electricity.
n Command areas of rivers prime source of development and management of
water resources (Related to Strategy 3)
• The government will forge partnership with the private sector depending
on the possibility of irrigation through multipurpose projects.
n Unforeseen risks to be borne by the sector which quotes lowest cost
• Contribution will be made to environment protection by developing
hydropower as the alternative to bio and solar energy. Negative impacts
of hydropower projects on environment will be mitigated and proper
arrangement will be made for the rehabilitation of the displaced families.
• Appropriate measures will be taken from both the public and private
sectors to minimise the risks to hydropower projects.
• In order to make electricity available at reasonable price, the price fixing
process will be made transparent and justifiable.
n Develop environment-friendly and highly beneficial small, medium and
large projects including reservoir (Related to Strategy 5)
• Efforts to develop large reservoir and multipurpose hydropower projects
will be continued and such projects are constructed in such a way that the
nation gets maximum downstream benefits.
n Nepal Electricity Authority will be unbundled through commercialisation
• Electricity leakage will be contro lled. Technical measures and legal
provisions will be adopted and emphasis will be given on mobilising
people for controlling leakage.
• Arrangements for regular repair and maintenance of running hydropower
projects will be made in order to operate them in full capacity.
• The existing public enterprises will be restructured to create competitive
environment in the power sector.
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n Hydropower to be made accessible to rural economies on the basis of social
justice (Related to Strategy 7)
• Rural electrification will be encouraged and expanded, and small and
micro-hydro projects will be constructed to provide electricity to a larger
number of people. Besides mobilising people, a rural electrification fund
will also be established for this purpose.
• Arrangements will be made to provide appropriate benefit to the local
level while constructing hydropower projects.
• Attention will be given to protecting the interest of consumers and to
providing them quality and reliable service.
• Consumers will be encouraged for demand management to boost
protection of energy. When demand for electricity is minimum, it is
encouraged to use power for rural drinking water, irrigation, industries
and tourism sectors.
n Power to be developed through bilateral and regional cooperation (Related
to Strategy 8)
• Electricity will be generated through bilateral and regional cooperation
and in keeping with the abundance of production capacity, export of
electricity will be encouraged.
n Increase in the participation of the private sector in power generation
• Private sector will be encouraged in the implementation, construction,
operation, ownership and transfer on the principle of BOOT (Build, Own,
Operate and Transfer) through competitive tender.
• Investment-friendly, clear, simple and transparent process will be
adopted in order to attract domestic and foreign investment in the
development of hydropower.
n Inter-transmission link between Nepalese and Indian grids to raise power

exchange between the countries (Related to Strategy 10)
• Electricity will be imported and exported as per requirement by
consolidating the bilateral inter-transmission lines.
16.5 Programs and implementation process

The programs of the power sector in the Tenth Plan have been divided into four sub-
categories on the basis of their nature:
1. Electricity production and supply
2. Electricity transmission and consolidation
3. Distribution, expansion and electrification
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4. Surveys, studies and promotional activities
These programs are implemented through the agencies under the Ministry of Water
Resources like the Secretariat of the Commission for Water and Energy, Department
of Electricity Development and Nepal Electricity Authority. Electricity production
and supply, transmission and consolidation, distribution extension and electrification
of the public sector will be carried out by Nepal Electricity Authority. Surveys and
studies will also be carried out by those agencies.
Electricity production, transmission and some activities of survey and studies will
also be carried out by the private sector as well. Promotion of the private sector in the
development of electricity will be carried out by the Department of Electricity
Development.
Following are the brief introduction to the programs to be carried out in every sub-
sector in the Tenth Plan:
Electricity production and supply

A total of 315 megawatt electricity will be generated and supplied from both the
public and private sector during the Tenth Plan to meet the domestic demand. The
public sector will produce 101 megawatt and the private sector 214 megawatt. The
contribution of 70-megawatt Middle Marsyangdi Hydropower Project and another 74
megawatt power generated from small hydropower projects (less than 10 megawatt
capacity) during the plan period will be remarkable.
It shall be required to begin construction of some hydropower projects during the
Tenth Plan in order to export and meet the demand of power after the completion of
the Tenth Plan. Construction of hydropower projects with a total capacity of 1,938
megawatt will be begun during the Tenth Plan. Arun with 402 megawatt, Upper
Karnali with 300 megawatt and Upper Tamakoshi (Rolwaling) with 250 megawatt
capacity are among the major projects.
The construction of Western Seti Hydropower Project of 750 megawatt capacity will
also be commenced during the Tenth Plan. This apart, construction of a reservoir
hydropower project suitable to the existing electricity system will also be started
during the plan period. (Chapter 16.2)
Electricity transmission and consolidation

Construction of a total of 430-km long transmission lines of various kilovolts will be
completed during the Tenth Plan in order to transmit power from the hydroelectricity
projects to be completed during the plan period to electricity consumption centre, to
export more electricity and to consolidate the system.
Of the total, 301 km transmission lines will be constructed by the public sector of
which the 127-km long Chameliya-Attariya 132 KV transmission line is worth
mentioning. In addition to it, the construction of 140-km Hetauda-Bardaghat, 75-km
Khimti-Dhalkebar and 40-km Hetauda-Thankot 220 KV and 14-km Dumre-Damauli
132 KV transmission lines will be commenced during the plan period. This apart, 129
km transmission line will be constructed by the private sector. (Chapter16.3)
297
Besides constructing new transmission lines, some new substations will also be built
and the capacity of some existing substations will be enhanced. Construction of a
total of 426 MVA capacity substations of various kilovolts will be completed during
the Tenth Plan. (Chapter 16.4)
Electricity distribution , extension and electrification

Special emphasis will be given on expanding electricity to the rural areas in the Tenth
Plan considering the unavailability of the facility. During the plan period, 965 km
long transmission and distribution lines of 33 KV, 4,977 km of 11 KV and 9,940 km
of 400/230 MVA and 33/11 KV distribution substations of a total capacity of 143.5
will be constructed for this purpose.
This will facilitate additional 1,000 Village Development Committees and 705,600
consumers. Electricity will be extended to additional 14 districts during this plan
period through the national grid. It is targeted to involve cooperatives or users groups
in rural electrification. (Chapters 16.5, 16.5 A, 16.5 B)
The details of rural electrification through micro-hydro projects and other alternative
sources of energy are given in the science and technology section.
Surveys, studies and promotional activities

Surveys and studies will be made on the hydropower projects to be completed or
begun during the Tenth Plan and on selecting appropriate projects to supply power in
the future and on exporting electricity. During the plan period emphasis will be given
on the studies of reservoir projects. Surveys and studies will be commissioned on
various projects with a total capacity of 13,376 megawatt of which 12,239 megawatt
will be produced from the public sector and 1,137 megawatt from the private sector.
Studies being commissioned with bilateral cooperation on Pancheshwor Multipurpose
Project (6,480 megawatt), Sunkoshi-Kamala Diversion (1,300 megawatt) and
Saptakoshi Multipurpose Project (3,400 megawatt) will be completed during this plan
period. Other studies on water resources and power development and on promoting
the private sector in the development of electricity will continue during the Tenth
Plan. (Chapter 16.6)
16.6 Resource Management and allocation

Seventy programs will be carried out during the Tenth Plan of which 14 will be
directly operated through government agencies and the rest through Nepal Electricity
Authority. The summary of the expenses of these programs are given below. The
detailed breakdown of the budget is included on chapter 16.7.
Table No. 16.2 Summary of budget appropriation to public sector

(In Rs million)
No. of Normal case Lower case
298
Programs progra Total HMG NEA Total HMG NEA
ms
A. Programs to be run
through government
agencies
Surveys, studies and 14
others 2099.6 2099.6 0 1600.8 1600.8 0
B. Programs to be run
through NEA
Electricity Production 7 19266.3 15496 3770.2 14270.9 11562.1 2708.9
Transmission & 16
Consolidation 6879.3 3851 3028.3 4506.5 2376 2130.5
Distribution & 26
Electrification 11605.4 9603.5 2001.9 9172.2 7748.8 1423.3
Surveys, studies and 7
others 1300.9 796.8 504.1 843.8 507.9 336
Total 56 39051.8 29747.3 9304.5 22194.8 22194.8 6598.6
Grand total 70 41151.4 31846.9 9304.5 23795.6 23795.6 6598.6
Of the programs to be implemented through Nepal Electricity Authority, the cost of

Marsyangdi Hydropower Project is estimated to be 10 billion and 703.1 million
rupees which comes to be 26.8 per cent of the total budget of the authority.
16.7 Policy, legal and institutional reforms

The existing electricity Act, 2049 and the Electricity Regulations, 2050 will be
amended as per Hydroelectricity Development Policy, 2058 for achieving the targets
of the Tenth Plan. Action will be taken to unbundling Nepal Electricity Authority.
Institutional provisions for the development of hydropower will be made as given
below.
Regulatory body
Electricity Tariff Fixation Commission will be developed as a regulatory body. The
body, in course of monitoring and supervising the quality of electricity, will issue
directives as required in keeping with the power purchase agreement of the public and
the private power developers.
Institution for the study and research of water and energy sources
1. Secretariat fo r the commission of water and energy

The secretariat will give suggestions to the concerned agencies of the government on
formulation of policies and project implementation for appropriate use, control,
protection, management and development of water resources and energy.
Similarly, the secretariat will evaluate the implementation of “National Water Plan”
and “Environment Management Plan” being formulated under the 25 year “Water
Resources Strategy Nepal” and to update the water resources strategy and water plans
299
on the basis of the evaluation.
The secretariat will also work on national demand projection and system planning
studies of electricity, carry out preliminary findings of power projects and various
policy researches on power development.
In addition to this, the secretariat will be developed as National Water Planning Unit
for the sustainable development of water resources and will be promoted as a special
agency for carrying out policy, legal, institutional and researches on water resources
and various sectors of energy.
During the plan period, the secretariat will primarily carry out studies on bilateral,
multilateral and multipurpose issues of water resources and energy, implement the
national water plan and cause the same, prepare strategy on sources of energy and
establish coordination among the agencies related to water resources.
Likewise, the secretariat will provide necessary consultations to institutions related to
water resources and energy and promote libraries established with the objective of
collecting information and data on water resources as an integrated information and
reference centre. Arrangements will be made for institutions related to water
resources to acquire pre-consultations from the secretariat on various policy issues
and project implementation.
Under the institutional reforms to be carried out in public enterprises, arrangements
will be made for involving the professionals in the board of Nepal Electricity
Authority.
2. Department of electricity development

The Department of Electricity Development will be basically developed as a study
and promoter institution for carrying out studies on hydropower projects including
multipurpose projects and attracting to and encouraging the private sector in the
development of hydropower.
Financial institutions
Electricity Development Fund will be established as an investor in the hydropower
projects to be constructed by the private sector for supplying power for the domestic
consumption. A Rural Electrification Fund will be established as a new source of
funding in the expansion of rural electrification by utilising some portion of royalty
generated from electricity tariff.
16.8 Prioritisation
Hydropower projects to be implemented through government agencies and Nepal
Electricity Authority will be prioritised differently as Nepal Electricity Authority also
invests in the projects implemented by itself. The summary of prioritisation is given
below in table No. 16.3. Prioritisation has been made on the basis of the budget
deducting the allocated fund for Middle Marsyangdi Hydropower Project, which is in
first priority order, as it alone constitutes a big amount of the total budget.
300
Since some projects have been put into the first priority in the budget for fiscal year
2001/02, projects of the Tenth Plan have been prioritised in keeping with them. The
detailed programs and estimated budget for the power sector in the Tenth Plan is
given in chapter 16.8.
Table No. 16.3 Summary of prioritisation

(In Rs million)
Programs No. of programs Normal case Lower case
To be run through
government agencies
• First 4 1438.1 68.5 1198.4 74.9
• Second 4 26.3 23.7
• Third 6 109.8 5.2 23.2 1.4
Total 14 2099.5 100. 0 1600.8 100. 0
To be run through NEA 0 0
• First 21 20240.6 68.0 16867.1 76.0
• Second 13 6970.1 23.4 4791.9 21.6
• Third 22 2536.7 8.6 535.7 2.4
Total 56 29747.4 100. 0 22194.7 100. 0
16.9 Contribution to economic sector

The Tenth Plan targets to increase per capita electricity consumption from 60
kilowatt-hour to 100 kilowatt-hour and to provide electricity to 43 percent of the total
population through national grid. Similarly, it aims to supply power to 2,600 Village
Development Committees and to raise the consumption and volume of electricity in
industry, agriculture, irrigation, education and health sectors thereby contributing to
the social and economic development in a sustainable manner.
It is estimated that it will, in the constant price of fiscal year 2001/02, raise the
contribution of the power sector to the Gross Domestic Product from current 2.3
percent to 2.7 percent by the end of the Tenth Plan.
During the Tenth Plan, 96 percent of electricity distribution and electrification will be
appropriated to the rural electrification and it will advance the social and economic
development and contribute significantly to poverty alleviation and human
development.
Similarly, 65 percent appropriation will be made to the Eastern, Mid-western and Far-
western regions, where electrification is comparatively low, and this will contribute to
balanced regional development.
The implementation of the programs of the Tenth Plan besides providing the primary
benefit of electrification, will also benefit the people of the project implemented areas
through the pre-production relation created by the consumption of electricity and
post-production relations created by the availability of goods and services there.
While the construction, maintenance and operation of the projects will create
301
employment opportunities directly, the pre- and post-production relations will create
such opportunities indirectly.
16. 10 Role of various organisations

The Ministry of Water Resources in cooperation with the Department of Electricity
Development and the Secretariat of the Commission for Water and Energy will make
necessary amendments to the governing Acts and laws as per Electricity Act, 2045
and Electricity Regulations, 2050 in order to implement the Tenth Plan.
Similar ly, steps will be taken to unbundling the Nepal Electricity Authority to make
the production, transmission and distribution of electricity being carried out by the
authority more efficient. Except for some hydropower projects, priority will be given
to the private sector for the construction of other projects.
Non-governmental users groups will be involved in rural electrification. As per the
spirit of the Hydropower Development Policy, 2058, the responsibility of bearing the
risks of hydropower projects will be given to the party quoting the lowest cost, be it
public or private.
The returns of hydropower development have not reached the urban and rural areas
due to economic, geographic, technical and other difficulties even by the end of the
Ninth Plan despite the abundance of water resources.
Promotion of cooperatives and involvement of community users groups are deemed
very important and effective in attracting both public and private sectors to develop
small and micro-hydropower projects in the remote areas, which have no access to
national grid, utilising the local labour, skill, resources and technology.
The Tenth Plan envisages to involving women in every level and sector of policy
implementation for encouraging them to participate in the mainstream of national
development thereby eliminating backwardness and gender inequality for good. To
realise it, women will be involved in the production, distribution and consumption of
electricity for improving their life standard.
16.11 Possible difficulties and risks

It is presumed that the Tenth Plan will face the following possible difficulties
and risks in power development.
• High electricity tariff compared to the purchasing power of the common
consumers.
• Lack of efficacy in the implementation of one window system.
• Lack of wheeling charge and grid code for the sales and exports of power
developed by the private sector through the national grid.
• Low investment in transmission and distribution of power compared to the
investment in production, and lack of policy on distribution line.
• Lack of enough investment in hydropower development.
302
16.12 Log frame
The summary of policy and programs framework of power sector is given below and
its detail is given in annex three.
303
Policy and programmes Log Frame- Electricity development*
Larger Sectoral goal : Increasing the contribution of electricity in the national development significantly
Objective Strategies Indicators Sources of Information Major Programs Risks and Obstacles
Sectoral Goals: • Development of hydropower • To exchange 150 • Ministry of Water Resources, 1. Increasing the • Fluctuation of
Sustainable development sector through private, public mega watt of Nepal Electricity Authority, electricity generation electricity market.
of economic structure of and partnership of the both. electricity between annual and quarterly reports capacity. • Expansion of
hydropower. • The watershed area of the Nepal and India of Electricity Development 2. Expansion of electricity electricity market
rivers to be made major base 132 KV line will be Department. service and its with India and its
of development of hydropower established in three • Special Survey Reports. reliability. management.
and its management. places. 3. Studying the potential
• The private or public sector • Generation of 214 of various
whichever can bear the mega watt of hydroelectricity
unexpected risks at low cost electricity by private projects.
will be given the responsibility. sector. 4. Policy level and
• All small, medium and large • Household with institutional reforms.
projects yielding high returns electricity access.
and low environmental impacts •
will be implemented.
• Nepal Electricity Authority will
be made more commercial
and will be move towards
unbundling.
• Hydropower services will be
extended to rural economy
level to promote social justice.
• Policy to develop hydropower
294
through bilateral and
multilateral level will be
adopted.
• To promote the participation of
the private sector
• investment friendly, simple and
transparent procedure will be
adopted.
• To promote the exchange of
electricity between India and
Nepal, a grid connecting the
electricity system of Nepal and
India will be established.
* The quantitative targets are based on the economic growth rate of 6.2 percent (details in Appendix 3)
295
Appendix 16.1: Hydroelectricity Projects to be completed
S.N. Project Name Capacity (MW)

Under Public Sector
Project with licence to generate electricity.
1 Middle Marsyangdi 70
b) The projects with feasibility completed
2 Chamelia 30
3 Heldung 0.5
4 Gumgad 0.4
Total 100.9
Under a joint venture of private and public sector
a) Project with licence to generate electricity.
1 Chilime 20
Total 20
Under Private Sector
a) Project with license to generate electricity
1 Upper Modi 14
2 Indrabati III 7.5
3 Mailung 5
4 Piluwa 3
b) Project with electricity purchasing agreement
5 Langtang 10
6 Daram 5
7 Khudi 3.5
8 Sunkoshi Small 2.6
9 Chaku 1.5
10 Baramchi 1
11 Feme 1
c) Project with feasibility study completed
12 Kabeli I 30
13 Rahughat 27
14 Lower Modi 20
15 Madi I 20
16 Dodi 8.5
17 Hewa 5
18 Manhariv 5
19 Lower Indrawati 4.5
20 Trisuli 4
21 Belkhu 2.6
22 Vijayapur-1 2.5
23 Thupal 1.9
24 Ridi 1.8
25 Rigdi 1.5
26 Kahule 1.5
27 Sirsegad 1
296
S.N. Project Name Capacity (MW)
28 Junrimba 1
29 Lower Piluwa 1
30 Golmagad 0.4
31 Khoranga 0.2
32 Tatopani 0.2
Total 193.7
Grand Total 314.6
297
Appendix 16.2: Hydroelectricity projects to be commenced
S.N. Name of the Projects Capacity (MW)
Under Public Sector
1 Kulekhani III 42
Total 42
Under the joint investment of Public and Private sector
1 Upper Tamakoshi (Rolwaling) 250
2 Khimti II 27
3 Thulo Dhunga 24.7
Total 301.7
1 Western Seti 750
2 Arun III 402
3 Upper Karnali 300
4 Likhu-4 51
5 Upper Marsyandi "A" 50
6 Myagdi 22
7 Upper Madi 19.2
Total 1,594.2
Grand Total 1,937.9
In addition to this, among the reservoir-run projects are under study,

construction of another reservoir-run projects will be initiated apropos
to the present electricity system.
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k|0ffnLnfO{ ;'xfFpbf] csf]{ Ps hnfzoo'Qm cfof]hgfsf] ;fj{hlgs If]q cGtu{t
lgdf{0f z'? ul/g]5 .
298
Appendix 16.3 : Distribution Line will be completion
S.N. Name of the Distribution Line Length (Km.) Completion year
Under Public Sector
a) 132 KV distribution line
1 Butwal-Sunauni (Link of Export and Import) 25 2060/ 61
2 Dhalkebar-Vittamod (Link of Export and Import) 45 2061/ 62
3 Parwanipur-Birgunj (Link of Export and Import) 15 2061/ 62
4 Mid-Marsyandi -Marsyandi Hydroelectricity Centre 41 2061/ 62
5 Thankot-Chapagaun-Bhaktapur 27 2061/ 62
6 Pathlaiya-Parwanipur 20 2061/ 62
7 Chameliya-Attariya 127 2063/ 64
b) 66 KV distribution line
8 Kulekhani III-Hetauda 1 2063/ 64
Total 301
a) 132 KV distribution line
1 Upper Modi-Modi Hydroelectricity Centre 10 2060/ 61
2 Kabeli "A"- Anarmani 77 2063/ 64
3 Rahughat-Modi hydroelectricity centre 26 2063/ 64
4 Lower Modi-Modi hydroelectricity centre 5 2063/ 64
5 Madi-1 Lekhnath 7 2063/ 64
b) 66 KV distribution line
6 Mailung-Grang 3 2060/ 61
7 Langtang -Chilime 1 2061/ 62
Total 129
Grand Total 430
Besides this, construction of 140 km long Hetauda-Bardaghat, 75 km long Khimti-Dhalkebar
and 40 km long Hetauda-Thankot, 220 KV extension lines will be initiated under public
sector. Similarly, 14 km long Dumre-Damulai 132 KV lines will also be started.
299
Appendix 16.4 : Construction of distribution sub-stations to be completed
S.N. Name of the substation Capacity (MVA) Completion year
a) 132/33 KV substation
1. Butwal 30 2059/60
2. Dubhabi 30 2059/60
3. Aanarmani 15 2059/60
4. Dhalkebar 15 2059/60
5. Chandranigapur 30 2061/62
6. Kawasoti 30 2063/64
7. Duhabi 30 2063/64
Total 180
b) 132/11 KV substation
8. Bharatpur 15 2059/60
9. Pokhara 15 2059/60
10. Naya Parwanipur 40 2060/61
11. Harisiddhi 22.5 2060/61
12. Bhaktapur 30 2060/61
13. Chapali 22.5 2060/61
14. Chandranigapur 10 2061/62
15. Bardaghat 10 2063/64
Total 165
c) 66/11 KV substation
16. Naya Chabhil 22.5 2060/61
17. Naya Patan 22.5 2060/61
18. K-3 36 2062/63
Total 81
Grand Total 426
300
Appendix 16. 5: Electricity generation, distribution, and extension projects whose construction will be completed
Projects Distribution and extension lines to be Additional VDCs Additional Additional 33/ 11 KV Additional of Project
added (kilometre) to receive customers to distribution transformers completion
33 KV 11 KV 400/230 V electricity receive service substation capacity date
(MVA)
Extension lines and rural 583 2,605 5,920 542 5,45,000 34.5 3,170 Will contd..
Electrification projects
Mid and Far West Electrification 152 620 491 145 15,000 9.5 197 2061/62
project
Kailali -Kanchanpur rural 0 579 1,836 29 30,000 16.5 490 2062/63
Electrification project
Rural electrification and dist. system 130 1,154 1,663 272 1,05,000 83.0 1,265 2062/63
reform project
Small hydropower construction and 0 19 30 12 600 0 15 2062/63
rural electrification
Total 865 4,977 9,940 1,000 7,05,600 143.5 5,433
p.s. Included is 33/11 KV substation extension and strengthening of and upgrading of 42.5 MVA.
301
Appendix 16.5 A: 33 KV distribution lines whose construction will be completed
S.N. Name of the distribution line District Length (KM)
a) Operation under the government and Nepal Electricity Authority (NEA)
1 Buipa-Okhaldunga Khotang, Okhaldinga, 29
2 Piluwa-Bhojpur Sankhuwasabha, Bhojpur 36
3 Ilam -Phidim-Taplejung Ilam, Taplejung, Pachthar 90
4 Sitalpati-Musikot Salyan, Rukum 50
5 Chhinchu-Rakam-Jajarkot Surkhet, Jajarkot 70
6 Ghorahi-Holleri Dang, Rolpa 45
7 Udipur-Besisahar-Manang Lamjung, Manag 81
8 Okhaldhunga-Solukhumbu Okhaldhunga, Solukhumbu 37
9 Dailekh-Kalikot-Jumla Dailekh, Kalikot, Jumla 92
10 Gorkha-Muchowk Gorkha 18
11 Dhading-Salyantar Dhading 15
12 Debighat-Chaughada Nuwakot 20
Total 583
b) Mid and Far Western area rural electrification
13 Dipayal-Safebagar Doti, Achham 17
14 Patan-Khalanga-Gokuleshwor Baitadi, Darchula 90
15 Dipayal-Chainpur Doti, Bajhang 35
16 Chhinchu-Gumi Dailekh, Surkhet 10
Total 152
c) Rural electrification and distribution system reform
17 Rupani-Fatepur Saptari 27
18 Janakpur-Yedukuwa Dhanusa 20
19 Birgunj-Kaliya Parsa, Bara 20
20 Biratnagar-Rangeli Morong 22
21 Khanar-Biratchowk Morong 15
22 Dhalkebar-Sonamai Mahottari 26
Total 130
Grand Total 865
294
Appendix 16.5 B: 33/11 KV substations whose construction will be completed
S.N. Name of the distribution line District Length (KM)
a) Operation under the government and Nepal Electricity Authority (NEA)
1 Buipa Khotang 1.5
2 Okhaldhunga Okhandhunga 1.5
3 Bhimeshwor Dolakha 1.5
4 Khimti Dolakha 1.5
5 Phidim Pachthar 1.5
6 Taplejung Taplejung 1.5
7 Sitalpati Salyan 1.5
8 Musikot Rukum 1.5
9 Khalanga Jajarkot 1.5
10 Holeri Rolpa 1.5
11 Besisahar Lamjung 1.5
12 Manag Manag 1.5
13 Nele Solukhumbu 1.5
14 Chupra Dailekh 1.5
15 Kalikot Kalikot 1.5
16 Jalpa Jumla 1.5
17 Gorkha Gorkha 1.5
18 Muchowk Gorkha 1.5
19 Salyantar Dhading 1.5
20 Chaughada Nuwakot 1.5
21 Bhojpur Bhojpur 1.5
22 Jirikhimti Terathum, 1.5
23 Rauwaghat Khotang 1.5
Total 34.5
b) Mid and Far Western Region rural electrification
24 Gokuleshwor Darchula 1.5
25 Patan Baitadi 1.5
26 Khalanga Baitadi 1.5
27 Chainpur Bajang 1
28 Safebagar Accham 1
29 Narayan Dailekh 1.5
30 Gumi Surkhet 1.5
Total 9.5
c) Rural electrification and distribution system reform
31 Yadukuwa Dhanusha 6
32 Sonamai Mahotarri 6
33 Simraungaud Bara 6
34 Bhimana Sindhuli 1.5
35 Manthali Ramechhap 1.5
36 Kusma Parbat 3
37 Galkot Baglunj 3
38 Biratchowk Morang 6
39 Rangeli Morang 3
40 Basantpur Terathum 3
41 Fattepur Saptari 3
42 Khaireni Rupandhei 3
43 Pitaujighat Nabalparasi 3
44 Jitpur Kapilvastu 3
45 Galeshwor Mygadi 3
46 Fikkal Ilam 3
Total 57
Grand Total 101
295
Appendix 16.6 : Hydroelectricity projects for completion of survey and study
S.N. Name of the Projects Capacity (KM)
a)Under Public Sector
1 Pancheswor Multipurpose Project 6,480
2 Saptakoshi Multipurpose Project 4,700
3 Upper Tamakoshi (Rolbaling) 250
4 Sapta Gandaki 225
5 Langtang Watershed 221
6 Upper Seti Watershed 122
7 Madi-Isaneshwor Watershed 86
8 Kanakai Multipurpose 60
9 Bheri-Babai 48
10 Kulekhani III 42
11 Inawa 2.7
12 Sarada 2.2
Total 12,238.9
b) Under Private Sector
1 Lower Arun 308
2 Upper Trishuli - II 300
3 Upper Marshyangdi 121
4 Upper Marshyangdi – II 85.5
5 Likhu-IV 51
6 Upper Marshyangdi A 50
7 Bhotekoshi-V 46
8 Khimti -II 27
9 Lower Magdi 25
10 Thulodhunga 24.7
11 Magdi 22
12 Upper Magdi 19.2
13 Roshi-IV 12
14 Roshi-I 10.5
15 Roshi-III 7.5
16 Aankhu 5
17 Sunaiya 4.8
18 Lower Roshi 4.8
19 Taadi 4.2
20 Lower Balafi 3
21 Kolfu 2.2
22 Dordi-I 2.1
23 Daraudi 1.4
Total 1,136.9
Grand Total 13,375.8
296
Appendix 16.7: Allocation in the public sector
(Rs. in million)
Expected growth rate Normal growth rate
Total HMG NEA Total HMG NEA
S.N Program allotment resources source allotment resources source
A) Programs to be run by government agencies
Promotion of private sector
1 in electricity development 754.6 754.6 0 628.8 628. 8 0
Study of small
2 277.7 277.7 0 231.4 231.4 0
hydroelectricity project
Hydroelectricity strategy
3 third phase (National Water
Policy) 78 78 0 53.6 53.6 0
Criterion regarding
4 hydroelectricity project 19 19 0 4 4 0
Study of Saptakoshi
5
multipurpose project 335 335 0 279.2 279.2 0
Restructuring of electricity
6
sector 177.2 177.2 0 121.8 121.8 0
7 Multipurpose projects study 89.2 89.2 0 61.3 61.3 0
Study of Pancheshwor
8
multipurpose project 70.9 70.9 0 59.1 59.1 0
Projects identification and
9
study 207.2 207.2 0 142.5 142.5 0
Saptakoshi Multipurpose
10
project study 2.8 2.8 0 0.6 0.6 0
11 River Basin study 36.3 36.3 0 7.7 7.7 0
Water and Energy
12 Commission 22.7 22.7 0 4.8 4.8 0
13 Energy Strategy 14.5 14.5 0 3.1 3.1 0
National Demand Projection
14 and System Project 14.5 14.5 0 3.1 3.1 0
Grand Total of government
agencies 2099.6 2099.6 0 1600.8 1600.8
b) Programs to be run by Nepal Electricity Authority
Electricity Production
Kaligandaki A
1 hydroelectricity project 633.2 545.4 87.9 435.3 374.9 60.41
Marshyangdi
2
hydroelectricity project 11228.3 9632.8 1595.5 9356.9 8027.3 1330
Chamelia hydroelectricity
3
project 5913.2 4069.6 1843.6 4065.3 2797.9 1267
Heldung micro
4 hydroelectricity project
(Humla) 94.6 94.6 0 65 65 0
Gumgad micro
5
hydroelectricity project 111.8 111.8 0 76.9 76.9 0
Kulekhani III hydroelectricity
6
project 755.1 692.7 62.4 159.5 146.3 13.19
7 One reservoir project 530 349.2 180.8 111.9 73.8 38.18
297
S.N Program
allotment resources source allotment resources source
Total 19266.3 15496 3770.2 14270.9 11562.1 2708.9
Electricity distribution and strengthening
Load despatching centre
8 665 603.5 61.6 554.2 502.9 51.33
expansion
9 Modikhola substation 66 KV 105.6 26.5 79.1 72.6 18.2 54.4
Expansion of distribution
line (export-import link)
10
Butwal-Sunauli132 K.V.
expansion line 581 145.4 435.7 484.2 121.1 363.1
Banepa, Panchkhal
11
substation project 182.9 45.7 137.2 152.4 38.1 114.3
Thankot-Chhapagaon-
12 Bhaktapur 132 KV
distribution line 1325.5 1082.5 243 1104.6 902.1 202.5
Grid sub-station
13
strengthening 195.2 167.9 27.3 41.2 35.5 5.76
Parwanipur Birgunj 132
14
K.V. distribution line 476.8 119.1 357.7 327.8 81.9 245.9
Distribution System
15 Development ( Birgunj
corridor 132 KV distribution
line) 1607 401.7 1205.4 1104.8 276.2 828.7
Hetauda- Dhalkebar,
16 Butwal-Bardaghat 132 KV
second circuit 336 84.1 251.9 231 57.8 173.2
H etauda-Bardaghat 220 KV
17 distribution line 353.4 317.6 35.8 74.6 67.1 7.56
Butwal-Bardaghat 220 KV
18 distribution line 28.4 26.1 2.3 6 5.5 0.48
Dumre-Damauli 200 KV
19 distribution line 96.4 71.3 25 20.4 15.1 5.28
Dhalkebar-Bhittamod 132
20
KV distribution line 287.8 197.8 90 197.9 136 61.85
Khimti-Dhalkebar 220 KV
21
distribution line 167.8 139 28.8 35.4 29.4 6.07
Hetauda-Thankot 220 KV
22
extension line 199.1 156.4 42.7 42.1 33 9.01
K-3 substation 66 KV
23
distribution line 271.3 266.3 5 57.3 56.2 1.06
Total 6879.3 3851 3028.3 4506.5 2376 2130.5
Electricity distribution and electrification
24 Other rural electrification 3301.2 3301.2 0 2751 2751 0
Kailali Kanchanpur
25
electrificatiom 1867.3 1263.2 604.2 1556.1 1052.6 503.5
Sitalpati Musikot 33 KV
26 102.2 102.2 0 85.1 85.1 0
distribution line
Budar Substation and
27 distribution line 3.2 3.2 0 2.2 2.2 0
298
S.N Program
Chhinchu-Rakam-Jajarkot
28
33 KV distribution line 116.1 116.1 0 96.8 96.8 0
Jirikhimti (Terathum)
29 18 18 0 15 15 0
substation
Ghorai-Holleri -Rolpa 33 KV
30 distribution line 104 104 0 86.6 86.6 0
Rural electrification and
31
distribution system reform 4074.8 3244.3 830.5 3395.7 2703.6 692.1
Mid and Far Western region
32
rural electrification project 812.6 690.2 122.3 558.6 474.5 84.11
33 Buipa-okhaldhunga 33 KV 74.7 74.7 0 62.3 62.3 0
Ilam -Phidim-taplejung 33
34
KV distribution line 91 91 0 75.8 75.8 0
asuwaghat-Khotang
35
substation 73.4 73.4 0 61.1 61.1 0
abukhairini-Gorkha 33 KV
36
distribution line 101.3 101.3 0 84.4 84.4 0
indhu, Dolakha distribution
37
line extension 43.6 43.6 0 36.3 36.3 0
istribution line and
38 460.8 115.2 345.6 97.3 24.3 72.99
substation strengthening
olakha-Kalikot Jumla 33 KV
apti, Vheri rural
40 electrification 4.2 4.2 0 0.9 0.9 0
iluwa-Bhojpur 33 KV
41 distribution line 9.8 9.8 0 2.1 2.1 0
Udipur-Besisahar-Manag 33
42 KV distribution line 36 36 0 30 30 0
Okhaldunga-Salleri 33 KV
Distribution system
44
development 106.7 87.4 19.3 22.5 18.5 4.08
45 Mechi rural electrification 4.2 4.2 0 0.9 0.9 0
Koshi, Sagarmatha, hill area
46
rural electrification 4.2 4.2 0 0.9 0.9 0
Western Region hill area
47
rural electrification 7 7 0 1.5 1.5 0
Dhanding-Salyantar 33 KV
48
distribution line 54.7 54.7 0 45.6 45.6 0
Debighat-Chaughada 33 KV
49
distribution line 120.7 40.8 79.9 100.6 34 66.62
Total 11605.4 9603.5 2001.9 9172.2 7748.8 1423.3
Survey, study and others
East-West 220 KV and
50 North-West 132 KV greed
connection study 32 8 24 22 5.5 16.5
51 Identification of reservoir 1048.1 618.1 430.1 720.6 424.9 295.7
299
S.N Program
projects and feasibility study
Study of institutional reform
52 in electricity distribution 4.5 1.1 3.4 0.9 0.2 0.71
Rural electrification,
53 distribution and extension
projects 87.8 66.5 21.3 73.1 55.4 17.72
54 Computerized billing 37.2 32.3 5 7.9 6.8 1.05
Small hydroelectricity
55
projects (micro projects) 7.1 7.1 0 1.5 1.5 0
56 Kankai Multipurpose project 84.2 63.7 20.5 17.8 13.5 4.33
Total 1300.9 796.8 504.1 843.8 507.9 336
NEA’s total 39051.8 29747.3 9304.5 28793.4 22194.8 6598.6
Grand total of all
programmes 41151.4 31846.9 9304.5 30394.3 23795.6 6598.6
300
Appendix 16.8 : Programs and estimated budget
(Rs. in million)
At expected At normal
A) Programs to be implemented through government
bodies
Programmes and projects in first priority A
1. Promotion of private sector in electricity development 75.46 62.88
2. Study of small hydro-power projects 27.77 23.14
3. Study of Saptakoshi Multipurpose project 33.50 27.92
4. Study of Pancheshwor Multipurpose project 7.09 5.91
Total 143.81 119.84
Programs and projects in second priority B
5. Hydropower strategy third phase (National Water Policy) 7.80 5.36
6. Restructuring of the electricity sector 17.72 12.18
7. Study of Multipurpose project 8.92 6.13
8. Project identifications and study 20.72 14.25
Total 55.16 37.92
Programs and Projects in third priority C
Percentage 5.23 1.4
9. Criterion related to hydropower project
10. Study of Saptagandaki Multipurpose Project
11. River Basin study
12. Water and Energy Commission
13. Strategy for Energy resources
14. National demand projection and system project
(B) Programs to be run through Nepal Electricity
Corporation
Programs and projects under first priority A
1. Expansion of Load Despatching Centre 60.35 50.29
2. Distribution line expansion (import-export link) Butwal- 14.54 12.11
Sunauli 132 KV
3. Other rural electrification 330.12 275.10
4. Marsyangdi Hydropower Project 963.28 802.73
5. Banepa, Panchkhal, Substation Project 4.57 3.81
6. Kailali, Kanchanpur rural electrification 126.32 105.26
7. Sitalpati-Mushikot 33 KV distribution line 10.22 8.51
8. Chhinchu-Rara-Jajarkot 33 KV distribution line 11.61 9.68
9. Jirikhimti (Therathum) substation 1.80 1.50
10. Ghorahi-Holleri (Rolpa) 33 KV distribution line 10.40 8.66
11. Rural Electrification and distribution system reform 324.43 270.36
301
12. Dhading-Salyantar 33 KV distribution line 5.47 4.56
13. Devighat-Chaughada 33 KV distribution line 4.08 3.40
14. Buipa-Okhaldunga 33 KV distribution line 7.47 6.23
15. Ilam -Taplejung-Phidim 33 KV distribution line 9.10 7.58
16. Rashuwaghat Khotang Substation 7.34 6.11
17. Aabukhaireni-Gorkha 33 KV distribution line 10.13 8.44
18. Sindhu-Dolakha distribution line expansion 4.36 3.63
19. Udipur-Besisahar-Manag 33 KV distribution line 3.60 3.00
20. Rural electrification, distribution and extension project 6.65 5.54
21. Thankot, Chhapagaon, Bhaktapur132 KV 108.25 90.21
Total 2024.06 1686.71
Programmes and projects under second priority B
22. Kaligandaki A Hydroelectricity Project 54.54 37.49
23. Chamelia Hydroelectricity Project 406.96 279.79
24. Heldung small hydropower project 9.46 6.50
25. Gumgad small hydropower project 11.18 7.69
26. Madikhola substation 2.65 1.82
27. Budar substation and distribution line 0.32 0.22
28. Hetauda-Dhalkebar, Butwal-Bardaghat 132 KV second 8.41 5.78
circuit
29. East West 220 and North-South 132 KV grid connection 0.80 0.55
study
30. Identification and feasibility study of reservoir projects 61.81 42.49
31. Parwanipur-Birjung 132 KV expansion line 11.91 8.19
32. Dhalkebar-Bhittamod 132 KV distribution line 19.78 13.60
33. Mid-Western and Far-Western region rural electrification 69.02 47.45
34. Distribution system development: Birgunj corridor 132 KV 40.17 27.62
distribution line
Total 697.01 479.19
Percent 23.43 21.59
Programmes and Projects under third priority C
( Possible projects)
35. Hetauda-Bardaghat 220 KV distribution line 8.53 2.41
36. Grid Substation strengthening
37. Butwal-Bardaghat 132 distribution line
38. Dumre-Damauli 132 KV distribution line
39. Dailekh-Kalikot-Jumla 33 KV distribution line
40. Rapti, Veri rural electrification
41. Kulekhani III hydroelectricity project
42. One reservoir project
43. Khimti -Dhalkebar 220 KV distribution line
302
44. Hetauda-Thankot 220 KV distribution line
45. Distribution line and substation strengthening
46. Piluwa-Bhojpur 33 KV distribution line
47. Okhaldunga-Saleri 33 KV distribution line
48. Distribution system development
49. Mechi rural electrification
50. KoshI -Sagarmatha hill rural electrification
51. Western region hill rural electrification
52. K-3 substation 66 KV
53. Study of institutional reform in electricity distribution
54. Computerized billing
55. Study of small scale hydroelectricity project
56. Kankai Multipurpose Project
Grand Total 2974.73 2219.48
303
Chapter - 17
Irrigation and water induced
disaster prevention
17.1 Irrigation
17.1.1 Background
The extension of irrigation facilities in the agricultural land can bring crop integration
and crop diversification, which can help to generate employment and reduce poverty.
It is necessary to pay attention to possible areas for irrigation development in the
Terai region for the increment of agriculture production and productivity. It is
necessary to formulate new irrigation projects or restore the existing irrigation
facilities in the hills, particularly in the food-deficit areas, to increase supplies of
essential food-items. It has become necessary to operate small irrigation projects by
adopting modern irrigation technology systems in the areas suitable from climatic
point of view and to produce high-valued crops (horticulture, vegetables etc .) in the
areas where year-round irrigation is available.
In Nepal's river, the volume of water fluctuates highly between the winter and rainy
seasons. During the monsoon season, irrigation facility is available in the targeted
areas from almost all the irrigation projects, whereas in winter the same irrigation
projects can irrigate only 30-40 per cent of the targeted area.
The Terai region has a huge groundwater reserve with the possibility of providing
year-round irrigation facilities to around 570 thousand hectares of land. Therefore, it
has become necessary to develop both the groundwater and surface irrigation
facilities by developing both the sources as supplementary with each other.
In the hills, there is possibility of extending irrigation facilities for various crops in a
small area by collecting rainwater in small ponds and applying the sprinkler or drip
techniques. In some hilly areas, there is high possibility of providing year-round
irrigation facilities by adopting the technologies, which can be used in prod ucing
high-valued crops.
A. Target and progress

The Ninth Plan had a target of providing irrigation facilities to a total of 249,400
hectares of land, including 142,400 hectares of land from new and under
construction irrigation projects and remaining 107,000 hectares of land from
reforms in the farmer managed systems. In addition, it was targeted to develop
304
command area in 15,100 hectares of land from the Sunsari-Morang Irrigation
Project and to constitute active water users groups and strengthening them at 11
irrigation systems incorporating a total area of 68,000 hectares of land. It was
also planned to hand-over to farmer users groups for maintenance and repair and,
operating it under the annual plan after reconstructing and reforming the most-
essential infrastructures. As per the target, irrigation infrastructures have become
ready and it has been shown in table No. 17.1.
(i) Table 17.1: Physical target and progress of the Ninth Plan
(in hectare)
S. New areas Reform of farmer system
No Concerned institution Target Progress Percent Target Progress Percent
1 Department of Irrigation
Surface irrigation 52,400 29,586 56 81,500 80,879 99
Ground water irrigation 30,000 23,613 79 500 500 100
a. Deep tube-well 11,650 9,969 86 500 500 100
b. Shallow tube-well 18,350 13,644 74 0 0 0
Total 82,400 53,199 65 82,000 81,379 99
2 Agriculture Development
Bank
a. Surface irrigation
b. Ground water irrigation 60,000 12,125 20
3 Non-government sector 10,000
Total 142,400 65,324 46 82,000 81,379 99
During the Ninth Plan period, it is estimated that a total of 146,703 hectares of land,
including 65,324 hectares from new irrigation projects and 84,561 hectares from
farmer canal reforms, has been brought under the irrigation network. The total land
under surface irrigation, which was 504,482 hectares by the end of Eighth five-year
plan, has been increased by 110,465 hectares to 614,947 hectares of land. Similarly,
during the same period, the total areas under the irrigation of traditional farmer canal
has been reduced to 300,935 hectares from 381,814 hectares, as the traditional canal
capable of irrigating 80,879 hectares of land has been transformed into surface
irrigation. So, by the end of the Ninth Plan, irrigation facility has been extended to a
total of 1,121,441 hectares of land. Similarly, 43,000 hectares of land has been
handed-over for joint management as per the irrigation management and hand-over
programs.

The Plan, which was prepared in accordance with Agriculture Perspective Plan, had
the objectives of poverty alleviation through proper maintenance and management of
the existing irrigation projects, extending year -round irrigation service to irrigable
land and contributing for institutional development of farmer users groups. The
following were the major problems and challenges faced by the irrigation sector
during the plan period.
305
1. Due to the failure of concerned authorities to assert their rights of collecting
service charge as per Irrigation Regulations 2056, the collection of irrigation
service charge was nominal due to which there was lack of fund for proper
maintenance, repair and operation of irrigation system resulting in poor
performances.
2. Lack of joint utilisation of water by associating groundwater systems with the
development of surface irrigation systems in the Terai region.
3. Low expansion of system of collecting rainwater in reservoirs and use it in
the dry season for irrigation in the hilly areas.
4. As a result of decline in the use of tube-wells, the plan of providing year-
round irrigation facility, as stated in the Agriculture Perspective Plan, could
not be fully implemented due to the following reasons.
a) A massive decline on demand for tube-wells due to sharp fall of sales
prices of rice and wheat in national and international markets.
b) Unrestricted inflow of cheap Indian food grains through open border into
Nepal and continued subsidy on tube-well installation and operation and
massive agriculture production that have lowered the cost of production
in India were the main reasons for low sales of domestic food-grains.
c) Phase-wise withdrawal of subsidy on installation of shallow tube-wells in
Nepal.
d) Price rise on per unit of electricity and diesel used in the operation of
tube-wells.
5. Weak implementation aspect of the institutional development of farmer user
groups.
6. Due to lack of co-ordination between the agencies concerned with agriculture
sector, agriculture packages are not implemented in the areas where irrigation
facilities are already available, resulting less-than-expected growth in the
productivity.
• Increase agricultural production and productivity by extending irrigated land

to 1,686,000 hectares of the total irrigable land by the end of the Twelfth Plan
through the development of year-round irrigation system, which will be
controlled by farm ers.
• Assisting in poverty alleviation by generating employment opportunities in
constructing infrastructures for expansion of irrigation services, maintenance
and renewal activities.
306
A. Objectives
1. Develop necessary infrastructures through the development of additional
infrastructures and strengthening the management of existing irrigation
facilities to extend year-round irrigation facilities by utilising available water
resources in the country.
2. For the sustainable management of the irrigation projects developed in line
with farmers' participatory approach, institutional development of farmers'
user groups
S. Projects Physical targets
N. (in hectares)
Normal case Lower case
1 Infrastructure development for expansion of new irrigation 177,600 150,200
areas
• Surface irrigation projects 42,600 36,200
• Ground water irrigation projects 77,000 65,000
• Through modern irrigation system promotion programs 10,000 8,500
• through the programs conducted by Agriculture 38,000 32,000
Development Bank
• through the programs conducted by Ministry of 10,000 8,500
Agriculture and Co-operatives
2 Sustainable management of existing irrigation system 280,710 240,000
• Sustainable joint/hand-over management of existing 37,000 31,400
irrigation system
• Reconstruction and maintenance of irrigation 33,780 29,000
facilitates constricted by Department of Irrigation
3 Expansion and maintenance of farmer cannel 64,000 54,000
Total* 241,600 204,200
* New irrigation schemes and maintenance of farmers cannel.
In addition, 10,000 hectares more command area will be expanded from Sunsari-
Morang irrigation, water user groups active in the various irrigation projects will be
strengthened and 37,000 hectares of land will be handed over to farmer user groups
for yearly maintenance and operation after reconstructing and reforming the most
necessary infrastructures. Successful exploration of tube-wells along with shallow
and deep tube-wells, under the groundwater irrigation program, will be converted into
irrigation tube-wells.
C. Strategy
In the context of low level of irrigated land, despite the high possibility of irrigation
in the country, irrigation can be an important medium to achieve high economic
growth rate through the adaptation of modern technology by increasing production
and productivity. Given the very low production and productivity of agro crops,
307
irrigation can make an important contribution in alleviating rural poverty by raising
both the production and productivity of agriculture. Remarkable contribution can be
made in the depr ived sectors by conducting small irrigation projects as targeted
programs to raise their incomes. There is high possibility of developing large and
small scale surface and groundwater irrigation systems in the country. As, Agriculture
Prospective Plan has stressed on the development of shallow tube-wells and small
surface irrigation keeping with the view of investment effectiveness and quick return,
the Tenth Plan has also incorporated the policy.
n Strategies related with objectives number 1
1. An intensive irrigation plan will be formulated and implemented in
irrigation areas where irrigation facilities, constructed and managed by
government and users group, are available throughout the year.
2. Capabilities of water users group will be developed by strengthening the
management of irrigation aspect and reforming existing canal, managed
and constructed by farmer and the government.
3. Project formulation and construction system will be reformed by
considering technical, social, economical and environmental aspects,
while initiating new irrigation projects.
4. Possible huge irrigation projects will be developed on the basis of
bilateral and multilateral co-operation.
5. As per the policy envisaged in Agricultural Prospective Plan,
groundwater irrigation projects will be formulated in the Terai region,
while projects like small surface irrigation, fountain irrigation and drop
irrigation will be formulated in the hilly region.
n Strategies related with objectives number 2
6. Capabilities of local bodies like DDCs, VDCs and Water Users Group will
be enhanced to make them able to formulate, construct and manage small
and medium irrigation projects. In addition, steps will be taken to involve
NGOs in implementation of such projects.
7. In order to increase agricultural productivity and effectiveness of
irrigation facilities, pieces of irrigable land having single ownership will
be integrated and farmers will be encouraged for contract farming and co-
operative farming.
8. Development and management of groundwater irrigation will be
improved.
9. Investment from the private sector in the irrigation sector will be
encouraged.
D. Policy and programs
n Farmer controlled and availability of year-round irrigation facilities
(related with strategy number 1)
308
• As per the concept of watershed management, formulating irrigation
projects will be done on the basis of availability of water in the given
river and period of water requirement and place.
• The existing seasonal irrigation system in Terai will be renovated to
provide year -round irrigation facilities by developing surface and
groundwater irrigation as supplement to each other.
•In order to extend year -round irrigation facilities in the possible hilly
areas, the existing irrigation facilities will be renewed, new surface
irrigation projects will be developed and rainwater, in seasonal irrigation
areas, will be collected in reservoir, to distribute by applying modern
technologies in the participation of NGO.
n Reform of existing farmer can al and the Nahars system constructed by the
government (related with strategies number 2)
• Groundwater resources, available in the Terai region, will be utilised at
maximum level. In this regard, shallow tube-well program will be
developed as a tube-well group and will be affiliated with the pocket
agriculture program conducted by the Ministry of Agriculture.
n Formulation of new irrigation projects based on technical, social,
economical and environmental aspects (related with strategy number 3)
•Implementation procedures of multi-purpose projects, which also
contributed for the development of irrigation, will be accelerated.
n Development of huge project on the basis of bilateral and multilateral co-
operation (related with strategy number 4)
•Detailed feasibility studies will be carried out before developing the
mega-irrigation projects like Bheri- Babai Diversion, Sunkosi-Kamala
Diversion and West-Rapti to ensure that they will not pose any negative
impact to environment and human settlements.
n Capacity enhancement of local bodies for formulation, implementation and
management of small and medium irrigation projects (related with strategy
number 5)
• By enhancing the public contributions, their stake in management of
irrigation projects will be increased . Actively involving them in new
projects from the early stages and mobilising them through organised
user groups in such irrigation projects will develop self-reliant users
groups.
• Except for the main canals of the large and medium scale irrigation
projects, farmers tertiary cannels will be involved in the construction and
management of branches, sub-branches and farmer irrigation projects
through water users committees. A policy aimed at encouraging
investment partnership between local bodies and farmers will be
formulated for the construction and management of small irrigation
projects.
309
• Priority will be given to handling-over the operation and management of
the already completed small and medium scale irrigation projects through
the formation of users' groups. A joint management team comprising both
the government and users' groups will operate large-scale irrigation
projects. Department of Irrigation will look after the operational
management of large-scale projects that are not feasible to hand-over at
the moment.
• The management of the already completed large-scale and medium-sized
irrigation projects will be strengthened and operated in co-ordination
among the agencies looking after agriculture and irrigation sectors so as
to ensure maximum benefits from the projects.
• Arrangement will be made under which the management and operation of
the already completed large-scale and medium-sized irrigation projects
could be handed-over to private sector on contract basis.
•Department of Irrigation will give priority for the reconstruction and
maintenance of irrigation facilities in the areas where local investment
partnership and commitment of paying water tax is high.
n Increase agriculture production and productivity by improving
effectiveness of irrigation facilities (related with strategy number 7)
•Water user institutions and related irrigation agencies will be empowered
by implementing effective legal mechanism to collect irrigation service
charge from farmers in the irrigation projects operated under joint
management.
n Improving groundwater irrigation and its management (related with
strategy number 8)
•As per the demand of farmers and active participants, the program of
extending supports to the farmer -managed irrigation projects will be
continued for physical and institutional reforms will be continued.
n Promoting private sectors' investment in irrigation sector (related with
strategy number 9)
• Irrigation projects on the basis of feasibility will be developed with the
participation of private sector.
E. Policy-level, legal and institutional reforms
The following policy-level, legal and institutional reforms will be carried out in
order to achieve the objectives of irrigation sector in the Tenth Plan period.
• As per the policy of Agriculture Prospective Plan, the irrigation sector will be
reviewed and updated.
• The Irrigation Policy will be reformed on the basis of National Water
Resources Strategy.
310
• Institutional reforms of Department of Irrigation will be carried out in order
to enhance implementing efficiency of irrigation development and
management.
• Action plan to increase people participation will be formulated to effectively
execute irrigation programs (surface and groundwater).
• Uniformity on irrigation policy and irrigation regulations will be brought.
• Water User Associations and Irrigation Division Offices engaged in
managing irrigation system and collecting irrigation service charge will be
empowered by awarding legal rights.
• User-centred designs will be included in Detail Designing of irrigation
projects.
• Both private sectors and NGOs will be encouraged to participate in the
development of irrigation facilities.
• Action plans will be formulated to enhance efficiency of Water User
Associations.
• Monitoring and evaluation processes in irrigation sectors will be strengthened
and made effective.
• Water management and its use will be gradually made effective.
With an aim to put the water resources strategy into action, Water and Energy
Commission will prepare National Water Plan during the Tenth Plan period. Apart
from the long-term water plan of irrigation sector, the National Water Plan will also
formulate action plan in implementing proper policy-level, legal and institutional
reforms.
F. Program/name of project, prioritisation, investment, physical goals, programs
executing agencies time frame to be operated under the government
investment.
As per the prioritisation, name of the projects and programs, required investment,
physical goal, implementing agencies and time frame has, herewith, been displayed in
table no. 17.2. Department of Irrigation will construct large-scale and medium-level
surface and underground irrigation (deep tube-well) projects. Activities like
constructing small-sale irrigation projects, renewal of farmer canals and their
renovations will be done by local bodies. Department of Irrigation, local government,
NGOs, Agriculture Development Bank and district and division offices under the
Ministry of Agriculture and Co-operatives are the implementing agencies of the
irrigation related projects.
Management of small-scale surface irrigation, groundwater shallow and deep-tube-
well projects will be carried out by water user institutions. Large, medium -scale and
multipurpose surface irrigation projects will be managed jointly by the irrigation
311
agencies and water user institutions. Small-scale surface irrigation projects and
shallow irrigation projects will be managed by the local bodies in co-operation with
NGOs while the management of modern irrigation projects will be conducted jointly
by farmers' groups and NGOs. Separate and integrated programs will be implemented
by categorising various irrigation projects to be constructed and managed by
government, private sector and local bodies.
17.1.5 Prioritization
During the Tenth Plan period, 46 programs/projects under the irrigation sector
(included with water-induced disaster control) will be implemented. Priorities of
these programs/projects have been fixed under the Policy Action Matrix. Following is
the summary of the prioritisation. Detail programs and estimated budgets have been
presented in table no 17.1.
(In Rs million)
Prioritisation No. of Normal case Lower case
program Budget Per cent Budget Per cent
allocated allocation
A P1 25 11134.1 48.9 9376.10 54.4
B P2 18 7089.0 31.2 5421.0 31.5
C P3 9 4526.9 19.9 2427.9 14.1
Total 52 22750.0 100 17225.0 100
G. Expected outcomes
• The targeted extension of irrigation projects during the Tenth Plan period
will contribute Rs 5.37 billion to the Gross Domestic Products.
• During the Tenth Plan period, addition al irrigation facilities will be
extended to 177,600 hectare of land and farmers' canal will be extended to
cover additional 64,000 hectare of land through the expansion and reform
of such canal.
Contribution towards poverty alleviation and human development
• Increase of excess of rural population towards irrigation facilities.
• Generation of employment opportunities while constructing, maintaining
and renewing existing irrigation infrastructures that will ultimately
contribute for poverty alleviation.
Employment generation and other contributions
The investments that will be made in the irrigation sector during the plan period will
generate both the temporary and permanent employment opportunities. The nature of
jobs that will be created in the construction phase will be temporary in nature and 30
per cent of the construction investment will be used in employing temporary nature of
jobs. The jobs that will be generated after extension of irrigation to the agricultural
land will be permanent ni nature. As per the findings of a study (Feasibility study of
312
Raj Kudwa Irrigation Project) according to which, irrigated land create permanent
employment equivalent to annual 72 labour day, 17,395,200 labour day employment
opportunities will be generated by expanding irrigation facilities in 2,41,600 hectares
of land.
Contribution in achieving regional development and balance
As farmer canal reforms, groundwater irrigation development and irrigation
management hand-over programs will be implemented proportionately in all five-
development regions, it will contribute for regional development and balance. Except
for the Mid-Western Region, central-level large and medium -scale surface irrigation
projects have been operated in other regions. With the construction of the Babai and
Sikta Irrigation Projects in the Mid-Western Region during the Tenth Plan period, it
is expected that such irrigation projects will help to bring about regional development
and balance through the development of large and medium scale irrigation projects.
Contribution for gender equality from irrigation programs and policies
The Irrigation Policy, 2053 has made it mandatory that at least 20 per cent
representatives in a farmer user group should be women. Women's direct
participation, at least by 20 per cent, in the course of irrigation development and
management will also help for gender equality.
Decentralisation of the programs as per the Local Self-governance Act 2055
Role of the Department of Irrigation, local bodies, private communities and NGOs is
explained below. The objectives of the different roles are to achieve the objectives of
irrigation in the Tenth Plan in accordance with its strategies, policies and reform
programs. HMG/Nepal will extend co-operation to local bodies, private sector and
NGOs in implementing irrigation plans.
a) Role of Department of Irrigation
• As per the irrigation strategy, the department of irrigation will construct
infrastructures that have capacity for year-round irrigation facilities and
manage them.
• As per the policy of involving local bodies in infrastructure development
and management of small irrigation projects is concerned, regional and
divisional offices of the Department of Irrigation will provide technical
support in these projects.
• Medium-level surface and deep-well irrigation projects will be
constructed by the Department of Irrigation. Role of water user
associations in each phase of the project will be as per the irrigation
policy. The water user association will do the management of the
completed projects.
• The Department of Irrigation will effectively construct, manage and
operate the running and under construction large-scale pr ojects.
313
• Feasibility studies will be carried out and project will be formulated for
the construction of surface irrigation in the areas where groundwater
irrigation is not possible. Irrigation facilities will be made available to dry
areas by carrying out feasibility studies and detailed designs of the
project.
• Priority will be given to construct irrigation projects at food-deficit hilly
areas.
b) Role of local bodies
• With the help of private community, DDCs, VDCs and water user
associations will construct and manage small irrigation projects.
• All irrigation programs at the local level will be implemented in
partnership of water user group and irrigation and agriculture bodies.
c) Role of private sector
• Construct tube-wells, renew and repair works
• Carry out repair works of electric motors and diesel pumps that will be
used in tube-well by setting up private workshop.
• Promote and implement drip, sprinklers and reservoir technology in hill
areas.
• Large-scale irrigation projects will be managed jointly Nepalese and
foreigners in the initial phase, but after enhancing the capacity of Nepali
private sector, such projects will be managed and operated by them in the
future.
• Private sector will contribute in sample testing, exhibition, development
and operation of the irrigation projects that are under construction.
d) Role of NGOs
• NGOs will play an important role in extending technical support to water
users groups and community organisations, formation of farmers' groups,
and formulate, design, construction and operation of projects.
17.1.6 Possible external risks in implementation of projects to achieve
the irrigation goal
• Availability of foreign assistance
• Availability of government's matching fund
• Collection of irrigation service charge
• Lack of co-ordination and co-operation among Department of Irrigation,
314
Department of Agriculture and Department of Soil and Watershed
Conservation
• Lack of political commitment for people participation.
• Availability of various agriculture-related services to farmers in co-
ordina ted manner.
17.1.7 Log Frame
The overall policies and programs of the irrigation sector have been presented
below. Detail information has been given in annex 3.
315
Policy and Programme Log Frame- Irrigation*
Overarching National Objectives: Poverty incidence of Nepali people (men and women) significantly reduced at a sustainable manner.
Sectoral objectives: Remarkably extending the contribution of irrigation sector in national development.
Objectives Strategy Indicators Sources of Major programs External risk factor
information
Sectoral • Intensive irrigation programs will be lunched •
Farmer canals reforms in • Four -monthly 1. Sustainable management • Commitment of
objective: in areas where year-round irrigation facility is
64,000 ha. and annual of the running projects. external
Extending available. • New irrigation facility progress report 2. Completing irrigation loans/assistanc
year-round • Irrigation management will be strengthenedextension to additional of the management and hand- e.
irrigation by enhancing capacity of water users 1,77,600 ha. Department of over projects. • Commitment of
facilities to • Participation of users in
associations. Proper co-ordination will be Irrigation 3. Renewal and extension of Matching Fund.
irrigable land. established with Agriculture related agencies
canal management, its • Annual report of farmers' canal. • Commitment of
at project, regional and national levels. strengthening and project NGOs. 4. Renewal and policies and
• Project formulation and construction hand over in 37,000 ha. • Special survey improvement of programs.
procedures will be improved by taking • Renewal and report. government projects. • Political
technical, social, economical and improvement of • Four -monthly 5. Development of commitment.
environmental aspects. government project in and annual groundwater projects in • Continuity in the
• Massive irrigation projects will be developed
33,780 ha. progress report new areas. participation of
• Maintenance, renewal,
on basis of bilateral and multilateral co- of the 6. Development of surface Department of
operation. management Department of irrigation projects in new Agriculture and
• Ground-water irrigation projects will be improvement of traditional Agriculture. areas. Department of
developed in Terei, while, in hills drip and
irrigation system in • Four -monthly 7. Producing high-value Soil -
sprinklers projects will be formulated. 280,710 ha. and annul crops by using non- conservation
• Capacity of local bodies (DDCs, VDCs and• Producing high-value progress report conventional irrigation and watershed.
water users groups) and NGOs will be crops in 10,000 ha by of local bodies. technologies. • Continuity in
developed in formulation, construction anddeveloping irrigation 8. Conducting irrigation participation
management of small and medium-scale through the adaptation of program from Agriculture and local bodies
projects. modern technology. Development Bank, and popele.
• Farmer will be encourage to integrate • Diversification in 9. Conducting irrigation
irrigable lands having single ownership and
agriculture. program from the Ministry
• Participation of local
to adopt contract farming and co-operative of Agriculture and co-
farming. bodies and people in operatives.
• Private sector participation in the irrigation
canal construction, its 10. Conducting feasibility
sector will be encouraged. maintenance and study of different projects.
management.
* Quantitative targets based on 6.2% growth rate (details in Annex 3)
316
Table 17.1: Program and estimated budget.
Rs in million
Projects Normal case Lower case
1. First priority projects
1 Irrigation Development Project (ongoing) 38.1 32.0

2 Community Irrigation Sector Project (new) 1140.0 960.0
3 Nepal Irrigation Sector Project, second phase (new) 1204.8 1012.0
4 Mahakali Irrigation Project, third phase (new) 95.0 80.0
5 Sikta Irrigation Project (new) 1045.0 880.0
6 Community Groundwater Irrigation Project (ongoing) 1962.7 1652.8
7 Groundwater project deep tube-well program under APP 712.5 600.0
(ongoing)
8 Maintenance of government-operated project (annually) 950.0 800.0
9 Extensive preservation of water infrastructure 237.5 200.0
10 Management and hand-over of government project (ongoing) 370.5 312.0
11 Bhairahawa-Lumbini Irrigation Project under PTP program 64.3 54.1
12 Rajapur Irrigation Project under POP program 41.1 34.6
13 Shallow tube-well under APP (ongoing) 86.3 72.7
14 Mahakali Irrigation Project second phase (ongoing) 34.2 28.8
15 Babai Irrigation Project (ongoing) 475.0 400.0
16 Project Management and Training Program 380.0 320.0
17 Institutional development 28.5 24.0
18 Construction quality testing laboratory 475.0 400.0
19 Regional Workshops 855.0 720.0
20 Project feasibility study (new)82.8 69.7
21 Groundwater exploration program 118.8 100.0
22 Research, training, monitoring and evaluation (ongoing) 47.5 40.0
23 First priority programs of Department of Water-induced Disaster 1566.6 1319.2
Control*
24 First priority programs run by Agriculture Development Bank 380.0 320.0
(irrigation)
25 First priority program run by Ministry of Agriculture and Co- 285.0 240.0
operative (small irrigation)
Total 11134.1 9376.1
Per cent 48.94 54.43
Second priority projects
Irrigation program
1 Sikta Irrigation Project (new) 765.0 585.0
2 Mahakali Irrigation Project third phase (new) 170.0 130.0
3 Renewal and reforms of government projects 593.6 454.0
4 Siphon construction on Babai River 340.0 260.0
5 Command Area Development in the area to be irrigated by 1147.5 877.5
Babai eastern main canal
6 Medium -scale Irrigation Projec t (new) 255.0 195.0
7 Renewal of Ranijamara Canal 510.0 390.0
8 Irrigation Development Quality Improvement Project 26.1 20.0
9 Praganna Irrigation Project (ongoing) 348.5 266.5
10 Nepal Irrigation Sector Project (ongoing) 477.9 365.4
317
Projects Normal case Lower case
11 Second Irrigation Sector Project (ongoing) 88.8 67.9
12 Sunsari-Morang Irrigation Project third phase (ongoing) 166.5 127.4
13 Bagmati Irrigation Project first phase (ongoing) 311.8 238.4
14 Chandamahana Irrigation Project (ongoing) 8.5 6.5
15 Non -conventional Irrigation Program (new) 399.5 305.5
16 Second priority programs of Department of Water-induced 1034.0 790.7
Disaster Control*
17 Second priority programs run by Agriculture Development Bank 255.0 195.0
18 Second priority programs run by Ministry of Agriculture and Co- 191.3 146.3
operatives (small irrigation)
Total 7089.0 5421.0
Per cent 31.16 31.47
Third priority projects
Irrigation programs
1 Trishuli Irrigation Project (new)
2 Mahakali Irrigation Project third phase (new)
3 Bagmati Irrigation Project third phase (new)
4 Sunsari-Morang Irrigation Project third phase (new)
5 Baghmara Irrigation Project (new)
6 Other irrigation projects
a) Chandu dam (ongoing)
b) Mallas Irrigation Project (ongoing)
c) Karngaghol Lift Irrigation Project
7 Third priority programs of Department of Water-induced
Disaster Control*
8 Third priority programs of the Agriculture Development Bank
9 Third priority programs of Ministry of Agriculture and Co-
operative (small irrigation)
Total 4526.9 2427.9
Per cent 19.9 14.1
Grand total 22750.0 17225.0
* List of priority project prepared by Department of Water -induced disaster control has
been presented in table 17.3.
318
Appendix 17.2 : Irrigation program/project priority list, investment cost, physical goal, implementing agency and duration
S.N. Name of Investment Cost Physical Progress Implementing Duration Remarks

program/project (in Rs. 000) agency
Investment Investment Plan Target Tenth Plan Target
cost of cost during
project Tenth Plan
New Renewed New Renewed
1. Maintenance and Department of 5 years
sustainable Irrigation and
management of water user
running irrigation groups
system
a) Renew and 1,000,000 (280,710) Department of 5 years Continuing irrigation facility to
improvement of Irrigation and 280,710 ha of land by carrying out
government run water user maintenance and management of
irrigation project groups government irrigation projects
b) Maintenance of 250,000 (33,780)
main dam and
pumping station
c) Repair, maintenance 698,400 (37,000) Department of 5 years Giving continuity to irrigation facility
and rehabilitation of Irrigation and 33,780 ha of land by renewing and
large-scale govt water user improving the running irrigation
irrigation project groups projects
d) Irrigation 390,000 5 years Improving structures of the most
management and needed irrigation projects
management transfer commanding 37,000 ha of land,
constituting water user groups,
improving their effici ency and hand-
over of management and operation
of branch canals to water user
groups
e) Farmer canal 0
renewal and
improvement
1) Praganna Irrigation 410,000 300 5000 Department of 2 years Improving the most needed
320
cost of cost during
project Tenth Plan
Project Irrigation and structures of farmer canals irrigating
water user to 5300 ha, improving efficiency of
groups water user groups, management and
operation of framers canals by
themselves
2) Community Irrigation 1,200,000 1,200,000 6,200 20,000 62,00 20,000 " 5 years Improving the most needed
Sector Project structures of farmers canals irrigating
to 26,200 ha, constituting water user
groups, improving their efficiency and
hand-over of their management and
operation to water user groups
3) Nepal Irrigation 1,265,000 1,265,000 11,000 20,000 11000 (4000 20,000 " 5 years Improving the most needed
Sector Project second ha from structures of farmer canals irrigating
phase surface), 31,000 ha, constituting water user
(7000 ha groups and enhancing their
from efficiency, hand-over management
ground- and operation to water user groups
water)
4)Babai irrigation 400,000 400,000 10,000 - 10,000 " 5 years A siphon will be constructed on
project (siphon Babai river to supply water to farmers
construction) canals on the Western bank of the
river from main canal of Babai
5) Command area 1,350,000 1,350,000 (10,000) - (10,000) " 5 years Development of command area on
development in areas 13,500 ha in Eastern bank of Babai
to be irrigated by the
Eastern main canal of
Babai irrigation
6) Second Irrigation - 104,437 - " 1 year Works of incomplete projects will be
Sector Project (SISP) completed
(ongoing)
7) Nepal Irrigation - 562,197 - " 1 year Works of incomplete projects will be
321
cost of cost during
project Tenth Plan
Sector Project (SISP) completed
(ongoing)
8) Ranijamara irrigation 600,000 600,000 8,000 8,000 " 5 years Systematising the source of
plan Ranijamara in Karnali River,
improving the most needed
structures of farmers canals irrigating
to 8000 ha, improving efficiency of
water user groups, operation and
management of farmers canal by
water user groups themselves
2. New and ongoing 0
irrigation projects
(programs with
availability of year-
round irrigation)
Surface Irrigation 500,000 5,000 5,000 Department of 5 years Works of Babai dam and main canal
Projects Irrigation and has been completed. Irrigation facility
a) Babai Irrigation water user will be provided to 13,500 ha by
Project (ongoing) groups constructing branch canal and
watercourses.
b) Sikta Irrigation 5,100,000 2,000,000 34,000 - 3,000 Department of 12 years Surface Irrigation projects are the
project (new) Irrigation and only alternative as groundwater
water user resource is low in Banke.
groups
c) Mahakali Irrigation 11,160,000 20,00,000 38,000 - 2,500 Department of 12 years As per the Mahakali treaty, share of
project (new) Third Irrigation and water that Nepal gets from the
phase water user Mhakali river will be used for
groups irrigation.
d) Trishuli Irrigation 1,500,000 1,500,000 1,000 - 5,00 Department of 10 years To be constructed under the grant
project (new) Irrigation and assistance from the Japanese
JICA government.
322
cost of cost during
project Tenth Plan
e) Mahakali Irrigation 35,996 - - - Department of 1 year To be completed rem aining 5 per
project second phase Irrigation and cent woks of the project.
(ongoing) water user
groups
f) Medium Irrigation 300,000 300,000 - - 2,000 Department of 5 years Extension of irrigation facility to 2,000
project (new) Irrigation and ha from new surface irrigation
water user projects.
groups
1) Baghmara irrigation 1,40,000 1,40,000 1,200 - - - Department of 7 years Supply of water to Khageri irrigation
(new) irrigation system from Baghmara river for
irrigating additional 1,200 ha.
g) Chanda Morang 9,981 " 1 year An incomplete structure of the project
irrigation project will be completed.
(ongoing)
h) Rajapur irrigation 43,290 " 2 years Project has been completed but
project (ongoing) should be operated for two years as
per POP*
i) Bagmati command 5,00,000 5,00,000 16,000 16,000 " 5 years New project to be started
area development
second phase (new)
j) Bagmati irrigation - 366,844 20,100 " 1 year To be complete ongoing project
project (ongoing)
k) Sunsari -Morang 1,000,000 1,000,000 - (10,000) " 5 years Renewal of branch canals irrigating
irrigation project third 10,000 ha., new tertiary will be built
phase (new)
l) Sunsari-Morang - 195,941 - (15,100) " 1 year Renewal of branch canals irrigating
irrigation project third 15,100 ha., work of incomplete
phase (ongoing) tertiary will be built
m) Irrigation 40,061 3100 1000 " 1 year Project to be completed
development project
(ongoing)
323
cost of cost during
project Tenth Plan
n) Community 20,66,022 60000 49000 " 5 years Tube-well expenses to be borne by
groundwater project farmer groups and Department of
(ongoing) irrigation to act as a facilitator
o) Shallow tube-well 90,880 90,880 40000 10000 " 5 years Tube-well expenses to be borne by
under special program farmer groups
(new)
p) Deep-tube well 7,50,000 7,50,000 10,000 11,000 " 5 years Deep tube-wells to be built by
under special program Department of Irrigation
(new)
q) Bhairahawa-Lumbini 67,680 " 2 years **Project has been already
groundwater irrigation completed but it should be operated
project for two years as per PTP
r) Groundwater 1,25,000 " 5 years Conduct annual groundwater
resources exploration exploration
program (ongoing)
s) Other surface 159,631 159,631 " 3 years Completion of the projects
irrigation projects
(Mallaz and Chandu
dam) (ongoing) and
Kerunga Ghol Lift
project (new)
3. Non -conventional 14,00,000 4,70,000 10,000 Non- 5 years Mobilising NGOs to do the work for
irrigation project (new) governmental Department of Irrigation
organization
4. Research, training, 50,000 Department of 5 years To be done by Department of
monitoring and irrigation Irrigation
evaluation
5. Feasibility study (new) 87,141 " 5 years To be done by Department of
Irrigation
6. Auxiliary programs of "
irrigation development
324
cost of cost during
project Tenth Plan
(annual)
a) System 40,000 " 5 years To be done by Department of
management and Irrigation
training program
b) Irrigation institutional 30,000 " " "
development program
c) Construction quality 50,000 " " "
test laboratory
d) Mechanical 90,000 " " "
workshop
e) Irrigation 30,700 " " "
development quality
enhancement project
7. ADB run irrigation 10,00,000 38,000 Agriculture " Program to be operated from the flow
project (new) Development of Agriculture Development Bank
Bank loan
8. Irrigation program run 750,000 10,000 Ministry of " To be operated by District Agriculture
by Ministry of Agriculture and Offices under Ministry of Agriculture
Agriculture and Co- Co-operative
operative (new)
Total 22,719,202 177,600 64,000
POM=plan of operation and maintenance, Rajapur irrigation project has been completed, in order to smoothly operate the project, irrigation systems will be systematized for two years as per the
POP. **PTP=project transitional period, as it is for 3 years during the tenth plan, budget for two years will be adjusted from Bhairahawa-Lumbini project.
325
17.2 Water Induced Disaster Prevention
17.2.1 Background
Adverse geographical structure, monsoon rain, global climatic changes and lack of
public awareness are the main reasons behind ever increasing loss of lives and
property due to floods, landslides, soil erosion and flow of debris. Therefore,
concerted efforts, community participation, awareness raising programs, development
of information system on disaster and development and expansion of appropriate
technologies have become imperative.
In this context, the objectives, policies and working policies of the Tenth Plan have
been prepared with the targets on mitigating water induced disasters, minimising loss
to lives and property by controlling rivers and rivulets, protecting arable land and
utilising the wasted land around rivers and rivulets thereby alleviating poverty.
17.2.2 Evaluation of the Ninth Plan
A. Review of the Ninth Plan
The Technical Centre for Water Induced Disaster Prevention, established with an
objective of enhancing the capacity of mitigating water induced disasters, has been
carrying out disaster mitigation programs and Mahakali River Control and the
Department of Irrigation have been carrying out some central river control programs
on Bakraha, Lalbakaiya and Bagmati rivers and emergency river control programs. In
course of institutional development, the centre was transformed into the Department
of Water Induced Disaster Prevention in 1999 and it has been mitigating water
induced disasters since then.
B. Problems and Challenges Faced during the Implementation of the Ninth Plan
The task of managing floods, landslides and soil erosion prevention in coordination
with agencies involved in water induced disaster mitigation still remains challenging.
Similarly, lack of appropriation of enough means and resources has also become a
problem.
17.2.3 Long-term Vision
To effectively mitigate and prevent water induced disasters in a coordinated manner
through institutionalising water induced disaster management.
A. Objectives
The prime objective of the Tenth Plan will be to control and manage water induced
disasters - soil erosion, floods, landslides and flow of debris which cause damages to
lives and property, arable land and development infrastructures every year - to
contribute to poverty alleviation and sustainable development and to develop and
326
expand appropriate and low cost technologies and to disseminate information and
enhance the capacity of people to protect themselves from such disasters.
B. Major Quantitative Targets
Following are the major targets related to the activities of control of water induced
disasters:
• To formulate policy, laws, regulations and guidelines on water induced
disaster management.
• To enlist, classify and sketch the map of areas prone to floods, landslides,
flow of debris, soil erosion and glacier outburst.
• To implement model projects to mitigate/prevent the damages caused by
floods, landslides, flow of debris, soil erosion and to develop and expand
appropriate technologies. To provide training to the technicians of the
concerned agencies of His Majesty’s Government.
• To carry out appropriate programs for collecting information on floods and
flow of water and its dissemination, for the establishment of pre-information
system and for raising public awareness.
• To assist in reconstruction of development infrastructures damaged by water
induced disasters and in emergency relief programs.
• To coordinate among the agencies related to water induced disaster
management.
• To make the Nepal-India Committees/Sub-committees on Inundation in
border areas effective.
C. Strategy
Water induced disasters have frequently damaged lives, property and thousands of
hectares of fertile land. Since such lands are generally owned by low income groups,
it has not only worsened the problem of sustenance of the poor, but has also
negatively impacted the economic and social structure.
In this context, the necessity of effectively managing water induced disasters to boost
economic growth and promote social justice is ever increasing. To enhance
knowledge on natural disasters, to develop a system of assessing possible risks, to
make efforts to stop change in the course of rivers and bring them back to original
courses and to take effective measures for resolving the inundation problem in the
border areas are the basic requirements. In this context, the prime strategies of this
sector are as follows:
1. The institutional capacity of various agencies related to this sector will be
enhanced by formulating policies and working plans of water induced
327
2. Mobilisation of people and rehabilitation system at the concerned agencies
and community level will be established for the effective implementation of
preventive measures and enhancement in public awareness to mitigate water
induced disasters.
3. Emphasis will be given on carrying out watershed management and river
control programs in an integrated manner through public mobilisation using
local skill and means.
D. Policies
n Policy Formulation, Working Plan and Institutional Development (Related
to Strategy1)
• Consolidation of collection, exchange and dissemination of information
on national and international water induced disasters and preparation of
risk map of floods, landslides, flow of debris and glaciers and
categorisation of disaster -prone areas will be done.
• Work plan on flood and course of rivers will be prepared and determining
the natural course of rivers, settlement and other construction of
permanent structures in the areas will be discouraged.
• Nepal-India Committee/Sub-committee on Inundation will be made
effective for resolving the problems of floods, landslides and inundation
in border areas.
• Work plan for flood and landslide control will be formulated and external
resources will be attracted for the purpose.
• Work plan for big, medium and small rivers of the kingdom will be
prepared for sustainable river control and landslide control of sensitive
steep areas will be prepared for preventing landslides.
• The rivers flowing into neighbouring countries will be enlisted and
updated records of their impacts on border areas will be kept through
preparing maps.
• Institutional capacity of agencies related to water induced disasters will
be enhanced.
n Preventive Measures, Public Awareness and Coordination (Related to
Strategy 2)
• Capacity of water induced disaster rehabilitation works will be enhanced
through promoting coordination among various agencies of His
Majesty’s Government, non-governmental organisations and the
communities for water induced disaster rehabilitation and reconstruction.
• The district level emergency river control and watershed management
328
activities will be conducted through the concerned local government
agencies. Local non-governmental organisations and community
organisations will be involved in natural calamities relief and
afforestation programs.
n Use of Local Skills and Means and Public Participation (Related to
Strategy 3)
• Exploration, development and expansion of low cost appropriate
technologies for mitigating water induced disasters will be made through
model construction activities.
• River control will be carried out in coordination with agriculture, forest
and soil protection activities. Arrangements will be made to optimally use
the local skills, means, resources and bio technology.
• Women’s participation in development works will be made compulsory.
E. Major Programs and Implementation Process
The major programs of the Department of Water Induced Disaster Prevention are
as follows:
• To formulate policies, laws, regulations and guidelines in order to
institutionalize water induced disaster management as a regular program.
The government has ratified National Water Resources Strategy which has an
objective of enhancing institutional capacity of water induced disaster
management. National Water Plan is preparing its detailed work plan. To
formulate policies and work plan for water induced disaster management and
execute them and to enhance institutional structure and capacity are the major
programs.
• To prepare the maps and sketches of areas prone to water induced disasters.
Such prone areas will be enlisted and categorised and risks will be mapped
and sketched and procedures and information system on disasters will be
consolidated. Major landslides, inundation areas, glaciers and risk-prone
watershed areas will be enlisted and their data will be collected on priority
basis and risk maps of 20 districts will be included in the geo information
system as soon as possible. Similarly, the ongoing Disaster Mitigation
Support Program will be continued and public awareness on water induced
disaster mitigation will be expanded.
• Appropriate technologies will be developed and expanded through model
construction works.
Model control, river control and watershed protection projects will be
implemented in order to mitigate/prevent damages caused by floods,
landslides, flow of debris and soil erosion. Appropriate model construction
329
works on water induced disaster control will be carried out.
• To inform the people and enhance public awareness on damages caused by
floods and landslides through pre-information system.
Appropriate programs will be conducted to collect information on floods and
flow of water, to disseminate the information, to establish pre-information
system and to enhance public awareness. Under this program, water induced
and other natural disasters and rivers will be enlisted and their information
will be collected and posters and pamphlets will be distributed for public
awareness. Efficiency will be enhanced by coordinating with government
agencies related to natural disasters, training will be given to users and public
awareness will be raised for river control and watershed protection purposes.
• Management of the course of sensitive rivers and prevention of landslides in
sensitive steep places will be done.
Studying the sensitive floods, lands lides, flow of debris and soil erosion,
potential projects will be updated. Preventive measures will be taken in
sensitive areas through mobilisation of people in coordination with the
concerned agencies. Poor people will reacquire their lands through the
management of the floods of sensitive rivers and it will help directly in
• Relief will be provided to water induced disaster prone areas and the
damaged structures will be reconstructed and rehabilitated.
Infrastructures damaged by water induced disasters will be rehabilitated and
assistance will be given to emergency relief works. The practice of
reconstructing the infrastructures damaged by water induced disasters by
concerned agencies and communities will be gradually developed under this
program. Necessary relief materials will be stockpiled in all five development
regions. Besides, emergency relief and rehabilitation projects will be run as
required and technical assistance will be provided to district level concerned
agencies for similar purpose.
• Seminars/workshops and interactions will be held to avoid duplication of
works and to coordinate programs related to the Department of Water
Induced Disaster Management and concerned government agencies, various
donor agencies, national and international non-governmental organisations.
• Nepal-India Committee/Sub-committee on Inundation will be made effective,
work plan for river course will be formulated and executed and disaster
mitigation/control work plans will be expedited.
Additional Implementation Process
• District level river control programs will be implemented through the local
agencies of the respective districts. Likewise, rescue activities on emergency
330
water induced disasters will also be implemented through the concerned
agencies of the respective districts with technical support from division and
sub-division offices. Some projects on floods, landslides and soil erosion will
be carried out through model construction sites for technical development.
Water induced disaster mitigation technologies will be gradually transferred
to public level through community disaster mitigation process by adopting
structural and non-structural measures. Consumers will be trained in adopting
safety measures to be protected from disasters.
• Pre-information system will be developed in order to inform the people on
the damages caused by sensitive rivers and landslides.
• Work plan on flood and course of rivers will be prepared and determining the
natural course of rivers, settlement and other construction of permanent
structures in such areas will be discouraged.
• For the protection of upper watershed areas of rivers, gorge control, bio-
engineering and afforestation programs will be conducted establishing
coordination with the Department of Soil and Watershed Conservation.
• All the said programs will be implemented with greater participation of the
people in coordination with all the concerned agencies of the central, district
and local levels. Similarly, training and consultations to the technicians of
various agencies of His Majesty’s Government at the central level will be
provided by the Department and at the district level by the divisions and sub-
divisions under the Department.
F. Policy, Legal and Institutional Reforms and Provisions for their
Implementation
Although the water induced disasters cause huge damage to lives and property every
year, due to lack of coordination among the concerned agencies to mitigate/prevent
such disasters they have not been effective and the affected people have not been
benefited. It has been imperative to establish coordination among the concerned
agencies and strengthening them for effective forecasting of floods and landslides to
mitigate and prevent disasters. The following reforms should be made in the Tenth
Plan:
• To expand the scope and rights of the Department of Water Induced Disaster
Management and to make coordination more effective and make arrangement
for necessary manpower and budget.
• To provide means and resources to the Department of Hydrology and
Meteorology required for forecasting floods.
• To provide necessary means and resources to the Home Ministry in order to
provide relief to disaster victims in time and to rehabilitate them.
G. Prioritisation of Government-funded Programs and Projects
331
The policies and activities of prioritisation of government-funded programs are
determined on the basis of Metrics Prioritisation Method.
The projects and names of programs in terms of priority order, required investment,
physical targets, implementing agency and timetable are given in chapter 17.4.
The implementing agencies are His majesty’s Government, Department of Water
Induced Disaster Prevention, Department of Hydrology and Meteorology,
Department of Soil and Watershed Management, District Administration Office, local
government bodies, non-governmental organisations and the local bodies.
Programs will be conducted with greater participation of people through the
beneficiary consumers groups with joint efforts of the non-governmental
organisations. First, second and third priority projects/programs are given in chapter
17.3.
H. Expected Benefits
• The additional contribution expected to Gross Domestic Product: The
mitigation of disasters will help more in protecting the productivity from
damages than contributing to the Gross Domestic Product. For the additional
contribution made from the reacquisition of land has to be analysed case-
wise. River and watershed improvement programs will give direct and
indirect economic benefits besides contributing to improving the
environment.
• As the water -induced disasters damage mostly the lives, settlement and arable
land of the poor people, disaster management will protect cultivable land and
will directly contribute to poverty alleviation. About 1.5 million persons per
day will be employed (within five years) during its construction period.
• As the use of local means, resources and people’s participation in flood
control is greater and the local people can be used for collecting construction
materials and filling stones in gabion wires, it creates direct employment
opportunity.
• Since women are also involved in labour-intensive works, it also helps in
practicing gender equality.
17.2.5 Possible Constraints and Risks of Implementation and Target
Achievement
If there is constraint of means and resources or if floods and landslides of greater
magnitude like that of 2050 BS (1993) occur, the available means and resources have
to be allocated to disaster-hit areas. Other risks perceived are as follows:
• Adequate availability of foreign assistance.
• Availability of people’s participation.
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• Continuity of cooperation and coordination among other concerned agencies.
17.2.6 Log Frame
The objectives, policies, sources of information indicators, major programs, their log
frame and detailed sub-programs of those programs and the vision table of indicators
are given in annex three.
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Policy and Programs Log Frame - Water Induced Disaster Control*
Sectoral objectives: Effective management of water-induced disasters.
Objective Strategies Indicators Sources of Major Programs Risks and Obstacles
Information
Sectoral Enhancing present institutional Policy and law for water- Department of 1. Formulating policy related with Continuity in co-
objective: capacity of the concerned bodies by induced disaster Water-induced Water -induced Disaster management. operation and co-
Effective formulating polices and action plans. management. Disaster control 2. Mapping and marking risk areas ordination among
management of Promoting public participation and Number of targeted and department of from the point of view of water-induced related institutions.
water-induced raising public awareness for programs for raising public Land and disaster. Availability of
disasters. precautionary steps to minimise awareness. watershed 3. Development of expansion of proper necessary financial
damages and promoting system of re- Damages and relief Conservation. technology through sample resources.
establishment at local and community programs created by construction.
level. Water-induced disasters. 4. Preparation and implementation of
Stressing to conduct watershed Projects/ programs related pogroms for Flood land management of
management and river control with watershed sensitive rivers and preventive
programs in an integrated way by management must be measures of sensitive cliffs.
using locally available skill and initiated. 5 pre-informing people about the
resource through public participation. Mapping of risks areas of possible damages from flood and
20 districts must be landslide through pre-information
completed. system.
6. Timely extension of relief to the
people affected by the water-induced
disasters and reestablishment of
demanded infrastructures.
7.Cordintation among the institutions
related with water-induced disaster
management.
8. Enhancing effectiveness of the
bilateral committee related with Nepal-
India border area immersion problems.
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Chapter - 18
Road Transportation
18.1 Introduction
The road sector has played an important role in the socio-economic development and
regional integration of Nepal. Till date, the road network has connected sixty district
headquarters. However, the road sector has yielded low economic returns because it
requires huge investment, but suffers from low traffic volume and lack of integrated
approach in the development efforts. According to the Nepal Road Statistics 2000, a
total of 15,905 km. road have been constructed, of which 29 percent is blacktopped,
24.9 percent graveled and 46.1 per cent earthen roads. In terms of the population, a
kilometer of the road serves about 1200 people. The Department of Roads is
responsible for the construction and maintenance of major roads along with urban
roads and district roads . The construction and maintenance of local district roads is
the responsibility of Department of Rural Infrastructure and Agricultural Road under
the Ministry of Local Development.
The status of road as of now , length of the roads according to development region,
and category of roads on the basis of length are shown in table 18.1, 18.2 and 18.3,
respectively.
Table 18.1: The Status of road as of now

S. no Type The total of FY 2058/059 (Till Falgun end )
Km Portion in percentage
1 Black topped 4,617 29.0
2 Graveled 3,958 24.9
3 Earthen 7,330 46.1
Total 15,905 100
Source: Nepal Road Statistics, 2000
Table 18.2: Road length according to development region (in Km)

Region Road length
Eastern 3,410
Central 6,343
Western 2,709
Mid Western 2,106
Far Western 1,337
Total 15,905
Source: Nepal Road Statistics, 2000
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Table 18.3: Classification of road and length by type (in Km)
Classification of road Road surface Total
Black topped Gravel Rough
Highway 2,357 248 369 2,974
Feeder Road 870 406 544 1,820
District Level Road 460 2,704 5,896 9,060
Urban Road 930 600 521 2,051
Total 4,617 3,958 7,330 15,905
Source: Nepal Road Statistics 2000
The efforts to connect district headquarters by the construction of new roads have
been slow as emphasis is given in the reconstruction, upgradating and maintenance of
the existing roads by the limited resources . It is expected that the recent approval of
National Transport Policy 2058 by the government will be crucial in preparing the
concept of long-term road development planning. Similarly, the provisions made by
Road Board Act, 2059 is expected to bring about a major change in repair and
maintenance of roads. It is expected that long-term projects will come forth after the
preparation of 20-year road plan.
A. Status and progress made as per the targets
The main objective of the road sector during the Ninth Plan was to contribute to the
economy and help in alleviating poverty by developing less expensive transportation
infrastructures.
The status of the first four years of the Ninth Plan show s that the physical
achievements were more than the target. The plan targeted 87 bridges , whereas more
than 150 bridge construction projects are under implementation. These are not only
small and middle bridges, but also large-scale ones like Trijuga (Saptari), Rapti
(Dang), Rapti (Nepalgunj) and Sunkoshi (Kavre). Though it was estimated that the
average annual budget of Rs 300 million would be enough for the construction of
bridges, the last year of the plan alone would require Rs. 1.1 billion.
The Ninth Plan had targeted to extend road network to 12 district headquarters out of
the total 19 district headquarters that were deprived of road network, but only four
district headquarters were connected by road by the end of the plan period. Public
Infrastructure Construction and Transfer Policy, 2055 has been implemented to
encourage private investment in transport sector. An Act, in this regards, is also
being formulated. Public Construction Directive has been prepared to construct roads
and bridges of pre-determined standards in a given time and cost, and to manage
resources needed for repair and maintenance by operating/implementing Road Board
Act and Public Constructions Work in a well organised manner.
Table 2.1 shows the road construction/upgrading progress during the Ninth Plan (FY
2054/55-2058/59)
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Table 18.4: Target and progress description
S.N Description of road Target of the Ninth Total progress Progress
construction, maintenance and Plan (km.) of the Ninth Plan (in %)
upgrading (km)
1 Road construction and upgrading
a. Blacktop 740 517 70
b. Gravel 1,225 843 69
c. Earthen 952 749 79
Total 2,917 2,109 72
2. Road improvement and 758 1,087 143
reconstruction
3 Periodic maintenance –blacktop 2,954 733 25
and gravel
4 Bridge construction (number) 87 99 114
5 *Links roads, district headquarters 12 4 33
but of remaining 19 districts in
(number)
6 New road construction (highways
a and sub feeder roads only) 149 407 273
b. Blacktop 819 1,152 141
c. Gravel 952 1,432 150
Earthen
Total 1,920 2,991 156
B. Problems and challenges faced during implementation

• Lack of budget appropriation as per the priority for the roads and bridges.
• Weak relation between the national and regional objective and targets
affected the predetermined achievement.
• Failure to allocate the required budget in each fiscal year as per the ratio of
total cost of the project.
• Constructions of roads without appropriate study and research.
• Various conflicts from the primary stage of road construction work delayed
road construction work.
• High cost of construction and maintenance of roads due to frail geological
and complex geographical structures.
• Lack of specifications to standardize liabilities of consultants.
• Weak monitoring and evaluation activities.
• Lack of inter -regional coordination and co-operation.
• Lack of systematic statistics and proper information system in the projects
• Lack of maintenance of roads and bridges, based on its actual physical status.
• Lack of awareness results in low participation of local people in the process
of construction and use of roads and bridges.
• Apathetic private sector investment in the road construction work.
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• Lack of adequate matching funds with the government as compared to the
foreign aid.
• The policy to tie up the construction and maintenance of the roads linking
major hydro power, projects could not be implemented effectively.
• The lax in security situation severely hampered the supply, storage and uses
of necessary inputs, and explosives.
• The poor utilization of locally available resources, and a trend to tendency
support from the centre even for the smaller projects.
• Weak decentralization, transparency, and accountability in the selection and
implementation of the projects.
18.3 Long Term Vision

In the process of expansion of road network, road sector will concentrate on the
development of necessary infrastructures to assist poverty alleviation and achieve
high and sustainable economic growth by contributing to minimize regional
imbalance and social inequality through proper mobilization, allocation, and
utilization of available resources. In order to expedite the development of the sector
the role of the private sector and the users group will be defined right from the level
of project formulation to implementation. In this context, the long-term vision of the
sector will be as follows:
• The road sector projects will be s elected, formulated and developed to help
alleviate poverty, and achieve high and economic sustainable growth through
effective mobilisation of resources and its justifiable distribution , both on
geographic and social basis.
• The government will play the role as a facilitator and regulator to promote
private sector investments through the identification of projects with
comparative advantages to achieve sustainable economic development,.
• The capacities of the government bodies from the centre to local would be
enhanced and made transparent to achieve higher growth.
In order to translate the above long-term vision into actual practice:
• All district headquarters will be linked by road network. For the areas those
are important and sensitive for the regional unification, easy and short
alternative routes will be identified and implemented.
• The major road network of the country will have three fully developed
parallel East West Highways (Existing Mahendra Highway, one highway in
Mid Hill region that would be ready by integrating various roads under
construction, and one in Southern Terai by rehabilitating and upgrading
existing postal route) and North-South Highways and feeder roads. There
roads will be connected with small centres, settlements and production areas
by the roads to be constructed in rural and local level.
18.4. The Tenth Plan

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a) Objective
The major objective of the road sector is to construct low cost road networks
(national and regional highways, and major roads in local level) and their repair and
maintenance by promoting private investment. The road sector to be constructed by
using local skills, technology and resources through the participation of the private
investment is expected to provide basic support in economic and social development
of the country and strengthening security mechanism, regional co-ordination and
national unification and to extend meaningful contributions in poverty alleviation, ,
reducing social injustice and regional imbalances.
b) Quantitative targets
The target during the Tenth Plan is to construct new roads and bridges of different
standards, maintain existing roads and upgrade the quality, and extend road link to
some district headquarter s. Major physical targets and expected achievements are
shown in table 18.5.
Table 18.5 Major physical targets of the Tenth Plan
Particulars Expected growth Normal growth
New road construction (All category) (in km) 1,025 870
Road upgrading (All category) (in km) 1,764 1,500
Road improvement, rehabilitation and 596 500
reconstruction (in Km)
Construction of road infrastructure (in km) 229 195
Periodic maintenance (in km) 1,216 1,033
Bridge construction (in number)(Including 132 220 187
that is under construction)
Link road to additional district headquarters (in 10 8
number)
Formation of Road Maintenance Fund To form within first fiscal year
Institutional strengthening To be c ontinued
Handing over local and urban roads under Within coming two years
local development ministry to municipalities
and DDCs
Reducing road transport expenses To be gradually reduced
c) Strategy:
The road network can be taken as an important basic infrastructure that is essential
for the socio-economic development of the country. Studies conducted to measure the
incidences of poverty have pointed out that the lack of road access is the main cause
of rural poverty. The road helps to enhance the rural people's access to the social
services like education and health, find market for their local products, and promote
rural employment through the promotion of income generating activities. Similarly, a
good road network helps in reducing the transportation cost in both rural and urban
areas, providing goods and services, reducing development gap between the urban-
rural making qualitative improvement in rural livelihood and increasing cost
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effectiveness. Overall, well-formulated and managed road programs can make
remarkable contributions in alleviating poverty by achieving high economic growth
and extending social services. Similarly, the extension of road network to remote
districts contributes to bring the deprived communities in the mainstream of
development through the process of socio -economic reunification. In this regard, the
following are the main strategies of the sector.
1. Development, construction and extension of strategically important road
networks.
2. Construction of roads that can contribute economic activities and develop
other infrastructures.
3. Promote the participation of private sector in the construction of road
networks and their maintenance.
4. Incorporate proper studies, technologies, environmental management and
road security measures in the road construction process.
5. Implement planned sys tem in repair, maintenance, expansion and upgrading
of roads and bridges.
6. Promote institutional development and enhance capacity as per of liberal
economic policy and decentralization.
d. Polices and working policies
n Development, construction and expansion of strategically important road
networks (related to strategy number 1)
• The policy will be adopted to expand road link in the district will have
headquarters not having a road link with a of linking all 75-district
headquarters special priority by the road network.
• The road network will be constructed and expanded so as to connect
major commercial centres to enhance macro economic activities of the
country.
• The East-West and North-South highways will be given due priority.
Gradual construction and upgrading of East-West feeder roads, district
and East-West pos tal highways will be made, so as to ensure gradual
construction and expansion of East-West highway through mid hill
region,
• Roads from northern mountain regions to link Tibetan markets and trade
centres across the border will be constructed.
• The economic activities of the Southern belt will be expanded through
expansion, upgrading and maintenance of postal routes.
• The North-South roads will be linked with local road systems.
• As per the South Asian development concept and the policy of expanding
the road network, the East-West highway will be developed as an Asian
highway and regional commercial route.
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• The low cost and labour intensive technology would be adopted and the
local resources will be utilised in the construction and repair and
maintenance of some sections of low-traffic North-South highway, and
link roads to district headquarter s.
• Priority will be given to the bridges in highways that are already
constructed or are under construction.
n Road construction to contribute in other infrastructure s, and support
economic activities (related with strategy number 2)
• Except the road projects linking to the district headquarters, priority will
be given for the projects with high rate of return.
• The districts remote with low traffic density will get minimum
transportation infrastructures that will benefit the social development.
• District level road construction will be decentralised, will have minimum
adverse impact to the environment, and cover tourism sites.
• Special initiation will be taken for regional and sub-regional cooperation
for the integrated development of transport sector -.
• The construction and maintenance of the roads that link important
projects like, hydropower, irrigation and tourism will be associated with
the respective projects.
• The bypass system will be introduced to lower the traffic pressure in
urban areas with dense and mixed traffic pressure.
• Under the various stages of Urban Road Development Master Plan the
land and house acquisition process will be expedited by timely
acquisition of the land and construction of track roads.
n Promotion of private sector's participation in the construction and
maintenance of road network (related with strategy number 3)
• The private sector participation will be enhanced by creating conducive
environment with the necessary legal and policy reforms.
• The government will perform more a role of the facilitator and regulator,
for which appropriate situation will be created
• Private sector will be encouraged in the construction of toll road, pay
parking, alternative and high-speed roads , for which project study will be
conducted.
• Alternative highways linking Katmandu valley and Terai will be
developed.
• Measures will be taken to attract and encourage domestic and foreign
private sector investments in Built, Operate, Transfer (BOT) and Built,
Own, Operate, Transfer (BOOT) projects. While calling private sector
for such investments, various concessions will be provided to the projects
so as to strengthen local economic activities and promoting employment.
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The government procedural, in this regard, will be made simple,
attractive, short and transparent.
• Necessary studies will be carried out to formulate program and policies to
ensure effective participation of private sector in construction, and
maintenance of roads. For this, institutional arrangement will also be
made.
n Proper research, technology, environment management and road safety in
road construction and expan sion. (related with strategy number 4)
• Road projects will be selected and implemented based on the cost and
benefit, sustainability, minimum adverse impacts on environment,
regional balance etc.
• Maximum mobilisation of locally available labour and resources will be
ensured to contribute in poverty alleviation. The environment aw areness
programme will be integrated with road development projects.
• Special attention will be paid in adopting low cost technology that
minimise environmental degradation in the process of design,
construction, maintenance, rehabilitation of roads, by using the locally
available resources, and manpower. The concept of green roads will be
effectively implement ed.
• Transporation infrastructures will be constructed and improved and
means of transportation will be managed to enhance traffic safety and
protect environment .
• In the areas of heavy traffic, the roads will be widened along with the
provision of bicycle lanes. .
• The construction of new roads in urban areas will be managed and
directed by formulating necessary directives, rules and regulations.
• While constructing new roads in urban areas, delivery system of basic
services like sewage, drinking water, telephone, and electricity lines will
be placed outside the road and the pavement.
• Repair, maintenance and upgrading of the central-level transport
infrastructures will be prioritised based on traffic density and economic
returns .
n Adoption of planned system to repair and maintenance, expand and
upgrading of road s and bridge s (related with strategy number 5)
• The highways and feeder roads that have heavy traffic pressure and have
the direct role in production and distribution of agricultural products will
be upgraded through proper repair, maintenance and rehabilitation, so as
to reduce road the user cost.
• Road Maintenance Fund will be established through Road Fund Board
for repair and maintenance of roads. All the available resource will be put
together and spent on priority basis.
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• The existing Planned Maintenance System being practised for the regular
repair and maintenance of roads and bridges will institutionalised and
implemented in all roads.
• Necessary research and mechanical tools will be managed for the
effective repair and maintenance of the roads.
• Old bridges will be reconstructed and maintained.
n Institutional development and capacity building as per the policy of
open and liberal economy and decentralisation (related with strategy
number 6)
• The strengthening, capacity development, and research and development
of the institutions related with road constructions and management will
be managed as a integral part of the construction and development works.
• Necessary reforms will be made in the bidding system of construction
and maintenance works. Instead of awarding annual contracts, policy
will be to award contract important by allocating prioritised projects
under the five-year plan them annual budget, will be appropriated the
budget for a period of 2-3 years.
• The responsibility urban road maintenance will gradually be transferred
to concerned municipalities.
• As per the concept of decentralisation, necessary measures for
institutional development and strengthening will be carried out in
Department of Roads and its offices so that they could render their
services quickly, efficiently and transparently.
• Necessary acts, rules and quality standard will be formulated and revised
for the development of transparent, quick and planned working system.
• The capacity of the concerned government agencies, local contractors
and consultants will be enhanced, so that they could implement projects
maintaing given quality standard in low cost and scheduled time.
• Concerned development agenices of the government and beneficiary
communities will be informed and involved in the construction and
expansion of the roads.
E. Main program, prioritisation and implementation arrangement
Main Programs
During the Tenth Plan, the major road programs will be implemented with the
government resources, and in co-operation with multilateral and bilateral donors like
the World Bank, Asian Development Bank, Japan, Switzerland, South Korea, China,
India, and OPEC fund. Road Maintenance and Development Program (RMDP),
which is under implementation since the Ninth Plan with the World Bank support will
be continued in the Tenth Plan. RMDP has been engaged in road construction,
rehabilitation and maintenance along with institutional strengthening, technical
supervision/audit and formation and operation of the Road Fund Board.
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The Tenth Plan will implement Road Network Development Project, which will be
focused on constructions of new road, upgrading, periodic maintenance and a
Performance Based Management Contract system. This project will be implemented
with the support from Asian Development Bank and DFID (Department of
International Development, UK). The Rural Access Program like Hile to Bhojpur
road will be implemented with the assistance from DFID and others, by adopting
labour-oriented construction technology.
During the plan period, 1,025 km of road and 220 bridges will be constructed while a
total of 2,589 km road will be upgraded, improved, rehabilitated, re-constructed and
constructed road infrastructure of various standards. Similarly, periodic maintenance
of 1,216 km road and regular maintenance of another 5000 km road will be
completed. Road networks will be extended to 10 additional district headquarters,
whence altogether seventy districts will be connected by the road networks by the end
of plan period.
The following programs will be implemented with high priority:
• Construction of roads to link the district headquarters, which are not yet
accessible by road.
• Development of strategic road networks ( East-West, Mid hill and North-
South roads)
• Construction of roads that contribute for the development of industries,
hydropower and other large development projects.
• Prioritization of construction of bridges in the high priority roads .
• Construction of roads that support the development of other economic
activities, tourism and promotion of commercial centres.
• Construction of new feeder roads and district roads in remote and
economically backward areas to maintain regional balance.
• In order to preserve the investments on roads and bridges, start and expand a
planned maintenance programme .
• Operation of a separate fund under the Road Fund Board to manage funds for
road maintenance.
• Keeping the strategic roads in working condition by awarding the contracts
on the basis of performance.
• Setting up a road inventories of different roads, so as to get updated road
traffic data, condition of pavements and other aspects of the road.
• Attract private sector investments and participation by amending rules and
regulations and inst itutional development and create conducive environment
to this end.
• Strengthening concerned government and private sectors and enhance their
capacities.
• Inform and involve the people who get direct benefits from the road, in
construction and expansion of road networks.
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• Development of standards, directives, manuals and norms, and regular
updating of Integrated Transport Plan.
• Maximum utilisation of locally available resources and means to reduce the
cost of road construction and maintenance.
• Using eco-friendly and labour-intensive technologies in road construction.
Project prioritisation
The prioritisation of the projects has been made on the basis of its contribution on
poverty alleviation and sustainable development, and the main strategies are based on
the contribution of the project on economic growth, social and infrastructure
development, targeted programmes and good governance. The programs are selected,
and projects prioritis ed and included in the Tenth Plan on the basis of
recommendations made by the Public Expenditure Review Commission, and various
related seminars.
The projects are prioritised on four ranks, 0 to 3, and this priority is given the
weightage of 100. The ranks; Bad, Satisfactory, Good and Very Good are based on
the national and sectoral objectives, regional balance, HMG’s involvement, public
participation, local participation/decentralisation, private sector participation, viability
and sustainability of projects and their current status.
Implementation Arrangement
A clear implementation plan based on the reports of Public Construction Directives
and Public Expenditure Review Commission will be formulated to implement the
road projects. Starting and ending dates and timetable of all the major activities of the
projects will be fixed while preparing implementation plan and timetable. The
monitoring and evaluation units of NPC, Ministry of Physical Planning and Works,
and Department of Roads will be strengthened, and made effective and responsible.
For this, necessary authority and support will be provided.
As per the provision made on project implementation procedures of Public
Construction Directive, arrangements related with description and implementation of
projects, project management plan, use of consultants, construction contracts,
financial accounts, progress report, and monitoring and evaluation will be followed as
directive principle while implementing projects. This will be developed, as the
concept paper and will be followed by implementation agency, project chief and
donors in formulation, implementation, monitoring and evaluation of the projects.
The concerned agencies and other assisting agencies of the projects will be identified.
For this, concerned ministries/departments, central bodies of Financial Comptroller
General Office and the office of the Auditor General's, DDC, District Administration
Office and other concerned sectoral district-level offices, Village Development
Committee/municipalities, and NGO's and local units will be imvolved. A system for
the co-ordination will be developed to ensure co-operation form the concerned
authorities in designing, implementation, operation and maintenance of the projects.
At present, 25 divis ion offices and 5 regional offices are existed under the
department of roads. Besides , there is a provision to establish separate project offices
for the major road projects. Department of roads has more than 3,000 staff including
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300 with high technical and management expertise. Though the technical capacity
and experts of department of roads is sufficient to implement the programs of the
Tenth Plan, training and orientation program is necessary for their effective roles as
facilitators, controllers and manager according to liberal economic policy.
Implementation Plan
A working plan along with a timetable incorporating staring and possible ending
dates of all major and other related activities of the project will be prepared while
implementing projects. A detail timetable regarding land acquisition, resettlement
action plan, procurement, appointment of consultants, contract award and
implementation will be prepared. Possible negative effects of the projects will be
mitigated by preparing special action plans like resettlement action plans , and
environment management working plans.
Implementation procedure
The following process will be followed to implement road program:
• The statistic al base related to the program, projects and budgets will be
regularly updated.
• Trainings will be provided to the manpower as per necessity.
• Monitoring and supervision will be carried out on the regular basis so as to
ensure smooth operation of the program in accordance with the objectives of
the plan.
• The trimester (four-months) and annual performance evaluation will be
conducted to find out exact problems and challenges during project
implementation.
f) Requirement of policy -level, legal and organisational reforms
Policy and legal reform s
• No roads and bridges will be constructed without feasibility study.
• The projects selected and included in the Tenth Plan will be included in the
program on priority basis.
• Projects with quick return and completion period of around five years will be
implemented.
• An integrated Transport Master Plan will be formulated by incorporating
long-term development vision of the government and recently implemented
National Transport Policy 2058.
• Speed limits will be determined as per the designs of the roads.
• While designing and studying roads and bridges, cost effective methods will
be followed by considering available alternatives, and the use of local means
and resources and technologies and implementation procedures.
• On the basis of environmental impact assessment, negative impact on the
environment will be minimised during the designing, construction and
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maintenance of roads. In this regard, the green road concept will be duly
considered.
• Encroachment affecting assigned road speed will be restrained, and removed.
The temporary and permanent settlements around major highways will not be
allowed and those already constructed will be removed.
• The road construction and maintenance will be conducted as per the recently
implemented Public Construction Directives.
• In every 2 to 3 years the roads under central road network will be evaulated.
The Roads not falling under central networks will be evaluated and
monitored through local road networks.
• As all the urban roads except those identified as national roads, fall under
urban road network, municipalities will be responsible for construction,
maintenance and repair of urban roads and determination of green belts and
its preservation. The municipalities will carry out such responsibilities
through public participation, and in co-ordination with concerned government
agencies.
• The reward and punishment system will be made effective making
accountable to the agencies and official involved in project implementation.
• Arrangement will be made to charge compensation by the consulting firms
and persons if any damages occur due to their faulty consultation.
• The regular maintenance would follow the cost-effective mechanism.
• The cost, standard and quality of roads in hilly regions will be determined on
the basis of the factors that can put the investments at risks, like minimum
traffic pressure, migration trend, and environmental hazards.
• The road upgradin g and rehabilitation work will be prioritised on the basis of
daily traffic pressure, and economic feasibility.
• Road maintenance activities (regular and occasional) will be categorised as
periodic maintenance, emergency maintenance and preventive maintenance,
and the periodic maintenance activities will conducted in a certain cycle.
• Local resources or grants will be mobilised for the preparation of projects,
and dependency on loans for the purpose will be discouraged, as far as
possible.
• The major roads will be considered for the concrete pavements.
• General public will be informed about the local project, regularly.
Institutional reforms
• All the roads that fall under the local transport system will be handed-over to
the local bodies within two years. The manpower, machines, equipment,
offices, and residential buildings will be handed-over to the concerned bodies
temporarily or permanently on the basis of road density.
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• Considering the nature of projects and programs, existing departmental,
ministerial, and high-level monitoring and evaluation system will be made
more effective.
• Technical Testing System will be institutionalised and will be implemented
more effectively.
• A National Transport Board will be constituted by co-ordinating all
concerned with the transportation sector, including Civil Aviation Authority.
• To encourage healthy construction, the local construction entrepreneurs will
be encouraged to compete in the international market by enhancing their
professional capability and quality, managerial skill, effective utilisation of
equipment and training.
• Necessary arrangement will be made for the institutional development of
private sector, and the system will be followed that the government will not
lease out its heavy equipments.
• An autonomous and independent body will be formed to carry out
construction, maintenance and repair of the major roads.
• As per the policy of minimising the total transport repair expenditures of road
within specified lifetime, the users will have to pay a fee will on the basis of
minimum direct benefit. Institutional development of road maintenance work
will be done to repair roads from the money paid by the road users.
• Projects will be completed within the specified cost and timeframe by
improving inter sectoral co-ordination.
• Number of Division Road Offices will be limited (approximately 25) and
maintenance and construction activities of new roads will be implemented
through the division offices.
• Necessary documentation - concession agreement, guideline, technical
specification and standard, project identification and feasibility study - will
be arranged by establishing a privatisation cell at Ministry of Physical
Planning to attract private sector in BOT scheme.
• Planning-budget programming sections will be strengthened.
• Transfers of project chief and office chief without accomplishing the given
task will be discouraged.
h) Expected achievements
Gross Domestic Product
The annual contribution of transport and communication sector to GDP, during the
Tenth Plan period, is projected to increase by 7.4 per cent. The contribution of the
sector to GDP is targeted to reach 9.1 per cent by the end of final year 2006/07 up
from 8.5 per cent in 2001/02.
348
Contribution s to poverty alleviation and human development
The Tenth Plan has set a target to contribute in poverty alleviation in the rural sector
through the expansion of road network and enhancement of professionalism in the
economic activities of the rural sector. In addition, the plan has also the objective of
developing social infrastructures like education and health by expanding road
transport.
Employment generation and other contribution s
During the Tenth Plan, investments made in the road sector, will generate both the
permanent and temporary employment opportunities. Employment opportunities
generated during construction period will be of temporary in nature, while surge in
economic opportunities and generation of employment as a result of enhanced
professionalism of rural productions in post construction period will generate
permanent employments. As a result of the policy of utilising maximum level of
locally available resources and skills means while constructing and expanding road
network in the rural and underdeveloped areas, rural production will be encouraged
and employment at the local level will be generated by making use of local labour.
Regional development and balance
The lack of road access has slowed down of economic and social infrastructure
development in the hilly and mountain regions. During the Tenth Plan as a result of
the strategy of developing road transportation, considering the development of least
developed areas and regional balance, social infrastructure, like education and health
will be developed by developing road transportation in the remote and least
developed areas. it will provide support in the effort of economic and social
unification at national level enhancing regional balance.
Decentralisation
Since the Tenth Plan has a policy of transferring the responsibility of construction,
maintenance and repair of all local- level roads to local bodies; the construction and
development of roads will carried out on the priority basis, and with proper
utilissation of local resources . The capacities of local bodies will be strengthened to
construct and expand local-level roads. The activities of all the concerned institutions
in the construction and expansion of roads will be made transparent and all the
activities will be conducted as per the policy of decentralisation.
Gender Equality
With the development of road, the rural sector will see the growth in infrastructure,
and also the level of public awareness. As a result the women's access to the
resources and employment opportunities will increase, which will promote the gender
equality.
Environment
While taking up any road construction project, environment sensitivity will be
assessed and measures will be taken to protect the environment. As a result of the
policy of minimising vehicular emissions , the road projects will have minimum
impact on the environment.
349
i) The roles of HMG, local bodies, private sector, communities and
NGOs in the implementation of programs / projects.
The role of major stakeholders/institutions during implementation of road projects
will be as follows:
HMG
Department of Roads and its division offices will have the major role in making the
road transport operational by implementing activities like expansion, maintenance,
and upgrading. Besides, National Planning Commission and Ministry of Finance and
other concerned ministries and departments will extend their co-operative role to run
the road projects smoothly. As per the liberal economic policy, decentralisation and
good governance, it will be the role of the government to create an appropriate
environment to attract the private sector investments for the expansion and
development activities, for which it might formulate and revise the necessary rules
and regulations , as required.
Local bodies
DDCs, Municipalities and VDCs will identify road projects according to local needs,
and construct and maintain the local roads as per the vision of green roads by utilising
the local resources, labour and skill, and enhancing their institutional capacities. All
these bodies will play co-operative role in the construction, expansion, maintenance
and repair of the roads of national priority.
Private sectors
Private sector will contribute for the infrastructure development of roads with the
commercial feasibility, through the concept of BOT/BOOT. Similarly, it will also
play a role in utilising the investments made on roads by promoting the economic
activities in the road influenced areas and in achieving the national goal of alleviating
poverty by generating employment opportunities.
Community/NGOs
National and local NGOs and Community-based Organisations will be engaged in
various activities in the road-influenced areas to raise public awareness and to
conduct income generation activities in rural areas, which will ultimately contribute
economic growth.
18.5. Probable obstacles and risks in achieving targets and
project implementation
Following obstacles and risks are expected to hinder implementation of the
program/projects, thereby also affecting expected achievements:
• Improvements in policies and plans, and effective implementation of the
reforms.
• Commitments made for foreign loans/grants and other aids should
maintained.
• Political commitment and understanding should be continued.
350
• Public awareness and participation should be raised.
• Institutional capacity building should be increased.
• The road fund should be brought into operation.
• The required recurrent budget as per the total cost estimate of the project
should be released.
• The security situation should be conducive for the smooth implementation of
the projects.
18.6 Monitoring & Evaluation
A) Process of monitoring and evaluation
The impact, progress, economic indicators and sources of information will be
defined for monitoring and evaluation process. Progress monitoring, site
supervision, work inspection and timely progress, seminars will regularly be
conducted on trimester basis at various levels for progress monitoring and
evaluation.
Following procedure will be implemented for this purpose.
• The big projects of national importance will be monitored by designing
the log frame, and their monitoring and evaluation will be carried out by
the NPC specially focussing on the goal, purpose, outputs and outcome.
• Project Implementation Plan based on annual programs will be prepared
for every project, and monitoring and evaluation of the project will be
done on a regular and periodic basis at ministerial and departmental
levels.
• Specially the engineering projects can be effectively monitored by the
on-site monitoring and evaluation followed by a workshop, arrangement
will be made for monitoring and evaluation in such a way.
• For the major projects, Implementation Process Monitoring will be
implemented gradually, in addition to Physical Progress Monitoring.
• With an aim to make the existing trimester and annual monitoring and
evaluation mechanism more effective, the trimester monitoring and
evaluations processes would also have the indicator to show the work
accomplished, hence enabling effective monitoring and evaluation.
• The trimester budget would be released on the basis of the progress made
in the previous trimester .
• Arrangement will be made for monitoring and evaluation of local-level
projects from the local level itself, but some percentage of the projects
will ultimately be monitored from the regional and central level.
• Arrangement will be made for independent and public auditing of the
projects on the regular basis.
351
• Post evaluation and impact assessment study will be conducted after the
completion of the pro jects, and future projects will be formulated on the
basis of the findings of the study.
B. Main annual indicators to monitor and evaluate the
programs/projects to see achievement against annual cost and
target
Following indicators have been specified to monitor and evaluate the major
achievements of the road sector during the Tenth Plan.
• Construction of roads (new) 1,025 Km.
• Upgrad ing 1,764 Km.
• Road improvement, rehabilitation and reconstruction 596 Km.
• Bridge construction 220
• Periodic maintenance 1,216 Km.
• Recurrent maintenance 5,000 Km
• Additional road linking district headquarters-10
After the achievements of above stated targets
• Roads will be expanded
• The road conditions will be better
• Institutional capacity will be strengthened
• Transportation cost will be lowered.
18.7 Programs and estimated budgets according to priority

The following is the synopsis of the prioritised programs/ projects of the road sector
for the Tenth Plan period. The detail program and estimated budget is presented in
annex 18.1.
Rs in million
Priority No. of programs Expected Growth rate Normal Growth Rate
ranking
A (P1) 60 20047.6 74.4 16929.1 80.8
B (P2) 50 5037.9 18.7 3899.3 18.6
C (P3) 13 1851.5 6.9 133.9 0.6
Total 123 26937 100.0 20962.3 100.0
18.8 Log frame

352
The following is the aggregate vision table of the road sector:
353
Policy and programs Log Frame- Road transport*
sustainable manner.
Sectoral Objective: Remarkable contribution of the road sector in national development.
Objective Strategy Indicators Source of Main Programs Risks and obstacles
Information
Sectoral objectives: Given • Construction, development and • Road Construction • Four-monthly and • Development, • Budget should be released on time as
the need to promote expansion of strategic roads. (new) 1025 km. annual programs construction and per the program.
sectoral unification and • Construction of roads so as to • Quality reports. expansion of strategic • Reform and effective implementation of
balance, and contribute for contribute forthe development of upgradeing1764 • Report of roads(including policy and programs.
socio-economic infrastructures and other economic km. concerned connecting district • Commitments made on foreign
development of least activities. • Improvement, seminars. headquarters and Asian loans/grants and other aid should be
developed areas, the • Promotion of private sector in rehabilitation and • Special survey highway). maintained.
Tenth Plan aims contribute construction and maintenance of reconstruction of report. • Construction and • Political commitment and understanding
to support in ach ieving the road network. roads 596 km. • Annual economic expansion of roads to should be continued.
national goal of poverty by • Arrangement of proper study, • Bridges survey of ministry contribute for economic • Inter-sectoral co -operation and co-
constructing, repairing and technology, environmental construction 200. of finance. activities, tourism, ordination should be developed and
maintaining road network. management along with security • Periodic • Reports of various hydropower and other continued.
arrangement while constructing maintenance 1216 local and sectors • Monitoring of programs should be
and expanding roads. km. international • Encouragement to effective in various levels.
• Implementation of planned system • Recurrent organisations. private sector in the • Public awareness and participation
in constriction, expansion and maintenance 5000 • Observation and development of road should be raised.
maintenance of roads and bridges. km. supervision. sector. • Capacity of local institutions should be
• Promote institutional development • Additional road link • Adaptation of proper enhanced.
and capacity building as per the to 10 district technology, arrangement • Maximum utilisation of local resource
policy of liberal economic policy headquarters for environmental and means.
and decentralisation. • Expansion of management and road • Road fund should be operated.
roads. security. • Proper amount of budget according to
• Good condition of • Implementation of total estimated budget should be
roads. planned system for annually allocated and released.
• *Institutional maintenance, expansion, • Conducive environment for the point of
enhancement. and quality upgrading of view of security should be created for
• Decline in roads. smooth operation of projects and
transportation cost. • Adoption of capacity programs.
decentralised system.
* Quantitative targets are based on the economic growth rate of 6.2 percent.
354
Table 18.1: Programs and estimated budget
(Rs. In million)
S. Name of program/projkects Normal growth Alternative
No rate growth rate
Projects and programs under P1
1. Machi highway (including Kchana - Charkhali sector) 79.7 67.3
2. Rapti highway 247.9 209.3
3. Karnali highway (Surkhet - Jumla sector) 147.4 124.5
4. Mahakali highway (Baitadi - Darchula sector) 57.6 48.6
5. Katari - Okhaldhunga (including bridge) 254.9 215.3
6. Tribhuvan highway 42.3 35.7
7. Chadragadi - Kachana 76.9 64.9
8. Arniko highway ( Barabise - Kodari sector) 104.3 88.1
9. Mircharya - Katari road 69.3 58.6
10. Arniko highway maintenance and repair project 5.4 4.6
11. Road Maintenance and development project 352.4 2577.6
12. Fourth Road Improvement Project 4773.6 4031.0
13. Various roads maintenance and construction 2270.4 1917.2
improvement
14. Bashantapur- Chianpur - Khadbari 29.0 24.5
15. Naranmuni Thulung Marg (Hele - Lughuwaghat - 595.1 502.5
Bhojpur)
16. Puspalal Marg ( Nayapul - Khimti - Manthali road) 161.6 136.4
17. Banglum – Bani - Jomsome 186.9 326.7
18. Chinchu – Jajarkot 161.6 136.5
19. Jaya Prithivi Bahadur Singh Marg (Khodpe - Bajang) 296.4 250.3
20. Shaphebagar - Marthadi 151.7 128.1
21. Shaphebagar - Mangalsen 93.4 78.8
22. Devastal Kainakada Chourajahari - Dunai (Dolpa) 1473. 0 147.2
23. Trishuli – Shapurbashi - Rashuwaghadi 188.5 159.1
24. Tanakpur link road 264.0 222.9
25. Karnali highway - Manma, Kalikot 120.6 101.8
26. Bashisahar - Chame 285.7 241.2
27. Okhaldhunga - Sallere 31.2 26.3
28. Karnali highway, Jumla -Gamghadi (Mugu) 31.2 26.3
29. Surkhet Ranimatta - Dhailek 142.6 120.4
30. Gorusinga - Sandhikharka road 12.2 10.3
31. Chachaki Liwang (including bri dge and other roads) 76.6 64.7
32. Pachkhal -Melanchi 8.1 6.8
33. Emergency maintenance (only strategic and district 54.0 45.6
headquarter linking road)
355
No rate growth rate
34. Projects under Integrated programs 14.4 12.2
35. Multi -model project link road , Birgunj 106.2 89.7
36. Kathmandu valley urban roads 485.3 409.8
37. Kathmandu valley junction improvement 1046.4 883.7
38. Bridge constriction programs 2578.1 2177.0
39. Culvert conservation and maintenance 344.5 290.9
40. Reconstruction of destroyed roads, bridge etc 72.0 60.8
41. Detail feasibility study, survey and design of roads 55.6 47.0
and bridge
42. Road Pavement, inventory survey/traffic study, 20.3 17.1
Nepal Strategic Road Statistics collection, preparing
map and booklet publication
43. Traffic accident and prevention plan 10.2 8.6
44. Promotion of private sector investment 6.8 5.7
45. Preparation of document and road plan with private 45.0 38.0
sector participation
46. Preparation and implementation of plan for donors' 59.8 50.5
investment
47. Preparation of integrated road plan and master plan 33.8 28.5
for road sub-sector
48. Alternative transportation development study 7.6 6.4
49. Computer network 10.2 8.6
50. Laboratory strengthening and standard project 25.2 21.3
51. Planing, program, evaluation, monitoring and geo- 36.8 31.1
environmental study
52. Technical Testing Strengthening project 9.0 7.6
53. Institutional development and improvement of 36.5 30.8
Department of Roads (as per the vision of MTEF)
and establishment and operation of BOT unit)
54. Project directives 7.6 6.4
55. Maintenance and repair of equipment 170.3 143.8
56. Procurement of technical equipment 207.9 1576.0
57. Road Transportation security, control of 25.5 21.5
encroachment and border protection
58. Kalu Pandey Marge (black top of Malekhu -Daghing) 14.0 11.8
59. Compensation 101.1 85.3
60. Kohalpur Mahakali Claim including ADB's claim 71.2 60.1
Total 20047.6 16929.1
In per cent 74.42 80.76
Projects and programs under P2 54.9 42.5
356
No rate growth rate
1. Sagharmatha highway (Ghaigat –Diktel sector) 2027.1 1569.0
2. Beseswhor Prasad Loirala marga (Banepa - Sindhuli 98.2 76.0
- Badribas)
3. Kanti highway 78.1 60.4
4. Improvement of Amelia - Tulshipur - Salyan 712.2 551.3
Khalanga sector
5. Black topping, quality upgrading, surface expansion 84.1 65.1
and reestablishment of Strategic road network
(national and sub-highways)
6. Bachantapur - Terathum -Atharai (including bridge) 41.7 32.3
7. Dasharatchand marga (Satbaz Baitadi - Julaghat) 22.6 17.5
8. Back topping of Toulihava sub-highway 40.3 31.2
9. Guleria 25.2 19.5
10. Ghirahi – Puthan 79.3 61.3
11. Rudrabani - Burdhibang - Dhorpatan (Baglum) 53.0 41.0
12. Terathum - Maglum - Mulpani 52.8 40.9
13. Sishuwa – Daurali - Polangtar 52.8 40.9
14. Karnali – Binayak Magalsen (including 33.2 25.7
reconstruction)
15. Gorkha – Arughat - Arkhet 86.3 66.8
16. Mushikpt –Burtibang 33.3 25.7
17. Takachilaghat - Jayaramghat 33.3 25.7
18. Nimal –Palungtar 18.8 14.6
19. Tulsipur – Puranshara - Surkhet Dang 273.5 221.7
20. Postal roads 19.0 14.7
21. Kalakati –Gadauwa Sikta 14.2 11.0
22. Nepalganj - Badauda road (including bridge) 87.7 65.6
23. Elam Maipokhari -Sandakapur 17.4 13.5
24. Phikkal – Shree Antudada 52.8 40.9
25. Bhedetar – Dadabazar -Rabirake 56.4 43.7
26. Chakrapath - Tokha -Jhor -Chare -Gujrebanjang- 54.5 42.2
Chahere -Talakhu and Chahare bridge
27. Dhamak Chichapani 26.8 20.7
28. Construction of Biratnagar bypass 44.2 34.2
29. Chatara –Ghaigat - Katari 26.4 20.4
30. Dholakha –Singhati - Lamabazar 47.7 37.0
31. Shakhu – Phakeshower -Baunapati 26.5 20.5
32. Ramdhi – Pipaldada - Gahidakot 31.7 24.5
33. Patan – Pancheshower (Baitadi) 99.8 77.2
34. Ghorkah –Manakamana 66.5 51.5
357
No rate growth rate
35. Drabaya Shah marg (Abuwa Satdobato) 27.7 21.5
36. Mulpani - Chagunarayen -Nagarkot 27.7 21.5
37. Limbini surrounding road 2.77 21.5
38. Khoshi Barrage - alternative roads (Ghaigat - 59.7 46.2
Phatepur -Chatara Dharan)
39. Ghalchi –Devigat (including bri dge) 23.9 15.5
40. Lumbini garden 30.1 23.3
41. Mahendranagar Daiji - Jhogbuda - Buthar 6.2 4.8
42. Saurahachock - Suarahabazar , Bharatpur 85.2 66.0
43. Ringroad and other maintenance 17.7 13.7
44. Bandipur –Pritivi highway 12.5 9.7
45. Ghuliyaphit -Bedabari -Malarani (Surkhet) 14.4 11.1
46. Dhodara Chadani road 51.5 39.8
47. Namobuddha (Phedi) - Panauti -Lamatar -Luvu 28.8 22.3
48. Buddha roads, Kapilbastu 27.7 21.5
49. Chabahil –Bank of Bagmati (Dhobikhola corridor) 27.7 21.5
50. Ramechap -Shalu - Shagutar (Ramechap, 5037.9 3899.3
Okhaldhunga)
Total 18.70 18.60
In Per cent 1854.5 133.9
Projects and programs under P3 6.87 0.641
Percent
1. Holere –Chunbang
2. Kicchak Bdha
3. Gangate –Labdhu -Samundratar -Galfu road
including Dorkhu bridge
4. Tallo Dhungeshower -Satkhamba Dhullu -Pipalkot,
Dhailek
5. Gumi – Patihalna chour (Surkhet)
6. Satdobato -Nibel -Baluwa
7. Ettabatta – Gadagalli -Girmile - Harkate
8. Satdobato -Daphakhel
9. Sunkoshi bridge (Kavre)
10. Sunkoshi bridge (Khurkat, Ramechap)
11. Rapti bridge Dang
12. Maintenance and repair co-ordination unit
13. Other Urban roads
14. Various sub-roads
Total 2693.70 2096.23
358
The List of feeder roads
1) Jirmale -Sandakpur
2) Barbote- Mabu Nayabazar, Jogmai
3) Ghinaghat-Biratchowk
4) Rabi-Madhumalla
5) Biratnagar-Harinagara
6) Inaruwa-Captaingunj
7) Mure-Doramba, Ramechhap
8) Deurali-Melung, Dolakha
9) Benighat Sele - Ramechhap-Rampur to Nawalpur
10) Kurtha -Mahadaia -roza-Ramgopalpur-Samsi
11) Lele -Chandpur
12) Chapagaun-Tikabhairab
13) Dolalghat-Chaurimaden -Guranse
14) Palanchowk Bhagwati sthan-Koshi Dekha
15) Galyang-Chapakot
16) Rudrabeni-Birgha -Keladighat
17) Tansen-Ranighat, Palpa
18) Chutrabesi-Asurkot-Jogitar-Khalanga
19) Kathanwa-Triveni
20) Kushma-Neta
21) Patichaur-Maidan -Langdi-Bajung Maidan-Bhuktangle-Jhilbarang
22) Badichaur-Gutu
23) Gulariya-Kothiyaghat
24) Gulariya-Jayapur-Magaragadhi
25) Bitthal-Bungal
26) Satnali-Melleg
27) Budar-Jorayal
28) Shreekot-Puchadi hat
29) Manikakham-Bohari gaun
30) Madan Ashrit marga
31) Sahajpur-Dipayal
32) Ugratara-Melauli
33) Mulghat-Triveni-Bhojpur
34) Tamghat-Purkot-Dahamachhi
35) Waling -Huwas
36) Tamghat-Arghakhnachi
37) Sainik Mode ward 9 - Sainik Bazaar
38) Dolalghat-Kattike deurali-Gunsi bhadaure Secondary S chool-Manthali (including
Chaurikhola bridge)
39) Lubhu- Bethat Dau Secondary School, Galba, Manthali
40) Others
359
Chapter - 19
Information and Communication
19.1 Background
The information and communication sector, which is a crucial infrastructure for
development, plays a vital role in overall development of the country. The task of
bringing positive changes on day-to-day lives of citizen by providing continuity to
development programs in a sustainable manner depends on the effectiveness of
communication. It is indisputable that the development, expansion and effective
mobilisation of information and communication can play an important role in
bringing together every citizen in the process of nation building by raising their
awareness.
Consistent with the free, liberal and competitive economic policy adopted by the
country, it has become important to promote commercialisation in the development
and mobilisation of communication sector to secure economic achievements. In doing
so, the sector can become self -reliant and can contribute to minimise the economic
burden of the nation. At the same time, the development of communication sector can
help in reducing poverty, as its development can lead to the development of social
sector, which ultimately contributes to the overall development of the country. In the
present context of private sector being attracted to invest in the communication
sector, it is equally important to welcome such efforts and move ahead to create a
new age communication system in a healthy and competitive manner.

a. Targets and progress
S.N. Targets Progress
1 Formulate a long-term plan for Long-term policy on information and communication has
Information and communication already been prepared and implemented.
sector.
2 Establish a National Draft of legal infrastructure has been prepared to establish a
Broadcasting Authority to launch National Broadcasting Authority in order to maintain a
transmissions of radio and healthy and competitive environment for development,
television in effective way. expansion and operation of broadcasting media.
Transmissions of Frequency Moudeling radio and cable
television from the private sector have been started.
3 Improve and expand Transmission of Radio Nepal has been improved by
transmission services. installing VSAT system ; frequency Moudeling radio has
been started. Transmission of Nepal television has been
linked with satellite system; transmission has been
360
extended by establishing a regional transmission centre in
Nepalgunj, and relay stations in some other parts and
infrastructure development has been initiated for the
transmission of second channel.
4 Involve private sectors in Nepal Telecommunication Authority has been established to
development and extension of work as a regulatory body for the co-ordinated and
communication media in a competitive development of telecommunication sector.
competitive manner. Activities have been initiated to encourage domestic and
foreign investors to invest in the telecommunication so as to
extend services in a competitive manner.
5 Provide three telephone lines to Nepal Telecommunication Corporation has distributed
every hundred people (2.5 327,673 telephone lines, including 201,900 new and 35,000
through telecommunication substitutes lines during the period of Ninth Plan and the
corporation and 0.5 through telephone density has been increased to 1.4 per hundred
private sectors), initiate mobile people. As the process of awarding license is in the final
telephone service (ten thousand stage, private sector has not started providing basic
lines), initiate other value-added telephone services. NTC has distributed more than 22,000
services -(e-mail, internet, mobile lines and granting license to private mobile service
payphone etc) providers is in final stage.
There has been an encouraging involvement of private
sector in providing additional telecommunication services
like e-mail and internet and limited pay-card phone services
is in operation.
6 In line with one target of The telephone services have been extended to 1,761 VDCs
providing telecommunication by the end of Ninth Plan, whereas the service was available
services to all development only in 1200 VDCs in the beginning of the plan. NTC has
regions through the participation extended telephone services to additional 600 VDCs during
of N TC and private sector, the plan period. As the process of awarding operation
extend rural communication licenses for mobile services and basic telephone services to
services in 2,700 new VDCs the private sector is in final stage, they have yet to start their
(1,800 through NTC and rest services.
from private sector)
7 Establish and operate rural As per the program of establishing rural exchange with the
exchanges with 150-300 lines in 150 to 300 lines capacity in the developing rural areas, 57
61 places of 41 districts. such exchanges have been established and have begun
operation.
8 Establish 100 area (Ilaka) post Additional postal services in 800 VDCs and 95 Ilaka postal
offices and 800 additional post services have been established and have begun services.
offices in VDCs to expand postal
service in each Ilaka and VDC.
9 Improve physical capacity, Legal draft has been prepared to develop postal service as
quality of services enhance and all institution that can provide commercial, competitive and
improve financial services of qualitative service. Quality of services has been improved
post offices. and money order services have been made effective by
conducting programs to enhance physical capacities.
10 Develop Department of Printing Building construction has been started, as part of required
as an institution to print security infrastructure development to acquire capacity toprint
printing materials security printing materials in the country.
361
11 Develop information sector in an As per the concept of developing communication village,
integrated way so as to provide Department of Communication, Press Council and
information and data related with Federation of Nepalese Journalists have been established
Nepal from a single agency . at Tilganga in Kathmandu.
12 Exchange news through In order to bring effectiveness in news collection, processing
computer network between eight and distribution of National News Agency, computer
main urban areas in order to networks have been established between the centre and
make the service of National Pokhara, Biratnagar, Bhadrapur, Nepalgunj, Birgunj and
News Agency more effective. Butwal.
13 Develop Gorkhapatra Corporation's capacity has increased by using colour
Corporation as a publishing technology in its publications.
house.
14 Create necessary environment Effort has been made to create an environment for the
for the development of motion development of film industry by establishing Film
picture sector. Development Board.
15 Arrange monitoring station and Limited equipment was added in the monitoring stations that
mobile monitoring vehicles and were established during the Eighth Plan period.
review frequency plan for
effective frequency
management.
B. Problems and Challenges

Complex and diverse geographical condition, lack of fully developed transportation
infrastructures and slow pace in adopting technological development due to lack of
enough modernisation are some of the major challenges in the field of information
communication sector. Similarly, lack of enough resources to meet huge investment
required for the development of information technology sector , lack of desired co-
ordination in implementation phase, time-consuming decision-making process, and
worsening security situation due to destructive activities are some of other problems
of the sector. Lack of nation-wide extension of effective mediums of public
communication services, like radio and television, lack of integrated availability of
mass communication mediums, development of information technology still being in
the initial stage and lack of enough manpower development are other problems.

The long-tern vision of the sector is to make a meaningful contribution in poverty
alleviation through the enhancement of working capacity of various institutions
engaged in information and technology sector and making them self -sufficient by
using proper modern technology and communication media available in the world
and developing information and communication sector to the rural areas in co-
ordinated and competitive manner .
19.4 The Tenth Plan

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a) Objectives
Following is the major objective of information and communication sector during the
Tenth plan:
Expansion, development and operation of information and communication sector to
the rural areas, as a basis of socio-economic development with the massive
participation of private sector with due stress in the expansion of information
technology.
• Extending 40 line telephone service to every thousand people
• Extending telephone services in all VDCs of the country.
c) Strategy
The activities of information and communication play an important role in enhancing
socio-economic capacity of the nation by making individual, community and country
informed and activating their daily activities. Timely and enough information can
contribute to achieve high economic growth by lowering the cost of production and
diversifying market. As a result of growing possibilities of use of new technologies
available in the information and communication sector, there is possibility that the
sector can achieve a notable development jump. There is high possibility that gross
domestic product of service sector can be increased remarkably due to the
development in the sectors like, telephone services, radio, television, paper and
magazines, postal services and international information transferring services.
Similarly, since the development of communication and information also contribute
for the expansion of distant education and social unification. It plays an important
role in social development of the country. The development of information and
communication also contributes to implement the concept of transparency and good
governance, as such development forms quick and effective contacts between the
centre and rural levels. In this context, following are the major strategies of the sector
• Developing, expanding and operating telecommunication services in massive
participation of private sector so as to contribute in poverty alleviation.
• Clearing liabilities and responsibilities of private and government
broadcasting services to develop, expand and operate their broadcasting
services in a competitive and co-ordinated manner .
• Improving the capabilities and effectiveness of postal service by arranging its
operation as autonomous body.
• Developing a security printing press by creating a favourable environment
within the country for all kinds of printing activities related with security
printing, except printing paper notes.
• With an aim to develop hea lthy competition in the journalism sector and to
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bring effectiveness in flow of information, Department of Information would
be developed as a centre for releasing information for general public in the
country and abroad.
• Encourage private sector in production of Nepalese films and develop Nepal
as a centre for international film related activities.
d) Policy and program
n Massive participation of private sector (related with strategy number 1)
• Information and communication services would be extended to the rural
areas in co-ordinated and competitive manner by adopting proper modern
technology.
• Legal and procedural reforms would be initiated with an aim to promote
private sector investments.
• As per the long-term target of expanding 150 telephone lines to every
thousand people by the end of Twelfth Plan, telecommunication sector
would be reformed and promoted by creating competitive environment to
extend 40 telephone lines for every thousand people by the end of the
Tenth Plan.
• Keeping with the view of rapid development of wireless technology in
broadcasting sector, Frequency Management Institution would be made
capable and effective to reform frequency management system.
• Mediums of telecommunications would be developed and expanded in a
competitive manner to create regional balance. Private sector would be
massively encouraged to be involved in development and promotion of
telecommunication in rural areas .
• The capacity of Nepal Telecommunication Authority, which is regulatory
body in the telecommunication sector, would be enhanced.
n Effective development of broadcasting services (related with strategy
number 2)
• National Information Network Structure would be expanded in the active
participation of private sector to accelerate socio-economic development
of the country by massively utilising information technology. Internet
centres would be established in the district headquarters in the
participation of private sector.
• With an aim to make the electronic media more competitive and reliable
and to promote healthy entertainment, knowledge and information along
with co-ordinated and competitive development of the broadcasting
sector, a Broadcasting Authority would be established. Environment
would be created for the maximum possible expansion of services of
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private sector.
• Radio Nepal would be developed as national broadcasting body and
satellite and computer technologies will be adopted to expand its
broadcasting service within as well as outside the nation. The service of
Radio Nepal would be expanded to cover maximum people by improving
and renewing existing broadcasting system and by enhancing
infrastructure capacity.
• With an aim to expand services of Nepal Television to every family
throughout the country at the free of cost, more relay transmission
stations would be established and Nepal Television would be developed
as a National Transmission Institution. As per the concept of second
channel, programs would be produced to promote Nepalese culture, arts
and lifestyle and to compete with the foreign satellite channels by
producing programs as per the interest of people and demand of time.
• Programs will be produced to reflect the feeling of multiparty system,
multi-ethnicity multiculturalism and multi-lingual society of the country.
• Communication mediums like FM transmission, participatory videos,
local television, cable television, wall magazines, community audio
tower, audio cassette magazines will be encouraged to increase the flow
of information among the general public . Stress would be given in
establishing Integrated Information Centres in the district headquarters to
provide multimedia services such as television, radio, telephone and
Internet for the benefit of general public.
• The contribution of advertising industry in the national economy would
be encouraged and managed by strengthening the industry as a national
industry.
n Capacity enhancement of postal services (related with strategy number 3)
• Postal service would be developed as an autonomous body to make its
services reliable and effective, and to make it economically sustainable.
Postal related services being conducted by private sector would be
monitored and managed, and would be promoted. New services like, E-
post would be initiated in the postal services .
• The management of local postal services would be handed over to local
bodies.
n Development of security press (related with strategy number 4)
• Arrangement would be made to develop Department of Printing as an
autonomous and professional institution capable of providing quality
services and to print security-printing materials inside the country.
n Effectiveness in flow of information (related with strategy number 5)
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• Department of Information will be developed as an institution to release
information related with the activities of the government to general
public and other institutions inside and outside the country.
• Effective steps would be taken to develop journalism sector as per the
basic democratic values and national needs. Press council would be made
more effective to develop and promote a reliable, respected, organised
and independent journalism.
• Press media would be conducted in a self-disciplined, respectable and in
competitive manner in accordance with the democratic values.
Involvement of private sectors in management of Gorkhapatra
Corporation will be encouraged.
• With an aim to enhance the services of Rastriya Samachar Samitte in
news collection, editing and distribution by adopting modern technology,
involvement of private sectors in its management will be encouraged .
n Development of Nepali film (related with strategy number 6)
• Priority would be given in producing movies in National language and
other languages for which private sector would be encouraged to develop
Nepal as a spot for international film activities .
e) Monitoring indicators
• Extending telephone services to 40 lines in every thousand people.
• Extending mobile telephones services to 170,000 lines.
• Extension of telephone services to all VDCs.
• Nation-wide extension of television services.
• Nation-wide extension of radio broadcasting services.
• Security printing activities would be done inside the country
• Long-term security of newsmagazines with the help of CD ROM
technology.
• Money order services would be extended to ten more countries .
• Expansion of Internal Express Mail Services to at least 10 areas and
Express Mail to addition al 20 countries. Similarly, internet/e-mail
services would be expanded to additional 31 district headquarters.
• Promote production of movies .
f) Prioritisation of projects/ programs
Prioritisation of projects and programs are based on "Policy Action Matrix
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Activities ". As per the prioritisation, following are the rating of projects and programs
and expected budget.
Rs in million
Prioritisation No. of programs Expected growth rate Normal growth rate
Amount Per cent Amount Per cent
A (P1) 8 3237.0 44.3 3066.7 53.9
B (P2) 5 2275.2 31.1 2022.4 35.6
C(P3) 1 1793.2 24.6 596.4 10.5
Total 14 7305.4 100 5685.5 100
19.5 Log Frame

The following are the aggregate Log Frame of the information and communication
sector.
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Policy and Programe Log Frame- Information and Communication Sector
Sectoral Objective : Remarkable contribution of Information and Communication in socio-economic development of the country.
Information
To ensure easy • Enhancing Participation of private • Availability of • Four-monthly and 1. Expand television • Continuous threat to
availability of news sector. television services annual progress services to all people in peace and security.
and information • Clearing liabilities and responsibilities in all parts of report of Ministry an effective way. • Continuity of the
based on facts and of private and government broadcasting country. of Information and 2. Expand radio services importance of
truth to the general services to develop, expand and • Increase in communication. to all people in an information and
people on time. operate their broadcasting services in a availability of radio • Special survey effective way. communication in the
competitive and co-ordinated manner. services. report. 3. Extension of security development process of
• Increase capability and effectiveness of • Increase in • Field inspection press services. the country.
postal service as an autonomous body. availability and report. 4. Extension of telephone,
• Developing a security printing press by quality papers. e-mail and internet
creating a favourable environment • Increase in services in an effective
within the country for all kings of availability of way.
printing activities related with security postal service. 5. Extension of quick and
printing, except printing paper notes. • Increase in effective postal
• With an aim to develop healthy availability of E- services.
competition in the journalism sector and mail and internet. 6. *Various activities of
to bring effectiveness in flow of • * Availability of the development of film
information, Department of Information security press. sector.
would be developed as a centre of
releasing information for general public
in the country and abroad.
• Encourage private sector in production
of Nepalese films and develop Nepal as
a centre for international film related
activities.
*Quantitative targets are based on the economic growth rate of 6.2 per cent.
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Programs and expected budget :
Rs in million
S. Name of the project Expected Normal
N. growth growth
rate rate
1 Reform in telecommunication sector (Ministry) 737.3 698.5
2 Improving postal service 190.0 180.0
3 Security Printing press plan 190.0 180.0
4 Improving press information 38.0 36.0
5 Improving and developing radio broadcasting system 237.5 225.0
6 Expansion of broadcasting areas (Nepal Television) 237.5 225.0
7 Telecommunication development (Nepal Telecommunication 399.0 378.0
Corporation)
8 Reform in telecommunication sector (Nepal Telecommunication 1207.7 1142.2
Authority)
Total 3237.0 3066.7
Pre cent 44.31 53.94
1 Communication improvement 76.5 68.0
2 Press Council improvement 16.2 14.4
3 RSS improv ement 9.0 8.0
4 Establishment of Metro channel 283.5 252.2
5 Development of telecommunication (Nepal Telecommunication 1890.0 1680.0
Corporation)
Total 2275.2 2022.4
Per cent 31.14 35.57
1 Development of telecommunication (Nepal Telecommunication 1793.2 596.4
Corporation)
Total 1793.2 596.4
Per cent 24.55 10.49
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Chapter - 20
Science and Technology, and
Alternative Energy
20.1 Science and Technology
Background
It has become indispensable for Nepal to accelerate the development through the
maximum possible adaptation of advanced technologies available at both natio nal and
international sectors. As a developing country, it is essential for Nepal to incorporate
and utilise new innovations and available technologies for expediting the
development pace. Use of science and technology should focus on fulfilling basic
needs, alleviating poverty, promoting income generating activities, generating
employment opportunities and conserving natural resources and environment and
maximising their utilisation.
The Tenth Plan would pay a special attention in poverty alleviation by enhancing
production and productivity through the maximum utilisation of science and
technology including the established infrastructures in the country.
The Tenth Plan will focus on mobilising available physical and human resources,
strengthening institutio nal and administrative sector to activate research agencies,
attracting private sector in research activities; encouraging proper and qualitative
researches; stressing in the development; and extension and use of information
technology and bio-technology.
Similarly, creating conducive environment for transfer of technology and foreign
investments, disseminating information related with outcome of scientific researches
and their uses, producing highly skilled manpower and enhancing local technology
are other focus areas of the plan.
With the objectives of helping people to uplift their socio-economic condition, the
Ministry of Science and Technology will play a role of promoter and facilitator, and
will provide necessary guidelines to ensure qualitative development of research
institutions. It will also extend an effective co-operation to various institutions
involved in research and development activities, like universities, councils and
academies. It will help coordination between national and international research
institutions, enhancing institutional capacity and effective mobilisation of resources.

Target and progress
Promotion of science and technological education, and traditional technology, import
of appropriate and advanced technology, formulation of a 20 year-plan; and setting up
of a national science and technology management mechanism and a science
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information centre were the major activities incorporated in the Ninth Plan. Similarly,
necessary measures to curb nat ional brain-drain by making the professions of
scientists and technologists attractive and an incorporation of a separate programme
for the development of alternative energy were other major activities initiated in the
Ninth Plan.
With an aim to raise the educational quality of science and technology from primary
level and to improve the quality of vocational and technical education up to the
international level, various national universities launched information technology (IT)
and the participation of private sector in the IT sector also increased. In this regard,
grant assistance has been extended to different universities to accelerate the
development and expansion of IT education and Tribhuvan and Kathmandu
universities introduced some additional IT courses in the higher level. Similarly, with
an objective to expand IT education in the high school level, computers along with
Internet services were provided to them.
The 20-year national plan on science and technology formulated by the RONAST is
yet to be finalised and implemented. Despite the initiation of some activities in
conserving and promoting traditional technologies, no remarkable progresses were
made in importing of utility-friendly necessary technologies.
Similarly, a plan of formulating a separate terms and condition for scientists and
technologists to make their role more effective could not be materialised. Despite the
plan to curb the brain-drain by proving adequate working opportunities to young
scientists in their areas of expertise inside the country, only few scientists have been
given such opportunities.
Efforts to set up separate research and development units at industrial, and science
and technology related institutions, and initiation of programmes to protect
intellectual property rights were some of the activities of the Ninth Plan. Similarly,
enactment of Information Technology Policy -2057, formulation of Cyber Law, and
exchanges of science and technology related programs with bilateral and multilateral
organisations were other activities.
Lack of proper co-ordination among the agencies responsible for execution of
national policy and programs, and failure to mobilise available physical
infrastructures and manpower in a creative way by providing due opportunities were
some of the major problems and challenges seen in the Ninth Plan. Similarly, lack of
environment to ensure balanced development of various IT related sectors was the
another major problem and challenge witnessed by the sector.
20.1.3 Long Term Vision

• To uplift the economic status of people through the development,
improvement and utilisation of science and technology in a sustainable
manner.
• To contribute in achieving the national goal of alleviating poverty through
creative use of science and technology (physical, human and academic) via
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institutional development by making the science and technology sector timely
and using it as an effective medium to increase national production and
productivity.

a. Objective
1. Developing of science and technology and its use in achieving a sustainable
and overall development of the country through maintenance and
improvement of traditional technologies that can contribute in the rural
development including the research and development of practical technology
and to extend necessary contribution to make children, women and deprived
section economically independent through science and technology.
b. Strategy
As most of productive sectors of the country are using traditional technology,
resulting a high cost of production, it is essential for Nepal to adopt new innovations
and developments of science and technology to enhance both production and
productivity and achieve high economic growth rate. Science and technology can
contribute for social development and mobilisation, if it is focused in fulfilling basic
needs of people, alleviating poverty; generating employment opportunities; and
conserving, utilising and mobilising natural resources and environment.
Similarly, co-ordinated efforts to fulfil local demands and develop science and
technology will generate additional income activities in the rural areas and it would
be beneficial for the targeted groups. In this regard, following are the major strategies
of the sector.
1. Ensuring maximum utilisation of available resources and means in the
science and technology sector and to arrange additional infrastructures and
institutions as per the need.
2. Developing and adopting appropriate technology through the mobilisation of
private sector in the development of science and technology and import of
appropriate foreign technology.
3. Developing of a mechanism to conduct research and development activities
in a competitive manner among individuals, communities and institutions
engaged in science and technology.
4. Contributing in the socio-economic development of people through the
development of knowledge and skills in the science and technology sector
and sustainable use of natural resources and means.
5. Encouraging universities, concerned institutions and in dividuals in scientific
researches and generating high-skill scientists by giving special priority to
science and technology in the higher -level education.
6. Expanding and developing water and meteorological services.
C. Policy and program
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n Arrangement of additional infrastructures and institutions in the science
and technology sector (related with strategy number 1)
• The long-term plan formulated to conduct various programs related with
science and technology in an integrated manner would be finalised and
implemented. Special emphasis would be given to promote agricultural
business while formulating the plan. Similarly, sustainable development
would be main basis for selecting technology while its contribution for
poverty alleviation, employment generation, and environment protection,
social values and norms would also be considered.
• With an aim to accelerate the development pace along with achieving a
sustainable socio-economic growth by utilising science and technology,
the existing National Science and Technology Policy would be updated.
n Mobilisation of private sector for the development of science and
technology (related with strategy number2)
• All level of manpower required for the development of science and
technology would be identified and priority would be given in
development of necessary infrastructure to ensure a sustainable supply of
such manpower. Necessary policies would be adopted for the institutional
development of science and technology and to encourage scientists.
Similarly, steps would be tak en to control the brain drain by providing
proper working opportunities in concerned sectors.
• Considering the global scenario of science and technology, special steps
would be taken to promote regional and international co-operation and
understanding. Special emphasis would be given in signing bilateral and
multilateral agreements, which would be helpful in enhancing national
scientific and technological capabilities of the country.
• Special efforts would be given in expanding the utilisation of IT to
general people and, in this regard, tele-centre would be developed and
expanded to ensure VDC's access to IT .
• As per the concept of sustainable development, attention would be paid
in uplifting the socio-economic status of the people living in rural areas
by promoting alternative energy technologies based on locally available
resources and by minimising the cost of construction and installation of
such technologies. The promotion of alternative energy would minimise
the consumption of traditional energy and would improve the health
condition of general public and environment.
• As per the policy of decentralisation, technological promotion programs,
in participation of local bodies, would be initiated in three regions
namely Terai, Hill and Himal.
n Establishment of a mechanism to conduct research and development
activities (related with strategy number 3)
• The replicable and result-oriented researches would be promoted, and
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universities would be encouraged to engage in basic research.
• Researches related with science and technology would be focused in the
maximising of agricultural and industrial production and productivity and
enhancing the mobilisation and utilisation of natural resources.
Researches would also be focused on exploration, expansion and
conservation of beneficial species.
• Forensic services, which is essential in criminal investigation and for
judicial purpose would be made competent, qualitiative, easily
accessible. , The National Forensic Laboratory would be made
resourceful. Arrangements will be made for the forensic lab to provide
modern tests, like Deoxyribonucleic acid (DNA) test within the country.
• Special study, research and efforts would be initiated for the conservation
and development of valuable herbs like Yarcha Gomba, Lodhsalla (Taxus
Wallachina), Panch Aunle, Shilajit and many other traditional and bio-
diversity crops like paddy, buckwheat in co-ordination of concerned
authorities.
• Necessary records would be prepared for enhancing intellectual property
right.
• Identification, research, development, expansion and conversation of the
available technology in the rural areas would be carried out and steps
would be taken to make them popular in both national and international
levels. Necessary institutional mechanism would also be arranged to
stimulate the process of mobilisation, transfer, development, expansion of
traditional technologies.
n Sustainable utilisation of natural resources in science and technology
sector (related with strategy number 4)
• Necessary policy for conserving, promoting and sustainable use of
botanical resource, enhancing agricultural production and productivity,
improving public health with focus on development, and expansion and
utilisation of bio-diversity would be formulated and implemented.
Necessary and appropriate legal basis would be formulated for secure
development and expansion of biotechnology and genetic engineering
and a Biotechnology Research Centre would be established for the
development of the sector.
• Special emphasis would be given in developing and expanding the
technologies that would minimise the labour and time of women in
household chores, and enhance employment opportunities to create
economic benefits.
n Incorporation of science and technology subject in higher-level curriculum
(related with st rategy number 5)
• With the efforts from Ministry of Science and Technology, necessary
mechanism would be developed to arrange a close co-ordination among
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the research institutions, and measures would be taken to strengthen the
exiting laboratories and, as per the necessity, more research centres
would be established. With an aim to incorporate scattered science and
technology libraries and records across the country into electronic
network, a national level Science and Technology Information Centre
would be established.
• As per the policy of promoting science education, necessary
arrangements would be made to supply educational infrastructures and
teachers. Appropriate environment would be created to attract Nepali
scientist and technologists in scientific field and due opportunities would
be provided to them. With objectives of creating awareness among the
general public and provide them general knowledge on science and
technology, planetarium, observatory and science museums would be
established.
n Development and expansion of meteorology services (related with strategy
number 6)
• Arrangement would be made to collect, process and disseminate
necessary data from the major sectors like agriculture, water resources,
forest, mines, glacier and climate in a co-ordinated manner and a
National Space Centre would be established for the promotion of study
and research activities.
• Water and meteorological services would be expanded with qualitative
reform. With the adaptation of modern technology, an automatic
Meteorologic al Centre would be gradually established and a reliable
meteorological information service for the agricultural sector would be
initiated. Emphasis would also be given to develop capacity to forecast
weather and natural calamities.
D. Programs
n Development and expansion of an effective management of science and
technology:
• A high-level National Science and Technology Council and a co-
ordination committee would be constituted that would adopt a national
vision and policy, and measures to enhance science and technology in a
co-ordinated manner with the participation of all concerned, thereby
contributing directly in the development of the country.
• Ministry of Science and Technology's competence would be enhanced to
play an active role in development and prop er use of science and
technology by taking necessary policy decision and establishing
necessary institutional infrastructures.
n Development of human resources:
• Extension of co-operation in producing necessary manpower in intricate
technology, practical technology, and industrial and service sectors.
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• Enhancing the competence of universities in producing quality human
resource.
• Checking brain drain by introducing attractive programs to enhance
capabilities of young scientist as per their expertise.
n Promotion of research and development:
• Conducting programs related with local resources, means and traditional
technology.
• Conducting programs to develop necessary technology to uplift rural life
standard.
• Conducting programs with focus on special areas and targeted groups.
• Conducting necessary research and development to accelerate the
development with the help of science and technology.
• Conducting research and development programs that would enhance
national capacity.
• Establishing a research fund.
n Contributing in the socio-economic development of urban and rural sectors
by enhancing the use of proper and traditional, imported modern, and high
technologies:
• Developing, utilising and expanding rural technology.
• Developing and expanding the use of modern technology like
biotechnology, IT and space technology.
• Managing and simplifying the transfer of technology and massive
publicising of the proper technology.
n Expansion of scientific and technological services:
• Conducting and expanding water and meteorological services.
• Expanding forensic services
• Expanding equipment maintenance and services
n Enhancing awareness about the importance and role of science and

technology:
• Establishing planetarium, Science and technology Museum, among
others.
• Publishing materials and conducting programs to create awareness.
• Mobilising professional Organisations.
• Raising the standard of science education in school level courses.
20.1.5 Priority rating of the programs

During the Tenth Plan period, 13 programs would be carried out in the Science and
Technology sector. The prioritisation of programmes has been done on the basis of
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Policy Action Matrix. The priority rating is as follows:
Priority No. of Expected case Normal case
programmes
Allocated budget % Allocated budget %
(in Rs million) (in Rs million)
A (P1) 4 766.4 45.8 742.9 58.3
B (P2) 4 544.1 32.6 509.7 40.0
C(P3) 5 361.7 21.6 21.3 1.7
Total 13 1672.2 100 1273.9 100.0
20.2 Information technology

Information technology (IT) can play a vital role for the socio-economic development
of the country. Nepal, which has failed to take benefit from industrial and green
revolutions, can benefit a lot from latest IT revolution. In order to tap benefits of
information revolution, it is important for Nepal to establish IT based industries and
expand their services to become an active partner of global IT market and get
maximum benefits from the exports of IT related goods and services.
Similarly, it is equally important to create a society based on knowledge by providing
computer education to all through the introduction of computer education in school
curriculum and providing Internet services at the VDC level.
The development of IT sector in Nepal is in preliminary stage as compared to
developed countries. Though more than 100,000 computers are in use nation-wide,
the use of computers in the government sector is still nominal. Though some
government and non-government agencies have been using computers to establish
data bank and their process, smoothly run their daily activities, and enhance
performance, it is important to arrange a mechanism for the collection of information
in an integrated manner nation-wide and use them as common assets.
Target and achievement
Massive expansion of computer education in school level, arrangement for high level
training and formal education in higher studies and, establishing good schools and
information technology park were the polices adopted by the Ninth Plan. Similarly,
policies of encouraging computer business and emphasising the use of computers in
government sectors while formulating plan and managing offices were also
incorporated in the plan.
Grant assistance was extended to four universities for the development and promotion
of IT education. With an aim to extend IT education in school level, computers and
Internet services were provided. Information Technology Policy-2057 has already
been introduced and a draft of Cyber Law has beenformulated. The construction of IT
Park in Banepa of Kavrepalanchok district has begun. Likewise, as per the policy of
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manpower development program, computer training at different levels have begun.
Despite the stress of the Ninth Plan on using computers in government offices while
formulating plans and managing offices, there has not been noted progress in the area.
Lack of proper co-ordination between the related agencies to implement programs
incorporated by Information Technology Act 2057, budget constraint, lack of proper
opportunity for available manpower and co-ordination between related agencies to
construct physical infrastructures were some of the problems and challenges seen in
the Ninth Plan.
20.2.3 Long Term Vision

The long-term vision of the sector is to utilise science and technology to create
knowledge-based socio-economic development and contribute in poverty alleviation
through the construction of national information highway, establishment of
information network with other parts of the world, management of uses and misuses
of IT and expansion of acces sibility of IT to rural areas.

A. Objectives
Promoting good governance and social services by enhancing accessibility of IT to
general people, generating employment opportunities, contributing to form
knowledge-based societies and promoting knowledge-based businesses and industries
are the major objectives of the sector.
B. Strategy
Flow of information is an important part for the socio-economic development of a
country. It is extremely important for Nepal to get benefits from global information
revolution by becoming an active member of global IT market and establishing IT
based industries and expanding their services to get maximum benefits from the
exports of IT related goods and services. The expansion of computer education from
school level can also contribute in creating knowledge-based society, thereby
contributing in poverty alleviation through employment generation.
The expansion of IT can contribute in achieving a high economic growth rate through
the quick dissemination and availability of necessary agriculture and non-agriculture
related information. Similarly, the expansion of IT can play an important role in
social development by establishing community information centres in the rural areas
to inform people about the important information on education and health, among
others.
The policy of gradual expansion of Internet services to all VDCs to develop IT sector
in the rural areas and to ensure access of information to general people would also be
benefited to targeted group. The use of IT can also contribute to make the government
activities transparent and to make the government's service extending mechanism
more effective and competence, including improving financial management and
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administrative capacity. In this regard, the following would be the major strategies of
the sector.
1. Creating conducive environment to attract private sector investments in the
IT sector.
2. Expanding access of general people to IT through the establishment of
Community Information Centre.
3. Identifying and expanding the services that are extendable through IT.
4. Extending education and training required for use of IT
C. Policy and workplans
n Creating conducive environment to attract private investment in the IT
sector (relates with strategy number 1)
• Policy, legal and procedural reforms would be initiated to increase the
participation of private sector in the IT sector.
• Private sector would be encouraged to produce middle-level manpower
needed for the IT sector. Co-operation to ht e private sector would be
extended to open institutions related with IT teachings and, researches
and developments.
• The concept of venture capital fund would be encouraged in the IT
sector.
n Ensuring accessibility of general people to IT through Community
Information Centre (related with strategy number 2)
• Keeping in view of accelerating flow of information, changing mediums
of information dissemination and expanding multimedia services, a
National Information Highway and North-South Information Network
would be constructed. In this regard, Nepal would be connected with
other part of the world through broad band information network.
• IT parks would be established in different part of the country as required,
to boost software development and exports.
• Emphasis would be given to expand disseminate important information
related with agriculture, education, health, and other business information
to the rural areas through the expansion of IT and establishment of
community information centres. As per the policy of expanding Internet
access to all VDCs gradually, general people of 1,500 VDCs will be
brought into the access of the facility within the plan period.
• Private sector would be encouraged to produce and publicise materials
related with natural beauty, religion, culture, and heritages of Nepal
through Internet.
n Identification and expansion of the services through IT (related with
strategy number 3)
• The National Information Centre established under Ministry of Science
and Technology would be activated to implement IT related plans and
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polices by supervision and monitoring. It would also regulate the IT
related private sector activities, and legalise the e-commerce.
• Conducive environment would be created to attract domestic as well as
foreign investments in the IT related industries like software
development, production and service industries like data entry,
digitisation, medical transcription, call centre, web designs, etc.
• IT would be utilised to make the government activities transparent and to
make the government's services extending mechanism more effective and
competent including improving financial management and administrative
capacity. In this regard, E-governance would be brought into practice.
• Necessary legal framework would be formulated to legalise the use of IT
and associated services and to create conducive environment for the
promotion of export of IT products.
• IT would be used in promotion of e-commerce, e-education distant health
and to transfer necessary technologies to rural areas. Teaching
institutions and hospital located in the areas with the access to power and
telecommunication services would be encouraged to use the IT services.
Such institutions located in the areas without power would be encouraged
to use the IT services by using solar or other power sources.
n Availability of education and training necessary to utilise IT (related with
strategy number 4)
• Emphasis would be given in research, identification and expansion of the
services that are extendable through IT. Similarly, expand ing education
and training to enhance access to IT would be stressed.
• Development and expansions of institutions that produce high and
middle-level IT manpower inside the country would be encouraged.
Similarly, international training to produce highly skilled manpower with
the skill to compete in the international market would also be
encouraged.
• Necessary efforts would be put to include computer education in school
curriculum. Internet facilities will be provided in universities and public
schools to provide quality computer education
D. Programs
Expansion of education and training to enhance the access to information services at
community level, and access of general people to the IT services and its extension are
the core factors that would be developed identically. The role of the government will
be a promoter and facilitator. Research and development in the IT sector will be
conducted in active participation of private sector. The following are the major IT
related programs.
• With the expansion of IT, Community Information Centres would be
established and it would help to deliver information related with agriculture,
education, health and other business in rural areas. As per the policy of
gradual expansion of Internet services to VDCs, 1,500 VDCs across the
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country would get the Internet access for the use of general public in
community level within the plan period. Internet nodes would be installed in
district headquarters with the help of private sectors and Internet services
would also be extended to rural areas. Charge on telephone calls, which is
used for Internet service, will be gradually lowered. Internet web that
promotes the preservation of Nepali culture, art, and materials to promote
rural development would be designed and launched both in Nepali and
English languages.
• Web sites incorporating information and statistics of education, health, water
resources, industry and agriculture would be developed and launched.
• Educational training would be promoted for the development of IT while IT
would be used to improve the quality of education. A long-term program with
a slogan “Computer Education for All by 2010” will be designed and
computer education will be gradually made compulsory in schools. Skilled
manpower will be produced in joint public -private efforts. Assistance would
be provided to educational institutes, which produce skilled manpower and
necessary foreign training for the development of IT would also be
encouraged.
• With an aim to expand the use of computer services in government offices,
maintain transparency in government activities and make the government
services competence along with the reforms in financial and administrative
management, a three-year plan will be formulated and implemented. All
ministries, departments and offices will be provided with Internet services
and other authorities would also be encouraged to use Internet.
• Domestic and foreign investments will be encouraged to develop IT related
infrastructures. With the participation of private sectors, IT Park will be
established in different and necessary parts of the country.
Telecommunication and electricity facilities would be provided to the people
engaged IT as per their demand.
• Distance education system would be introduced through radio, television,
Internet and intranet. Networking such as School Net, Research Net and
Commerce Net including the multi-lingual computing will be developed.
• Necessary arrangements would be made to encourage e-commerce.
Necessary legal infrastructures would be established to introduce services
like, distance-treatment, distance-education, distance-procession and e-
commerce. Similarly, necessary law enforcement and strengthening measures
to protect intellectual rights would be carried out to promote the development
of IT.
• An Information Technology Development Fund would be established to
create IT awareness among people, assist the rural networking, produce
skilled manpower and provide social services that are extendable through IT.
• Necessary arrangements will be made in foreign-based Royal Nepali
Embassies for development, promotion and expansion of IT trade.
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20.2.5 Priority order
Five programmes will be launched during the period of the Tenth Plan. The
prioritisation of programmes has been done on the basis of Policy Action Matrix.
The priority rating is as follows:
(Rs. in million)
Priority Programme Expected case Normal case
no.
Allocated budget % Allocated budget %
(Rs in Million) (Rs in Million)
A (P1) 1 299.7 47.7 284.7 59.3
B (P2) 1 164.9 26.3 153 31.9
C (P3) 3 163.6 26 420 8.8
Total 5 628.2 100 479.7 100
20.3 Alternative Energy

20.3.1 Background
Though the rural sector occupies a significant position in Nepal’s economic
development, the outcomes of development plans of last four-and-half decades
regarding the rural development is less than expected. Shortage in the power supply,
among others, can be taken as one of the major causes. Only seven percent of the
total people living in the rural areas are currently using electricity services generated
from sources of alternative energy.
The annual power consumption in Nepal is equivalent to 6,864,000 to 7,825,000 tons
oil. While looking into the total national power consumption trend of last five years,
traditional sources of energy contributes 86 to 90 per cent while the share of
commercial sources of energy is only from 10 percent to 14 percent. In totality, 77
percent of the total power consumption is generated from firewood, while 9 percent
from agricultural by-products and dung and remaining 14 percent from imported
petroleum products, coal and electricity.
The per capita power consumption of Nepal is equivalent to 336 kg oil energy while
per capita consumption of power from commercial sources is 46 kg oil energy.
Though the rural sector absorbs 86 per cent of the total power consumption of the
country, consumption of organic energy is on the top. Renewable energy (organic)
and imported kerosene are among the major sources of energy in the rural areas.
Since huge investment is required to arrange power supply to rural sector from
national grid system, development of alternative energy is the best available option to
enhance rural development and benefit the rural economy.
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While looking into the power production capacity of micro hydel of the country,
adequate electricity can be produced from small streams in 55 districts, 4-5 KW-hr
per square metre per day (8 GW hr/day) electrical energy can be produced from the
solar power. Similarly, it is estimated that there is capacity of establishing 1.3 million
bio-gas plants and it is also estimated that 11 MW electricity can be produced from
the by-products of eight sugar factories of the country. Likewise, it is estimated that
3.1 million tonnes of oil can be produced annually from seeds of 160 types of plants
found in the country. Since 10-13 percent of energy can be saved from the use of
improved oven in the villages, more energy can be acquired from the existing supply
of firewood.

Targets and achievements
As per the set objectives and policies, various programmes were incorporated in the
Ninth Plan for the development of alternative energy sectors. During this period,
Renewal Energy Grants Policy-2057 and the Renewal Energy Grants Work Plan-
2057, which was issued for effective and well-managed execution of the policies,
were implemented. The formulation of a 20-year long-term plan for renewed energy
was also carried out.
During the Ninth Plan period, an additional 4,459 KW installation capacity was
increased – 3347 KW from small hydropower installation and 1,112 KW from the
Rural Energy Development Programmes. This achievement is about 63 percent of the
set target of the Ninth Plan. Though the plan had set to conduct the Micro Hydro
Inventory Study in 15 districts, such study was completed in 16 districts. A total of
59,678 bio-gas plants have been installed, which is 66 percent of 90,000 installation
target set by the Ninth Plan.
Similarly, during the plan period, 51,100 out of the targeted 250,000 modern ovens
have been installed. Likewise, the plan to conduct training and research on improved
modern oven in 45 districts has been accomplished in 39 districts.
With regard to the Solar Power Development Programme, 23,570 out of 38,000
domestic Solar PV Systems (of 36/50 peak-watt capacity) have been installed. Of the
targets of distributing 300 solar dryers of maximum three-square metre capacity,
completing solar statistics collection and solar mapping in 20 districts, and
conducting training/exhibition/supervision/ technology research and development on
solar energy, 413 solar dryers and cookers were distributed in five districts. Similarly,
solar energy statistics collection and mapping were also completed in five districts
while training/ exhibition/supervision/ research completed in 31 districts.
Among other programmes, wind energy statistics collection was completed in seven
districts against the earlier plan for five districts; geothermal inventory study was also
completed in one out of three targeted districts; and four out of the targeted eight
Quality Setting Workshops have been conducted. As per the target of setting up a
Rural Energy Development Fund with investment of Rs 10 million, Interim Rural
Energy Fund has been set up to mobilise the grants for Solar Energy and Small
Hydroelectricity. The task of statistics collection and mapping of wind energy was
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done by setting up a wind turbine at Nagarkot. Similarly, feasibility studies were also
conducted in Myagdi and Tatopani of Sindhupalchowk for the development of land
warming energy.
Institutional development of the Alternative Energy Promotion Centre has been
enhanced through the Danish Government-funded Energy Areas Co-operation
Programmes. It has also helped in the development of power in Nepal, especially
small electricity, solar power and improved oven, and progress in all areas was
satisfactory. There was a significant progress in the bio-gas programmes, which were
supported by the Dutch and German Governments. Rural Energy Development
Programmes funded by the United Nations Development Programme (UNDP) were
implemented in 15 districts.
Rise in deforestation and its negative impact on environment due to less-than-
expected use of alternative energy, failure to create awareness about alternative
energy to remote areas were some of the underlining problems seen in the Ninth Plan
period. Similarly, lack of technical manpower for the organisations working in the
sector, unaffordable technology to the people living in low -income bracket and lack
of effective and regular monitoring and evaluation mechanisms were some of the
other major problems of the sector.

The followings are the major long-term vision of the sector
• Accelerating economic development, improving living standard of the rural
people, increasing the employment opportunities, and maintaining
environmental sustainability through the development of rural energy
systems.
• Commercialising the alternative energy technologies and reducing the
dependence on imported energy through planned technology development
and its expansion.
• Keeping in mind the long-term consequences of the use of natural resources,
use of traditional energy resources would be slowly replaced by the modern
energy sources that are within the reach of purchasing power of rural people.

a) Objectives
Developing and expanding alternative energy, as a powerful tool for alleviating
poverty, raising purchasing power of the rural people by developing alternative
energy technologies based on the local resources, and increasing consumption of
alternative energy and reducing dependency imported energy by lowering the
cost of installation through the proper utilisation of local resources and means.
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• Providing electricity services to 12 percent of the rural people from the
source of alternative energy. Under this plan, electricity will be supplied to
1,000 VDCs.
• Producing 44 MW energy by installing 200,000 bio-gas plants in 65 districts.
• Producing 3.5 MW electricity energy by distributing 52,000 domestic and
institutionalised solar electricity systems in 52 districts.
• Installing 2,700 solar dries/cookers in 20 districts.
• Conducting 100 solar drinking water and irrigation projects in 15 districts.
• Producing 10 MW electricity through small hydroelectricity in 47 districts.
• Installing 4,000 improved water mills.
• Producing 20 MW wind energy electricity and conducting mapping in 20
districts.
• Constructing 250,000 improved ovens in the rural areas.
c) Strategies
As most of the rural people are deprived of the electricity it needs quite a huge
investment to connect the rural sector and supply power form the national grid
system, the development of alternative energy, which requires less investment, can
make remarkable contribution for the economic development of the rural sector.
Taking into consideration of pressure on natural resources, measures to replace
traditional source of energy by modern source of energy will put positive impact on
various sectors of environmental and social development including the targeted
groups. In this regard, the following are the major strategies of the sector.
1. Emphasis will be given for the promotion and expansion of small
hydroelectricity, solar energy, wind energy and improved ovens in view of
available resources and means in the rural areas.
2. As per the concept of improving living standard of the rural people, priority
will be given to the programmes that are carried out in an integrated manner
ensuring the economic, social and environmental sustainability while
developing and expanding the alternative energy.
3. Measures would be taken to create conducive environment to attract
community and private sector in the expansion and development of
alternative energy and expand it to the rural areas.
4. IT development programs would be conducted in the rural areas with due
priority by supplying electricity through alternative energy programs.
5. A separate Rural Energy Fund will be set up for the sustainable development
of rural energy. This fund will be expanded to the district and village levels
6. Emphasis will be given for necessary research and technological hand-over to
reduce the cost of technology and to increase its capacity so as to create an
atmosphere where maximum number of rural people can use it.
d) Policies and Programs
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n Promotion and expansion of micro hydropower, solar power, wind power,
and improved ovens in the rural areas (related with strategy number 1)
• Establishment of service centre would be expanded to ensure effective
development of micro hydropower and to extend co-operation to small
hydroelectricity projects for maintenance and operation including
rehabilitation of those projects, which are in technical and financial crisis.
Special emphasis will be given to the end-use diversification for making
establishment of small hydroelectricity projects more feasible from both
economic and financial aspects.
• The utilisation capacity of various organic energy sources in the rural
areas like firewood and agricultural by-products that otherwise would be
wasted, will be increased. It will help reduce negative environmental
impact while using organic energy sources.
• Priority would be given to increase the use of solar power, as it helps
meet the rising demand of energy. In some of the remote rural areas,
where power connection from the national electricity system and
establishment of small hydroelectricity centres are not possible in near
future, solar system is the most effective means and hence it will be
expanded in such areas. Likewise, based on feasibility study, the use of
solar pumps would be expanded in the hilly and mountainous regions
while in Terai, emphasis will be given to the use of wind energy. The
policy will also assist Agricultural Prospective Plan.
n Expansion and development of alternative energy to uplift life standard of
rural people (related with strategy number 2)
• Dependency on imported energy would be gradually reduced through the
proper utilisation of locally available sources of alternative energy.
• Production of energy would be increased by applying various
technologies used in organic energy like, Gasifier, Co-generation etc, and
necessary steps would be taken to raise awareness in this regard.
n Attracting community and private sector in the development and promotion
of alternative energy (related with strategy number 3)
• Consumers and locals would be encouraged to form and conduct
activities related with energy management and they would be encouraged
to participate in the plan formulation so as to give sustainability to rural
energy production, distribution and its consumption through effective
social mobilisation.
• Improving the purchasing arrangements of electricity energy produced
small electricity projects with private investment while distributing
through the central electricity transmission system.
• Development of IT in rural areas through supply of electricity from
alternative energy source (related with strategy number 4)
• Development of information and communication in areas untouched by
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national electricity supply would be carried out by supplying electricity
through alternative energy technologies. Likewise, educational
institutions will be mobilised for the production of necessary manpower
required for alternative energy development.
n Establishment of a separate Rural Energy Fund (REF) for the sustainable
development of rural energy (related with strategy number 5)
• Necessary reforms would be carried out on subsidy policy and its
management to ensure maximum possible benefits to rural families and
people, and to secure their accessibility in alternative energy and
associated technologies.
• After completing the formation of REF, necessary financial co-operation
would be extended to the fund to make the alternative energy
development activities sustainable. This will ensure increase in the access
of poor, deprived and minority communities to alternative energy through
group collateral scheme, set-up of rolling fund and easy release of loans
in low interest rates.
• With an aim to make the energy sources and related technology
development program more effective, the Alternative Energy Promotion
Centre, which contributed for the development of the sector in rural
areas, would be made more competent with due reform processes. In
order to make the plan formulation and implementation of programs
related with alternative energy successful, necessary manpower would be
developed and institutional reforms would be carried out for effective
supervision, monitoring and regular review.
• Participation of educational institutions, local bodies, private sector and
national and international NGOs will be ensured by making them more
active to carry out studies and researches and development works to
develop, expand and reduce costs of alternative energy technologies.
n Stress on necessary research and technological transfer for alternative
energy technology (related with strategy number 6)
• Development and expansion of alternative energy would be carried out
with high priority so as to ensure the minimum supply of energy, which
is also the basic need of the rural popula tion. Similarly, the development
and expansion of alternative energy will also help develop the rural
economy.
e. Policy reforms, legal reforms, institutional reforms and their
implementation arrangements
Necessary reforms and changes will be made in the existing policies and legal
provisions to make the development of alternative energy more effective. Policy rules
to set the quality standard of equipment and tools used for development, production
and related technology would be formulated, which would en hance protection and
welfare of consumers. The Alternative Energy Promotion Centre and the ministry will
carry out supervision to know if the works have been executed as provisioned in the
387
rules.
As the responsibilities and role of the Centre formed as per Development Committee
Act 2013, are increasing and becoming important, a separate act would be enacted to
make the centre an autonomous body and to make it able to carry out co-ordination
among the government and donor agencies, consumers’ groups, and private sector.
Rural Energy Fund would be established to mobilise loans and grants for the
development of alternative energy and various service centres would be constituted at
different part of the country in order to make micro hydropower projects financially
feasible, to bring sustainability in operation and to extend necessary technical
supports.
f. Programs and projects
Bio-gas program
As the popularity of bio -gas is growing among rural families due to its diverse
benefits, it would be expanded since it saves firewood, reduces dependency on
imported energy and there is no negative impact in the people’s health. In addition,
the use of bio-gas plant brings no environmental pollution and the slurry, which come
out from the plant as by-product is used as the best fertiliser. So, the Tenth Plan has
set a target of installing a total of 200,000 bio-gas plants, including 199,500 private
bio-gas plants and 500 community bio -gas plants. Priority will be given to suitable
and relatively smaller-size plants and necessary researches would be carried out for
its expansion in the Himalayan region and to reduce costs.
Solar energy programme
The contribution of past plans in expanding domestic solar electricity system for
electricity supply in rural areas was significant and since such system has greater
importance in the rural areas where national electricity system has not reached, its
demand has also significantly increased in recent years.
Solar pump, which is used to pull groundwater, has played an important role in
solving drinking water problem in the rural areas. The system can also be used for
irrigation of additional agricultural land. The rising demand of energy in the rural
areas can be fulfilled through the solar energy, as the use of solar cooker, drier, water
heater etc. are in the rise.
With an aim to provide electricity service to the rural people through solar energy, the
Tenth Plan has targeted that 52,000 solar electricity system will be installed, around
100 solar electricity water pumps will be set up and around 2,700 solar cooker/drier
will be installed. In addition to this, competent manpower will be produced by giving
training regarding the installation of the solar energy system, to carry out feasibility
mapping of solar energy at several places and researches to reduce the cost of
installation.
Micro hydroelectricity program
During the plan implementation period, to fulfil the need of domestic electricity and
for other productive uses electricity from rivers and rivulets of the rural areas. Under
the micro-hydro programme new projects will be producing 9,400 KW, the
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renovations of the old projects would provide 500 KW and improved water mills
would generate 100 KW. Hence, the plan has a target of generating 10,000 KW of
electricity from micro hydro, and it also aims at installing 4,000 improved water
mills.
Wind energy programme
The Tenth Plan has targeted to prepare wind mapping and wind-related statistics for
20 districts for the development of wind energy and to produce electricity by
installing small wind generator in the districts.
Organic energy programme
It has been planned that a total of 250,000 improved ovens will be constructed during
the plan period in order to prevent the wastage of energy from firewood thereby
lowering pressure on forests. During the period, studies and researches will be
conducted to produce organic oil and feasibility studies will be conducted to start
such projects. In addition, feasibility studies of the projects, other energy production
technologies such as Briquetting, Cogeneration and Gasification will be initiated.
Setting up Rural Energy Fund
In the context of requirement of huge initial investment and its tough competition
with established traditional sources of energy, the Rural Energy Fund will be set up in
order to regulate grants and loans and to mobilise them in simplified way for the
development of alternative energy. After the establishment of Interim Rural Energy
Fund, which is under Alternative Energy Promotion Centre, remarkable success has
been achieved in mobilising grants to the small hydroelectricity and solar energy in a
swift and simplified way. So, it will be expanded and will be converted into Rural
Energy Fund as a full autonomous body.
Institutional reforms and support programme:
Realising the important roles of Alternative Energy Promotion Centre and other co-
operative organisations, especially the non-governmental organisations and local
bodies to effectively implement the policies and programmes on alternative energy,
necessary Acts, regulations will be formulated for institutional reforms of the centre.
Emphasis will also be given for the construction of its own office building and
manpower development. Arrangements will be made to extend co-operations to other
organisation engaged in promotion and expansion of alternative energy for their
capacity building.
Miscellaneous programmes:
During the plan period, programmes like survey, feasibility study, research and
development, promotion, exhibition and awareness programme, setting up of the
National Information Resource Unit, and setting up of national quality standard of
equipment and monitoring would be conducted. Similarly, decentralised energy
management, formulation of the model project, formulation of policies and plans and
workshops related with alternative energy are some of the programs incorporated in
the Tenth Plan. Arrangements will also be made to ensure quality supplies of
equipment related with alternative energy technologies by setting up a national
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standard of equipment. Short term, medium term and long term policies and plans
will be formulated for the expansion and development of alternative energy.
20.3.5 Resource Management and Allocation:

During the plan period, a total of Rs. 4160.6 million and Rs 3115.2 million have been
estimated for implementation of programs related with alternative energy under
normal case and alternative case respectively. Of the total expenditure, His Majesty’s
Government will provide 12 percent while remaining 88 percent will be covered from
foreign assistance.
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Policy and programs Log Frame- science and technology*
Sectoral Objective: Enhancing the use of Science, technology and Information Technology in increasing production and
productivity and accelerating -economic development of the country.
Information
Vision (sec tor- • Establishment of a mechanism to • Effectiveness of • Four-monthly and 1. Development and • Availability of timely
wise objective): conduct research and development technologies used in annual reports of promotion of technologies for the use in
There would activities agriculture and industries. ministries of traditional and agriculture, industry,
be massive Agriculture, industry, proper technology. education and health
use of science and science and services.
and technology technology.
in socio- • Contribute in raising scio-economic • Effectiveness of • Special survey 2. Ensuring the easy • Availability of market
economic condition of people through the technologies used in reports availability of management for the
development sustainable use of natural resource education and health renewable energy. agricultural and industrial
activities. and means. services. products produced by
using timely technologies.
• Producing high-quality scientists • Access of consumers of 3. Massive use and • Availability of programs to
manpower different group to the development of IT. increase the excess of
technologies used people towards timely
agriculture Industries, technologies.
education and health
services and their
proportionate growth
• Development and expansion of 4. Publicise and
meteorological services. ensuring availability
of information
related with weather
and floods.
• Creating conducive environment for 5. Expanding science
attracting private sector investment education and
in IT sectors. researches.
391
Information
• Establishing access of general
people to IT through Community
Information Centres.
• Expansion of training required using
IT.
• Expansion and promotion of micro-
hydel, solar power, wind power,
improved ovens in rural areas.
• Creating environment to attract
community and private sector in
development and promotion of
alternative energy and its expansion
to rural areas.
• Establishment of a separate Rural
Energy Fund to ensure a
sustainable development of rural
energy.
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Programs and Estimated Budget
Science and Technology
(Rs in million)
S. No Programs In normal In alternative
growth growth
Programs/projects under P1
1 Development of qualitative manpower 49.0 47.5
2 Strengthening Ministry of Science and Technology 31.4 30.4
3 Department of Water and Meteorology 588.0 570.0
4 Bio-technology 766.4 742.9
Total 766.4 742.9
Per cent 45.83 58.31
Programs/projects under P2
5 Development of Libraries/record museums 28.5 26.7
6 National Forensic Laboratory 95.0 89.0
7 Research and development 47.5 44.5
8 Technology research and development for rural 373.1 349.5
development
Total 544.1 509.7
Per cent 54.41 50.97
9 Promotion of science and technology
10 Roy al Nepal Academy for Science and Technology
11 National Research Fund
12 B. P. Planetary, Observatory and Science Museum
13 Space Science and Technology
Information Technology
(Rs in million)
S. No Programs In normal growth In alternative growth
Programs and projects under P1
1 Comity Information Centres 299.7 284.7
Total 299.7 284.7
Per cent 47.7 59.4
2. Information Technology Park Project 164.9 153.0
Total 164.9 153.0
Per cent 26.3 31.9
3 National Information Technology Centre
4 Market promotion of software in
international market
5 Human resource development for IT
sector
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Chapter - 21
Housing, Building and Urban
Development
21.1 Background
According to the census of 2001, about 14 percent of the population in Nepal is
residing in urban areas , and this figure is estimated to reach to 24 percent in the next
10 years. In addition to 58 municipalities, there are more than 132 small towns and
market centres in the kingdom which have been playing the role of service centres for
the rural areas and that of the backbone of the economic development and the catalyst
of change. As a result, the rural areas emulate the development-oriented changes that
occurred or going to occur in the urban areas.
In an effort to promote private sector to manage safe and comfortable housing in the
rural and urban regions of the kingdom, the role of His Majesty’s Government should
be as a facilitator and a catalyst. Although there is no shortage of construction
materials and technology in housing development, lack of concessional loan is
making this task problematical. Besides, rehabilitation of the families of the freed
bonded farm labourers (kamaiyas), landless people and those who become homeless
annually as a result of natural disaster has been a problem.
The country spends a huge sum of resource on building houses as a result of which
employment opportunities in large scale are created every year. This sector that
involves local consultants and construction entrepreneurs should be made more
employment- and technology-oriented and productive.
The trend of migrating to the urban areas from rural regions to seek out employment
has resulted in population pressure in the urban areas. The number of towns and
market centres has been increasing with the construction and extension of highways.
The migration pressure and increasing population has made it difficult to provide
sufficient physical and social infrastructure in the urban areas. The task of enabling
the local bodies to develop and manage urban areas has been a big challeng e. As a
result, the urban areas have gradually become unmanageable.
The urban development efforts should be considered as a precondition for the
development of rural areas. For this, the policy of regional balance should be
followed in the development of urban areas. A strengthened linkages of urban areas
with the rural areas is essential. It has become essential that the natural and cultural
environments of Kathmandu Valley be conserved by reducing its population pressure
by disseminating the services, facilities and economic opportunities clustered in the
Valley to other large municipalities of the countries.

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21.2.1 Targets and Pro gress
The following progress has been made during the Ninth Plan period in urban
development and building construction sectors:
a) Towards urban development, integrated action-oriented programmes of 15
municipalities have been carried out and base maps of some municipalities
have been prepared.
b) Apart from carrying out studies for the development of small towns and
market centres, the task of formulating the physical development plans of all
municipality development committees has been completed.
c) In addition to completing the formulation of the 20-year perspective
development plan of Kathmandu Valley, study has been made to develop the
Harisiddhi area as a sub-municipality (satellite town).
d) The national building construction code has been prepared in order to
systematically develop the building construction activities.
e) Regarding the organizational restructure and human resource development,
the existing Department of Building and Department of Housing and Urban
Development are merged to set up Department of Urban Development and
Building Construction.
While determining the programme of this sector during the Ninth Plan period attempt
has been made to identify all activities to be done in this sector. However, no
significant progress have been made in the following sectors:
a) Absence of action-oriented roles and quantitative goals for future direction of
major municipalities of the kingdom to solve the settlement problems.
b) Lack of quantitative goals towards the building of infrastructures in the
appropriate areas.
c) Monitoring programmes have not been carried out for the implementation of
the town planning with base map.
d) Municipality development committees have not been made capable although
the committees were constituted throughout the kingdom .
e) The development efforts of urban areas, settlements and building construction
could not get the synergy due to lack of coordinated projects with the other
ministries .
f) Even though the list of programmes is prepared subsequent to identification
of the problems of this sub-sector in detail, lack of appropriation of budget
accordingly has inhibited the launching of the programmes .
The Ninth Plan’s progress as compared to the sectoral objectives is as follows:

Sectoral goals Progress
1. Policy formulation and Limited progress has been made in the areas of policy formulation and
research research.
396
Sectoral goals Progress
2. Formulation of acts, National Building Construction Codes have been prepared. Kathmandu
regulations and Valley Urban Development Bill is prepared.
standards
3. Organizational reform s Towards organizational reform s, former Ministry of Works and
and human resource Transports and Ministry of Housing and Physical Planning were merged
development to form the Ministry of Physical Planning and Works. Besides, the then
Department of Housing and Urban Development and Department of
Building were merged to set up the Department of Urban Development
and Building Construction. In addition to this, the structure of this
Department has been changed and the existing District Offices have
been merged into the Divisions according to the principles of Division
Office. A separate Training Centre has been created for human resource
development.
4. Kathmandu Valley Formulation of Perspective Development Plan 2001 of Kathmandu
Development Valley has been completed. Land Integration Programme has been
Programme initiated in the three cities of the Valley. The study on Harisiddhi to set up
it as a sub-municipality has been completed. The report regarding
‘healthy city’ has been prepared. Protection of Changunarayan has been
accomplished.
5. District wise integrated The task of preparing physical plans has been done; some districts have
physical development carried out the construction of buildings and have prepared the
programme documentation of the government buildings. Renovation of the damaged
buildings is yet to be made.
6. Urban Area Base maps of some municipalities have been prepared, integrated
Development action-oriented plans have been initiated in 15 municipalities. The
Programme progress of Housing Finance Company remained satisfactory. A limited
progress is made in the distribution of homesteads by developing land.
7. Development Physical plans of all municipality development committees have been
programme of small prepared; a provision of limited number of technical work force and little
towns, urbanising amount of subsidy were made.
villages and market
centres
8. Rural housing and The approach paper regarding the densely populated settlement is in its
densely populated final stage and infrastructure development of 14000 homesteads
settlement programme (housing plots) has been accomplished through Rural Housing
Company.
9. Town Development Loans and grants have been extended from the Fund.
Fund
10. Other programmes Under this programme, retaining walls/dikes have been constructed on
both banks of the Bagmati River.
11. Rural-urban partnership By means of community mobilization in 12 municipalities and 31 rural
programme market centres, 629 small social infrastructures have been established
and 2492 micro businesses have been set up as a part of poverty
alleviation efforts. Private sector has been mobilized to establish and
operate the urban service infrastructure.
397
The objectives and programmes set for the Ninth Plan period tried to incorporate
various aspects of building, housing and urban development; but because of such
problems as lack of resource mobilization as required, weak managerial aspect,
absence of coordination, lack of appropriate human resource, etc., its implementation
has been weak. As many urban development plans did not have substantial
involvement of multi-sectoral expert human resource, the plans could not be
qualitative. Since the municipality development committees set up in different areas
of the kingdom have not been provided with the indispensable physical and human
resources, etc ., their contribution in urban development naturally remained
insignificant. Expected progress could not be attained as different obstacles were
emerged while providing support for the physical infrastructure to different districts
of the country.
On the whole, as the programmes adopted and quantitative targets set were wide-
ranging and ambitious against the backdrop of the proposed programmes, available
means, resources, managerial aspect, human resource, etc. proposed by the Ninth
Plan for this sector, the implementation part proved weak.
This sub-sector has the following challenges:

1. Lack of urban development policies and lack of timely reform of the existing
act/policies.
2. No harmony between physical plan and investment.
3. The municipalities are attracted to the income-generating projects rather than
setting up the basic facilities.
4. The programme for enhancing the capability of the local bodies have not
been implemented.
5. Absence of an all powerful, high-level body to systematically manage and
coordinate the developmental activities of Kathmandu Valley.
6. Town Development Fund has not been effectively mobilized for the
development of urban infrastruc ture.
7. Lack of appropriate acts to attract the private sector in land development and
building construction.
21.3 Long-term Approach

To strengthen the linkages of urban area with rural areas by managing the
uncontrolled urbanization through physical planning, to activate the private sector in
order to provide affordable housing that reduces the effect of earthquake, and to adopt
the necessary construction technology to make the public and private buildings more
safe and cost-effective will be the long-term approaches of this sector.
21.4 The Tenth Plan

a) Objectives
398
n Urban Development
1. Develop the cities and strengthen the rural-urban linkages by providing
with the modern physical facilities and by protecting and promoting the
cultural, touristic and historical areas in their present form .
n Housing and rural settlement
2. Provide with safe and cost-effective houses by promoting systematic
settlements.
n Building
3. Construct and develop safe, cost-effective, environment-friendly
buildings that can display indigenous architecture.
b) Main quantitative targets

In the context of reducing poverty by regulating the uncontrolled urbanization and
providing with the physical and social infrastructures to develop systematic urban
settlements, physical target prioritisation and investment for this sector are shown in
the table.
Urban development
Strategies
Intense housing pressure in urban areas has entailed the construction of safe,
comfortable and cost-effective housing, and it has become necessary to develop
necessary infrastructure to put the already settled unmanaged dwellings in order.
Equally necessary is to protect and promote various historical, cultural and touristic
heritages found in the urban areas. It is necessary that resources, means and
capabilities of local elected bodies along with that of private sector be optimally
utilized for the construction, operation and management of urban infrastructures. By
implementation of these programmes, it is expected that well-managed settlements
will be developed. In this context, major strategies of this sector are as follows:
n Strategies related to the first objective

1. Protect historical and cultural inheritances and lead urban development to
create urban infrastructure in a sustainable manner by means of physical
development plan.
2. Kathmandu Valley will be developed as the capital of the kingdom and a
touristic and cultural centre; and the Valley’s neighbouring areas will be
developed as satellite towns .
3. For the construction, operation and management of urban infrastructure,
the means and resources of the private sector and the local bodies will be
mobilized.
4. Necessary regulatory activities will be carried out to manage the urban
development.
5. Promote the programmes of rural-urban partnership
399
Policies and Working Policies
n Protection of historical and cultural heritages and urban development
(related to the first strategy)
• A policy of increasing participation of the public and private sectors will
be adopted to develop and exp and the urban basic services, facilities and
infrastructure, to improve the urban environment and to protect the
cultural and natural treasures.
• In order to systematize the unrestrained urban development and
expansion, physical planning system will be strengthened by formulating
the development plans of different geographical regions . By integrating
physical and economic development plans, employment generation
programmes will be carried out.
• For the balanced regional development, the concept of urbanizing
development roads will be adopted and the likely cities and rural markets
will be connected with such growth corridor concepts as east-west and
north-south highways .
n Develop Kathmandu Valley as a touristic and cultural centre (related to the
second strategy)
• The concept of integrated and coordinated development of the
Kathmandu Valley will be carried on. Apropos of this concept, based on
the twenty-year development approach of the Kathmandu Valley and
other studies, a policy of systematic urban development will be
undertaken. Besides, policies of discouraging the industries and other
activities that adversely affect the environment of the Valley and replace
them by information technology industrie s that have positive
environmental impact will be adopted.
• Integrated urban policy will be formulated to guide the urban
development of specific geographical places .
• The medium-sized and satellite towns situated within the influence of the
Kathmandu Valley will be developed in an integrated manner. New
satellite towns or settlement centres will be developed as required.
n Resource mobilisation of local elected bodies and private sector to construct
the urban infrastructure (related to the third strategy)
• Minimum services and facilities such as drinking water, electricity,
telephone, roads and sewerage will be gradually developed in
municipalities with the initiation of the local elected bodies.
• Capabilities of the local elected bodies in urban management and
resource mobilization will be enhanced.
• The ‘polluters pay principle' will be applied to manage the waste of the
urban areas .
• Private sector will be involved in the waste management of the urban
areas.
n Management of urban development (related to the fourth strategy)
400
• Considering the trend of population growth and internal migrations, rural
market development and the process of urbanization will be put in order
with priority.
n Village-town partnership programme (related to the fifth strategy)
• By strengthening the interdependence of villages and towns, the urban
areas will be activated to nurture the rural development.
Housing and Rural Settlement
Strategies
As the pressure of housing in urban areas is increasing and construction of buildings
becoming more expensive, it is imperative to construct economical and comfortable
houses with the involvement of the private sector. Similarly, as the unplanned
urbanis ed settlements have been developing in the rural areas as well, it has been
necessary that the facilities to be provided should be managed from development’s
viewpoint by giving it necessary guidance. In order to relieve the victims of natural
disaster, management of cost-effective housing facility has been inevitable. By
implementing these programmes, it is expected that well-managed settlements will be
developed and new opportunities of employment and income generation will be
created to contribute to the national strategy of social development. The housing
programme will contribute to the national strategy of supporting the targeted groups
by relieving the disaster-afflicted communities . In this background, the following
will be the major strategies of this sector:
n Strategies related to the second objective

1. Develop urban housing with the participation and involvement of the
private sector.
2. Develop market centres in the urbanizing settlements and provide loans
to the poor with low income for housing while regulating the
developments of densely populated residences and rural settlements
considering the protection of available historical and cultural heritages.
3. Provide the housing facilities to the victims of natural disaster and the
marginalised groups with priority and construct ‘emergency buildings’ to
relieve them.
4. Strengthen the village-town linkages.
Policies and working policies
Housing
n Participation of private sector (related to the first strategy)
• Based on the basic concepts ascertained by the National Housing Policy

1996, provision of housing will be carried on effectively in urban and
rural areas.
401
• Real estate development programme will be carried out with the joint
effort of the private and government sectors.
• A mechanism will be developed to establish coordination among the
related bodies /institutions by initiating reforms in the legal structure of
market system of land and housing.
Rural Settlement
n Development of densely populated settlements and rural dwellings (related
to the second strategy)
• Small municipalities and urbanizing villages will be developed as rural
market centres in order to provide the rural areas with basic services and
facilities .
• Conditions of rural settlements of the kingdom of Nepal will be
improved. Basic services and facilities such as drinking water, electricity,
telephone, roads, biogas and sewerage will be gradually developed in
urbanizing rural areas .
n Relief to the poor and the backward communities (related to the third
strategy)
• Special housing programme will be carried out for the low-income poor
groups.
• Credit will be arranged through financial institutions for low -cost
housing to the families unable to construct houses .
n Village-urban partnership programme (related to the fourth strategy)
• The village-urban partnership programmes will be identified and
executed.
Building
Strategy
Unmanaged and earthquake-prone bu ildings are constructed in the densely populated
urban and rural areas. Among them are many government buildings . By strictly
enforcing the updated building construction codes, and enhancement of the
capabilities of the construction professionals, the probable harms to the public assets
will be reduced. As such the base of strengthening economic growth. In the context
of the excessive use of foreign labour in constructing the buildings of urban areas,
enhancement of the skills of the local labourers and artisans would contribute in
employment generation. Similarly, by putting the building codes into operation,
national strategy of good governance will be supported as the trend of occupying the
public land will be discouraged. In this background, the following are the main
strategies of this sector :
n Strategies related to the third objective
• Implement the building construction codes and standards applicable to
both the government and private sectors.
402
• Carry on the promotion and capability development of the local
consultants and construction entrepreneurs.
Policy and Working Policies
n Building construction codes and standards (related to the first strategy)
• Such measures as economical, earthquake resisting and safe from other

natural disasters will be adopted for all kinds of build ings constructed in
the government and private sectors.
• Research will be carried out for the development of local materials, skills
and appropriate technologies in order to adopt the local architecture and
maintain environmental cleanliness.
• Wide publicity will be given to the use of the available technologies .
• After revising the National Building Codes apropos to time, initiation
will be made to implement the codes under the Building Act.
n Promotion of national consultants and construction entrepreneurs (related
to the second strategy)
• Programmes of promotion, capability development and awareness
creation of national consultants and construction professionals will be
identified and carried out.
(e ) Policy, legal and institutional reforms and implementation

mechanism
n Policy reforms
The following policy reforms should be carried out in order to materialize the
above-mentioned objectives of the Tenth Plan:
• Investment programmes will be formulated as per the priority in the areas
designated by physical plan.
• Effective coordinating mechanism will be developed among the
institutions that formulate plans, implement projects, and make
investment.
• The trend of the municipalities to spend on income-generating activities
(such as shopping complex) instead of investing on basic services and
facilities (such as sewerage, drinking water, roads ) will be discouraged.
• Rural housing and settlement programmes will be carried out under the
partnership of the concerned institution of His Majesty’s Government and
local bodies.
• Necessary steps will be taken to give the National Building Codes a legal
status .
• His Majesty’s Government will strengthen the capacities of the local
elected bodies by carrying out the programmes of joint investment
(partnership) with the participation and involvement of urbanizing
403
Village Development Committees and municipalities.
• The urban development policy will be formulated by clearly specifying
the scopes, responsibilities and jurisdiction of such institutions as
Department of Urban Development and Build ing Construction,
municipalities and Ministry of Local Development which are directly
involved in urban development sector.
n Legal reforms
• The district development committee will be granted more authority/say in
the task of municipality’s development by mak ing necessary amendments
in Municipality Development Act.
• Kathmandu Valley Urban Development Act and regulations will be
formulated and implemented.
• Necessary amendments and moderations will be made in Building Act,
1998.
• Municipality Development Regulations and national level standards will
be prepared.
• By adjusting the conflicting issues between Municipality Development
Act and Local Self-Governance Act, both acts will be made equally
effective in urban development and land development.
• Regulations regard ing private sector land development act and joint
housing will be prepared to implement in order to encourage, direct and
regulate the land development activities of the private sector.
n Institutional reforms
• Kathmandu Valley Urban Development Council will be set up.
• The Municipality Development Programme will be put into practice in
the feasible places through the Municipality Development Committees
established all over the kingdom. For this, recommendation of the
concerned District Development Committees will be made mandatory.
• The role of Municipality Development Fund will be made widespread
and flexible in the areas of urban infrastructure development.
• Urban Development and Building Construction Offices of His Majesty’s
Government will be made more responsible and capable in the task of
enhancing plan-wise technical capability of the local elected bodies.
• Settlement improvement programme will be carried out through Rural
Housing Company for rural settlement, family afflicted by natural
disaster and the families displaced by large projects.
• The scope of the Housing Finance Development Company will be
expanded and concessional financial investment will be flowed to
construct new houses and repair the existing houses .
• A system of providing with the concessional loans will be commenced to
404
the helpless families headed by the women to construct new houses or
repair the old houses.
(f) Implementation system

Roles, responsibilities and accountability of the relevant institutions of His Majesty’s
Government, local elected bodies, semi-government and non-governmental
organizations should be made clear to implement the reform programmes . The
Department of Urban Development and Building Construction will have a leading
role in urban development and building construction. In housing sector, Nepal
Housing Development Finance Company, Rural Housing Company, Commission to
Solve Squatters' Problems , Personnel Provident Fund and non-governmental
organizations along with the Department should assume responsibility from their
respective sectors. The monitoring and evaluation of the activities done by these
institutions will be arranged as follows:
1. Monitoring and evaluation of the government and semi government
institutions will be carried out by the Ministry of Physical Planning and
Works and help the National Planning Commission to formulate macro level
policy by providing the progress report.
2. The National Planning Commission will carry out monitoring and evaluation
of the programmes of the government, pr ivate and non-governmental
institutions and local elected bodies.
In order to accomplish the objectives and goals of the Tenth Plan, different
institutions of His Majesty’s Government as well as the local elected bodies should be
granted with additional authority and resources . With the aim of widening the role of
private sector, legal and administrative reforms will be steadily made.
21.5 Priority order of the programmes/projects

Prioritization of programmes/projects is made based on the priority assessment
procedure of policy action matrix. Programmes and budgets are listed below . Detailed
programmes and estimated budgets are presented in Appendix 21.1.
Summary of Priority Assessment

Rs. in million
Priority Number of Expected growth General growth
order programmes amount percent amount percent
P1 19 707.4 62.8 628.8 73.1
P2 15 386.2 34.3 198.7 23.1
P3 17 32.4 2.9 32.5 3.8
Total 51 1126 100 860 100
21.6 Monitorable Indicators

405
n Urban development
• Availability of digital maps of all municipalities.
• Healthy city programme will be executed in 10 municipalities.
• Urban environment improvement project will be executed in nine
municipalities .
• Environment improvement in 100 areas.
n Kathmandu Valley
• Establish Harisiddhi sub-municipality (satellite town).
• Availability of twenty thousand plots of land.
• Environment improvement of five squatter areas.
n Rural settlement
• Establish twenty systematic market centres.
• Physical plans of twenty-five VDCs will be completed.
• Prepare five growth corridors.
• Skill-oriented training will be imparted to 2000 persons.
n Housing
• Two areas will be developed as sample of densely populated zones
settling 10-15 families in each.
• Group housing and joint housing development will be carried out in four
cities by involving the private sector.
• Housing loans will be provided to two thousand persons.
n Building
• Publish the up-to-date records of the government buildings.
• One hundred emergency buildings will be constructed as an experiment
by selecting suitable materials and technologies.
n Development of special importance areas

• Master plans of 10 areas will be prepared.
21.7 Log Frame

The complete policy action matrix of housing, building and urban development is
presented below . Its detailed outline is given in Appendix 3.
406
*
Policy Action Log-frame – Housing, Building and Urban Development
Sectoral Objective : Productivity of the human resource will be increased sustainably.
Purpose • Guide urban development through the protection of historical • Availability of the • Ministry of 1. Enhance well- • Continuation of
(sectoral and cultural heritages and the support of urban infrastructure digital maps of the Physical managed the priority of His
objective): in a sustainable manner. municipalities. Planning and urbanization. Majesty’s
Condition of • Develop Kathmandu Valley as the capital city and touristic • Increase the Works 2. Develop Government on
human and cultural centre of the kingdom of Nepal, and develop the compliance of the • Department of interdependenc housing, urban
settlement will satellite towns around Kathmandu Valley. norms of Urban e of rural and development and
be improved Development building
• Mobilize the means and resources of private sector and municipalities. urban regions.
sustainably. and Building construction.
local elected bodies for the construction, operation and • Availabi lity of market 3. Develop rural
management of urban infrastructure. centres that are Construction and urban
• Carry out the necessary regulating functions to systematize systematic as per the • Sectoral housing.
national standards. supervision
urban development. 4. Manage
• Execute sample reports building
• Promote village-town partnership programme.
programmes of construction
• Develop urban housing with the participation and densely populated and
involvement of private sector. settlements. maintenance.
• Update and implement the building construction codes and • Increase in the 5. Develop the
standards. completion of areas of special
construction of importance.
government
buildings.
* The quantitative goals are based on the economic growth of 6.2 percent (details in Appendix 3)
407
Appendix 21.1: Pro grammes and estimated budgets
(Rs. in million)
S. For expected For general
No. Projects growth growth
First priority programmes/projects
1. Prepare digital maps of suitable scale in all municipality areas
as specified in the Local Self- gov ernment Act, 1998 and
90.0 80.0
provide the maps to the concerned municipalities. (Urban
Development)
2. Prepare urban development and building construction standards
4.5 4.0
and moderate the existing norms. (Urban Development)
3. Assist municipalities to prepare sectoral master plans of
45.0 40.0
periodic plan. (Urban Development)
4. Assist municipalities to prepare participative annual budgets as
45.0 40.0
per the Local Self-governance Act, 1998. (Urban Development)
5. Urban environment improvement programmes in the towns
90.0 80.0
around the valley. (Urban Development)
6. Develop well-managed markets in small towns and market
90.0 80.0
centres. (Urban Development)
7. Conduct skill training and transfer of technology through
community mobilization in rural and urban areas for economic 18.0 16.0
development by the village-municipality linkages. (Urban
Development)
8. Carry out the urban infrastructure improvement programme.
67.5 60.0
(Kathmandu Valley)
9. Complete the construction of Bishnumati link road. (Kathmandu
81.0 72.0
Valley)
10. Implement the long-term concept of Kathmandu Valley.
18.0 16.0
(Kathmandu Valley)
11. Prepare and implement the urban development, joint housing
0.9 0.8
and real estate business act and regulations. (Housing)
12. Hand over the economical and reliable local construction
materials and technologies based on research and experiment 20.3 18.0
through publicity. (Housing)
13. Prepare plans to execute the dense settlement programmes in
18.0 16.0
different parts of the kingdom. (Rural Settlement)
14. Carry on updating of the documentation of the government
buildings. (Building Construction) 9.0 8.0
15. Carry out the task of physical infrastructure management in the

18.0 16.0
Singha Durbar complex. (Building Construction)
16. Train the concerned officials, inspectors, construction
entrepreneurs, consultants along with the local artisans about 13.5 12.0
the building codes. (Building Construction)
17. Make provision of the emergency shelters for immediate relief.
18.0 16.0
(Building Construction)
18. Prepare and implement the master-plans for sustainable
development of special areas. (Area Development of Special 45.0 40.0
Importance)
408
19. Renovate the temples, religious places of refuge, stone spouts,
etc. that have special importance in the national life and 15.8 14.0
improve the environments of these areas. (Area Development
of Special Importance)
Total 707.4 628.8
Percent 62.8 73.12
Second Priority Programmes/Projects 0.0 0.0
20. Carry out the healthy city programme. (Urban Development) 68.6 35.3
21. Provide suitable training to the employees of municipalities in

planning, financial management, institutional reform, etc. 1.7 0.9
(Urban Development)
22. Carry out land development programme (integration of land,
directed land development programme) out of the Valley with
the participation of the local elected bodies. For this, His 6.9 3.5
Majesty’s Government will play the role of auxiliary and
facilitator. (Urban Development)
23. Improve the environment of the unplanned settlements of urban
and urbanizing areas in order to ensure systematic physical
24.0 12.4
infrastructure and housing with local people’s participation.
(Urban Development)
24. Prepare physical development plans of rural market centres
3.4 1.8
and small towns and markets. (Urban Development)
25. Prepare provincial plans according to the priority by identifying
0.7 0.4
the economic growth centres. (Urban Development)
26. The programmes constructing physical infrastructure and
reform agenda in small towns and market centres will be 61.7 31.8
carried out in order to strengthen the village-town linkage.
(Urban Development)
27. Municipalities will set up urban development fund in order to
provide loans and skills for the promotion of sustainable self- 13.7 7.1
employment. (Urban Development)
28. Establish infrastructure for the development of e-commerce in
20.6 10.6
urban and rural market centres. (Urban Development)
29. Initiate the land development programmes through the joint
investment of His Majesty’s Government and private sector to 34.3 17.7
cater the increasing need of homesteads. (Housing)
30. Arrange necessary assistance to encourage the studies and
research by the private sector for technology development. 6.9 3.5
(Housing)
31. Run programmes with private sector’s participation to fulfil the
increasing demand of housing and develop collective joint
30.9 15.9
housing, etc. as intended by the national housing policy.
(Housing)
32. Complete the construction of the two buildings of Ministries of
Finance and Land Reform, wall of the Singha Durbar complex 102.9 53.0
and security press building. (Building Construction)
409
33. Take initiatives in transferring high-level technologies by
increasing the involvement of national consultants and 0.7 0.4
construction entrepreneurs in large building construction
projects. (Building Construction)
34. Strengthen (institutional) the Department of Urban
Development and Building Construction. (Building 9.3 4.8
Construction)
Total 386.3 198.7
Percent 34.3 23.1
Third Priority Programmes/Projects 32.4 32.4
Percent 2.9 3.8
35. Identify the likely areas for the partnership between the
government and the private sector. (Urban Development)
36. Involve private sector to provide the basic urban services.
(Urban Development)
37. Study the linkage of urban and rural sectors. (Urban
Development)
38. Establish modern satellite town in the Harisiddhi area.
(Kathmandu Valley)
39. Distribute 20,000 housing plots in the Valley by developing 500
hectares of land. (Kathmandu Valley)
40. Expand and develop the traditionally densely populated
settlements in a systematic way by improving their
infrastructures. (Kathmandu Valley)
41. Prepare plans to systematize the unplanned and squatter’s
settlements of the Valley with the coordination of all concerned
stakeholders. (Kathmandu Valley)
42. Run the residential building improvement programmes.
(Housing)
43. Develop the cooperative housing. (Housing)
44. Conduct study and research about the housing construction
technology for different geographical areas. (Housing)
45. Complete the construction of the buildings of three ministries –
Communication, General Administration, and Local
Development – and that of bank, postal office, library and
canteen. (Building Construction)
46. Initiate the construction of the parliament building after
completing its design. (Building Construction)
47. Develop the expertise to standardize the designing of
government buildings. (Building Construction)
48. Formulate policies to harmonize the process of repair, building
construction and introduce uniformity in the required spaces for
the government office buildings. (Building Construction)
49. Go on constructing government office buildings and employee
quarters in remote and backward districts. (Building
Construction)
410
50. Construct some office buildings or employee residences as
samples in order to implement the Building Codes, 1998 in all
office buildings of His Majesty’s Government. (Building
Construction)
51. Implement the Building Codes Act, 1998 after making
necessary amendments subsequent to the incorporation of
international norms in the areas of natural disaster including
fire, flood, and landslide to put the building construction
technologies in order. (Building Construction)
411
Chapter - 22
Population, environment and
natural disaster management
22.1 Population management
22.1.1 Background
According to the national census 2001, the total population of Nepal has reached to
23,151,423. It means that the average annual rate of increase of population is 2.25
percent. Although the fertility rate has begun to decrease in Nepal due to the gradual
improvement in the social and the health sectors services, the rate of increase of
population has not been decreased by the desired rate because of the tendency of high
number of population of child bearing age of people along with the high rate of
increase of population, high rate of infant and maternal mortality rate, early age of
marriage, sexual discrimination, and low rate of use of family planning devices.
According to the analysis of population from the composition of age, the numbers of
children, adolescents, and adults less than 25 years of age in Nepal are 58.73 per cent,
as a result, it seems that the trend of increase in population will be continuous for the
few decades to come. Therefore, to fulfill the long term objectives of the Ninth Plan
of obtaining the total fertility rate of Nepal to the replacement level by the end of the
Twelfth Plan, it seems appropriate to formulate long term plan related to population
including population aspects in the sectoral development programs effectively.
a) Progresses in the Ninth Plan period
The Ninth Plan’s long-term schemes were to materialize the concept of two children
only in the Ninth Plan period and to get the total rate of fertility to the replacement
level in 20 years. Similarly, In the Ninth Plan, the major objectives were to carry out
various population related programs for attracting the common people to a small
family size according to the concept of two children, to conduct different population
related programs to get the total fertility rate to the replacement level of fertility, and
to make easily available or accessible the family planning related devices as well as
the standard maternal child health services to the people. In that period, the main
goals were to bring the total fertility rate from 4.58 to 4.2, to increase the users of the
family planning devices from 30.1 to 37.0, to decrease the percent of married women
of 15-19 ages from 42.1 to 36.1, to decrease the infant mortality from 74.7 to 61.5
(per 1000, live at birth) and to decrease child mortality (per 1000, live at birth and
under 5 years of age) from 118 to 102.3 persons.
By the analysis of achievements of the Ninth plan, it was found that there was
significant improvement in the above-mentioned indicators. According to the
Demographic and Health Survey, the total fertility rate of Nepal was reduced to 4.1
413
percent and the users of family planning devices were reached to 39.3 percent, infant
mortality per thousand was decreased to 64 infants, and child mortality of under 5
years of age was decreased to 91 children. Based on these positive indicators, it was
seen that there was an achievement according to the goals set in the Ninth plan.
Inspite of various obstacles, the success made in the plan should be taken very
positively. It seems that the strategies and programs that are adopted so far should be
extended. By the analysis of the Ninth plan it is seen that how to keep the fertility rate
in the urban areas that is already at the replacement level and how to reduce the high
rate of birth prevailing at he rural areas need to be considered.
b) Problems and challenges:
The problems and challenges that are prevailing are how to integrate the demographic
matters effectively in the development activities, how to extend the behavior change
communication programs to the remote areas of the country, how to establish
effective coordination among the programs of population management, and how to
ensure the quantitative objectives (e.g. to decrease the total fertility rate to the
replacement level) as well as qualitative objectives (e.g. eradication of illiteracy, and
development of educated and skilled human resources) of population management
efforts.
The long-term objectives of the plan is to attain the fertility rate of Nepal to the
replacement level by the end of Twelfth Plan by relating the population with the
development and to help alleviate the poverty to create an affluent society by
developing educated, healthy, and skillful human resource.
a) Objectives
1. To attach the population with developmental activities by means of
developing small and qualitative families.
2. To manage the migration processes.
(b) Quantitative targets
S.N. Description Position in Objectives of 10th plan
the Ninth (at the final year)
plan* expected normal rate
growth rate
1 Total fertility rate 4.1 3.5 3.6
2 The users of family planning devices (%) 39.3 47.0 46.0
3 Infant Mortality Rate (per 1000 live birth) 64.2 45.0 47.0
4 Child Death Rate under 5 (per 1000 live birth) 91 72 74
* As these indicators are taken as average for 1998, 1999, and 2000 A.D. based on the
Demographic and Health Survey 2001, the situation can be better than this by the end of
the Ninth Plan.
(c) Strategies
414
As the population growth is at the higher rate of 2.25 percent; there is a pressure on
education, health and other basic services, as a result, it has been difficult to increase
the quality of social service sector to speed up the pace of development of the
country. The strategies that emphasize to decrease the high infant and maternal
mortality, decrease marriage at an early age, eliminate sexual discrimination, increase
the use of family planning devices, increase the awareness in population management
by raising the literacy of women, and attract the people to the smaller size of family,
would reduce the rate of increase of population, help achieve higher economic
growth, and also contribute to human resource development and management and
ultimately, support the poverty alleviation programs. In this context, the main
n Strategies related to the first objective
1. Reproductive health services will be made easily available and the late
marriage and breast-feeding will be encouraged.
2. Emphasis will be given to raise public awareness extensively in the
management of population.
3. Policy will be taken to conduct special programs targeting to adolescence
and adults (10-24 years).
4. Population management will be made effective by carrying out review
and policy reform of the laws related to population.
5. Emphasis will be given to raise the women’s family and social status, to
enhance women’s skill and employment opportunities, women’s literacy,
and girls’ education.
6. The role of educational institutions in the formulation and
implementation of population related programs will be increased
substantially.
7. The policy of getting higher participation of local bodies according to the
concept of decentralization while carrying out population management
programs will be adopted.
8. The policy of carrying out population management activities jointly with
private and non-gov ernmental sectors will be adopted.
n Strategies related to the second objectives
9. The internal and external migration will be systematized.
d) Policy/Action plan
n Encourage availability of reproductive health services to all, encourage late
marriage, and promote of breast-feeding (related to strategy 1.).
• The population related behavior change communication programs will be
taken at the village level with the help of the local bodies as well and by
mobilizing the community-based organization to raise public awareness
in such the areas as, education to children and health about the
415
importance of small family, late marriage, reproductive heath, enhancing
social status of women, importance of family planning, involvement of
men in family planning, and so on.
n Emphasis on raising massive scale awareness (related to strategy 2.)
• Priority will be given to carry out those population and environment
related activities, which will target the backward areas and communities.
• Appropriate policy will be formulated and implemented by studying the
various aspects of population management.
• The advocacy targeted to the local and central level policy makers,
administrator and journalists, and the civil society will be carried out for
raising awareness to integrate sectoral policies and programs in various
aspects of population management.
• The vital registration system will be strengthened.
n Operation of special programs targeting adolescents and the youths (related
to strategy 3)
• In addition to formulation of adolescent-friend ly programs in the areas of
education and health for the development of adolescents, arrangements
will be made to counsel the adolescents and the youths on such matters as
development of education, skills and creativities, sex and reproductive
health, employment and self-employment opportunities.
n Reviw of population related laws and policy reforms (related to strategy 4.)
• The action plans approved by the international conventions on population
will be implemented.
n Raise women’s family and social status (related to strategy 5.)
• In the areas of population management, the local health workers will be
mobilized to provide the basic health services, such as, sex and
reproductive health, maternal and child health, etc.
n Formulation and implementation of population education programs
• Initiation will be taken to incorporate economic population education in
all terms of social mobilizations such as the vocational and technical
education, skill development related to employment, entrepreneurial
development, agricultural extension, community forest development, etc.
that reach to the rural level.
• The population related programs will be attached to education and the
educational processes.
n Participation of local bodies according to the concept of decentralization in
the population management programs (related to strategy 7).
416
• Projection of population will be carried out based on the National
Census, demographic health survey, and data received from other
sources, and a population related data bank will be developed. To
conduct the population management effectively, the population policy act
and long term population plan will be formulated and implemented based
on the above data and their tendencies.
• The programs related to population management, development,
environment and health will be integrated and carried out for the target
groups that helps to alleviate poverty.
• The responsibility of population management will be given to the local
authorities according to the decentralization concept. For this purpose,
the programs that need to be carried out by the central and the local levels
will be identified and the local and the central bodies will be activated.
n Participation of private and non-governmental sectors in activities related
to population management (related to strategy 8).
• In the management of population, the role of the private sector, NGOs,
community based organizations, and the civil society will be made
effective and they will be motivated in a coordinated manner. Emphasis
will be given to their active participation by clarifying their working
areas and roles.
• For population management, human resource and the flow of information
which strengthen the organizational structure will be developed.
n Internal and external migrations (related to strategy 9.)
• To manage international migration, appropriate policies and programs
will be formulated by carrying out necessary study and research.
• To regulate internal migration, population pressure index will be
prepared and appropriate programs will be formulated based on that
index. In addition to this, the roles of other related line ministries and the
local bodies will be made clear.
• By increasing skills development and employment opportunities and
related economic activities, and by giving priorities to the income
generating activities, and the development of rural infrastructures
systematic internal migration will be developed.
(e) Policy reform, legal reform, institutional reform and the provision of their
implementation
The economic, social and cultural development, population dynamics and the
development in the public awareness level call for the availability of standard services
and facilities as well as continuous reform in the population policy. In this context, by
studying the situation and trends of birth, death, and migration, a relevant population
policy reform will be carried out. As some of the matters related to population should
be implemented legally and innately, the existing legal system will be reviewed and
417
improved according to the need. To coordinate and carry out the population
management effectively, strengthening of institutional development and population
related human resource development will be steadily reformed.
(f) Priority order of programs and projects:
In addition to the government sector, the population management programs will be
operated by the investment of the non-governmental sector, private sector and the
civic society. The non-governmental sector will be given priority to operate the
programs by themselves in the areas where they have developed specialization. The
priority setting of programs has been done according to the Policy Action Matrix. The
summary of priority setting is given in the following table:
(Rupees in million)
Priority Number of Expected growth Normal growth
programs
A (P1) 3 58.8 61.3 49 66.4
B (P2) 5 35.5 36.9 24.8 33.5
C (P3) 5 01.8 1.8 00.1 0.1
Total 13 96.1 100.0 73.9 100.0
22.1.5 Programs that are given special emphasis
• Formulation and implementation of long term population plans,
• Review of population policy and legal provision and implementation,
• Conduction of population management programs with the involvement of
local bodies,
• Operation of population management program with the partnership of
civic societ y, non-governmental organization, and private entrepreneurs,
• Operation of adolescent-friendly and youth oriented programs,
• Preparation of population pressure index,
• Record keeping of Nepali at the point of departure from Nepal and record
keeping of foreigners at the point of arrival to Nepal,
• Programs on population advocacy, behavior change communication,
information, and education programs,
• Availability of reproductive health services,
• Strengthening of vital registration system and its use,
• Increase access of children to the educational opportunities.
22.1.6 Expected achievements
418
The return of achievement from population management, which is related to
social sector, is experienced after a long period of time. Small size of family
as a result of attraction of the people towards small family leads to decrease
the population growth rate which, in turn, supports to reduce poverty on the
one hand and contributes to develop human resource and management on the
other. By this achievement, there will be a balance between the population
growth rate and the new employment opportunities, as a result, it will be
helpful for the qualitative employment management. After the decrease in
population growth rate, the balanced development will be achieved because
of the optimum utilization of local resources and management of migration
will be facilitated. After carrying out population management effectively
under the leadership of district development committees, the backward
classes and regions will not be denied the returns of development. Operation
of programs such as girls’ education, enhancement of the family and social
status of women, and so on in the population programs, will also help
improve the gender-equality. As a result, with the management of the growth
rate, composition, and distribution of population, it will be helpful to get the
quantitative and qualitative achievement and to materialize the long-term
concept of population.
22.1.7 Log frame

The overall policy and program matrix of population management sector is
presented below. The long-term sketch is presented in Appendix 3.
419
Policy and Program Log Frame- Population Management*
Overall Sectoral Objectives: the development programs that are based on the balanced of population will be sustainable.

Intention • Reproductive health services will be made available and the late • Reduce the total fertility • National 1. To tie up
(sectoral marriage and breast- feeding will be encouraged. rate to 3.5 census population with
objecti ve) • Emphasis will be given to raise public awareness for population • Increase the users of family • Surveys development
Development of management. planning services to 47.0 • Gazette activities
small and • The policy to operate special programs focused on adolescents percent • Research 2. Management of
qualitative and the youths (10-24) will be undertaken. • Reduce the infant mortality • International migration
family. • Population management will be made effective by reviewing rate to 45 person (per 1000 publications 3. To take
population related laws and making policy reforms. live birth) • Progress population
• Special emphasis will be given to raise the social and family • Reduce child mortality to reports management to
status of women and skill development & growth of employment 72 (per 1000 live birth) the local level by
opportunities, women’s literacy, and girls’ education. • Human Resource participatory and
• The role of educational institutions in the formulation and Development Index decentralized
implementation of population education programs will be • Gender Index manner
increased. • Percentage of Literacy
• The role of local bodies in the operation of population
management programs according to the concept of
decentralization will be increased.
• The policy of participatory partnership of private and non-
governmental sectors for the operation of population
management tasks will be adopted.
• The internal and international migration will be regulated.
* The quantitative objectives are based on 6.2 percent economic growth rate (details on Appendix 3)
420
22.2 Environment Management
22.2.1 Background
• For the protection of environment of Nepal, there have been policy level
efforts since the Sixth Plan. It was realized that for implementing the
programs by the sectoral institutions, the environment protection
activities will also be advanced side by side. In the process of formulating
the environmental protection policy in 1987, the National Environment
Protection Action Plan was prepared and implemented. In 1993, the
Nepal Environment Policy and Action Plan (NEPAP) came into effect.
Various programs are formulated for the implementation of sustainable
development in the context of Nepal by ratifying the international
convention on Environment and Development held on Rio De Generio of
Brazil and other treaties approved in various international forums. In the
process of institutional development and legal provision strengthening,
the Environmental Protection Act, 1996 and Regulations 1997 are in
effect. With regard to environmental management, our efforts in
particular will be toward integration of environment management concept
with development projects and to advance in a balanced way as an
indivisible part of development. For the achievement of this objective, it
is necessary to take the concept of environmental management from
central to the local level development activities through decentralized
programs. Similarly, it is also necessary to promote the involvement of
governmental, non-governmental, local level authorities and the private
sectors. Therefore, the Tenth Plan will be directed tow ards the proper
management and utilization of natural resources and the achievement of
sustainability in its use by involving all concerned stakeholders in the
management of environment and the natural resources.

a) The progress in the Ninth Plan with regard to its objectives:
• In the Ninth P lan period, by integrating the environmental management
with the development, the emphasis was given to capacity building for
the Environmental Impact Assessment (EIA), institutional arrangement,
and legal provision.
• For the improvement of environment at the local level, various activities,
such as, cleaning programs, public awareness, ban on the use of the
plastic bags, are being carried out by various municipalities. The
integration of environmental aspects while formulating periodic plan by
the District Development Committees has already begun.
421
• In the area of population education due to the effort of the Ninth plan, the
classes of population education from primary to the higher levels have
already begun.
• From the Kathmandu Valley, the three wheelers diesel tempos have been
displaced. The registration of two stroke engine vehicles has been
banned. For the control of vehicle pollution, the standards have been set
and brought into effect and in the process of setting the standard of water,
a minimum to maximum levels of limitations are set for the discharge by
the industrial sector to the surface water. In addition to this, standards are
in effect for the test of smoke emitted by the vehicles that use Liquefied
Petroleum Gas (LPG) and Compressed Natural Gas (CNG).
• In the process of implementing international treaties on environment, the
preparation of national information according to the Treaties on Climate
Change and the preparation of national report on the implementation of
Treaties on Prevention of Desertification is carried out and in the context
of Treaties on Ozone Layer Protection, the Regulations on Control of
Consumption of Materials that Degenerate the Ozone Layer, 2000 has
been in effect to ban import of materials that affect the ozone layer.
• The action plans are formulated for the implementation of biodiversity
treaties. Preparation of Sustainable Development Agenda for Nepal
(SDAN) is completed now. In addition to this, in the World Environment
Day and public awareness raising programs on environment, the roles of
local authorities, non-governmental organizations, community
organizations, and private sectors have increased.
b) Problems and challenges:
• The reasons behind not fulfilling the environment and resource protection
policy and programs proposed in the Ninth Plan are the lack of budget
and also the lack of putting in place the institutional accountability for the
materialization of the policies set in the Plan. The problems that are
perceived are the lack of required priority given to the policies proposed
by the sectoral authorities while implementing their programs, the lack of
apparent coordination of environment policies and programs with the
various sectoral policies and programs, lack of capability of the Ministry
of Population and Environment, and lack of complete evaluation of the
works carried out by non-governmental organizations and donor
agencies.
422
• The long-term objective of environment management are to create a
clean and healthy environment by making environment management
effective on the basis of the concept of environmental governance and
controlling pollution, and to attain sustainable development through
wise/judicious utilization of the natural resources.

a) Objectives
• in view of the fact that the interrelation between the environment
protection and the economic development can lead to sustainable
development, emphasis will be giv en to the protection of natural
environment protection, restoration, and sensible use of resources.
• In an endeavor to control the pollution in the urban areas and to keep the
rural areas clean, healthy and beautiful, voluntary participation of people
will be encouraged and the sustainable development will be promoted.
b) Strategy
• Although the policy level efforts have been made for the protection of
environment, it is necessary to operate the various sectoral programs
coordinately. Since the environmental aspect is closely linked with the
human life, it will be effective to carry out programs coordinately by the
governmental, non-governmental and local authorities, and the private
sector to the field level in a decentralized manner. If the environment is
preserved in an appropriate manner, it will significantly contribute to the
sustainable economic development and improve environmental health
and consequently contribute significantly to the human resource
development. The appropriate use and protection of natural resources in
various sectors will help to make the regional development balanced and
sustainable. In this context, the main strategies in this sector are as
follows:
n Strategies related to the first objective:
• Environmental programs will be operated as an inseparable part of
development by internalizing the environment management in the
development programs.
• To raise the environmental awareness, the non-governmental and private
sector, local authorities and the general people will be effectively
mobilized.
• An action plan will be prepared apropos to Nepal and brought into effect
by prioritizing the ratified treaties and proposals at the international level.
n Strategies related to the second objective
• The national standards of air, water, and noise pollution will be
established and brought into effect.
423
• To control the river pollution, the connection of drainage systems to the
rivers will be prohibited. The local authorities will be encouraged to
establish sewerage treatment plants. To control the industrial pollution,
monitoring and inspection for the effective enforcement of national
standard will be strengthened.
• By establishing the necessary indicators of waste management, the
management activities will be operated accordingly through various
concerned authorities.
c) Policy and action plans
n Internalization of environmental management in development programs
• Priority will be given to the implementation of sustainable development
agendas for Nepal (SDAN) by exploring the indicators of development
agenda.
• Monitoring and evolution of the projects that have undertaken
environment impact assessment will be made effective.
• Act and regulation that are necessary to make the environmental health
program effective will be devised and improved.
• To promote new technologies and approaches in the areas of
environmental protection, the scientists, technicians and researchers will
be encouraged.
• By evaluating the contribution of women’s groups toward the protection
of environment at the national level, the policy of awarding them will be
adopted.
• The municipalities will be made compulsory to prepare a land utilization
and waste management plans and these plans will be carried out into
effect. While implementing the urban and housing development plans,
the provision of sewerage purification devices will be made compulsory.
The local authorities that carry out special efforts for the protection of
environment (e.g., declaration of areas prohibiting plastic bags, etc.) will
be provided subsidy through the Environment Protection Fund.
• By documenting the traditional customs, technology and so on, the
environmental protection will be given emphasis. In addition to this,
environment information and data bank will be established and
strengthened.
• An Environment Protection Center will be established under the Ministry
of Population and Environment and emphasis will be given to utilize the
human resources related to environment.
n Environmental awareness raising (related to strategy 2.)
424
• Policy of restoring the decreasing natural resources, bio-diversity, and
cultural resources in the country will be carried on. Specially, bio-
diversity, land resource and cultural resource protection will be given
priorities.
• The involvement of local bodies in the protection of environment will be
increased and the Local Self-governance Act 2055 will be implemented
based on the total participation in the management of local natural
resources by making the local bodies capable and responsible.
• Emphasis will be given to self-awareness and compliance regarding the
improvement of environment by various communities themselves.
• Policy of reforming of environment and preservation and management of
natural, cultural and religious places of the kingdom will be carried out
with the part icipation of local level authorities. In this task, the role of
non-governmental organization, community organization and the private
sector will be encouraged.
• The rehabilitation policy for the management of environmental
degradation in the lower areas that are actually affected by the
developmental activities (e.g., hydro power, irrigation) in the upper areas
will be adopted.
• Environment education will be tied up with the formal and non-formal
educational programs. In addition, the curriculum will be reformed as
required.
n The implementation of the conventions and treaties and implementation of
proposals (related to strategy 3)
• For the implementation of environment related international treaties (e.g.,
climate change, desertification control, Wasel Treaty of Harmful Waste,
etc.), the policy provision for coordinating various programs will be
made by establishing a central level mechanism in the Ministry of
Environment and Population.
• The export will be made environmental-friendly by preparing the
environment protection manual and methods that are necessary for the
World Trade Organization (WTO).
n The setting of national standards of air, water, and noise pollution and
their implementation (related to strategy 4)
• The municipalities will be designated as author ities to issue the
certificates by testing the pollution emitted by the vehicles.
• The programs of measurement will be implemented by setting the
standard of air, water and noise pollutions, For this purpose, emphasis
will be given to the effective monitoring system.
425
• The Environment Protection Fund will be operated effectively. The
pollution control fees and other charges will be collected.
• The necessary research and study will be carried out for the control of
environmental hazard by the outburst of Glacie r Lakes. In this context,
the convention on climate change will be taken as a basis.
n Prohibit the mixing the drains into the rivers for the control of river
pollution (related to strategy 5)
• Fiscal policies and the legal provisions will be improved and
implemented to control and manage the industrial pollution.
• Necessary programs for the protection and sustainable utilization of the
Bagmati, Bishnumati, and Manahara rivers of the Kathmandu Valley,
will be implemented, by coordinating the concerned authorities.
• The system of evaluation of various development policy and programs
from the environmental aspects will be established.
• Concept of integrated development will be emphasized on the basis of
inter-relationship between upper and lower lands.
• Different strategies will be formulated for the brown sector, green sector,
blue sector, etc. of the environment.
• Different work-plans will be prepared for the management of green
waste, amber waste, and red waste and the plans will be implemented.
• The use of renewable and clean energy will be encouraged.
d) The legal and institutional policy reforms and their implementation
arrangements
• The subject matter of environment protection is a crosscutting issue and it
affects all the developmental activities; therefore, while making any
policy arrangements, the process of the strategic environment assessment
will be made strong.
• Arrangement for submitting the proposed laws in the parliament through
the concerned ministry will be carried out by reviewing the different acts
and regulations about the protection of environment and by preparing the
points of amendments to be made in these acts and regulations.
• An Environment Management and Promotion Center will be established
under the Ministry of Population and Environment. In the organizational
structure of the ministry, provision of necessary human resource will be
made. The ministry will be involved in the administrative, managerial,
and the policy related affairs. The Environment Management and
Promotion Center that will be established under the ministry will be
developed as a technical unit related to environment.
• In each ministry, an environmental focal point will be designated to
oversee the environmental aspects with priority.
426
• The monitoring unit of the ministries will be made more responsible to
make the management of environment more effective.
e) Prioritization of programs and projects
• The environmental management programs of the Tenth Plan are listed in
priority order. The priority of programs is based on the process set in
policy action matrix. The summary of the priority order process is shown
in the following table.
Order of Number of Expected growth Normal growth

Priority programs
amount percent amount percent
A (P1) 5 7.23 64.9 6.38 74.9
B (P2) 4 3.65 32.8 1.88 22.1
C (P3) 4 0.26 2.3 0.26 3.0
Total 13 11.14 100.0 8.52 100.0
22.2.5 Expected achievement

• The data showing direct contribution of environmental protection on
GDP cannot be presented. If the environment is protected, the gross
domestic production will increase and the sustainable development can
be achieved. Similarly, if the environment is protected, it will assist in the
poverty alleviation and improved environmental health will also
significantly contribute to the human resource development. Although
one cannot directly see the creation of employment by this sector, this
sector may also help to increase the employment by increasing increase
in activities in the environment sector in the country. The rational
utilization and protection of natural resources that are prevalent in
various sectors can make the regional development sustainable and also
assist to balance the developmental efforts. To carry out the
environmental protection effort at the local level, the local bodies
themselves will be provided with the package programs for the
implementation; therefore, such activities will help to implement the
programs that are explained in the Local Self-governance Act 1998.
Although, the protection of environment is the concern of both men and
women, as the women are actually encouraged in this area; as a result, it
is considered that such policy will assist to achieve the gender equality.
22.2.6 The areas that are especially emphasized.
• Improvement of urban and rural environment
• Institutional reform and development of environment
• Prevention and control of pollution
• Assessment of environmental impact
427
• Preservation of natural and cultural heritages
• Implementation of treaties in environment
22.2.7 The possible obstacles and risks for the implementation and
accomplishment
• While implementing the programs as the active assistance of all the
ministries and other sectors is required, if any one of the authorities do
not become active, there will still be problems to operate the programs.
22.2.8 The achievement monitoring indicators
• The annual monitoring indicators will be developed to monitor the
achievements vis-à-vis the targets and in the process of implementing the
institutional provisions both the Ministerial Level Action Committee
(MDAC) and the National Development Action Committee (NDAC) will
be regularly called for. In addition to this, the monitoring unit of the
ministries will be made active.
22.2.9 The programs and the estimated budget of the Tenth Plan in the
area of environmental management are presented in the
Appendix 22.1
22.2.10 Action plan matrix
• The complete action plan in the form of matrix of the environmental
management sector is presented below. Its detailed framework is given in
Appendix 3:
428
Policy and program Log Frame- Environment*
Sectoral broad objectives: The development programs that are based on the balance of population and environment will be
sustainable.
Information
Intention (sectoral • To internalize the environmental • Implementation of • Population and 1. Protection of Bio- • Provision of law and
objectives management with development international Environment diversity, land order
• To achieve programs, treaties/conventions, Ministry resources , and • Promptness of
sustainable • To mobilize the non-governmental and • Pollution control and • Gazette cultural resources, vehicles owners
development private sector, local authorities, and prevention, • Local bodies 2. Control of pollution • Timely amendment
through the people for the environmental awareness • The number of (municipalities) 3. Appraisal of of laws, acts, and
interrelationship raising campaign. programs that are and various development regulations which
between • To make a work plan by setting priorities appraised for the means of programs from are contradictory to
environment and to implement the treaties and proposals environmental impact communication environmental each other.
development sanctioned at the international level, assessment. • Ministry of Health perspectives
• To set a national standard for air, water
and noise pollution,
• To ban the mixing of drain directly to the
rivers for controlling the river pollution.
* The quantitative goals are based on the 6.2 percent economic growth (details on the appendix 3)
429
Appendix 22.1: Programs and estimated budget
Population management
(Rs. in Crore)
S.N Programs Expected Normal
growth growth
First priority programs/projects
1 Formulation and implementation of long term work plan related to 1.26 1.05
population,
2 The operation of population programs with the involvement of local 3.78 3.15
bodies and non-governmental organizations,
3 National, district, urban, rural, and regional population projection 0.84 0.70
Total 5.88 4.90
Second priority programs/projects
4 The review of population related policies and legal provisions 0.64 0.45
5 The population related behavior change, communication, and 0.64 0.45
advocacy programs
6 Various research and studies related to population 0.64 0.45
7 The implementation of work plan ratified by the international 0.97 0.67
convention of population and development
8 Development of human resources related to population 0.64 0.45
Total 3.55 2.47
Third priority programs for projects (possible projects) 0.17 0.01
9 The strengthening and utilization of population related data bank
10 The coordination, monitoring and evaluation of population related
programs run by different ministries and authorities
11 The record keeping of Nepali at the departure point and that of
foreigners at the arrival point of immigration
12 The preparation of population pressure index
13 Special programs on adolescents
430
Environment
(Rs. in Crore)
S.N. Programs Expected Normal
growth growth
First priority programs/projects
1 The implementation through the decentralized and local 1.70 1.50
2 authorities 1.70 1.50
3 Pollution control and prevention 1.28 1.12
4 Environment impact assessment 1.70 1.50
5 Environmental consciousness raising and promotion 0.85 0.75
Implementation of the treaties 7.23 6.38
Total 64.91 74.91
Percent
6 Second priority programs/projects 0.73 0.38
7 Establishment and dev elopment of urban parks 1.10 0.56
8 Land use and resources protection 0.73 0.38
9 Implementation of the recommendations of parliamentary 1.10 0.56
committees 3.65 1.88
Environmental standard and their monitoring 32.79 22.09
Total 0.26 0.26
Percent 2.29 3.00
10 Third priority programs and projects
11 Percent
12 Miscellaneous
13 Environmental l aw
Environment Fund/Council/Commission
Institutional strengthening
22.3 Natural and man made created disaster management

22.3.1 Background
Because of the geographical and geological structure together with the haphazard
settlement, increasing population, economic backwardness, illiteracy, and lack of
knowledge, the man made disaster is increasing day by day. Due to the natural
disaster like flood and soil erosion, there is the possibility that the infrastructures like
road, electricity and irrigation may break down and the investment may be wasted. In
addition to this, tho usands of people are losing their lives, and many animals,
agricultural land and the harvest is being damaged that required. Large-scale
preparedness to minimize the earthquake and other natural disasters, which in our
country lies in the earthquake prone area.
The main challenges of natural disaster management are the lack of coordination
among the authorities involved in it, adaptation of the controlling type of attempt by
the management instead of preventive measures, the lack of modern technology that
provides pre-information and warning about the possible natural disaster, the lack of
topographic survey of possible disaster areas, and the lack of awareness in the
management of natural disaster. In addition to this, the main problems of natural
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disaster management are the lack of appraisal of natural disaster while selecting
development projects, the lack of operation of rehabilitation and support programs,
and the lack of adherence to the building code while making higher residential
buildings.
a) Objectives
• Contribute substantially to make the public life secure by managing the
natural and man made disaster systematically and effectively and by
making the development and construction related programs in the country
sustainable, reliable, and highly gainful.
b) Strategy
• In Nepal, incidents, such as, increasing problem of natural and man made
disaster, the loss of animals and arable land and crops, and the damage of
earthquake, etc., are creating problems repeatedly. An extensive
preparation before hand is required to minimize the losses by earthquake
and other natural calamities in the earthquake-prone areas. The damage
of lives and wealth can be minimized and economic development can be
promoted by strengthening the natural and man made disaster related
management, by exchanging information among concerned international
organizations related to disaster, and by mapping the high risk areas. The
above activities can also assist to reduce the problems that arise
repeatedly in social sector. In this context, the main strategies of this
sector are as follows.
• While formulating plans and policies on natural and man made disaster
management, emphasis will be given to the use and development of
technologies that lessen harm on natural disaster and environment
• The relief and rescue activities that are provided to the disaster affected
families by the state will be made transparent. Emphasis will be given to
enhance awareness regarding natural disaster management.
• The seismological measurement center and the natural disaster
management center established in the country will be strengthened.
c) Policy and programs
n Use of technologies to minimize natural disaster and environmental impact
In the formulation of plans and policies (related to strategy 1.)
• Formulation and implementation of the sectoral programs based on work
plan will be made effective by formulating a long-term work plan on man
made and natural disaster management and by coordinating the donor
agencies, governmental and non-governmental sectors.
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• Environmental impact study and natural disaster appraisal study will be
made compulsory before implementing the infrastructure building
projects.
• People’s participation will be increased for the water induced disaster
management and watershed management by strengthening the capacity of
authorities that are involved in formulation of policies, work plans and
programs.
• The appropriate reform will be carried out in the existing laws and
organizational structure for disaster management.
n Transparency in rescue and relief activities (related to strategy 2)
• Relief and rescue activities will be operated by involving local bodies,
non-governmental organizations, community organizations, and the
private sector.
• The awareness raising programs will be operated to increase the people’s
participation in the management of flood, landslide, earthquake and other
natural disasters.
• The policy of institutional, remedial and rehabilitative arrangement for
the disaster management from the central level to the lo cal level will be
adopted to eradicate the negative impact on health, wealth and lives of
the victims of various disasters and to make arrangement for the
preparation at the time of disaster and pre and post disaster.
n Strengthening of Seismological Measurement Center and natural disaster
management (related strategies 3)
• The hazard map of earthquake, floods and landslides will be prepared.
• The Natural Disaster Management Department will be developed as a
central coordinating body by emphasizing the institutional strengthening
of Seismological Measurement Center established in the country and the
institutions are involved in natural disaster management.
• Mapping of earthquake risk zones, the regular appraisal of earthquake,
preparation management, and awareness rising of the people living in the
risk areas will be done for reducing the damage that may happen in the
future by evaluating the management of earthquakes happened in the past
and by evaluating the impact of the tragedies.
• Various disaster related areas will be classified by collecting, storing, and
exchanging the information on water induced disaster, river flow
improvement, possible flood, landslide, and flow of sediments by
preparing risk map, in view of glacier lake.
d) Programs
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1. An integrated information system will be developed by coordinating the
national and international organizations working in the area of natural
2. In addition to the inclusion of disaster management in the secondary school
level curriculum, various consciousness-raising programs will be operated for
raising awareness in the natural disaster management.
3. Based on the basic database system and the map of possible areas of flood,
earthquake, landslides, a Central Database System in the center and District
Database Systems in the districts will be gradually established.
4. By preparing the existing institutional capacity inventory for the pre
preparation against disaster, the disaster relief materials will be stored in the
storage centers that will be established in all the five regions.
5. In the process of increasing the capacity of controlling fire, the fire brigade
services in the Kathmandu Valley will be extended and the physical material
necessary for this purpose will be arranged and the fire control service laws
and National Fire Code will be formulated.
6. The tasks, such as, preparation of a geological map of the kingdom through
the Department of Mines and Geology, exploration of new mines, and
identification of the areas which can be affected by natural disasters, e.g.,
flood, landslides, erosion, and earthquakes, preparation of the hazard maps of
such areas, preparation of landslide inventory, and preparation of epicenter
map based on the records of previous earthquakes, will be continued.
7. Collection of information and updating the catalog of earthquake by
recording the earthquakes regularly from 21 Seismic Stations established
under the National Seismological Center and the dessimination of
information of earthquake more than 4 rector scales to the people promptly
will be systematized.
8. The awareness raising programs about the possible damage by the water-
induced disaster will be carried out.
9. In addition to making hazard maps, geo-engineering and geo-environmental
maps of increasing urbanization, unplanned settlement and irrational use of
land of the urban areas, the disaster resistance method will be applied in the
tasks of physical infrastructure development and the natural disaster
management.
10. The programs for disaster affected people, such as, estimating damage of life
and property of the affected people, providing psychological counseling to
affected people, providing relief to the people by giving food, clothes,
medicine, cereals, shelter, etc., will be carried on. In addition to this,
rehabilitation program will be conducted to make the affected people able to
live a normal life.
22.3.3 Expected achievement

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1. Activities of reducing the damages of disasters will be made effective by
expanding relations with the international organizations related to natural and
man made disaster management and by exchanging the information with
them.
2. With the preparation of hazard map, it will be helpful to reduce the damage
of life and property.
3. The rehabilitation program will be promoted and the victims will be benefited
by storing the instant relief materials regionally and by distributing it
according to the needs of the victims of disasters.
22.3.4 Possible risks and obstacles for the implementation and
accomplishment
To obtain the targeted goals, the limited budget can be the main obstacle. If the
concerned authorities cannot supply the needed manpower in time, there can be
problems. In addition to this, one of the problems is the difficulty of collecting the
information due to geographical inaccessibility. As the disaster management activities
come under the inter - sectoral responsibilities, the effective leadership of the
concerned ministry and participation of the sectoral ministries in this regard may also
be the challenges.
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Chapter - 23
Education and Sports
23.1 Background
Education has been accepted as the primary means of a country’s all-round development.
The country can develop only when available resources are used at their optimum by
linking education to the national reality and accepting the concepts of ‘education for all’
and ‘education for development’. Therefore, in order to produce able, productive,
disciplined and socially responsible citizens, it is important to create a w orkforce capable
enough to face the challenges of the 21 st century by improving quality education
accessible to all. Since educated human resource can play an effective role in reducing
poverty, it is essential that the Tenth Plan have the main objective of developing
education as a more effective means of poverty reduction in the context of the priority
given during the Ninth Plan period to carry out the poverty reduction programmes.
Nepal has local and international commitment ‘education for all.’ In order to render
education that is productive, employment oriented and provides practical skills, it is
imperative that the country stresses balanced development of the schools, tec hnical
colleges and universities for higher education. As the women have limited access to
educational opportunities for different reasons, it is necessary to take special steps to
enhance their participation to a greater extent.
The Tenth Plan will be oriented towards assigning the responsibility of school
management to the local level as it has been necessary to make education more
competitive; make role of private sector effective, relevant, and opportune; ensure public
participation in the formulation of appropriate policies and plans, management,
implementation and monitoring to maintain quality; and carry on administrative and
educational decentralizations hand in hand by following the policy of decentralization.
For the mental and physical development of the youth, it has been realized as extremely
necessary that sports programmes that can compete at the international level should be
gradually carried out at the local and school levels.

The progress made as a result of implementing the programmes of education sector
planned in the Ninth Plan is given in Appendix 21.1.
23.2.1 Targets and achievements

Analyzing from the subsectoral perspective, very few pre-primary education centres have
been established. The progress of primary education has been satisfactory in terms of the
net enrolment as compared to the achievements of the past years although its progress is
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not as expected. The gross enrolment percentages of lower secondary and secondary
levels are near the targets but the student enrolment percentage of the higher secondary
level is still low. From the point of view of literacy, progress has not been made as only
55 percent of the population above the age of six years is literate as compared to 70
percent target of the Ninth Plan. The numbers of the people trained in long and short-term
technical education and vocational training appear to approach the targets. A satisfactory
progress is made in the enrolment of girl students as a result of the impact of scholarship
provided under the Women Education Programme. The number of schools conducting
special education programmes has increased and Special Education Scholarship
Programme and Resource Teacher Training Programme have been satisfactory. With
regard to higher education, although the Ninth Plan had the targets of setting up Open
University and additional universities at the regional level, the required infrastructures to
that end were not developed.

Due to the lack of resources and effective management, expansions of the opportunity of
pre-primary education throughout the kingdom and effort of making result-oriented
public participation have not been materialised. As the mobilisation of resources and
means from the local community for non-formal education programme has been difficult,
facilities of post-literacy and continuous education programmes have not been provided
to all of those who have completed the basic literacy course. The primary school age
group children from extremely backward communities have not still been enrolled in
schools. Educational management has not been decentralised for quality improvement of
primary education because of the lack of local participation, low interest among the
guardians for the educational achievement of the children, and absence of dynamic roles
expected from the social, local and concerned bodies/institutions.
Although the curricula have been revised from time to time, they have not been made
timely as expected in line with the prevailing social, business, economic and political
environments. It has been twelve years since Higher Secondary Education Act was made
effective, but the challenge of making education of this level accessible to all is still there.
This level has not been adopted as the final level of school education system. High cost,
lack of effective steps towards sustainable development, and difficulty in preparing
human resource as per the need of local levels are the main problems of this sector.
From regional, caste/racial, gender and social perspectives, expansion of the opportunity
of higher education has been a major challenge. Producing the workforce to support the
country’s economy through higher technical and vocational education and making quality
education available by granting autonomy to the educational institutions opportunity of
the time and context are yet to be realised. The cost-benefit principle has not yet been
implemented.
Development and extension of programmes to rescue the youth from crimes and
addiction effectively, to mobilise them in development programmes, and to create
awareness by involving the youth in sports from the school level have not been taking
place.
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23.3 Long-term concept
Continuing the Ninth Plan’s long-term vision of providing access of education to the
people of each class and level, raising the quality of education, involving the local bodies
in the process of educational development, ensuring gender equality, making education
employment-oriented by producing lower -, medium-, and high-level workforces and
developing the educational institutions as ‘centres for excellence’ by making higher
education scientific, the Tenth Plan adopts the following long-term approaches.
• Considering the spirit of the Local Self-governance Act based on the concept of
decentralization, empower the local elected bodies and communities to assign
them the responsibility of educational plan and management as far as possible
and allot the responsibility of school operation to the management committees
comprising, among others, the teachers and guardians and provide necessary
services and support to this end.
• Accepting grades 1 to 12 as school education, strengthen the curriculum,
examination system and financial management accordingly.
• In order to meet the country’s need of the human resource, prepare the
programmes of formal, non-formal, technical, and vocational education and
implement the useful and appropriate education system gradually; and emphasise
the use of technology.
• Higher education will be made effective and modern so as to provide excellent
specialists and academic human resources to various disciplines.
• With the aim of discouraging different kinds of addictions and other distortions,
mobilize the youth from school level and emphasize on their intellectual, social
and emotional developments and the civic education.
• In view of the condition of the women, dalits (oppressed, lowest-caste people),
people with disability and backward communities, carry out special programmes
to increase their access to quality education.
23.4 The Tenth Plan

The main objectives, policies and programmes of the Tenth Plan in view of the long-term
concept of educational sector and the progress and challenges faced during the Ninth Plan
period will be as follows:-
a) Objectives
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1. Help raise the living standards, especially of the backward communities and
women by carrying out programmes of literacy, post-literacy, income-generating
and valuable non-formal education.
2. Develop and expand quality education according to the need of the country’s
development and make quality primary education easily accessible.
3. Supply basic and medium-level skilled, technical human resource required by the
country.
4. Utilize education as an effective means of economic and social development to
eradicate poverty by way of developing human resource that can compete at the
international level for all-round development of the country and support the
national economy.
5. Give responsibilities to the institutions of all levels of education by way of
making them capable to take leadership on the basis of the definitions and norms
of quality education developed and refined, and, for this, strengthen the systems
of supervision, monitoring and evaluation as well as develop infrastructure in
order to make the teaching license compulsory to all levels and specify
intermediate level as the minimum qualification plus training for the primary
school teachers.
6. In the context of the principle of ‘Education for All’, make special provisions to
increase the access of women and people with disability to the opportunities of
education.
7. Mobilize the youth and develop sports to prepare able, strong and disciplined
human resource required in the country.
b) Main quantitative goals of different levels and in aggregate
Non -formal education
In an attempt to achieve the goal of literacy determined by the Plan, make 1866 thousand
illiterate people, mainly women, lowest caste, backward indigenous/ethnic people, literate
and provide post-literacy level education to 933 thousand newly literate persons out of
which impart skill-oriented training to 93300 individuals. Towards non-formal education,
provide basic primary education to 200 thousand children and establish 205 community
study centres under local elected body’s responsibility for piloting continuous education.
Pre-primary education
Increase the number of the Early Childhood Development Centres to 13000 so that 40
percent of the students enrolled in class 1 come from the Centres or pre-primary classes;
provide orientation training to all head teachers and teachers of the primary schools;
provide parental education to 266 thousand parents.
Primary education
Raise net enrolment of primary level to 90 percent; improve the ratio of female teacher to
30 percent; provide nutritious food to 450 thousand children every year; provide
scholarships to the girls and children from disadvantaged communities (dalits, backward
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indigenous communities, persons with disability and economically backward).
Secondary education
Raise the gross enrolment to 65 percent at the lower-secondary level and 45 percent at the
secondary level; provide scholarship to 50,000 students where the girls, backward
indigenous and lowest caste students will get the priority.
Higher Secondary education
Develop an integrated curriculum for grades 1-12; establish at least one community
higher secondary school in each constituency to add up to 205 in which education of
science will get priority, and manage at least one higher secondary school to teach
vocational subject in each district.
Technical education and vocational training
Impart regular (full time) training to 7100 persons and short-term training to 23555
persons by establishing two additional technical institutions and two poly-technical
colleges; and on the basis of feasibility studies, conduct Annex Programmes with
additional classes to provide secondary level skill-oriented education in 75 community
schools one in each district.
Higher education
Develop Open University and universities at the regional level to raise the gross
enrolment rate to 6 percent and provide scholarships and loans to the poor and intelligent
students. Since the expansion of the Tribhuvan University has been too large affecting its
efficiency and progress, break it up into regional universities to develop qualitative,
participatory and competitive higher education in different disciplines. In this context,
develop Pokhara University and Poorbanchal University in the form of regional
universities. Develop special mechanism to maintain quality by coordinating these
regional universities.
Youth and sports
In addition to train one teacher for sports in each secondary school, mobilise 3000 youth
volunteers and establish 75 Youth and Sports Development Centres with the involvement
of community higher secondary schools. Besides, conduct various creative extra-
curricular activities including scout. Emphasise on the equal participation of girl students
in these programmes.
c) Strategies
While conscious, capable and well-informed citizens are the foundation of social and
economic development; education is the main factor behind these all. Development and
opportunity of education is also the strong means to remove social disparit ies. Since the
educated and skilled citizens can attain significant achievements, these aspects (education
and skills) are considered as the main indicators of human development. In the country
like ours where low rate of literacy and increasing unemployment exist side by side,
440
emphasis on promoting literacy and technical education is thought to be effective for
economic development. An emphasis on female education helps improve gender equity.
Similarly, for the speedy development of the country, development of higher education
helps develop human resource capable to lead in various subject-wise disciplines. As the
number of people requiring basic education is large and their concentration is in the poor
communities, high priority on literacy programme, primary education, non-formal and
technical education can support the Plan’s objectives of economic and social development
and poverty eradication; so these should be carried on as targeted programmes aimed at
the backward indigenous communities and specific groups. In this regard, the main
strategies of this sector are as follows:-
§ Strategy related to the first objective
1. Increase literacy by expanding non-formal educational programmes and make
non-formal education useful for life.
§ Strategies related to the second objective
2. Emphasize on public participation from local level for the overall management
of school education for which the government plays strong role to facilitate and
promote quality, regulate and provide service and support in consonance with
the concept of decentralisation.
3. Emphasize on pre-primary education, and also on the expansion and
development of quality primary education to fulfil the national commitment of
‘Education for All’.
§ Strategies related to the third objective
• Increase the opportunities by making the programmes of technical education
and vocational training effective to prepare skilled human resource.
• Increase the access of the rising number of primary school graduates to the
secondary level education and develop secondary education so as to make
the higher secondary level as the last destination of the school level
education.
§ Strategy related to the fourth objective
• By adopting the principle of cost recovery in higher education, emphasise on
its opportunity, quality and diversification.
§ Strategy related to the fifth objective
• Enhance the quality of education at all levels and make appropriate
arrangement for teachers’ training.
§ Strategies related to the sixth objective
• In view of the condition of women, people from the lowest caste (dalits) and
backward communities in education, conduct additional programmes to
increase their access to education.
• To carry out the concept of ‘Education for All’, develop inclusive and
integrated education system in line with the concept of special needs
education for the groups requiring it (including persons with all kinds of
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disabilities).
§ Strategy related to the seventh objective
• Mobilize the youth in community development activities by emphasizing on
the sports development programmes from the local level.
d) Policies and action plans
§ Literacy and non-formal education (related to the first strategy)
• Increase the literacy rate by carrying out adult literacy and out of school
programs with focus on the target communities especially the women,
backward ethnic communities and the lowest caste (dalit) groups; and
conduct programmes of literacy, post-literacy and continual education by
way of coordinating with other developmental activities with the
involvement of the government, non-governmental organizations and local
elected bodies in line with the objective of providing useful education.
§ Education and decentralization
• Ensure access of education in all levels of programmes to the regions, races,
gender and backward communities based on their socio-economic
conditions.
• Develop an appropriate framework to make scholarships provided by the
institutional schools systematic and transparent to the benefit of genuinely
poor and intelligent students.
• By clarifying the roles of local elected bodies to decentralize education
system, implement the programmes related to school improvement plans and
district education plans with the spirit of devolving the rights and
responsibilities of school education to local elected bodies and giving
impetus to decentralization as well as to empowering local communities and
guardians. Select and appoint the teachers at the local level.
§ Development of pre-primary and primary education (related to the third
strategy)
• Corresponding to the declared policy and international commitment of
providing education to all by 2015 AD of His Majesty’s Government,
gradually implement the programme of compulsory primary education and
improve institutional, managerial and physical infrastructure accordingly.
• Establish the Early Childhood Development Centres with the participation of
local elected bodies by linking it with the parental awareness programmes
and encourage to conduct one-year pre-primary classes in community
schools through local resources.
• Encourage the programmes of teaching in the mother tongues to increase
participation of linguistic groups of different ethnic communities in
education.
§ Development of technical and vocational education (related to the fourth
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strategy)
• Expand Annex Programmes to increase the opportunities of technical
education and vocational training by mobilizing the participation of local
elected bodies and private sector.
§ Development of secondary education (related to the fifth strategy)
• By accepting higher education level as the last phase of school education,
make institutional arrangements and improve the structure of school
education accordingly.
• By phasing out the intermediate (certificate) level gradually from the
Tribhuvan University, make appropriate arrangements to incorporate it into
the higher secondary level.
§ Higher education (related to the sixth strategy)
• His Majesty’s Government will adopt the principle of cost recovery in the
investment of educational sector, implement the system of reducing the share
of the government as the level of education increases and implement the
system of block grant instead of existing grant system based on the number
of teachers.
• A policy of accrediting the affiliated educational institutions of the
Tribhuvan University to other regional universities will be adopted to
develop the institutional structure of higher education at the regional level in
a realistic way. For this, institutional development will be made on cost
sharing basis with concerned stakeholders and communities.
• Encourage programmes that mobilize the post-graduate students in
community development services.
§ Development of the quality of education (related to the seventh strategy)
• Enforce compulsory training and teaching licence system to maintain quality
in education; and utilize distant education as well in all training programmes
of education and involve all training institutes to increase access to training.
• Make the systems of examination, monitoring and supervision effective
based on indicators representing the objective standards by defining the
quality of education at all levels. Until this happens, strengthen the
examination system that has been accepted as the indicator to measure the
quality of education and of teachers’ performance and develop the trend of
utilizing the results of examinations as the powerful means to measure the
quality of education and teachers’ performance.
• Assist in expanding education suitable to the modern world by utilising
computer literacy at all levels of education; and teach the subjects related to
information and communication technology in the schools according to the
national policy of science and technology.
• Along with encouraging the private sector, develop an effective accreditation
system by bringing all levels of education within the regulatory framework
in order to enhance competition in education.
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• Encourage educational institutions of different levels to set up and run
libraries.
§ Women education (related to the eighth strategy)
• Make provision of scholarship in order to increase the access of women, the
lowest-caste (dalit) and disadvantaged communities to education.
• Implement ‘gender auditing’ system by developing specific sensitive
indicators in all aspects of holistic education such as study, teaching,
training, policy formulation and management.
§ Education for the persons with disability (related to the ninth strategy)
• Extend the courses of primary to higher education by integrating the
programmes of special education for persons with all kinds of disabilities.
§ Sports development (related to the tenth strategy)
• Develop players who can compete at local as well as international levels by
incorporating the programmes of sports, extra curricular activities and youth
development in the educational programmes of school to higher education.
• Emphasise on extracurricular activities, scouting from school level in order
to support the development of sports.
e) Programmes
• Develop the National Non-formal Education Centre as an institution to
formulate policies, provide technical service, and conduct monitoring and
evaluation; and assign responsibilities to the non-governmental organisations
and the local elected bodies by clarifying their roles in the programmes of
eradicating illiteracy.
• Allow to set up new school on the basis of school mapping.
• Take steps to gradually make free primary education compulsory, and, while
doing so; arrange scholarship for the children of backward communities
(lowest castes or dalits, indigenous groups, women, persons with disability
and children of economically backward communities) with priority.
• Develop the courses of study in a way to incorporate the concepts of gender
awareness and provide useful skills from primary level onwards; teach
English from class 1 on the basis of capability of the schools; and implement
the Continuous Assessment System up to the fifth class on the basis of pilot
and experience.
• Establish at least one community higher secondary school in each election
constituency; and encourage conducting the course of science and vocational
subjects there.
• Administer the present examin ation system of grade XI at the school level
and retain final examination of grade XII at the national level.
• Extend at least one Annex Programme in each district based on the
effectiveness and success of the pilot.
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• Strengthen scholarship programs to facilitate the access of women, backward
indigenous and lowest caste communities and persons with disability to
higher education.
• Encourage the non-governmental and private sectors to establish educational
institutions for higher education.
• Establish and operate Open University.
• Prepare and implement total quality educational development programme in
order to develop higher education to the level of international standard.
• Enable the University Grants Commission to evaluate educational
institutions, set their equivalence and accredit them by setting up an
Assessment and Accreditation Council.
• Convert the existing Institute of Agriculture and Veterinary Science into a
university under the concept of deemed university; and develop required
infrastructure to set up university in Mid Western and Far Western regions
for increasing access to higher education.
• Encourage non-governmental organizations to conduct preventive and
curative programmes to liberate the youth from crimes and addictions.
• Involve the youth as volunteers in different social service sectors including
education, health, and sports.
• In order to provide managerial and trainers’ training, develop the existing
National Sports Council as an apex body; and make implementation
arrangements by classifying the levels (local, national and international) of
competition.
23.5 Improvements in policies, laws and institutions and their
implementation arrangements policy improvements
The following policy improvements will be made to implement the strategies and action
plans in order to achieve the objectives and goals of the Tenth Plan:-
• Teach English from grade1 and give continuity to the continuous assessment
system.
• Provide free education up to the secondary level to the lowest caste (dalit),
backward indigenous people, women and persons with disability below the
poverty line.
• Arrange an appropriate mechanism to effectively implement the system of
providing 5 percent scholarship to the targeted communities by the schools run
by the private sector.
• Consider higher secondary level as the final stage of school education, make
institutional and managerial improvements and formulate a bill/act for a separate
board accordingly.
• Manage to conduct higher education on the principle of cost recovery; and
approve new universities to set up under the concept of deemed university.
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• Formulate and implement the regulatory framework in order to systematize the
management of institutional schools.
• Implement the systems of effective monitoring, evaluation and supervision by
defining and determining the standards of quality education.
• Implement open and distance education systems in order to make easy access of
modern education to all by using educational technologies.
Improvement of laws
In order to integrate higher secondary education into the management of school
education, a Unified School Education Act will be formulated by amending related acts
and regulations. As different universities are set up and run as per their own acts, various
problems have been noticed in their performances, a single umbrella act will be made
with a view to guide the establishment of new universities and systematize the
accreditation from national and foreign universities.
Institutional improvement
The Ministry of Education and Sports will be developed as an effective institution to
formulate policies and carry out monitoring and evaluation based on objective standards.
The Department of Education will be entrusted with the responsibility of managing
school education (classes 1-12). By making necessary changes in the organizational
structure of other central institutions at present (Higher Secondary Education Council,
National Centre for Educational Development, Distance Education Centre, Curriculum
Development Centre, Office of the Controller of Examination, Secondary Education
Development Centre, Non-formal Education Centre, etc.) as required, these institutions
will be retained to extend technical services. The regional directorates will be assigned
with the responsibilities of plan formulation, monitoring, evaluation and examination. The
concept of multi-board system will be adopted to conduct examinations. The District
Education Offices will be held fully responsible in implementing education programmes.
School Management Committees will be empowered with a view to undertake the
responsibility of school management at the local level.
The University Grants Commission will function as an institution to evaluate the
managerial and qualitative progress of the universities and to provide grants by making
unambiguous bases/formula for the same.
Implementation arrangement
Gaining momentum to the process of formulation of national education policies, their
modifications and reappraisals, a national level permanent committee will be set up to
coordinate the education of all levels and it will be institutionalized and strengthened.
Priority of the programmes and projects

Summary of programmes and budgets of education and sports sector is given in the
following priority order. Detailed programmes and estimated budgets are presented in the
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Appendix 23.3.
NRs. In million
Priority Number of Normal case growth rate Alternative case growth rate
order programmes
P1 7 14464.0 76.9 12397.7 86.4

P2 8 4296.5 22.8 1918.7 13.4
P3 11 39.6 0.3 39.6 0.2
Total 26 18800.1 100 14356 100
The main prioritized development programmes to be conducted during the Tenth Plan
period are as follows: -
a) Education
The present programme of Basic and Primary Education will be terminated and
programme of next phase will start in FY 2003/4. From the first year of the Plan, the
Secondary Education Support Program will be started by coordinating lower secondary,
secondary and higher secondary education. Non-formal education programme will be
gradually expanded. The technical and vocational education will be included in the
secondary level education, its implementation will be demand-based and the programmes
conducted on pilot will be expanded in consideration of their results. In this way, the
priority order in education will be as follows:
1. Basic and primary education
2. Non-formal education
3. Secondary education
4. Technical and vocational education
5. Pre-primary / Early childhood development
6. Higher secondary education
7. Higher education
b) Youth and sports
The policy of preparing the youth as capable citizens to competently contribute to the
advancement of the country and to fight against poverty, backwardness and distortions
will be adopted. Emphasis will be given to increase the number of disciplined players
who can enhance the dignity of the country by developing and expanding sports. A
coordinated effort will be made by coordinating the government, non-government and
private sectors as well as loc al bodies to carry out activities to encourage institutions
involved in the development of sports, support the livelihood of the players who win
medals and uphold the respect of the country at the international level, and expand sports
as an inalienable part of livelihood down to the local level. In this regard, priority will be
given to the development of sports that are suitable to the geo zones of the country and
447
are economically viable. High Altitude Training Centre, Sports Academy, and highly
potential sports and competition like cricket will be promoted.
23.6 Expected achievement

It is expected that the education programs of the Tenth Plan will contribute to growth in
gross domestic production, poverty eradication and human development, creation of
additional employment, balanced development, implementation of Local Self-governance
Act and gender equity.
23.6.1 Growth in gross domestic production

As functional literacy programmes make illiterate adults literate and also impart skills,
production will increase according to the needs of rural areas. In view of the high rate of
return as compared to the investment in primary education, it is certain that the extension
of primary education will result in the substantial growth of the gross domestic
production. Quality secondary education helps to increase productivity in agriculture and
rural economic activities. Vocational education under Annex Programme provides
medium-level workforce for local needs and, hence, helps increase the local economic
activities. As a result of extension of higher secondary education and its access to rural
level, a knowledge-based society will be created to help raise productivity. The
programme to utilize the information and communication technology from secondary
level will eventually make the country competitive at the international level and direct it
towards economic development.
23.6.2 Contribution to poverty eradication and human development

The programmes such as literacy activities and ‘Education for All’ will contribute to
human development from educational perspective. The provision of providing free
education and scholarship to the persons with disability, women, the lowest caste (dalit)
and backward indigenous communities below poverty line will help raise the level of
education of all backward communities living in every corner of the country. In addition
to these arrangements, the employment-oriented vocational education will help eradicate
poverty directly within 5 years to come.
23.6.3 Employment generation and other contribution/achievement

General quality education helps obtain employment. The use of vocational and technical
education and technology of information and communication directly helps produce
skilled workforce; it contributes significantly to supply human resource required in
various professions of the country. The policy of involving the youth in various voluntary
and other development programmes helps increase employment.
23.6.4 Achievements in regional development and balance
448
Provisions of establishing new schools on the basis of school mapping, setting up of new
educational institutions based on district and constituency, and opening new universities
on regional basis will significantly contribute to achieve the objective of regional balance
and development.
23.6.5 Support to decentralization in accordance with the Local Self-

governance Act
As the Tenth Plan aims to promote community-based management of schools, the system
of managing, monitoring and evaluating education at the local level will be developed
during the Plan period. The programmes of carrying out activities of plan formulation,
implementation, supervision and monitoring of such programmes as expanding Early
Childhood Development Centres to secondary education through the local elected bodies
will strengthen the decentralization program in line with the Local Self-governance Act,
1998. As His Majesty’s Government will start the system of block grant and the role of
guardians will be made important in establishing school and formulating School
Management Committee, the foundation of real decentralisation will be created.
23.6.6 Gender equity through program and policy responses

Assuming women’s equal participation in literacy to higher education, the objective of
formulating substantive action plan on the basis of gender audit will help attain the goal of
gender equity in this plan period.
23.7 Potential risks

• Continuation of block grants to the community schools (otherwise difficult to run
pre-primary classes).
• Availability of access to opportunity of school level training for ten months (this
programme is difficult to continue).
• Provision of strong coordinating mechanism to bring the private sector into the
framework of regularity (this mechanism may lack).
• Coordination between the higher education teaching institutes and research
centres (this is very difficult).
• Clear policy of block grant of His Majesty’s Government (difficult to release
grants in time) and condition of accepting responsibility by the communities (may
not accept).
• Effective implementation system of incentives programme as the children outside
schools belong to the hard-core groups (if faced obstacles, difficulty in attaining
objective).
• Campaign for the importance of literacy to the target communities (or else,
449
difficult to raise the literacy percentage).
• The role of local elected bodies to conduct programmes in backward areas
(difficult to conduct literacy programmes in the absence of legal provisions).
• Amendment in the act of the Higher Secondary Education Council to integrate the
management of school education (difficult if not amended).
• Political commitment and understanding and coordination between the
universities and the Higher Secondary Education Council (absence of this may
make it difficult to integrate all programmes of intermediate/certificate level into
the higher secondary education).
• Institutional arrangement to extend the access of technical training to targeted
communities and areas.
• Coordination between the Ministry of Education and Sports and the University
Grants Commission with regards to various universities established under separate
acts.
• Mechanism to coordinate different institutions related to sports (otherwise difficult
to make the programmes effective).
Approaches to policy, legal and institutional reforms are adopted in order to minimize the
risks. As the Tenth Plan aims to accelerate economic growth through the main objective
of poverty eradication, it is expected that the external risks of the programmes of
education sector will be very few. Moreover, the policies of His Majesty’s Government to
increase investment in social development sector and that of special emphasis on
educational development will help reduce external risks and attain expected
achievements.
450
Policy Action Matrix: Ministry of Education and Sports*
sustainable manner.
Comprehensive Sectoral objective: Increase human resource development and its productivity sustainably.
Information
Purpose • Increase literacy by expanding non-formal educational programmes • Percent of children • School 1. Encourage pre-primary • Lack of awareness
(Sectoral and make non-formal education useful. of 6-14 years who enrolment and education. of importance and
objective): • Emphasize on public participation of local level for the overall do not go to school attendance 2. Universalise the quality of readiness about
Make management of school education for which the government plays a • Literacy percent of register primary education. education among
sustainable strong role to facilitate, promote quality, regulate and provide service women and men • Trimester and 3. Provide programmes of local communities
growth in and support in line with the concept of decentralisation. 70 % (6 yrs +) annual progress functional literacy and and guardians.
access to, • By calling attention to pre-primary education, emphasize on - Female literacy reports of District alternative, non-formal • Lack of awareness
and quality expansion and development of quality primary education to fulfil the (6 yrs+) 67% Education Office education to the adults and readiness
and national commitment of ‘Education for All’. - Adult above 15 and Min of and children deprived of towards education
management • Increase the opportunities by making the programmes of technical years – 63 % Education & primary school. among the adults.
capacity of education and vocational training effective for the production of - Female literacy Sports 4. Raise the quality of, and • Absence of
education. skilled human resource. (15 yrs+) – • Reports of access to, the continuity of
• Increase the access for the transition of rising number of students 55% special surveys secondary education. priority to education
passed from primary level to the secondary education and develop - Gender parity and evaluation 5. Provide vocational sector under the
the secondary education to make the higher secondary level as the index – 0.8% • Field supervision training and technical national social
last destination of the school level education. • School enrolment education. service.
• By adopting the principle of cost recovery in higher education, ratio of girls and 6. Increase the quality of,
emphasise on its opportunity, quality and diversification. boys and dropout and access to, higher
• Enhance the quality of education at all levels and make appropriate rate secondary education.
arrangement for teachers’ training. • Qualitative and 7. Raise the quality and
• In view of the conditions of women, people from the lowest caste objective bases of diversification of, and
(dalits) and backward communities, conduct additional educational the teachers’ access to, higher
promotion education.
programmes to increase their access to quality education. 8. Mobilize the youth and
• To carry out the concept of ‘Education for All’, develop inclusive and • Number of school
managed by the raise the diversification,
integrated education system in line with the concept of special needs
education for the groups requiring it including the persons with communities. quality of, and access
to, sports.
disa bility.
• Mobilize the youth in community development programmes by
emphasizing on the sports development programmes from the local
level.
451
Appendix 23.1: The Ninth Plan’s progress against its targets
S. No. Particulars of programmes Targets Progress
1 Pre-primary Education Centre 10,000 2,915*
2 Primary education
a) Net enrolment rate (NER) 90 80.4**
b) Additional primary schools 3,000 2,643**
c) Additional primary teachers 15,000 6,415**
d) No. of trained teachers 50,000
e) Additional female teachers 2,000
f) School renovation 10,000
3 Lower secondary and secondary education
a) Gross enrolment rate
- Lower secondary level 55 58
- Secondary level 45 37
b) Additional lower secondary schools 1,500 1,227**
Additional lower secondary teachers 6,000 4,734**
Trained teachers (one month training) 10,000 9057
c) Additional secondary school 2,000 1,028**
Additional high school teachers 8,000 3,004**
Trained teachers (one month training) 5,000 7600
4 Higher secondary school
a) No. of affiliated schools 758 775
b) Gross enrolment rate 60
c) No. of trained teachers 2,000
5 Non-formal education
a) Literacy rate (6 yrs +) 70 55.5##
b) No. of participation
No. of adults and out of school children 40,00,000
Post-literacy number 22,00,000
6 Technical education
a) Regular training (long training) 4,995 3537
b) Short-term training 20,000 16366
7 Higher Education
a) Total Gross enrolment rate – 4%
8 Special education
a) No. source classes 228
b) Special education school 33
9 Incentives programme
a) Primary school scholarship 1,62,404
b) Local scholarship 58,041
c) Campus/college scholarship 2,376
d) Upgrading scholarship 1,804
e) No. of students benefited by nutritious food program 2,50,000 2,14,000
10 Youth
a) Youth mobilization 20,000
b) Youth self-employment 10,000
c) Youth personality development 20,000 326
11 Sports
a) Trained players 15,00,000 15,00,000
b) Construction of sports complex 6 5
* Community -based Early Childhood Development Centers only
** Based on the data of 2000 AD with 1997 AD as the base year
## Estimated (by the end of the Ninth Plan)
452
Appendix 23.2 Main sectoral/subsectoral quantative targets of the
Tenth Plan
End of End of 10th Plan
S. 9th
Indicators Expected
No. Low growth
Plan* growth
1 Literacy
a) Literacy rate (6 yrs +) 55.5* 70 68
b) Literacy rate (15 yrs +) 49.2* 63 61
c) Literacy gender parity index 0.6 0.8 0.75
2 Pre-primary education (including Ear ly Childhood Development/
ECD)
a) Gross enrolment rate 15 32 30
3 Primary level
a) Enrolment rate with pre-primary education 21 40 37
b) Gross enrolment rate 118 110 111
c) Net enrolment rate 82 90 89
d) Girls' enrolment percent 45 47 46
e) Trained teacher - including partially trained (%) 52 100 100
f) Female teacher (%) 26 30 30
4 Lower secondary level
b) Girls' percentage 42 45 44
c) Trained teachers - partially trained also (%) 100 100
5 Secondary level
b) Girls' percentage 41 45 43
c) Trained teachers - partially trained also (%) 100 100
6 Higher secondary level
a) Gross enrolment rate (including proficiency certificate) 23 22
b) No. of higher secondary schools (govt. level) 205 205
7 Technical and vocational education
a) Regular training 7100
b) Short-term training 23,555
c) Conduct Annex Programme 15 75
d) Skill certification – 4,000
8 Higher educati on
a) Gross enrolment rate 4.5 6 5.75
b) Open university 1 1
c) Phasing out of proficiency certificate level all
9 Youth and sports
a) Youth mobilization for community development 926 3,000 2800
b) Youth rehabilitation – 1,000 800
c) Youth and Sports Development Centre 70 70
d) National level prize 1750 1750
* Based on Population Census, 2001 and estimated for the end of the Ninth Plan.
453
Appendix 23.3: Programmes and estimated budget
NRs. in 10 million
General Alternative
S.
Names of projects (central and district level) (expected) (low)
No. growth growth
Programmes/projects receiving first priority
1 Basic and primary education 1178.34 1010.01
2 Dalit Student Scholarship Programme 13.64 11.69
3 Women education 84.37 72.32
4 Teachers' training project 84.00 72.00
Technical education annex programme/ Council for Technical Education
5 48.33 41.43
and Vocational Training
6 Primary girl students scholarship programme 12.92 11.08
7 Non-formal education and literacy campaign 24.79 21.25
Total 1446.40 1239.77
Percent 76.94 86.36
Programmes/projects receiving second priority
1 Early childhood development programme 0 0
2 Free textbooks 67.84 30.29
3 Secondary Education Project 190.59 85.11
4 Public school quality improvement (including computer education) 0 0
5 Primary school nutritious food 168.69 75.33
6 Population education 1.88 0.84
7 Higher secondary education project 0.32 0.14
8 Martyrs' children scholarship programme 0.32 0.14
Total 429.65 191.87
Percent 22.85 13.37
Programmes/projects receiving third priority (probable projects) 3.96 3.96
Percent 0.21 0.28
1 University Grants Commission
2 Tribhuvan University
3 Mahendra Sanskrit University
4 Poorbanchal University
5 Pokhara University
6 Open University
7 National Sports Council
8 Sports development programme
9 Youth Activities Programme
10 Stadium construction (Eastern and Far Western Development Region)
11 Budhanilakantha School
Grand total 1880.01 1435.6
454
Chapter - 24
Health
24.1 Background
Health service is accepted as a very important area of human right. As a result of
planned development, health sector has improved substantially. However, from the
point of view of health indicators, satisfactory progress has not been made yet as
compared with other deve loping countries. Especially remote and rural communities
and the people there who are devoid of health services have not been benefited from
the essential health services. Therefore, the government and non-government
mechanism involved in the development of the health sector needs reforms in
economic and human resource management to make further improvements in the area
of programme implementation process as well. In this context, through gender
awareness, decentralization, and effective and skilful management, the health sector
of government, non-government and the private sectors as well should be extensively
mobilized.
The second twenty-year Long-term Health Plan is prepared for the objective of
making essential health services as well as the other specialized services universal.
The main objective of the development of health service is to support poverty
eradication by way of providing high-quality health services to all and developing
competent human resource on the basis of medium -term expenditure framework with
the view of harmonising the objectives, goals, policies and budgets envisaged by the
medium -term strategic plan and the periodic plan to implement the Long-term Plan.

The Ninth Plan had the objective of supporting poverty eradication by improving the
health status of the people with the help of preventive, promotional, curative and
rehabilitative means of health services. The Plan had the polices of improving the
health status of the people and enhancing the access of integrated health services in
addition to providing the essential health services to the local level, extending
specialist health services, making modern and traditional curative services effective,
developing and expanding reproductive health services, modernizing medico legal
services, increasing the effectiveness of sectoral plan management. Additionally, for
the quality services and human resource development, the policies as mobilization of
private and non-government sectors; improvement in cost-effectiveness of
institutional health services based on public requirements; development of policies
suitable to solve the problems related to environment of professional health;
promotion of people’s participation, inter -regional coordination and decentralization
in order to make the health service common to all and sustainable; and exploration of
457
alternatives to health care financing were also adopted. The achievements made in the
health sector during the Ninth Plan period can be analyzed as follows:
• During the Ninth Plan period, the progress of different health sectors was
satisfactory. As compared to the target, 70% of essential health services were
made available.
• During the Ninth Plan period, in the context of policy reforms, Medium-term
Strategic Plan of four subjects related to essential health service,
decentralization in health sector, participation of the government, non-
government and private sectors and sectoral management was accepted in
which tw enty programmes were included as essential health services.
Moreover, policies and strat egies related to national reproductive health and
safe motherhood have been prepared. Reproductive health clinical protocol is
also prepared. Similarly, the national health financial policy is also under
implementation after its formulation. Besides this, list of essential medicines
(for sub-health post to the district hospitals) is prepared and the Human
Organ Transplantation Act, 1998 and a draft of Antibiotic Policy, 1997 (in
order to control, prevent and utilize the antibiotics) have been prepared.
• During the Ninth Plan period, substantial improvements have been made in
the indicators of health status as shown in Table 24.1. Significant
achievements have been made in immunization; control of tuberculosis,
leprosy; effective services for malaria, kala-azar (typhus); and control of
diarrhoea. In the same way, the average life expectancy at birth has reached
to 61.9 years. The progresses in the areas of infant and child mortality rates
remained a little lower than what was targeted. The status of maternal
mortality is not available after the survey of 1996 and a detailed health survey
including maternal mortality is already underway to be completed by mid-
2003; and childbirth service by the trained health workers has reached to 14.3
percent. The progress of the users of the means of family planning is found to
exceed the target.
24.2.1 Targets and progress of the Ninth Plan

Table 24.1
458
S. No. Health indicators Targets of Progress
9th Plan
1 Availability of essential health services (percent) 70 70
2 Obstetric service by the trained health workers (percent) 50 14.3∗∗
3 Contraceptive prevalence rate (percent) 36.6 39.3
4 Total fertility rate (15-49 years) 4.2 4.1
5 Crude birth rate (per 1000) 33.1 34
6 Infant mortality (per 1000) 61.5 64.2
7 Child mortality (under 5 yrs, per 1000) 102.3 91
8 Crude mortality rate (per 1000) 9.6 10
9 Life expectancy (yrs) 61.9 61.9
10 Total hospital beds (government) 5023
11 Primary health centres 160∗∗∗
12 Health posts 710
13 Sub-health posts 3167
14 Female community health workers (community) 48549
15 Hospitals (including district, zonal, regional, sub-regional, 85∗
ayurvedic, central)
∗ Health workers from the Ministr y of Health, HMG and under it only.
** The childbirth services provided by the local birth attendants (sudenis) are not included.
∗∗∗ The total Primary Health Centres number 205.

Problems
• Although institutional development of health services has taken place to the
local community level, satisfactory improvements in human resource
development and access to the services have not been made. Similarly,
because of the geographical difficulties, supplies of workforce, medicines,
tools and equipments have not been regular.
• Effective monitoring and evaluation of plan formulation, implementation and
the private health institutions' access to and quality of health services have
not been carried out.
• Maintenance of regularity in financial management sector and effective
implementation of all available resources according to demand and supply
have not been made on the basis of cost-effectiveness and economy.
• Local communities have not been mobilized satisfactorily in the health
sector. On the one hand, there is a wide mismatch in the availability of
services to the general people and on the other hand, there still lacks
capability among people to manage to pay for the extended health services
and the expenditures as a result of lack of improvements in economic
condition.
459
• Even if the Health Service Act has been implemented, effective utilization of
the workforce has not been made as a result of lack of appropriate
management and incentives. Therefore, the tendency of concentration of the
health workers in the urban areas and their absence in the rural areas still
persists.
Challenges
• It is still very difficult to deliver essential health services proportionately to
the targeted communities in view of geographical inaccessibility, pressure of
large population, lack of very basic health-related information, lack of
education and bac kwardness.
• It seems difficult to materialize the concept of happy family due to the lack of
adequate provision of family planning services.
• Lack of effective services to the pregnant women, childbirth at home by
many and prevalence of respiratory diseases as well as malnutrition are the
factors of the deaths of the mothers and children to pose serious challenge.
• Due to the absence of required coordination among private, government and
non-government sectors, plan of producing health workers on the basis of
their demand and supply and utilization of the available workforce have not
been made effectively.
• HIV/AIDS is appearing to be an enormous challenge because of poverty, lack
of education and awareness.
• Diabetes, cancer, other diseases related to heart, blood vessels and life-styles
are rising.
• Still a large amount of resource is spent on health institutions used by the
well-to-do societies. Majority of the people in rem ote rural areas is excluded
from even the basic health services too.
• The problems relating to implementation such as lack of medicines and
equipment, improper and insufficient use of the available medicines and
equipment, inadequate maintenance of the health institutions, lack of
effective supervision of the health system still exist.
• As the connection between cost and benefit has not been analysed yet, it has
been difficult to monitor the sufficiency of the cost as well as whether or not
the cost is utilized efficiently, effectively and proportionately.
• Due to such inter-regional challenges as lack of education, safe drinking
water, sewerage system, waste/garbage management, balanced nutritious
food and behaviour, it has been difficult to improve the health status of the
people.
• Employment gives rise to internal and external migration and drug addiction
and girls trafficking to the HID/AIDS.
24.3 Long-term vision

460
The long-term vision of the health sector is to support poverty eradication by
improving the health status of the Nepalese people and providing equal access of
health services to them through effective management system; by creating attraction
towards small family by way of establishing balance between ec onomic, social and
environmental aspects; and by developing healthy, strong workforce.
24.4 The Tenth Plan

a) Overarching national objective
Reduce the magnitude of poverty among the Nepalese people substantially and
sustainably by developing and mobilizing the healthy human resource.
b) Objectives
In order to render capable and effective type of curative, preventive, promotional and
rehabilitative health services and to make the reproductive health and family planning
services available to reduce the rising population, the health service sector will have
the following objectives:
1. Apart from improving the quality of health services, extend the access of the
poor and bac kward people of the rural and remote areas to these services.
2. Besides systematizing the rising population, access of reproductive health and
family planning services will be extended to the rural areas extensively in
consideration of maternal health service.
c) Quantitative goals
The goals of the health service sector are given in the following table:
Table No. 24.2 Quantitative goals

Targets of 10th Plan
S. Status
Health indicators General Alternative
No. of 2002
growth growth
461
Targets of 10th Plan
S. Status
Health indicators General Alternative
No. of 2002
growth growth
1 Availability of essential health services (%) 70 90 88
Availability of the stipulated essential medicines in
2 80 90 89
the specific institutions (%)
Provide essential health services with all health
3 60 '% ` 80 78
workers required (%)
Percent of women receiving prenatal service for
4 14.3 18 17
four times
Women of 15-44 age group receiving TT vaccines
5 45.3 '% 50 49
(%)
6 Birth attendance by the trained health workers (%) 13 * 18 17
7 Contraceptive prevalence rate (%) 39 47 46
8 Use of condoms for safe sex (14-35 years) (%) – 35 35
9 Total fertility rate (women of 15-49 years) 4.1 3.5 3.6
10 Crude birth rate (per 1000) 34 30 30
11 Maternal mortality rate (per 100 thousand) 415 # 300 315
12 Newly born infant mortality (per 1000 live birth) 39 32 33
13 Infant mortality (per 1000 live birth) 64 45 47
Child mortality (below 5 years old) (per 1000 live
14 91 72 74
birth)
15 Crude mortality rate (per 1000) 10 7 7
16 Life expectancy at birth (years) 61.9 65 64
* Included are the attendance by the trained sudenis (female childbirth attendant with short
orientations) but the status and goals afterwards do not include them as per the
unders tanding with the World Health Organization.
d) Strategies
The nation's major responsibility is to provide basic health services to all. From social
development perspective, it is necessary to ensure the equitable access of related
essential services to the people by strengthening health services. After providing basic
health services to all, the programmes and activities of the health sector contributes
significantly in social development by way of improving the health and nutrition of
the people in general and the poor in particular and by availing access through
mainstreaming to all communities and ethnic/indigenous people. Similarly, the Long-
term Health Plan helps the objective of economic development of the Plan by
reducing death rate and saving workforce from curable diseases. In view of
mainstreaming the bac kward areas and communities, various programmes can be
carried out to improve their health status through targeted programmes. In this
context, the main strategies of this sector are as follows:
§ Strategies related to the first objective
462
1. Investment to provide essential health service to the poor and the
backward communities will be increased gradually.
2. Ayurved, naturopathy services and traditional healing systems (like
homeopathy, Unani) will be developed as the supplementary health
service. In order to protect and promote these services, these rem edial
systems will be developed by the use and development of local medicinal
herbs and by enhancing skills and expertise.
3. Health services will be gradually decentralized according to the Local
Self-governance Act, 1998 and the office-bearers of Local Health
Administration and Management Committees will be involved in
orientation programmes to enhance their working capability.
4. So as to raise the availability of and access to the essential health services
of such main contributors of the health problems as safe motherhood,
reproductive health, child health, nutrition, tuberculosis, kala-azar
(typhus), malaria, Japanese encephalitis and other communicable
diseases, the health service will be enhanced in rural and remote areas
through special services.
5. All government, non-government and private health institutions from the
local level health institutions providing basic health services to the
central level institutions providing specialist services will be effectively
managed and strengthened by means of two-way communication system.
6. With the aim of improving the quality of health services provided by the
collabor ation of the government, private and non-government sectors, the
human, financial and physical resources will be managed effectively.
§ Strategy related to the second objective
1. By making reproductive health programme having imperative role in
population management more effective, the family planning service will
be made more extensive and effective based on the public choice and,
hence, will help reduce maternal and child mortality.
e) Policies and work plans
In order to fulfil the objectives of keeping the population growth within the desired
rates, bringing down the problems of diseases, and providing the people in general
and the poor, women and children without any facilities in particular with the quality
health services, the following policies are spelt out.
§ Extension of essential health services (related to the first strategy).
• Review the existing health policies and programmes extensively to
prepare and carry out required action plans.
• With the intention of improving the health condition of the backward
classes and special targeted communities, qualitative and effective
medicines will be made available all the year round through community
insurance, cooperation and par tnership.
• To take the health promotion activities among the targeted communities
463
effectively, distant education and special information and communication
technologies will be used, and, for these activ ities, a network will be set
up between the government, non-government and private sectors to
encourage extending programmes up to the local levels through the
volunteer groups.
• Health services provided by all institutions of the kingdom will be
supervised, monitored and evaluated to regulate them vis-à-vis the
standards prepared by the health sector in order to make them equal,
sustainable, economical and effective.
§ Ayurved, naturopathy, Unani and other traditional health services
(related to the second strategy)
• Ayurved, homeopathy, Unani and naturopathy systems will be developed
as supplementary to the health service. Medicinal herbs available locally
will be protected and promoted to acquire self-sufficiency.
§ Management and decentralization of the health sector (related to the third
strategy)
• The Health Economics and Finance Unit will be incorporated in the
organizational structure of the Ministry of Health and strengthened to
support the overall economic system as well by analysing the
investments made in health sector (through National Health Accounts),
and by developing appropriate system with the aim of making alternative
arrangements for rising expenditures of the health sector to facilitate the
plan/programme formulation based on solid evidence by way of
emphasizing such main aspects as cost-effectiveness, efficiency, equality,
sustainability while preparing new programmes.
• Participatory plan formulation and management capability will be
strengthened in all levels by maintaining gender balance.
• Necessary steps will be taken to post the female doctors to the hospitals
of the outlying districts.
• In view of the national requirements, government, private and non-
governmental institutions will be mobilized to prepare qualitative health
workers of medium and high levels. Regulatory system will be arranged
to determine the quality of human resource, and to control and coordinate
them.
• Scientific health technologies that can be used, taken care of, maintained
and made self-sufficient such as medicines, epuipments and medical
procedures will be developed and extended.
• In order to make the country self sufficient in producing quality
medicines, the regulatory process of medicines will be strengthened and
the quality of the im ported medicines will be ensured.
• In order to supply quality medicines, only the workforce recognized by
the Ministry of Health and educational institutions will be allowed to sell
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the medicines.
• The public will be informed well to take effective and qualitative
medicines only and to make their rational use. In addition, transparency
will be maintained by disclosing the names of the producers, price list,
usage directions, expiry dates, etc. in the drug stores as per the checklist
prepared by the World Health Organization.
• To take health service to the reach of the general people effectively,
community medical programmes, insurance and partnership processes
will be carried on under the cost sharing/cost recovery principles.
• In line with the principles of decentralization, the district and lower level
health institutions and health services will be devoluted to the local
elected bodies during the plan period in all dis tricts gradually.
• The services rendered by the health workers will be made the bases of
their placements and promotions, and these processes will be made
transparent. Arrangements will be made to encourage working in rural
areas.
• The health-related professional councils (medical, nursing, paramedical,
pharmacy and Ayurved) will be encouraged to contribute to improve in
the qualities of service, human and physical resource aspects.
• The private as well as the government doctors designated by His
Majesty’s Government will be arranged to contract with the concerned
institutions in case they are interested in providing health services
through the government health institutions.
• With the aim of materializing the notion that a small family is the
indicator of a happy family, mobile services will be conducted to enhance
the access of family planning services to the remote and backward areas.
§ Special health service to control communicable and non -communicable
diseases (related to the fourth strategy)
• In order to control serious non-communicable diseases such as heart
disease, kidney problems, cancer, emphasis will be laid on information,
education and publicity. The private sector will be especially encouraged
in the treatment processes of these kinds of dis eases.
• School health education will be carried out to improve the health service
of the children of school going age.
• To facilitate control of epidemics such as HIV/AIDS and other sexually
transmitted diseases, widespread public awareness will be created. In
addition, the victims of these diseases will be rehabilitated by involving
them in income-generating activities with the intention of arranging for
easy medical treatments and rehabilitation respectively in the society.
§ Disseminating system (related to the fifth strategy)
• Disseminating system will be made effective beginning from the local
465
health inst itutions to make the medical service systematic and result-
oriented. The central hospitals as well as the local hospitals and nursing
homes will be involved in developing specialist health services.
§ Partnership/participation of the government, non-government and private
sectors (related to the sixth strategy)
• The medical institutions run by the private and non-government health
institutions will be encouraged to provide curative as well as preventive
and promotional services. Physical facilities and subsidiary programmes
of the hospitals will be contracted out to the private sector and necessary
steps will be taken for their management and operation.
• Private sector’s involvement will be enhanced to increase in the access to
and the quality of the health sector. The government will play effective
roles of facilitator and regulator. The rural people and the poor who
cannot obtain the private sector’s services will be enabled to assess
quality service through the partnership of the government, local elected
bodies and the communities as well.
• Ministry of Home Affairs will be the focal point to control the drugs and
such activities as amendment of laws, restriction of drug abuse, reduction
of the number of drug addicts and enhancement of public awareness will
be carried out.
• Necessary norms for the private and non-government sectors will be
prepared for the provision of essential and equalitarian health services,
and necessary regulatory arrangements will be made to have their
compliance.
§ Reproductive health service (related to the seventh strategy)
• In order that the reproductive health service reach to the access of the
poor and the oppressed people, both curative and promotional
programmes will be carried out.
• From the district down to the village levels, the areas of health care and
vaccine programmes for the pregnant women and infants will be
extended to protect the health of both the mothers and the children.
24.5 Bases of the Programmes

In line with the recommendations made by the Public Expenditure Review
Commission and the policy of involving local elected bodies in physical and financial
management of the health institutions operated at the rural level, the health posts and
primary health centres will be transferred to the local elected bodies in the Tenth
Plan.
Communicable diseases, malnutrition and the motherhood-related diseases
are found to be the causes of 68 percent of all diseases and 50 percent of total
mortality rate in Nepal. In the days to come, in order to implement such programmes
as control of contagious diseases, nutrition, reproductive health and family planning
466
with due priority, it is necessary that the government and private institutions be listed
and the places and norms of the services (including specialist-oriented services) be
specified.
There is substantial disparity in the conditions of health services between the
urban and the rural areas. An independent National Microec onomic Health
commission will be set up within the accepted structure of the national programme of
poverty eradication to conduct the programmes of health sector in a coordinated
manner.
24.6 Programmes and their priority

The health service programmes are prioritised on the following bases in the Tenth
Plan:
• Burden of diseases,
• Implementing capacity,
• Equity,
• Programmes targeted to the poor, the oppressed and those devoid of
opportunities,
• Programmes contributing to poverty eradication,
• Availability of resources.
In view of the above bases, the programmes are arranged to implement by
categorizing them in the following three priority order:
24.6.1 The programmes in first priority (P1)

Expanded vaccination and national polio vaccine
This programme plays a vital role in reducing child mortality rate by enhancing the
children’s immunity system. Special programmes will be conducted to make vaccines
available to the children below one year. For this, vaccination programme for five
times will be conducted so as to provide BCG, DPT (3 doses), polio vaccine (3
doses), measles to save children from TB, poliomyelitis, diphtheria, whooping cough,
tetanus and measles. In addition, hepatitis -B vaccine will also be conducted steadily.
With the aim of eradicating poliomyelitis, National Polio Vaccination Service will be
carried out up to 2005 as a special vaccine program me.
Control of Acute Respiratory Infection

The programme having the objectives of reducing mortality rate of the children under
five, reducing the rate of diseases through health education and preventing the
complications caused by upper respiratory tract, will be extended to 35 districts by the
end of the Tenth Plan period which is conducted by the female volunteers in 15
districts at present. Discouraging the unsystematic use of antibiotics and extending
the treatment of pneumonia to the community level are also the objectives of the Plan.
Diarrhoea
467
This programme has the objective of reducing illness and death rate of the children
under five years due to diarrhoea with the help of effective oral dehydration therapy.
This programme will make oral dehydration therapy effective and various types of
technicians will be trained in standard case management during the plan period in
order to reduce the death rate of the children under five years.
Nutrition
This programme has the objectives of reducing the problem of anaemia, controlling
deficiency of vitamin-A, and controlling the impacts due to the deficiency of iodine.
Protein energy malnutrition (PEM) prevalent among the women, children, adolescent
and pregnant women will be reduced. With the aim of distributin g vitamin-A capsules
to the children under five years, providing iron tablets to the pregnant women,
distributing medicines to worm-infected children and promoting awareness of breast-
feeding, programmes such as dispatch of directions to the health institutions of 75
districts, production and distribution of educational materials in the local language
and increasing the times of weighing the children will be conducted. Similarly, in
addition to teaching about nutrition in schools, clean environment will be created
within school compounds by involving the schoolchildren; and school programmes
and health education programmes will be conducted among the parents and the
neighbourhood through the schoolchildren to create clean environment.
Safe motherhood
Nepal has enormously high rates of maternal and infant mortality rates compared with
those of other countries. Obstetric service will be strengthened and extended. This
service will be provided by the health workers only. In add ition, the basic obstetric
care and comprehensive emergency obstetric care will be extended at different stages
to the primary health centres and hospitals. Although tangible programmes have not
been conducted with the purpose of reducing the mortality rate of the newly born
infants, it is combined with the safe motherhood programme. With the
commencement of the Tenth Plan, concrete programme will be initiated in this
regard. For this, training and services related to the health of the newborns will be
gradually provided at the levels of health institutions and communities. In order to
provide healthcare and education related to the newborns, trained traditional birth
attendants (sudenis) and female volunteers will be mobilized.
Family planning
Bringing down the population growth rate, extending the concept of ‘small family’ to
the rural people, providing quality services and reducing the unmet needs are the
objectives of this programme. Moreover, non-government and private institutions will
be involved in family planning programmes. Mobile sterilization camps will be
conducted in remote districts to enhance its access.
Reproductive health of the adolescents

As the health education provided to the adolescents plays a vital role in reproductive
health, the Tenth Plan will extend the programmes to provide health education and
advices related to reproduction to the adolescents.
468
Female community health volunteers and sudenis (trained traditional birth
attendants)
With the mobilization of the trained female health volunteers and with their active
involvement, prevention and promotional health education and service can be
extended to the doorsteps of the people with their active involvement.
Epidemiology and control of diseases

Control of malaria
Full-fledged or partial spread of malaria is found in 65 districts of the kingdom. This
programme has the objective of reducing the outbreak of malaria to control mortality
due to this disease. For this, the Rapid Responsive Team is scheduled to set up in 75
districts so as to strengthen the laboratory to diagnose malaria in time, spray
insecticides in the excessively affected areas for two times a year, encourage using
insecticides and nets and strengthening the supervisory activities.
Typhus (kala-azar)
The Tenth Plan has the objective of controlling probable pandemic of typhus and
reducing deaths by curing patients of this disease. Prompt diagnosis of typhus from
hospitals and primary health centres will be made available through K-39 in 12
districts. First line/second line will be treated by medicines. For this, regular
surveillance, focal spray programme are scheduled to carry out.
Natural disaster and management
With the purpose of sending off the medical teams during the pandemic period,
providing training regarding pandemic management and treating the suddenly injured
people due to natural disasters, medicines will be sent to 20 districts of the kingdom
before natural disaster takes place and arrangements will be made to provide training
and adopt safety measures to reduce probable risks because of earthqu akes.
Vector-borne diseases and their control, research and training

This centre has all resources related to research and training. The centre trains
medium -level health workers related to malaria, typhus and other vector-borne and
parasitic diseases, and conducts on-the-job operational research programmes.
Tuberculosis
Its objective is to reduce the death rate by reducing the rate of tuberculosis patients
and control the transmitting process to one another. Similarly, the other objectives are
to cure all diagnosed tubercular patients, examine cough and to treat all the patients
by the DOTS method. The epidemic of tuberculosis is found to exist in urban areas
than in the rural areas. With the collective coordination and cooperation, 70 percent
of unidentified patients of tuberculosis will be diagnosed and more than 85 percent of
the TB patients will make recovery. Adding 12 more percent of population for
treating by the DOTS method, altogether 95 percent patients will be benefited by this
service. As tuberculosis and HIV/AIDS reinforce each other to create complications,
this type of co-epidemics will be controlled with special vigilance.
469
Leprosy
The Leprosy Eradication Programme, which is conducted with the concept of
eradicating leprosy from the kingdom of Nepal and creating a leprosy-free society,
will provide qualitative and cost-free service of leprosy through ni tegrated health
service to attain the goal of eradicating this disease by the year 2003 AD. The number
of the lepers will be reduced from their present 3.4 per 10,000 to less than 1 per
10,000 by the year 2003.
HIV/AIDS and Sexually Transmitted Diseases (STD)
The objectives of this programme during the Plan period are to reduce the outbreak of
HIV/AIDS and STD, change the behaviour of high-risk group, and timely detection
and treatment of STD. In order to accomplish these objectives, multilateral
coordination between the government and non-government sectors will be continued
to carry out integrated programme for changing the public behaviour by creating
awareness and get to the identified high-risk group.
As multisectoral approach to conduct programme is necessary to contain this disease,
a High-level National Council is formed for multilateral coordin ation. Public
awareness will be created by us ing personal, collective and all means of mass media
including radio, TV, papers, posters, pamphlets; and blood culture, test, preparation
of training manual and curriculum, care, counselling and experimental services will
be gradually extended along with the effective preventive and curative programmes to
control the STDs.
Health information, communication and education
In the process of encouraging people to use necessary health services through basic
programmes of health services, health education, information and communication
programme plays a vital role. During the Plan period, this programme aims to print
and produce educ ational materials and distribute them; to publicize the advertisement
and various other programme through electronic means of communication such as
radio and television; to conduct community-based cultural programmes in a
coordinated manner; to extend health education unit by providing basic epuipments to
the health units of the district and lower levels; and to communicate latest information
to the health workers of various levels.
Supply management
Regular supply of essential medicines, epuipments and apparatus required in health
sector is the objective of this programme. Within the next 15 years, based on the
information system, arrangement of timely supply of stipulated medicines and
equipments will be made to all health institutions of the kingdom after taking the
existing stock situation into account. In addition to maintaining the biomedical
equipment, means of transportation and cold chains, information system will be
improved effectively and developed institutionally.
Community medicine
All primary health centres, health posts and sub-health posts will be supplied with the
necessary medicines with the involvement of local elected bodies. During the Tenth
470
Plan period, health insurance programme along with additional community medicine
programme in var ious 35 districts will be carried out.
Health insurance
Citizens have a right of access to health services. With the objective that health
service will not be denied simply because of lack of medical expenditure and that a
mechanism of bearing expenditures by the low-income people will be developed,
health insurance programme will be initiated. Within next five years, community and
social health insurance programmes will be carried out in parallel in formal and
informal sectors as well. From this programme, huge amount of expenditures made
by the formal and the gover nment sectors in social sector such as medical treatment,
pension can be managed well. Formal sector’s investment on social security can be
mobilized to raise the living standards of the poor and helpless communities in the
rural areas. Micro-credit and other income-generating programmes conducted to carry
out social health insurance in rural and urban communities will contribute to poverty
eradication also.
Information management
Collecting information and data, processing these data and, consequently, helping to
prepare annual and periodic programmes and policies for the effective tasks of plan
formulation, mi plementation, monitoring and evaluation of health sector will be the
objective of this programme. As information from the institutions under the
Department of Health Services only has been collected so far, the information related
to Department of Ayurved and Department of Drug Management as well as all other
information related to health will also be collected and published in the Tenth Plan.
24.6.2 The programmes in second priority (P2)

National health training
The National Health Training Centre is established to enhance skills of the workforce
affiliated to the health sector. As this Centre has been conducting training
programmes under the Department of Health Service so far, the Centre will now on
be recognized as an institution under the Ministry to develop the concept of national
training system and it will be entrusted with responsibilities of training on ayurved
and drug management accordingly. Necessary research-oriented activities will also be
carried out by this Centre to make the health service effective.
Bir Hospital
With the purpose of developing Bir Hospital as a national hospital, emergency and
trauma centres will be established and extra beds will be added. The National Medical
Science Foundation is established within the compound of Bir Hospital. Ten hospitals
of Kathmandu valley and regional, sub-regional and up to zonal hospitals will be
involved in this Foundation. Necessary specialists will be prepared within the country
and a mechanism of providing specialist services up to the zonal hospitals will be
developed.
Shahid Shukraraj Tropical and Infectious Disease Hospital
471
The infectious disease hospital will be developed as a centre for services, facilities
and study and research of tropical diseases.
Kanti Children’s Hospital
As a centre for providing all types of specialist facilities for the curative services of
the children and studying and conducting research on children’s health, Kanti
Children’s hospital will be developed as central hospital for children’s health.
HRH Indra Rajya Laxmi Maternity Hospital
This maternity hospital has the objective of developing itself as the centre for
ultramodern services, education and research related to reproductive health and the
health of the newborns. During the Tenth Plan, this hospital will be developed as the
focal point of maternity health for the World Health Organization to provide quality
services relating to maternity, gynaecology, newborns and family planning and to
make available the quality maternity services available.
Urban health
The health organizations and institutions in the metropolis, sub-metropolises and
municipalities will be coordinated and provided with the technical assistance by the
Ministry of Health as a mediator.
Ayurved services
In order to provide information regarding ayurved, Ministry of Education and
Tribhuvan University will be coordinated to formulate the policies on teaching
ayurved. A directory on alternative health will be prepared. Ayurvedic hospitals will
be established in five develo pment regions to provide health service through
ayurvedic methodology. During the Plan period, ayurveda pharmacopoeia will be
prepared and mobile ayurved health camps with specialists will be conducted.
Laboratory and other auxiliary services
Spec ialist-oriented experimentation will be developed to expand the National Public
Health Laboratory established for the purpose of experimenting m icrobes of various
diseases on the basis of disseminating system for making diagnoses and medical
treatments effective. In addition, provision of basic laboratory services will be made
in the local health institutions as well.
Strengthening supervision, monitoring and evaluation systems
Institutional setup of planning, personnel administration and financial administration
sectors will be strengthened. In addition to providing with related skill-oriented
training to all types of technical and administrative people, improvements will be
made in the supervision of their work and evaluation tasks with the aim of making
extensive improvements of health service management. The Department of Ayurved
will be entrusted with the responsibility of facilitating Homoeopathy, unani,
naturotherapy and Singha Durbar Vaidyakhana. As per the policy of transferring the
authority concentrated at the centre to the local level according to the Local Self-
governance Act, 1998, strengthening programme will be carried out to implement the
decentralization action plans. So as to continue this programme effectively, it will be
improved on the basis of the reports received from the studies and researches. The
472
local bodies and Health Management Committees will be trained on operation and
management of the health institutions.
Blood bank and blood transmission service
In line with the long-term conc ept of health, a policy of arranging blood banks and
blood transmission services for health service in the central, zonal and district
hospitals will be adopted. The offence of trading in blood for cash will be completely
discontinued. The non-government organizations and organizations related to
literature, music and culture will also be encouraged blood donation. By making the
systems used in emergency effective, this arrangement will be strengthened in the
district hospitals also. With the help of donor organiz ations as well, additional
modern technologies will be arranged in the Nepal Red Cross Society to make this
service more scientific and reliable.
Health research
The Health Research Council, established with the view of formulating policies based
on the results obtained from the studies and researches of health sector, will continue
the research activities effectively.
24.6.3 The programmes in third priority (P3)

Nepal Eye Hospital
During the Tenth Plan, the Eye Hospital will be developed as an institution to deliver
specialist services. Again, there is a concept of making the Hospital economically
self-sufficient with the income earned from the services it renders within next ten
years. Eye camps, dia gnostic treatment, education camp and school screening
programmes will be conducted. Research activities will be continued effectively.
Netrajyoti Sangh
In line with commitments made by the World Health Organization and His Majesty’s
Government, excellent services will be provided to the eye patients through
Netrajyoti Sangh by coordinating with the non-government organizations as well.
BP Koirala Memorial Cancer Hospital
During this plan period, besides adding hospital beds and providing the specialist
services of cancer, emphasis will be laid on publiciz ing to keep away from smoking,
drinking as they are the main causes of cancer; and essential health service
programmes will be continued.
BP Koirala Health Science Foundation, Dharan
BP Koirala Health Science Foundation, Dharan has the programmes of MBBS, B. Sc.
(Nursing), Postgraduate, BDS, Bachelor Level Applied Health Science and other
training and seminars; and the Foundation has the objective of providing people with
health services.
Shahid (Martyr) Gangalal National Health Centre
By carrying out researches and studies within the country, a condition of self-
473
sufficiency will be attained within coming 15 years in the area of curing heart disease.
During the Tenth Plan period, there is a programme of establishing a 200-bedded
ultramodern heart related hospital with all facilities. An action plan to develop this
centre as a central and disseminating body of national programme for curing and
controlling heart disease will be prepared.
Dental care service
A policy related to dental health will be formulated to take this service to the people
with priority. Necessary provision for the use of salt and toothpaste with fluoride will
be made and dental health education will be made wid espread.
Ayurved Hospital, Naradebi
Development of such methodologies as panchakarma and kshatrasutra (alkynes/salt
formula), operation of emergency service, establishment of library and museum for
herb samples (herbarium) by arranging required epuipments and apparatus to carry
out this programme are some activities of this programme.
Singha Durbar Vaidyakhana
Activities of production, export, import, storage, supply and sale will be effectively
carried out in order to make the country self-sufficient in the production of ayurved
related med icines. Apart from this, medicines will be produced by cultivating
medicinal herbs within the country. Ayurvedic service will be developed with the
help of effective and modern laboratory. Effective market arrangement will also be
made to distribute the products of the Vaid yakhana to the people.
Homoeopathy
In the context of development and extension of this service, a feasibility study for the
possibility of establishing Homoeopathy hospitals in the five development regions
will be carried out. Emphasis will be laid on production of medicines related to this
service within the country.
Unani
This service will be effectively continued during the Tenth Plan also.
Naturo-therapeutics
The natural medical system that helps cure diseases through water, soil, light/heat, air
as well as physical exercise, yog a, diet, behaviour, etc, will be mainstreamed to health
service in the Tenth Plan and developed in an instit utional way.
Management of medicines
Provision of adequate and qualitative medicines as required for the protection of
public health will be the objective of the Plan. For this, strategies for special provision
of qualitative medicines, ensuring people about the appropriate use and quality of
medicine and making the country self-reliant in the production of medicines will be
adopted.
Programmes of qua lity control of the production of vaccines and antibiotics and
supervision and test of protecting quality while transporting and storing will be
carried out. Special programmes at central and local levels will be conducted with the
474
efforts of the government, private and both parties to operate programmes of quality
medicines.
Post-graduation
As economic, social as well as institutional development is likely with the help of the
production of high-level human resource within the country, the programme of
preparing postgraduate human resource will be advanced. For this, the group of
hospital in the Valley will be treated as the teaching institutions.
Hospital development and extension
As the resources have been apportioned corresponding to the administrative structure
of the hospitals up to now, the resources will also be allocated in proportion to the
services rendered by these health institutions during the Tenth Plan period.
Control of addictive drugs
Existing laws will be revised to go well with the programme of controlling addictive
drug. Public awareness programme will be conducted to check the diversion of the
medicines and reduce the number of the drug addicts as well. Programmes to
rehabilitate the addicted youths and to create employment-oriented pro grammes that
can generate income for the addicts will be carried out.
24.7 Contribution of health sector to the expected
achievements of the Tenth Plan
Poverty eradication
Healthy human resource, low mortality rates of infants and children, deve lopment of
safe motherhood will improve various aspects of human development indicators
(HDI) and, hence, contributes to eradicate poverty. In order to contribute to poverty
eradication by way of creating healthy human resource and thereby providing
increased opportunities of income generation and employment and making
improvements in lifestyle, availability of med icines will be ensured through
established health institutions and outreach clinics set not more than two kilometres
or more than on hour’s walk so as to make preventive, promotional and curative
services available to all places where the poor, extremely backward and the
communities out of the reach of common health services live until now. In addition,
provision of community medicine and health insurance will be arranged in such areas.
Creation of employment and other contributions/achievements and

income generation
A healthy workforce is likely to get employment opportunities and generate income
thereby. Income growth results in changed lifestyle which in turn is expected to
support the development of the country as a result of its (lif estyle’s) positive effect.
Expansion of health service helps generate employment in administrative and
technical sectors to offer employment opportunities to the local workforce as well as
the specialists.
475
Achievement in regional development and balance
Emphasis will be given to the health service of all five development regions and
special programmes will be carried out in Far Western and Mid-Western
Development Regions for the balanced development of health service. There is a
huge gap between the health service sector of urban and rural areas. Based on health
indicators, condition in the Terai is worse than that in the hills/mountains. The health
indicators are comparatively weaker in the Mid-Western and Far Western Regions. In
this context, special services will be made available easily and universally in the areas
where health indicators show weak condition during the plan period.
Local Self-governance Act, 1998 will be implemented

The physical and management aspects of the sub-health posts operated at the rural
level will be entrusted to the local elected bodies. Moreover, based on this experience,
programmes will be implemented by carrying out additional studies and researches on
the operation of the health posts with the involvement of local elected bodies. On the
basis of the resources and capabilities of the district hospitals, they will be made
1
effective by converting them into Development Committees .
Gender equality
The reproductive health and family planning programmes will no longer be the
programmes of women only and male’s participation in them will be enhanced. In the
programmes such as prevention of unwanted conception, new programmes for
creating awareness among the adolescents, unmet need, etc., equal participation of
men and women will be initiated, and reproductive health will, however, be protected
form the perspective of women’s right.
24.8 Probable obstacles and risks while implementing and

making achievements
The probable obstacles while implementing the programmes set for the health sector
are estimated as follows:
• Because of the geographical difficulties and due to the lack of resources,
it may be difficult to communicate right information and provide
necessary health services adequately.
• In case the behavioural changes do not take place for health check-up
before and during pregnancy, it will be difficult to make safe motherhood
programme effective.
• In case the backward women, helpless poor and the women under risks
1
Development Committees are the special institutional bodies formed under special laws
which have autonomy in their day -to-day activities and are entitled grants from the
government for their services performed.
476
remain neglected, consumption of health services may decrease.
• Effectiveness of immunization may be negligible and security assurance
for the supply and distribution of the required health materials/means
may be scanty.
• Development of timely health care service can be slow.
• Appropriate reforms of such aspects as building, human resource,
apparatus, equipment, and management in line with the norms set for
health institutions may be difficult.
24.9 Programmes and budget

The summary of programmes and budget of the health sector are given below
according to the priority order. Detailed programmes and estimated budgets are
presented in Appendix 24.1.
(Rs. in million)
Priority order No. of General (expected) Alternative growth rate
programmes growth rate

P1 19 8713.9 62.3 7558.0 70.7
P2 13 3785.9 27.0 3011.9 28.2
P3 11 1500.4 10.7 122.0 1.1

Total 43 14000.2 100. 0 10691.9 100. 0
24.10 Log frame

The overall form of programme matrix of health sector is presented below. Its
detailed sketch is presented in Appendix 3.
477
*
Policies and Programmes Matrix : Health
Sectoral objective: Ensure the health and productivity of the Nepalese people.
Purpose • Investmen t to provide essential health service to the poor and • Life expectancy at birth will • Reports 1. Child health • In case the
(sectoral the backward communities will be increased gradually. rise (from 61.9 to 65 of programme. local elected
objective): • Ayurved, naturopathy services and traditional healing systems years). househol 2. Family health bodies and
Availability (like homeopathy, Unani) will be developed as the • Among those receiving d survey. programme. the
of capable supplementary health service. In order to protect and promote curative, preventive, • Four- 3. Programme for the communities
and these services, these remedial systems will be developed by promotional health monthly control of parasites do not show
effective the use and development of local medicinal herbs and by services, all 100% will be and and endemic any interest,
health enhancing skills and expertise. satis fied. annual diseases. • In case of
services • Health services will be gradually decentralized according to the • The number of health reports of 4. Programme for the lack of
(curative, Local Self-governance Act, 1998 and the office-bearers of workers will be adjusted as MOH. control of non- confidence
preventive, Local Health Administration and Management Committees will per the size of population. • Nepal communicable in peace and
promotional be involved in orientation programmes to enhance their • Decrease in time to reach Health diseases. security,
and working capability. the nearest health centre and 5. Partnership and • In case the
rehabilative • So as to raise the availability of and access to the essential from the households Demogra participation users do not
services) on health services of such main contributors of the health (dis tance less than one phy programme of the show any
equality problems as safe motherhood, reproductive health, child hour’s walk). Survey government, non- interest in
basis, and health, nutrition, tuberculosis, kala-azar (typhus), malaria, • Increase in assistance in Report. government and receiving
effec tive Japanese encephalitis and other communicable diseases, the management and private sectors. health
reproductive health service will be enhanced in rural and remote areas operation of local level service,
health and through special services. service units of health • In case the
family • All government, non-government and private health institutions service from the local level. health
planning from the l ocal level health institutions providing basic health • At all levels of health service
services to services to the central level institutions providing specialist service, the participants will programme
bring down services will be effectively managed and strengthened by have enhanced capability does not get
the rising means of two-way communication system. to follow plan and priority and
people as management system. continuity,
well.
478
• With the aim of improving the quality of health services • The process of ensuring 6. Programme to operate • In case of
provided by the collaboration of the government, private and the quality of service in the with the coordination lack of
non -government sectors, the human, financial and physical government, non- of such programmes availability of
resources will be managed effectively. government and private as decentralization rated human
• By making reproductive health programme having imperative sectors will be programme, and physical
role in population management more effective, the family systematized. qualitative resources,
planning service will be made more extensive and effective • Human, financial and management of • In case the
based on the public choice and, hence, will help reduce physical resources will be human, financial and financial
maternal and child mortality. effectively arranged. physical resources, sources
population and dwindles.
environment.
7. Programme for the
development of
alternative curative
service system.
8. Programme to
enhance the
effec tiveness of health
service through
qualitative
management of
resources.
9.
* The quantitative goals base on general (expected) growth rate of 6.2 (detail in Appendix 3)
479
Appendix 24.1 Programmes and estimated budgets
(Rs. in 10 millions)
S. No. Programmes Budgets for Budgets for
general alternative
(expected) growth rate
growth rate
The first priority programmes/projects
1 Control of Tuberculosis 58.10 50.40
2 Control of AIDS and sexually transmitted diseases 155.15 134.57
3 Family planning and mother-child welfare and female health volunteers 18.12 15.72
programme
4 Extended immunization programme 206.95 179.50
5 Respiratory disease and diarrhoea control programme 42.73 37.06
6 Management of control of epidemiology, malaria, ty phus, and natural disaster 55.45 48.09
7 Leprosy control programme 3.18 2.76
8 Supply management 124.37 107.87
9 National Health Education, Information and Communication Centre 24.30 21.08
10 Control of vector-borne diseases and research and training service 14.65 12.71
11 Community medicine and health insurance programme 0.39 0.34
12 Family planning, mother and child welfare and female health 47.49 41.19
13 Integrated supervision programme 65.60 56.90
14 Control of tuberculosis 4.43 3.84
15 Control of respiratory diseases 18.48 16.02
16 National health education, information and communication 12.59 10.92
17 FPMCH (Ramechhap and Dolakha) 9.48 8.22
18 Control of malaria and typhus 8.15 7.07
19 Leprosy control programme 1.77 1.54
Total 871.39 755.80
Percent 62.24 70.69
The second priority programmes/projects
20 Bir Hospital 249.73 198.67
21 Health Research Council 7.56 6.01
22 Ayurved and others 9.70 7.72
23 Kanti Children’s Hospital 17.74 14.11
24 Maternity Home 17.75 14.12
25 Ayurved Hospital 3.02 2.40
26 Ayurvedic hospitals/dispensaries and others 13.61 10.83
27 National Laboratory 6.41 5.10
28 National training programme 25.61 20.38
29 National Training Centre 17.19 13.68
30 Urban health programme 0.74 0.59
31 Contagious Disease Hospital 2.98 2.37
32 Monitoring and evaluation strengthening programme 6.54 5.21
Total 378.59 301.19
Percent 27.04 28.17
The third priority programmes/projects (potential programmes) 150.04 12.20
Percent 10.72 1.14
480
S. No. Programmes Budgets for Budgets for
general alternative
(expected) growth rate
growth rate
33 Nepal Eye Hospital
34 BP Koirala Memorial Cancer Foundation
35 Shahid (Martyr) Gangalal Heart Centre
36 BP Koirala Health Science Foundation
37 Hospital Construction, Renovation Management
38 Post-graduation
39 Department for Medicine Management
40 Health Institution Grants
41 Singha Durbar Vaidyakhana
42 BP Memorial Eye Centre
43 Nepal Netrajyoti Sangh
Grand total 1400.02 1,069.19
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Chapter - 25
Drinking Water and Sanitation
25.1 Background
By the end of the Nint h Plan 71.6 percent of the total population has the access to
drinking water . It is estimated that there are still 28.4 percent of the population
deprived of drinking water facility, a basic need of life. As majority of the population
is unware about the importance of environmental, social and personal hygiene and
sanitation, the water borne diseases are still out of control. As such epidemic of water
borne diseases have been seen. So the major challenge is to develop and expand
adequate drinking water supply with sanitation facilities. Side by side, it is also
necessary to make the community aware of importance of sanitation for improving
the public health.
As a matter of fact, drinking water and sanitation facility are the basic needs of
human beings. Development of this sector will have positive impact upon consumers'
health, and will produce healthy manpower, which would contribute to the growth of
other productive sectors and activities of the country. Safe drinking water will
significantly control water borne diseases and on the other hand it substantially
minimizes health expenses to be incurred on treatment of such diseases. Apart from
this, the time saved from fetching water could be utilized in productive works, which
in turn, provide opportunity to earn more income to the general public. Development
of drinking water sector contributes to production of healthy manpower, additional
income generation and less health expenditure on treatment of diseases. All these
together would undoubtedly assist to achieve poverty eradication goal of the Tenth
Plan.
25.2 Progress Review of the Ninth Plan:

25.2.1 Target and Achievement:
The target of the Ninth Plan was to provide basic drinking water to all by the end of
the plan period. During the period, increased involvement of the consumers' group as
well as wider public participation in the construction, operation and maintenance of
drinking water projects created favorable atmosphere to make projects more
sustainable. The sanitation programs related to health, education and public
awareness were also launched during the plan period.
483
(Population in thousand)
Description 9th. plan target 9th.plan 9th.plan Benefited by the end
achievement achievement of Ninth Plan
( %) population Percent
Additional population 9700 2904 29.94 17017 71.6

benefited from drinking water
Population benefited 5258 1490 28.34 5920 25.0
from sanitation
The table below presents the status of drinking water facility in the urban and rural
areas of the country by the end of the Ninth Plan.
S.N. Development region Rural Population Urban Population Total Populatiin
Benefited Percent Benefited Percent Benefited Percent
1. Eastern 2917 61 471 70 3388 62
2. Central 4251 65 1465 85 5716 69
3. Western 3216 79 412 72 3628 78
4. Mid western 2284 80 168 70 2452 79
5. Far Western 1719 85 114 46 1833 81
Total 14387 71 2630 76 17017 71.6

The problems and issues encountered in the implementation of the drinking water and
sanitation projects/programs during the Ninth Plan period are as follows:
• Effective coordination could not be established among the agencies involved
in drinking water and sanitation sector because of ineffective decentralization
of authority to local bodies and consumers' groups. During the period, the
local bodies could not play an effective role. Even duplication was noted in
the investment programs and activities of the government, non-governmental
organizations and private sector agencies.
• Due to the lack of proper repair and maintenance of completed projects,
many projects are completely non-operational and many are partially
operational. Consumer groups are unwilling to take one the ownership of the
completed projects since they are not involved in the implementation phase.
• It is difficult to ascertain the number and types of drinking water projects
required for each district, as many district still lack comprehensive district
drinking water supply programs. When preparing district development plan
only government investment has been included. An integrated program
including the investment from national, international and non-governmental
organization could not be formulated.
• Inadequate budgetary allocation impede timely completion of the projects .
Due to simultaneous initiation of numerous projects, many projects took
484
more than a decade to complete. Linkage between target setting and budget
allocation was hardly maintained. Hence the Ninth Plan could not produce
expected output as envisaged.
• The urban drinking water supply system is based mostly upon the
government grant and not on cost recovery principle. The private sector
could not be attracted in the operation of the drinking water system.
• Updating of national data pertaining to drinking water and sanitation sector
could not take place. It is therefore diffic ult to get the actual status of this
sector and consequently the program formulation for improving drinking
water supply and sanitation has become a problem.
• The monitoring and evaluation of drinking water supply and sanitation
programs/projects are ineffective.
• Proper and adequate coordination in the programs like adult education, health
education and income oriented gender activities launched by various agencies
could not be established, which is needed for the development of rural
sanitation sector.

The long term vision is to assure drinking water and sanitation facilities in accordance
with the T wenty-year Drinking Water Service Perspective Plan. The drinking water
service will be categorized into three different levels, viz., high, medium and basic
employing indicators like water quantity, quality, access, supply period as well as
reliability. As high as 25% of population will be provided high level service and
medium level service to 60%, while basic level service will be made available to 15%
population. In urban areas, treated drinking water supply will be made available along
with the service of sewerage system and solid waste management. In rural areas,
drinking water facility will be provided with appropriate system and domestic toilet
service.
25.4 The Tenth Plan

25.4.1 Objectives
• Provide basic drinking water service to all regions of the kingdom by
gradually up-grading the level of services by the end of the plan period.
• Provide appropriate sanitation facilities in urban as well as in rural areas by
increasing public awareness.
• Assist to reduce child mortality rate by controlling water borne and water
induced diseases and thereby help to increase income generation through
opportunity of utilizing saved labor from illness.
• Involve private sector in the overall management of urban water supply
systems/ facilities and also in the improvement and up-gradation of drinking
water projects.
485
25.4.2 Quantitative targets
• Provide basic drinking water service to additional 4.591 million people
including 3.852 million rural and 0.739 million urban population within the
Tenth plan period.
• Provide a high level service to 1.334 million people and medium level
service to 2.668 million people by upgrading the drinking water supply
system.
• Sanitation facility will be provided to 7.421 million people including 5.613
million from rural and 1.808 million from urban areas by motivating the
households to construct private toilets. Public awareness on personal hygiene
and sanitation will be increased through mass publicity and training programs
within the Tenth Plan period.
• Detail status of drinking water and sanitation is presented in the Annex 25.2
25.4.3 Strategy
Drinking water is important not only for human survival but for sound public health.
The availability of drinking water directly or indirectly will assist the poverty
alleviation in the sense that it helps to improve labor productivity which would occur
from increase in average life span, reduction in infant and child mortality rate and
improved public health. Such indicators improve public health related Human
Development Index (HDI). Most of the women and children have to spend substantial
time of the day in collecting and in fetching water. Easy access to drinking water
therefore undoubtedly will save time, which could be utilized comfortably in other
economic activities. In the case of children, the saved time will provide them more
educational opportunit ies. The other benefits of easy access to drinking water are: it
increases women literacy and assist in promoting gender equality. Considering the
vital role of consumers, they are to be involved in the drinking water projects right
from the design stage up to the implementation and operation. Also, the time-bound
programs are to be decentralized to all district level agencies. Such decentralization
will make the projects more sustainable and their operation as well as maintenance
will be effective. In this context, following major strategies will be adopted.
§ Strategies related to Objective 1
• Drinking water supply schemes will be operational on the basis of cost
recovery principle. In rural areas, users' committee will be entrusted to
operate the system on operational cost recovery principle, while in the
urban areas strategy will be to recover other costs besides operational
cost.
• Rural drinking water project will be undertaken on the basis of
community needs and demands, with the involvement of user community
for maximum utilization of locally available resources and means .
486
• Emphasis will be given on the conservation of local resources and
operating rural drinking water projects through the consumer committees
and NGOs. Such institution's skills and capabilities will be enhanced.
• Priority will be accorded to simple and appropriate type of drinking water
systems that could be managed by the users' groups themselves . In the
areas where perennial and adequate water sources are not available,
rainwater harvesting, solar PV pumping system, hydraulic dam, etc. will
be promoted.
• Priority will be on the on-going projects and reconstruction of rural
drinking water projects.
• Proper conservation and development of natural water reservoirs/storages
will be carried out by utilizing surface as well as groundwater sources
existing in the protected watershed areas through integrated management
approach.
§ Strategy related to Objective 2
• Sanitation program will be made as an integral part of the drinking water
supply project. In the urban areas where population density is high,
public awareness in sanitation will be raised, and drainage sewerage
system will be constructed with community participation. In other places
emphasis will be given to construct public toilets.
§ Strategy related to Objective 3
• To Strengthen the quality monitoring and controlling process, national
code of conduct on the norms and standard of water quality will be
devised. A national drinking water regulatory committee will be formed.
§ Strategies related to Objective 4
• Drinking water facility will be developed and extended by involving
private sector and encouraging their participation in the development as
well as management of urban drinking water supply along with entrusting
responsibility to the District Development Committees (DDC), the
Village Development Committees (VDC) and Municipalities in line with
decentralization policy.
• The regulatory committees will gradually monitor drinking water
services operated in urban and semi-urban areas by private sector, semi-
government organizations, consumers' committees and governmental
organizations.
25.4.4 Policy and Working Policies
§ Cost recovery in the Operation of Drinking Water Supply Project (Related
to Strategy 1)
• Provision will be made to deposit certain percentage of total project cost
in cash in the project fund in the beginning of the project. In order to
ensure drinking water service to the poor and backward communities
487
from the projects launched under consumer's contribution programs,
there communities will be exempted from such contribution. Also, repair
and maintenance fund will be established by collecting money from the
water users' group for project's operation and maintenance at the very out
set. The service level will be tied up with the consumer's contribution.
The modality will be "Higher the contribution, higher the service level. "
• The consumers' groups will be given proper training regarding the
necessity of service tax, and monitoring system will be strengthened with
the objective of making the project's repair and maintenance system
effective. The water charges will be fixed so as to cover the expenses
incurred on the repair and maintenance. Also, provision will made of the
trained repair and maintenance worker.
• In addition to external resource mobilization for construction of drinking
water projects, internal resources will also be channeled to the maximum
possible extent by coordinating with various local institutions. The urban
water tariff policy, which will be guided by the scientific cost recovery
principle that takes into account cost of capital, water supply as well as
facility expansion, etc. will be put into operation.
• Considering the level of services to be provided, policy of differentiated
tariff rates will be introduced for different towns. The consumers will
have to bear certain percentage of total cost of newly proposed
construction project in the urban areas. Legal arrangements will be made
for the access of consumers' groups to borrow money from the financial
institutions for drinking water projects. In this regard, necessary policy
and leval reform measures will be introduced.
§ Participation of consumers' groups in rural drinking water supply projects
• Every district development committee will prepare its annual and
periodic master plans, and all other sectors will implement the projects
incorporated in the master plan in priority basis. This will incorporate all
projects implemented either by government or by non-governmental
organizations within the district development program.
• It will be made mandatory that project preparatory phase should devote,
at least, one full year community mobilization and management before
the implementation in order to develop and operate drinking water
projects in a sustainable manner. The projects proved unfeasible on
economic, social and technical grounds will not be implemented. With a
view to provide consumers' groups a legal status and to coordinate them
with local institutions as well as to avoid duplication, registration of
consumers' groups during preparatory phase itself will be made
mandatory under the Water Resources Act.
488
• Standard criteria will be used in the prioritization and selection process of
rural drinking water projects. The projects will be prioritized under such
criterion, and implemented accordingly.
• With a view to make women's role effective for project sustainability, the
female representation will be made mandatory in consumers' committee,
and representation of at least one female member in the committee will
be made mandatory.
§ Implementation of rural drinking water supply projects through
consumers' committees or Non -Governmental Organizations while
ensuring conservation of local resources (Related to Strategy 3)
• Emphasis will be given on regional balance, while taking up new
construc tion projects. New projects will be taken in those districts where
very few people have access to the drinking water.
• Arrangement will be made to complete the construction within the period
of two years after their implementation. This will help quick return from
the projects and the consumers will get the benefit soon.
• Maximum peoples' participation will be mob ilized so that to promote
optimum use of local resources and skills for project development.
Among others, the degree of peoples' participation will also be
considered as one of the criterion of prioritization when selecting and
implementing projects. The rural areas will enjoy certain leverage on the
basis of equity oriented participation principle, since the transport cost
raises the project cost significantly in such areas, which otherwise would
demand very high local contributions.
• Different types of training programs will be launched for capacity
building of local consumers' groups. Such trainings will also be
conducted for completed projects should need arises.
§ Priority to drinking water supply projects affordable to consumers'
committees (Related to Strategy 4) based on simple and appropriate
technology
• Department of Drinking Water Supply and Sewerage (DWSS) will be
made responsible to major activities, for instance, policy formulation,
technical support, monitoring and evaluation of the project, while in the
works related to construction DWSS, consumers' groups and local
institutions will be made responsible. In this context, the responsibility of
construction of minor projects benefiting less than 1,000 people on an
average will lay with the consumers' group. In such projects non-
governmental organizations, community organizations, private sector and
local institutions will play facilitator's role.
• Priority will be accorded to construction of small drinking water projects,
which are within the capacity of consumers' groups, and which are
affordable and sustainable. Drinking water will be supplied by employing
the rainwater harvesting method as well for those areas where permanent
489
sources of drinking water are not available in near by localities. All the
places of the kingdom requiring rainwater harvesting will be identified
and a comprehensive plan will be prepared for its implementation. Solar
PV pumping system, hydraulicd ram, technologies will be adopted, if
feasible in such areas for supplying drinking water.
§ Priority to reconstruction and on-going / uncompleted rural drinking water
supply projects (Related to Strategy 5)
• Priority will be given to complete the incompleted projects while
allocating resources.
• Reconstruction of rural drinking water projects will be carried out with
the local community participation.
• The whole responsibility of construction as well as repair and
maintenance of the projects will be vested to consumers'
committees/groups. For major repair and maintenance, the consumers'
groups and the local institution have to bear expenses, but the district
office of the concerned agency will make available necessary technical
supports. Grants will be made available from the Natural Disaster Fund
for repairing damages caused by natural disaster.
§ Development and Proper Conservation/Protection of Natural water storage
• Emphasis will be given particularly to the improvement of watershed
areas and also protecting water sources for quality maintenance of
drinking water in rural areas. Moreover, effective legal provision will be
introduced to protect water sources from pollution.
§ Sanitation program as an integral part of drinking water project (Related to
Strategy 7)
• Mutual coordination among the agencies involved in drinking water and
sanitation sector will be made functional and effective under the active
role of the national drinking water and sanitation committee. At the
ministry level, coordination among the government, non-government and
private sector as well as other agencies involved in drinking water supply
will be established to enhance project effectiveness.
• The construction of sewerage drainage system with filtration plant under
the active involvement of consumers' group for unpolluted urban
environment will be encouraged. The consumers will be motivated to
construct private toilets with safety tanks in the areas where there is no
sewerage drainage system. Private sector will be involved for
institutional development in collecting and processing of night soil of
safety tanks to produce agriculture manures. Necessary laws will be
enacted and enforced to discourage the tendency of polluting clean and
pure environment by discharge of sewerage drainage in the rain water
drainage, surface water drainage, river and streams.
490
§ Water Quality Improvement for safe drinking water (Related to Strategy 8)
• Filtration plants will be constructed to improve the quality of surface
water. Gradually, ground water filtration will also be taken up for its
quality improvement.
§ Involvement of private sector in the development and management of water
supply system in urban areas (Related to Strategy 9)
• Department of Water Supply and Sewerage (DWSS) will create sectoral
data bank on water supply and sanitation sector. It will assist the Ministry
of Physical Planning and Works and the National Planning Commission
in the formulation of plan and policies.
• Private sector involvement will be encouraged in the management of
existing drinking water system and development of new projects in the
urban areas.
• A regulatory body will be established to monitor drinking water service
benefits, water quality and water charges.
§ Monitoring of drinking water service in urban and sem i-urban areas
• Top priority will be accorded to renovate the defunct drinking water
project because of poor maintenance, under the leadership of consumers'
groups. Priority will be given to transfer the project ownership to the
consumers' groups after renovation.
• Emphasis will be given on regular monitoring and eva luation of drinking
water and sanitation development related activities. Monitoring and
evaluation phase will be incorporated even after the completion of
project, in which achievement evaluation will be paid greater attention.
25.4.5 Programs and Implementation Arrangement
The programs below will be implemented in order to realize the targets of the Tenth
Plan.
The rural sector program
Department of Drinking Water Supply and Sewerage (DWSS) and the Rural Drinking
Water and Sanitation Fund Development Board have played important role in the
extension and promotion of drinking water and sanitation facilities in the rural areas.
The government investment in the drinking water and sanitation is mostly spent
through these two institutions. The following activities will be undertaken for the
development of rural drinking water supply during the Tenth Plan period.
In order to provide drinking water facility to the people of rural areas by extending
the service, programs to complete on-going projects will be continued. Under this
program, in hill areas drinking water will be supplied by constructing gravity projects
based upon surface water, but in terai region hand pump, deep boring and wells will
be constructed, since in most of the terai area under ground water can be exploited
easily. With respect to drinking water supply in the scattered settlements, traditional
491
sources of drinking water services will be improved and protected, since pipe
distribution system will be expensive in such settlements.
Under the World Bank/IDA Credit financing made through the Rural Drinking Water
and Sanitation Fund Development Board, the target is to provide basic drinking water
service to 0.950 million population by implementing 1,260 rural community drinking
water and sanitation schemes within the Tenth Plan period
A study on community based rural drinking water project is continuing. The project is
under implementation with the support of the Asian Development Bank. About 560
thousand people are estimated to benefit from this project wit hin the Tenth Plan
period.
Only those rural drinking water projects/schemes will be implemented which would
address the need of the consumers' groups and which fall under the priority listing of
consumers' demand. The main basis for selecting and prioritizing the projects will be
the status of drinking water facility, and time saving after the project/scheme
completion. In this regard the non-governmental organization/private sector and the
government agencies will assist the consumers' groups/committees . However, the sole
responsibility of maintaining the project after completion lies with the consumers'
groups/committees. The District Technical Office (DTO) will make available
necessary technical support for this. The Department of Drinking Water Supply and
sewerage (DWSS) will assist the consumers' groups if the project is large in size and
its beneficiary exceeds 1,000 people. The DWSS will also help in quality
improvement aspect and rehabilitation as well as technically complicated projects.
The Departmental role would be of a facilitator during the project implementation
stage.
The Urban Sector Program
In major towns and cities of the kingdom, annual demand of drinking water for
domestic use, other industrial use and commercial use is growing at the rate of 6 to
9%. In large towns, the existing system could hardly meet water demand of the
population. In the context of growing population pressure, the problem of drinking
water supply in these towns will be more complicated in the coming years. In such a
situation, rehabilitation of existing drinking water system along with the new program
for increase water supply as well as the up-gradation of drinking water service quality
program will be undertaken during the Tenth Plan period with the available
investment resources.
In the small towns and urbanizing market places of the kingdom, the implementation
of small town drinking water supply and sanitation program will be continued. By
mobilization of the cash and kind contribution from 40 to 50 small town consumers'
groups and using partial cost recovery principle, quality drinking water and sanitation
service will be provided to additional 900,000 people within the period of Tenth Plan.
The drinking water quality improvement project will be implemented to up-grade
service level by improving the water quality of existing system in the Tenth Plan
period. Also, filtration plants will be constructed to improve quality of surface water
as well as steps will be taken to treat the underground water. The private sector
investment will be encouraged in these programs; the projects under such program
492
will be implemented on the basis of feasibility study.
Kathmandu Valley urban sector program
The drinking water demand of the Kathmandu valley at present is about 170 million
liter per day, whereas the supply of drinking water is merely 140 million liter per day
during rainy season and in dry season it is not more than 90 million liter per day.
Therefore, the existing supply-demand gap is a major problem. To cope with this
situation the Melamchi Drinking Water Project will be taken up as a long-term
solution and for the short period, water sources available within the Valley will be
explored, identified and constructed along with the measures for improvement of the
existing water supply system. In this context, new projects will be implemented for
optimal use of available water sources of the Valley, reduce the leakage of water and
strengthen the existing system for the improvement of existing water supply situation.
Under the Kathmandu Water Supply Improvement Project, additional 13.0 million
liter per day water will be supplied from the river Manohara.
The Melamchi Water Supply Project
It is projected that water demand in the Kathmandu Valley will reach about 250
million liter per day by the end of the Tenth Plan. Rapid ly increasing water demand is
not possible to meet by the existing water sources within the Valley. The Melamchi
Water Supply Project, considered appropriation technical, financial and
environmental grounds, is being implemented as a long-term solution. Major
construction of the project will be completed by the end of Tenth Plan period
however the project target is to supply water at the beginning of the Eleven Plan only.
The project will supply 170 million liter per day water to the Kathmandu Valley.
The existing sewerage and surface drainage system of the Kathmandu Valley will be
rehabilitated. The limited sewerage drainage facilities existed in few places at present
will be gradually extended. The existing non-functioning sewerage treatment
plants/stations will bring into operation by rehabilitating and renovating them along
with the construction of new drainage system, make the rapidly polluting rivers and
rivulets of the Kathmandu Valley pollution free.
The Sanitation Program
Sanitation programs will be launched as an integral component of the drinking water
supply projects. Consumers will be motivated to construct and use family toilets. The
locals will be educated on the importance of sanitation in public health through
extensive publicity and training programs. The rural sanitation project will be
implemented separately for the community, where drinking water has been already
available.
Sewerage drain construction program will be implemented in the urban areas and
district headquarters assessing local needs to minimize the adverse impact resulted by
growing urbanization and high population density on urban environment. Feasibility
study for development and extension of surface and sewerage drainage sys tem will be
carried out. Based on availability of financial resources, sewerage drainage system
493
with the treatment plant will be constructed and operated in few other towns of the
kingdom.
Rainwater Harvesting
Drinking water distribution through piping sys tem is complicated and expensive in
those hilly areas having none of the traditional water sources and having scattered
settlements. In order to provide relief to the people residing in those settlements by
collecting rain water and distributing in the dry season, a rain water harvesting project
will be emplemented. About 40,000 people will be benefited from this program.
Support Programs
Projects having direct and quantitative benefit for the sustainable development of
water and sanitation sector will be implemented likewise activities such as quality
improvement, leakage control, metering, public awareness, enhancement,
development of management information system and monitoring, and human
resource development will be effectively implemented.
Regarding the issue of arsenic in tube well water of Terai region, necessary
coordination among various agencies and institutions will be established to ascertain
the magnitude of arsenic content in tube well water , and a water tasting program at
national level will be initiated. Alternative water sources will be explored where the
arsenic content is high. In those places having is no alternative of tube well water,
necessary measures will be taken for their proper treatment.
25.4.6 Policy Reform
Consumers' groups will be involved from the very beginning of project phase and the
responsibility of implementation, repair and maintenance of the project will be given
to them. The role of the non-governmental organization, private sector and district
office of line ministry/department will be of supporter and facilitator.
The entire responsibility of maintenance of the rural water supply schemes lies with
consumers' group and local bodies. In general, all types of repair and maintenance
works will have to be carried out by the consumers' groups except the major repair
and maintenance works. In case of major maintenance, the consumers' groups will be
provided financial support from the local institution and technical help from the
district office of the line ministry/department to complete the work.
Municipalities will be involved and assigned special responsibility for the

development and extension of urban water supply system. The Kathmandu Valley
Water Authority will be set up for the integrated use of water sources of the Valley.
The Authority will be constituted with the representation of the local bodies and
concerned ministries. It will develop management concept regarding water
distribution, water use and protection of water sources of the Kathmandu Valley by
implementin g water sources protection and conservation measures and methods of
river basin management.
494
Acts relating to Urban Sector Water Supply Service will be formulated and enforced
with an objective to involve private sector in the development and management of
urban water supply. This Act will create congenial atmosphere for the private sector
participation in the development and management of water supply and sewerage
system.
In order to discourage uncontrolled use of groundwater for preventing environmental
disaster that may happen at any time due to drastic fall in groundwater level,
amendment in the existing Acts and regulations will be undertaken.
25.4.7 Prioritization of projects
Drinking water supply projects incorporated in the Tenth Plan have been prioritized.
The Melamchi Water Supply Project has been identified as the national priority
project and top priority has been given for its implementation.
Next priority area of drinking water sector is to provide basic drinking water service.
The up-gradation of drinking water service program falls under the second priority.
The criteria of listing priority are regional priority, need of government's
involvement, cost effectiveness, regional balance and expected period of return/
benefits from the proposed projects. The priorities of projects/programs have been
grouped into three broad levels, and description of prioritized projects are presented
in the Annex 25.1
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Priority Categorization of Projects in Summary Form
(Rs. in millions)
S.N. Project/Program No. of Programs Expected Growth Normal Growth
1. Melamchi Project 1 2156.59 1733.34
2 Priority- No.1 9 561.51 73.4 451.31 90.6
3. Priority-No.2 6 196.45 25.7 39.29 7.8
4. Priority-No.3 7 7.53 0.9 7.38 1.6
Total: 23 2922.08 100. 0 2231.32 100. 0
While prioritizing the drinking water supply projects separately, difficulty of water
supply (fetching time for water) will also be considered.
25.4.7 Economic contribution of drinking water supply sector

a) Employment Generation:
It is estimated that additional 15,000 jobs will be created from the various programs
and activities of drinking water supply and sanitation sector during the Tenth Plan
period.
b) Impact on Gender Equity:
It is required to have equal contribution and participation of both the male and female
for the balanced development of the country. Hence, the role of female will be
increased gradually in the implementation of drinking water supply and sanitation
programs. The role of women will be made decisive by involving them in each stage
of project operation, considering their major responsibility in the Nepalese society
from water collection and carrying home, use and cleaning of houses, while
implementing the project. The project will be sustainable as well as the women will
get time to participate in other activities from such arrangement. Women will be
made capable by undertaking adult education and income generating programs as
supportive programs of water supply projects. This will avail them opportunity to
involve in income earning activities. Likewise children also get opportunity to go to
school, which helps increase in enrollment of girls students and contributes to realize
the target of gender equality.
c) Contribution to Poverty Eradication and Human Resource Development:
The investment in the drinking water and sanitation sector not only provide drinking
water service but it will improve the health condition of consumers thereby contribute
in productive activities. Besides, it helps to check expension to be made on the
treatment of water borne diseases. It will bring down the child mortality rate. A study
has revealed that in hill areas more than 2 hours per day is spent in fetching drinking
water. So, it helps to utilize the time save in the additional income earning activities
and also saves energy spent on water fetching.
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25.4.8 Monitoring indicators
Following indicators will be used for output monitoring of water supply and
sanitation program:
• Number of projects annually completed and benefited population from those
projects
• The degree of people's participation.
• Cost effectiveness
• Time saving in fetching water
• Service provided to neglected and poor section of the population
• Production indicators such as women's participation (in consumer
committees) and outcome indicators such as health and hygiene.
• Reduction of diarrhea to the children below the age of 5 years
• Regular use of toilets
25.5 Risk and obstacles anticipated during program

implementation
When implementing the programs to realize the targets of the Tenth Plan, the
following risks and obstacles may emerge.
• Availability of sources of water and continuity of water availability
• Continuity of peoples' participation
• Capacity building of local bodies
• Private participation in the urban water supply management
• Pollution of natural sources of water
• Effectiveness of cost recovery principle in urban water supply
25.6 Log frame

The log frame of water supply sector is presented in the table below and its detail
is presented in the Annex 3.
497
Log frame of Policy and Programs: Drinking Water and Sanitation Sector
Overarching National Objective: Poverty incidence of the Nepalese people (men and women) will be reduced
significantly and in a sustainable manner.
Sector Objective: Improve public health and increase productivity by providing drinking water and sanitation service
Sector Objective: • Drinking water project(s) will be operated on • 85% of population will benefit • District drinking 1. Provide basic • Continuity of
Improve public the basis of cost recovery principle. from basic drinking water water and drinking water peoples and
services. sanitation facility local bodies
health and • Drinking water project(s) will be constructed
increase and operated with the involvement and • Additional 5% population will be documentaries. 2. Provide participation
productivity by participation of Users' Community and local benefited from high level • Trimester and appropriate and
supplying drinking resources will be mobilized to the maximum. service annual programs sanitation facility contribution
water and • Emphasis will be laid down to increase skill • Additional 10% population will of the Ministry of 3. Up-gradation of • Local level
sanitation services and capacity of the users' be benefit from medium level Physical Planning drinking water capacity
in a sustainable and Works. building
community/committees and NGOs who will service. service level
manner. involved in the mobilization of rural drinking • District health
• Reduction of illness from water 4. Increase
water schemes / projects borne diseases (children below statistics capability of local
• Priority will be given to appropriate, simple 5 years of age) • Special survey bodies/institution
technology based projects / schemes, which • Save in water fetching time. reports s and consumers'
could be afforded by the consumers' community
committees. In those places where there are • Increase in school enrolment of
no permanent sources of water and enough girl students in rural areas.
water quantity, drinking water will be supplied • Reduction in per capita
by adopting rainwater harvesting, solar PV expenditure in health treatment.
pump, high dam (hydro ram), etc.
• Priority will be accorded to rural drinking
water projects to be reconstructed and
uncompleted /ongoing projects
• Adopt policy for proper protection and
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development of water storages by protecting
the watershed and manage integrated use of
its surface and underground water sources.
• Sanitation will be made as an integral
component of drinking water program. In
urban areas where population density is high,
sewage drainage will be constructed with
peoples' participation, while in other areas
toilets construction will be emphasized.
• National code of conduct/ norms for quality
water will be developed to provide safe
drinking water. Quality monitoring and
controlling process will be strengthened.
Also, national water regulatory authority will
be set up.
• In urban areas, private sector involvement
will be encouraged. Also, drinking water
facility will be developed and extended by
giving responsibility to District Development
Committee (DDC), Village Development
Committee (VDC) and municipality in line
with the decentralization policy.
Note: Quantitative targets are based upon 6.2% economic growth (Detail is given in Annex 3)
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Annex 25.1: Programs and Estimated Budgets
(In Millions of Rs.)
SN Project/ Program Expected Normal
Growth Rate Growth Rate
1. Special Projects:
a) Melamchi Drinking Water Project: 15,954.6 12,823.3
b) Kathmandu Valley Urban Drinking Water Project: 4,402.9 3,538.8
c) Kathmandu Valley Drinking Water Improvement Project: 1,208.4 971.3
Total: 21,565.9 17,333.4
Program/Projects under First Priority
2. Other Maintenance and Improvement Project (Rehabilitation project): 404.2 324.8
3. Rural Drinking Water and Sanitation Fund Development Board: 1,514.9 1,217.6
4. Rain water Harvesting Project: 78.8 63.3
5. Drinking water Leakage Control and Maintenance Program: 33.7 27.1
6. National Management Information System and Monitoring 8.1 06.5
7. Community Drinking Water Project: 916.1 736. 3
8. Environmental Sanitation Program: 32.3 26.0
9 Drinking Water and Sewerage Drainage Program: 67.4 54.1
10. Drinking Water Project: 2,559.7 2,057.3
Total: 5615.1 4513.1
Percentage: 93.02 97.91
Programs / Projects under Second Priority
11. Rural Drinking Water and Sanitation Program: 178.5 35.7
12. Rural Drinking Water Development Program (Western Development
Region): 12.0 02.4
13. Human Resource Development Project: 20.0 04.0
14. Macro Sewerage Drainage Project: 60.0 12.0
15. Drinking Water Supply Improvement of urban areas Outside the
Kathmandu Valley Program: 414.0 82.8
16. Small Town Drinking Water and Sanitation Project: 1,280.0 256.0
Total: 1,964.5 392.9
. Program/Projects under Third Priority (Proposed Projects) 75.3 73.8
17. Drainage Construction project
18. Drinking Water Production Enhancement Program
19. Rural Sanitation Program
20. Drinking Water Quality Improvement Project
21. Deep Tube well and Metering Project:
22. Maangadh Drinking Water Project:
23. Bagmati Drainage Project:
24. Projects run under Ministry of Local Development *:
25 Projects under Non -governmental Organization**:
Total: 29,220.8 22,313.2
* Budget allocation will be made under the Ministry of Local Development.
** Budget will be borne from the sources of the Non-Governmental Organizations
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Annex 25.2 : Status of Drinking Water and Sanitation by the end of
the Tenth Plan
S.N Description Rural Urban Total
-Population of FY 2058/59: 20,281 3,461 23,742
-Projected population for the FY 2063/64: 22,315 4,368 26,683
Drinking Water Sector
1.1 Benefited population up to FY 2058/59: 14,388 2,630 17,017
1.2 Benefited population up to FY 2058/59 ( in %) : 70.9 76.0 71.6
1.3 Projected population to be Benefited by FY 2063/64: 18,967 3,713 22,680
1.4 Projected population to be benefited by FY 2063/64
(in %): 85 85 85
1.5 Population to be benefited from the existing system
by FY 2063/64: 15,115 2,974 18,089
1.6 Additional population to be benefited from new
projects in Tenth Plan period: 3,852 739 4,591
Service Quality Improvement
1.7 Additional population to be benefited from the high
quality service in Tenth Plan: 1,334
1.8 Additional population to be benefited from the
medium quality service in Tenth Plan Period: 2,668
Sanitation Sector
2.1 Benefited population as of FY2058/59: 4,094 1,826 5,920
2.2 Benefited Population as of FY2058/59 (in % ): 21 53 25
2.3 Projected population to be benefited by FY 2063/64: 9,707 3,634 13,341
2.4 Projected population to be benefited by FY 2063/64
(in %): 43 83 50
2.5 Additional population to be benefited in Tenth Plan
Period: 5,613 1,808 7,421
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Chapter - 26
Women, Children and
Social Welfare Sector
26.1 Women:
26.1.1 Background:
The improvement in the status of women could not be achieved much due to various
reasons. It is because the traditional outlook of the society towards women did not
improve as expected, neither expected improvement in legal framework had
introduced in the gender discrimination. The government investment in some areas of
social sector remained low, the emergence of competitive atmosphere in economic
activities emerged due to globalization and the limited access of women to the new
technologies development and their utilization are also the contributing factors for
such situation. Majority of women are forced to work at low wage in unsafe working
conditions. As a matter of fact, no improvement has occurred in their domestic as
well as social conditions. Their access to economic resources and opportunities are
also limited.
His Majesty's Government is concerned about women's rights and gender equity. In
the mainstreaming of development, the welfare concept is gradually transforming to
the concept of rights. Nepal has committed firmly to implement the convention on
elimination of all types of discrimination against women (CEDAW), Beijing
declaration and its review document including other documents related to
international human rights. In this context, it is but necessary to implement policy of
involving women in the mainstreaming of development through transparency and
women empowerment with the active support from the civil society.
There are hosts of works remained to be done, particularly in the fields of legal,
policy matter, institutional development, program formulation and execution,
monitoring and evaluation for ensuring children's rights and their development as
committed by His Majesty's Government in the international and regional
conferences and in line with the United Nations Children's Rights Convention (CRC).
In such a context, the Tenth Plan will be based on policies and programmes of
children rights.
So far physically challenged are concerned, the rights of such population and
principle of equality as committed in the international conferences should be
implemented. Therefore, it is necessary to initiate various programs directed towards
their poverty reduction, illiteracy, unemployment and social backwardness.
Regarding the senior citizens' rights and development, it is necessary to utilize the
senior citizens' knowledge, skill and experience in the different areas of national
development, keeping in mind the firm commitment made by His Majesty's
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Government in different international conferences and ensuring social and economic
security for their dignified living.
There has been a surge in the registration and operation of various non-governmental
and social organizations committing public awareness enhancement and socio-
economic development. The experience tells that the international non-governmental
organizations are to be made obligatory to implement their programs through national
non-governmental organizations and civil societies and equally it is important that
their programs are to be formulated in coordinated manner with the center and the
local institutions. Hence, it is felt necessary to create congenial atmosphere to
enhance their operations by bringing them into mainstream of national development.
The government by adopting positive in-discriminatory policies in an effort of equity
oriented development has implemented various programs and projects directed
toward the development of women, children, physically and mentally challenged
(disables), senior citizens and socio-economically backward ethnic groups and people
through the targeted plan and programs. These programs are launched in consonance
with the commitments made by the government and they are related to different
treaties, conventions and conferences. The convention on abolition of all types of
discrimination against women, convention on children's' right, conferences on social
development, and the 1995 United Nations conventions are just a few to be
mentioned. The national and international non-governmental organizations have
contributed in a meaningful way in these programs. In order to carry out these efforts
in more effective way, it is equally important to reform the management system and
other aspects to make non-governmental organizations and civil society achievement
oriented in their actions in the area of raising the living standard of targeted groups.
Some notable indicators revealing the status of male and female in the areas of access
to economic resources and control as well as opportunity in consumption is presented
in the table below.
Information Exhibiting Status of Females
Subject Male Female
1. Population (%) 49.96 50.03
2.Average age (in years) 61.8 62.2
3. Literacy rate (above 15 years in %): 62.2 34.6
4. Participation in Council of Ministers (%): 94.45 5.55
5. Member of House of Representatives (%) 86.67 13.33
6. Participation in Civil service (%) 91.45 8.55
7. Judges (%) 97.96 2.04
8.Teachers (%) 74 26
9. Participation in communication sector (%): 88 12
10. Participation of foreign employment (%): 89.15 10.85
11. Land ownership (%): 89.16 10.83
12. House ownership (%): 94.49 5.51
13.Contribution to agriculture production (%): 39.5 60.5
Source: National Population Census Report, 2001, Central Bureau of Statistics
26.1.2 The issues requiring gender mainstreaming, in sectoral basis:

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The gender equality is the most important base for poverty eradication. It is
necessary to merge socially and economically backward communities into the
mainstream of development on the basis of equality and equity oriented principles.
Women empowerment, gender equality and mainstreaming are necessary to include
in the objectives as well as programs of other line ministries.
The women empowerment policies and programmes should be incorporated
transparently and responsibly in the development mainstream, and benefits of the
development should be catered to the targeted groups with the active participation of
the civil societies. The woman issues are human development issues, so it should not
be limited to one particular ministry. The gender balancing strategies mentioned in
the national work plan of gender balancing and women empowerment could not be so
successfully incorporated in the sectoral objectives and annual work plans of the line
ministries. Likewise, the sectoral ministries have to take additional efforts to develop
institutional capabilities to work with in the areas of women's human rights and
women development targeting gender equality, for which the government has
expressed, time and again, its commitment at the international levels.
In order to mainstream the women issue in the national development, ensure
women's access to the resources and benefits of development, and reduce the existing
gender gap, the women issue should be dealt as a sectoral issue as well as crosscutting
issue. It is required to formulate policy and programs as well as their effective
implementation for improving the existing socio-economic condition of women by
adopting various policies based upon equality and equity to merge various sectors'
activities into gender mainstreaming.
a) Social Sector:
Education is the important medium to realize the goal of gender equality and women
empowerment. Despite the fact, the gender gap wide in education sector. The present
situation is characterized by low female literacy rate, low female enrollment rate, low
female participation in technical education, high female drop out rate in the school,
few game clubs for female and not more than 26% of teachers are females. Therefore,
policy to reduce gender gap need to be adopted for improving the existing situation
and for this policy level and working level coordination will be enhanced among
related sectors' agencies.
In this context, the programs such as compulsory employment of female teacher up to
the level of secondary education, inclusion of gender perspective in the curriculum,
extension of female scholarship along with facilities of hostel to female students will
be undertaken. It seems necessary to include topics like women's perspectives and
gender sensitivity in the training courses and women participation in management
transfer, debar from schooling to be treated as social crime, arrangement of separate
examination for the women in maternity within specific time period and there is a
need to organize national sports/games for females exclusively.
The health condition of Nepalese women is very poor. The reasons are less access to
health service, poor mental health, leukemia and malnutrition, poor knowledge about
maternity health cure, lack of legal consultancy services, limited maternity services
by trained persons, high maternal mortality rate, child marriage, etc. Hence, the
505
policy like formulation of integrated he alth program instead of isolated one as well as
policy of life cycle based on reproductive health cure service has been adopted.
In the health sector, number of programs has been implemented. These programs are
maternity health service, formulation of the procedural arrangement oriented towards
health service regulations related to safe and easy access to maternity health service,
sex education and consultancy service for youth, extensive publicity on HIV / AIDS,
consultancy service as well as other health services to women suffering from HIV/
AIDS and arrangement of consultancy and health service to women above 49 years of
age. In addition, programs such as, development of the fully-equipped maternity
service in each district, extensive publicity on family planning and its service up to
the village level are executed. Besides, activities like awareness in the area of
women's rights to health service by using communication media and also about
nutrition awareness including malnutrition treatment was undertaken. All programs of
health sector need to be gender friendly.
Although the institutional development of electronic and print media has developed
along with the privatization process in the country, women participation and gender
mainstreaming could not how ever be taken place as expected. In the communication
sector, not more than 12 percent women found employed, but most of them were in
the supportive posts, not in the policy making. The study on women has not been
carried out yet in the communication sector. Special program is to be launched to
increase information and access of women in the field of information and
communication by adopting policy of women access and their participation at all
levels of the communication for their mainstreaming in the communication sector. In
the same manner, special time and budget are to be allocated for the development of
women and children, along with the awareness programs to change their traditional
role. Also, the opportunity for study suitable to women is to be created and training
to be provided to them. The gender awareness related training courses for woman
journalists from policy to grass root level including measures for extensive publicity
and broadcasting about women's rights and empowerment are also to be undertaken.
The women's condition as of today is that women employment in local institutions is
limited to allocated quota only. The women have not been in the decision making
levels, although there are 40,000 posts, as provisioned by the Local Self Governance
Act, that females can be employed. The women participation in all the community
activities including housing, sanitation, rural electrification, transport, drinking water
and communication is to be ensured. Similarly, quota is to be fixed for increasing
women participation in the decision-making level of the local level institutions. The
participation of women in the training program related to leadership development is
to be increased. The women public representatives association is to strengthen with
adequate resource and the program related to empowerment of the marginalized
women/ downtrodden/backward community is to be launched.
b) Economic Sector:
Women play major role in the economic activities. Generally, the domestic chores as
well as agricultur e work done by women is not considered in the national income
estimation. Women's access to economic resource and control over it is less because
506
of legal discriminatory property rights. The difference between average income ratio
between male and female is 1: 0.39. The implementation of micro financing program,
focusing on women as a target group has not produced any substantial impact on
eradicating poverty of the country as expected. Hence, the policy will be adopted to
assess the female work in the national accounting system and gender auditing for
women empowerment through their economic self-sufficiency. The policy and law
will be formulated to assess tax on women independently. The credit program with
the objective of providing clean loan to women at low interest rate and priority to
women in loan disbursement will be implemented. Also, necessary measures will
have to be taken to encourage those industries with limited female employees to
increase female labor in their industries.
Despite the fact that women work as high as 11 hours a day on an average, their
income is very low. It is because majority of them work in the rural area and that also
in the informal sector. Another reason is that women do substantial amount of work
without remuneration. Because of the maternity role to be played by women, they
have dual wok load and it has affected their employment outside domestic affairs. Of
the total labor force employed in foreign jobs, the share of female is not more than
10.85%. In addition, women are victimized of wage discrimination as well. Not only
that there is lack of policy and acts of controlling the ill-sex behavior to them in the
work places. However, some policy measures for women participation and their
protection at the working places have been taken to improve their participation in the
employment.
The policy and programs need to be implemented include development of policy and
acts for promoting women participation in the employment, provide training related
to modern business and occupation for increase in women employment, enforcement
of laws and policy against ill-treatment of sex at the work places, establishment of
baby care centers, increase skills and capability of women for foreign employment,
monitoring of women working abroad, require to enter into bilateral agreement on
norms and standard relating to minimum facilities and security with the countries
employing Nepalese labor force and also necessary to monitoring as well as
evaluation of the companies dealing in overseas employment. Measures have been
initiated to arrange women friendly transport means and to motivate female driving in
the development of transport sector.
The proportion of female human resource engaged in the agriculture sector is
continuously growing. Welfare to female farmers is a must to improve the overall
agriculture sector of the country, and for this, policy of improvement and extension of
agriculture technology, keeping in mind gender friendly approach, is to be adopted.
For this, it is necessary to produc e women agri-entrepreneurial human resource and
needs to increase female participation, particularly of the low income families, in the
income generating agriculture activities, and enhance women's access to various
training programs on improved agri-technology user friendly to women, extension of
agriculture technical know -how, technical service inputs, agriculture credit, animal
husbandry, cattle feed industries, etc. Also, it is necessary to effectively enforce law
related to women's property rights to ni crease women's agriculture land ownership
and gradually necessary steps will be taken in this direction. In the enrollment of
507
agriculture institutes, special priority will be given to women to increase their
participation, while policy will also be adopted to make women participation
compulsory in the management of irrigation system.
In respect of land ownership and its utilization, women lagged far behind the male. Of
total households, merely 10.83% women has ownership over land with houses, while
in the case of agriculture land the women ownership is hardly 4.4%. Regarding the
land holding, as high as 81% women own less than 1 hector of land. In order to
increase women land ownership and its utilization, the implementation of under
mentioned aspects seem to be important.
In the process of rehabilitation of liberated bondage labourers (Mukta Kamaiya), both
the names of males and females are to be mentioned in the title of land ownership,
likewise both the male and female names are to be mentioned in the land title of
distributed land to landless. It is necessary to ensure female participation in the
training program related to land management system. The discriminatory act in regard
to tenancy right of unmarried women after 35 years of age only is to be amended and
extensive publicity is required on women property rights. Like manner, in the
diversity in management, conservation and development of natural resources, gender
mainstreaming is to be done, income generating and employment opportunities are to
be increased by extending women access to community, contractual and private
forest. Not only this, women access to water should be enhanced and they are to be
made partners in water management. In addition, the women's income generating
program is to be launc hed by utilizing the inter linkage between natural resource
protection and women's traditional knowledge of ecosystem. While taking gradual
steps for the implementation of the aforesaid different aspects, the execution of
awareness promotion programs will also be undertaken.
In the industry and commerce sector, the involvement of women hardly exceed 2.1%
and it merely 0.4% women are now working in the service sector. The limited access
to economic resources and control over it, limited opportunity to get ed ucation,
training and technology, dominance of patriarchal values and duel role to be played
by women including shouldering of household responsibility are the factors creating
negative impact upon development of women entrepreneurship. In order to promote
women entrepreneurship, special credit and capital management program, facilities
for encouraging women industrialist, conduct of special training program for women
employees/industrialists will be undertaken. Moreover, training program to increase
women participation in modern industrial occupation, protection of traditional skill
and cottage industries will also be implemented. Initiative will be taken to develop
small scale industries through women involvement and in such industries women
participation will be encouraged. In respect to regular tourism, women can play
effective role, so program will be launched to involve women participation in the
development of tourism.
The development of science and technology has no doubt created new opportunities
of employment and noble ways of doing things, but it women's access to use these
facilities is limited and they have not able to take optimum benefit out of them. So,
with a view to benefit the women as well, measures will be taken to develop and
extend gender friendly technology by adopting the policy of increase of women
508
participation in the use of science and technology. In addition, women will be
encouraged in the education of information technology and in computer training
courses, sanctioning 33% seats for females. Development of renewable energy
technology will be sped up, for the simple reason that its impact on woman's health is
very much positive.
Obviously, there will be no disagreement that gender mainstreaming will be result-
oriented and can support to development process, only if women participation will be
increased at the policy formulation level of political, administrative and other sectors.
Special effort has to be made at the present juncture of low level of women's
participation at the policy formulation level. Hence. it is necessary to adopt
motivating mechanism such as policy, law and regulation, training etc. for this
purpose.
26.1.3 Women's Rights (Gender Mainstreaming, Equality and
Empowerment)
Progress Review of the Ninth Plan:
The Civil Code (11th. amendment) has been passed in an effort to abolish
discrimination against women. The amendment was positive in respect of women's
right to property, abortion, sexual exploitation, minimum marriage age and marriage
and divorce. The high level committee constituted for review of all types of legal
discrimination against women has already submitted its report.
The women section has been set-up in all the ministries and has established National
Women Commission. Efforts are continued to empower the working committees,
center as well as district level, constituted for controlling trading and trafficking of
girls. The national work pan for gender equality and women empowerment was
prepared in line with Beijing Work Plan. The government has expressed its
determination to implement the article of SAARC convention on prostitution relating
to the trading of women and children, which was passed in the eleventh SAARC
Summit conference. In 16 districts of the Kingdom, female police cells have been
created to deal women and children issues more sensibly and sensitively. In order to
quantify/measure the women's participation in the national development, statistical
information of gender differences as well as female labor used in domestic work has
started to reflec t in the assessment of national accounting system.
In an effort of merging women into the mainstream of development, and as a result of
special arrangement, almost 40,000 females have been elected in the local level
elections. Certain special arrangements have been introduced in the Civil Service Act
to increase female participation in the civil service. In addition to this, special
coaching classes for women were organized for entrance examination in civil service
and in this respect positive changes have been noted.
Programs related to publicity and training were implemented to bring awareness on
topics like gender issues of central to local level and women related international
convention and treaties. The non-governmental organizations working in this sector
are also undertaking public awareness, rehabilitation and economic empowerment
programs.
509
Women's life expectancy has been increased as a result of efforts to improve their
health condition and also has come down their reproductive rate. As compared to
female education and training, female literacy rate has gone up to 34.4% and the
share of female teacher in the total has reached 26%.
Programs such as micro financing for women economic empowerment, women
development program, intensive banking program, women awareness and income
generation program, informal enterprises program, skill development program and
cooperative programs have already been implemented. The involvement of women
particularly in the savings and credit programs indicates that mobilization of women
has taken place in social form. Women access to production technology (which is
required to increase efficiency of female farmers), inputs, production credit, training,
marketing facility has become easy and simple. In order to increase women
participation in the sectors related to economic activities like industry, tourism and
forestry, the women's involvement has increased in the implemented programs, such
as, enterprises and management training, easy finance and employment. Similarly,
separate consumers' groups in forestry sector have been formed.
Indicators of Women development
Indicator As of pre 9th Plan Status at the end of
status 9th. Plan
1.Average age (in years) 53.05 62.2
2. Literacy (%) 30 34.6*
3. Mortality rate (per 100,000 person) 539 415
4. Infant Mortality Rate (Per 1000 live birth) 161.6 64.2
5. Fertility rate 4.6% 4.1%
6. Health service at the time of maternity 7.4% 10.8%
7. Use of family planning devices 24.1% 38.8%
8. Female participation in the local institutions 20% 20%
9. House of Representatives 3.41% 5.85%
10. Rastriya Shabha (Upper House) 8.33% 13.33%
11Tteachers 13.7% 20.5%
12. Farming 63% 65%
Source: Ninth Plan 1997-02) and Population Census Report of 2001, the Central Bureau of
Statistics.
* Estimation of the National Planning Commission
Problems and challenges encountered during implementation:

• The legal gender discrimination remained in practice
• The fact that women development and empowerment are also the integral
parts of children, family, society and the nation could not be popularized.
• Gender issues could not be translated into policy and programs in an effective
way.
• Policy adoption, program implementation, monitoring and evaluation could
not take place as per political commitment. There was lack of coordination
510
among inter agencies as well..
• The available resources could not be effectively utilized.
26.1.4 Long term vision:

Egalitarian society based upon women empowerment and gender equity through
gender involvement in the mainstreaming in every area of national development will
be created.
The main targets are to accomplish 0.750 GDI (Gender Development Index) and
0.700 GEM (Gender Empowerment Measurement) by 2074 BS in order to realize
long term vision.
26.1.5 The Tenth Plan:
Objective:
The primary objective is to create egalitarian society based upon women's rights by
improving GDI (the Gender Development Index), and by abolishing all sorts of
discriminations against women for the realization of economic growth and poverty
eradication goals of the Tenth Plan.
Major Quantitative Targets:

• To raise Gender Development Index (GDI) up to 0.550.
• To raise Gender Empowerment Measurement (GEM) up to 0.500.
• To raise women participation in policy development up to 20 percent.
Strategy, Policy and Implementing Strategy:

The increase in female literacy rate will contribute to overall economic development,
since it contributes to decrease population growth at one hand and increases
productivity of female farmers at the other. In the context of over 50% female
population, and less access of women to family income, the effective implementation
of self -employment training and other targeted programs will contribute to their
income earning capacity and promotion of social justice. Since, without increasing
women participation at the implementation level, the programs related to women
development cannot get momentum. So, increase in the women participation in all the
implemented programs related to women empowerment and poverty alleviation and
income generating activities at local level will help to improve their socio-economic
condition and to reform in the level of gender equality. Against this background, main
strategies will be adopted as follows.
1 Make effective women's participation in the formulation, implementation,
coordination, monitoring and evaluation of related sector policy and women
targeted programs.
2 Increase women's participation in the every aspects of the projects relating to
poverty alleviation and income generating.
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3 Increase awareness of gender equity at all groups and levels.
4 Make amendment in the laws discriminating women on the basis of equity
and international commitment.
Policy and work strategy:
§ Women related sectoral programs (Related to strategy 1)
• All line ministries are required to consider incorporating gender issue in
the mainstream as a common responsibility. The National Planning
Commission will play the facilitating role to carry it out in a coordinated
manner and integrating it with other processes of development.
• Special efforts will be taken to increase women's participation in
political, administrative and economic sector from the center to the
village level.
• Make the National Women Commission as a powerful institution
equipped with legal authority for reforming existing gender equity
situation of the country.
• Establish effective coordination among the focal points of line ministries
in respect of women development.
§ Local level programs and women's participation (Related to strategy 2)
• Increase women access to employment, occupational technology and
resource allocation.
• By providing skill oriented trainings, self employment oriented jobs will
be created to displaced women due to criminal activities as well as single
women. Also, access of women to employment opportunities created
under targeted programs and micro credit will be extended.
• Launch different types of programs related to women empowerment,
incorporating gender issues into mainstreaming and women equity by
involving local institutions, non-governmental organizations and
associations as well.
• Increase women's active role in the selection of targeted
projects/programs, their implementation/operation and distribution of the
output.
• Undertake necessary steps for socio-economic development of
geographically, socially and economically backward women including
physically challenged and victimized by insurgency (terrorists' victim).
§ Awareness for gender equality (Related to strategy 3)
• Against the traditional and defeatist regional, social and economic gender
discriminative attitude and to enhance awareness about women rights,
non-governmental organizations, community based organizations and the
civil societies will be mobilized.
§ Women issues related legal reforms (related to strategy 4)
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• Necessary steps will be taken to formulate new laws and amend the
existing ones on the basis of gender equity, while devising special
arrangements for transition period. In the industry sector, to merge
women into mainstreaming, the industrial policy, labor act and legal
provision related to taxation will be amended to meet the demand of time.
Programs and Implementation Arrangement:
Mainstreaming:
• All the legal provisions, policy, programs and budgeting will be analyzed on
gender perspective. The Gender Resource Center will be set-up.
• The national action plan will be formulated for mainstreaming and
development of women. At the same time, the line ministries will be made
effective to implement the programs.
• By developing the reproductive health cure service based upon life cycle
pattern, programs related to health sector will be oriented towards gender
friendly for the improvement of the women health.
• By assessing women farmers' contribution to agriculture development, steps
will be initiated to undertake programs related to income generating
activities, market arrangement, loan, agriculture education and training for
uplifting their living standard.
• Steps will be initiated to conduct industrial training, provide concession
loans, launching of awareness programs including marketing and awards and
decorations to motivate women entrepreneur.
Empowerment:
• Short term measures will be taken to increase women participation at all
levels of political, administrative, technical service, as well as in
constitutional bodies and committees including group operation and
management, etc. Also steps will be taken to launch actions and programs,
such as, motivating employers to increase female labor participation,
checking sexual misbehavior in work places, attracting women in the foreign
jobs.
• Necessary coordination will be established with the concerned ministries for
arranging special programs, for instance, free education to female students up
to lower secondary level, special stipend/scholarship to female students,
informal female education, compulsory female education, technical and
vocation education including training, course books and curriculum, increase
gender sensitivity in training materials and increase women participation in
sports.
• Steps will be taken to develop networking for conducting trainings with a
view to develop leadership quality, skill enhancement and capacity building
for women empowerment.
• Scholarship/stipend arrangement will be made for the female students
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belonging to the ethnic groups, oppressed and backward communities for
giving them opportunity to get higher education.
Gender Equality:
• Undertake steps to reform in the existing legal system related to women and
set-up legal arrangement and carrying out legal enforcement to stop crimes
(against bokshi, juma, deuki, badi) arising out of superstitions.
• Awareness will be increased on women's rights.
• Programs will be developed and coordinated to provide compensation,
counseling service, medical treatment, legal advice and rehabilitation and re-
integration for the survivors of domestic violence, trafficking and other types
of attrocities. In addition, programs, such as, providing security to displaced
women like widow, orphan and other children and women victimized due to
emerging political conflicts, as well as their rehabilitation and income
generating programs based upon community will be initiated.
• Participation will be increased on the basis of equality principle in the
distribution of productive resources and development activities.
Monitoring and Evaluation:
• Monitoring and evaluation of projects and activities implemented relating to
mainstreaming of gender, empowerment and equality will be done on the
basis of statistical information.
• Measures to strengthen the capability of monitoring and evaluation system of
the National Planning Commission and the Ministry of Women, Children and
Social Welfare will be undertaken.
• Steps will be initiated to strengthen gender development unit with adequate
physical and human resources of all line ministries.
26.1.6 Expected output:

• Contribution to increase in the Gross Domestic Products (GDP) will occur
through the programs like gender awareness, mainstreaming, empowerment
and equality which will raise the women's income earning level and create
more economic activities for them. Moreover, the development of women
will raise the level of human development.
• The growth in entrepreneur women and increase in job opportunities will take
place. Also, among the women, the access of backward poor, downtrodden
and ethnic group women to education, health, income generation activities
will be enhanced.
• With the active participation of authorities of local institutions based upon
decentralization policy as incorporated in the Local Governance Act, 2055
BS, women will enjoy their rights and fruits of development as a result of
implementation of programs of women's rights and gender equity.
• Gender equity will be accomplished as a result of effective implementation of
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policy and programs of mainstreaming, empowerment and equity in the
manner of transparency and responsibility.
26.1.7 Probable obstacles and risk in the implementation and
accomplishment:
• Lack of gender sensitivity and lack of perception of gender on project cycle
• Lack of resource mobilization.
• The programs based upon gender equity under line ministries may not receive
priority.
• Legal obstacles may be unsolved.
• Values of patriarchal system may persist.
• Political instability may continue.
26.1.8 Achievement monitoring indicators:

• Gender Development Index (GDI) and Gender Empowerment Measurement
(GEM).
• Ratio of female and male average income.
• Average life span total rate of females, maternity mortality rate
• Female literacy rate
• Policy development at all levels and women participation.
• Percentage of women participation in employment.
• Legal development and improvement in accordance with conventions and
treaties related to women.
• Implementation of national action plan,
• Formation of closed hearing units, family courts/special hearing units.
• Course books on gender sensitivity and training methodology
26.1.9 Program and Outlay:

The women development sector related programs and outlay in order of priority is
presented below.
(Amount in Rs. millions )
Order of No. of Under Normal Under Under low Under low
priorities programs Growth Rate normal growth rate (in growth
(in amount) growth amount) rate (in %)
rate (in %)
a) (P1) 4 560.2 64.1 490.2 73.3
b) (P2) 2 290.9 33.3 156.1 23.3
c) (P3) 2 22.3 2.6 22.3 3.4
Total 8 873.4 100.0 66.86 100.0
26.2 Children's Rights and Development

26.2.1 Review of the Ninth Plan:
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During the Ninth Plan, the central and district level child welfare committees on legal
basis were created. The juvenile delinquency court was set-up. At the governmental
and non-governmental level, for protecting and rehabilitating children in hardship,
public awareness activities relating to institutional development and children's rights
were carried out. Also, during the period, along with increase in children enrolment in
school, works like, ratification of 182 article of the International Labor Convention
and the SAARC convention on child welfare were also completed. The Vitamin "A"
and Polio/ Vaccine programs were executed with national importance; the area
coverage of nutrition program launched for the primary schools was extended; growth
in birth registration was recorded; reduction of child marriage and child mortality rate
were recorded and also initiated monitoring and evaluation of the INGOs' programs.
Major Problems and Challenges of the Ninth Plan:
• Lack of resources.
• One third of children are still deprived of primary level education.
• The access to basic health service has not reached to all children.
• Children involving in mean type of labor as well as handicapped children
remained victimized of hatred and discrimination.
• Unable to frame effective laws and regulation prohibiting exploitation of
child sex and increase of immoral sex workers.
• Effective coordination in sector programs and at institutional level could not
take place, neither monitoring and evaluation system could function well.
26.2.2 Long TermVision:
The long term target of this sector is to create enabling condition suitable to children
to put an end to all types of criminal acts, exploitation and discrimination by
promoting and protecting children's rights committed to the charter of children rights
and other related additional documents including international and regional levels.

Objectives:
The rights of children will be protected and promoted by putting an end to
exploitation and discrimination, and thereby, to ensure their rights to develop
physically, mentally, socially and psychologically.
Sectoral Major Targets:
• Make legal arrangement to suit children's rights and strengthen institutional
development and structures.
• Motivate government, local institutions, non-governmental organizations,
civil societies and private sector to launch programs oriented towards
children's rights.
• Abolition of mean child labor.
• Ensure education and health facilities vis-à-vis improvement of nutritional
status.
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• Ensure birth registration of approximately 80% of children.
• In the context of increase in children's rights and children development,
children participation will increase
Strategies:
Children are the future of the nation; hence it is necessary that the country should pay
due attention to develop their basic requirement. The problem of child labor in the
society is on the increase, number of street children is growing rapidly and 20% of
children is devoid of basic education if judged from school enrolment criteria and in
such context it is but necessary to have clear - cut policy and programs related to
children rights. All types of exploitation against the children are to be put to an end
for ensuring the rights of children to get education and right to live without fear in
particular. Programs related to publicizing of children's rights in their home will
promote social justice and it will increase capacity of coming generation, which in
turn contribute to economic development itself. Against this backdrop, main
1. Merging of children's rights in the mainstream of national development in the
context of rights oriented concept.
2. Strengthen the children's rights by eliminating child labor and rehabilitating
children affected by hardship and criminal activities.
3. Increase awareness about children's rights.
Policy and Implementation Strategy:
§ Mainstreaming of children's rights (Related to Strategy 1)
• Establishment of legal system in line with children's rights.
• Development of legal framework/structures along with creation of an
atmosphere to protect and stop children from sex exploitation, trading,
ill-treatment and juvenile delinquency.
• Increase institutionalization of children participation at all levels by
protection and development of children's rights.
• Provide free education to children of disabled and downtrodden
communities and make them effective and also extend special education
program for disables.
• Strengthen central and district level child welfare committees.
• Adopt partnership pattern for children's right and development with
national and international development communities and civil societies.
§ Abolition of child labor (Related to Strategy 2)
• Abolition of exploitative types of child labor during the plan period as
well as gradually abolish other forms of child labor along with the control
of exploitation of child sex, ill-behavior, trading and trafficking through
curative, promotional and rehabilitation measures.
• Donor community, non-governmental organizations, private sector and
civil society will be mobilized for community based rehabilitation of
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displaced children due to hardship condition and affected by terrorist
activities.
§ Increase in awareness in the protection of children's rights (Related to
Strategy 3)
• Awareness programs related to children's rights will be launched through
the involvement of non-governmental organizations, community based
organization and civil society. The children's opinion and their
participation will be encouraged in the operation of such programs.
Programs:
• Amendment of disable related acts and regulation.
• Coordination with related ministries in mainstreaming of children's rights in
national development.
• Establishment of legal system in consonance with the children's rights. In
order to safeguard children from sexual exploitations, trafficking of girl
children, abuse of drugs, and to protect them from the ill effects of war and
not to let them involve in such wars, a committee will be formed to formulate
required laws and regulations.
• Preparation of national level action plan to implement the commitments made
at the international level.
• Necessary measures will be taken to encourage birth registration and
controlling child marriage.
• The retaliatory, promotional and rehabilitating acts against child sex
exploitation, drug addiction, trade and trafficking of children will be initiated
and public awareness will be enhanced.
• Provide basic education, health facility through the community based
rehabilitation program to the children living in hardship and affected by
terrorist activities. The government will work jointly with donor
communities, non-governmental organizations, private sector, and civil
society to achieve this goal.
• Continuation of children's rights awareness program and increase children
participation in such programs.
• Free education for disabled children and take needful action for making
special education program effective.
• Establishment of national resource center.
• Establishment of rehabilitation shelter, one in each five regional development
centers.
• Gradually equipp the centers and district level child welfare committees with
adequate resources.
• Provide grant–in-aid to the Nepal Children Organization as well as non-
governmental organizations to run child development programs.
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26.2.4 Expected Output:
• Substantial increase in the protection and development of children's rights.
• Effective coordination among government, non-government organizations,
civil society and private sector in the implementation of children's rights
oriented programs will occur.
• Institutional strengthening will have taken place in implanting children's
rights.
• Abolition of mean types of child labor will be realized.
• Institutionalization and sustainability of monitoring and evaluation system
will take place.
26.2.5 Programs and Outlay:

The children's rights sector related programs and outlay in order of priority is
presented below.
(Rs. in millions)
Order of priorities No. of Normal growth rate lower growth rate
programs amount Percent amount Percent
a) (P1) 4 43.0 79.3 39.3 92.4
b) (P2) 2 10.0 18.4 02.0 4.7
c) (P3) 3 01.3 2.3 01.3 2.9
Total 9 54.3 100.0 42.6 100.0
26.3 Physically and mentally challenged

During the Ninth Plan period, various activities and works were undertaken for the
physically and mentally challenged. The work of creating preconditions required for
providing services, facilities and opportunities to such persons was completed. The
employment oriented training program was conducted along with the implementation
of special education program in 35 districts. Also, programs, for instance, curative
and preventive for reducing disability, work related to rehabilitation of disables based
on community, networking, etc. were executed. During the period, identification
cards for physially challenged persons were distributed in 50 districts of the kingdom,
etc. Likewise, the study on status of disables at national scale was initiated.
Major problems and challenges of the Ninth Plan:

• Inadequate physical resources and ineffective targeted programs.
• Lack of coordination among the agencies involved in the sector.
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• Absence of the long term perspective plan and work plan related to disabled
persons.
• No substantial change occurred in traditional public outlook at disability.
• Lack of curative and preventive programs as envisaged.

The long term objective is to mainstream challenged people in the national
development process by protecting and promoting their rights and to creating the
environment.

Objectives:
Creation of environment to lead a normal life as with the case of other general
civilians though various awareness and promotional oriented programs and bring
them in the mainstreaming of national development by undertaking the programs of
protecting and developing disables' rights through their participation, which will be
run by themselves.
Major Macro Quantitative Targets:
• Special arrangement relating to legal and policy matter to provide equal
opportunity to disables will be undertaken.
• Provide service and facility, such as, education, training, health, employment,
etc. and offer opportunities.
• Create atmosphere for enabling them to participate in the project activities,
viz., formulation, implementation, monitoring and evaluation process.
Strategy:
It is the duty of the civil society to accept disables/ handicaps as an integral part of
society without any hesitation and in still dignity within them. There are different
types of disables; therefore different services can be provided to disables by
developing different types of programs suitable to their condition. Particularly, to
enable them to live a self-dependent, decent and respectable life, equal opportunity
will be provided in education, health, training to increase their efficiency and making
their life healthy. The work like utilization of their skill and energy in the national
building, positive attitude towards them in the society and their development will not
only promote social justice but also will contribute additionally to nation building
task. In this backdrop, the strategies of this sector will be as follow:
1. Increase access to all types of opportunities including socio-economic
conditions of disables and to ensure socio-economic necessary security,
necessary amendment in the acts, policy, etc. will be undertaken.
2. Prepare national work plan for disables and develop networking up to district
level for coordinated and integrated works.
3. Utilize capability, single mindedness, skills and knowledge in the different
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sectors of nation building.
Policies and work strategies:
§ Legal provision for disables for access to opportunities (Related to Strategy
1)
• Necessary amendment as demanded by time and situation in the existing
acts and regulation.
• Make arrangement to provide basic health cure service, education and
rehabilitation based upon community at all lev els for disables.
§ Development of network for national work plan (Related to strategy 2)
• Extension of networking at functional level for disables.
• Establishment of national Protection Fund for social security and
economic protection of disables.
§ Increase contribution of disables in national building (Related to Strategy
3)
• Develop mental and physical aspects of disables, arrange programs of
skill development training and consultancy service and provide them
special opportunity for employment.
• Develop positive attitude toward disables, raise public awareness on
prevention and means to curative protection and arrange distribution of
materials for disables.
• Increase disables' participation in all the programs related to
handicapped/disables.
Programs:
• Amendment of Disables related Act and regulation.
• Special arrangement will be made for free education, training and health
service along with employment and other opportunities.
• Provide equal opportunity to disables by extending access to them and take
measures to provide rebate and concession in various services and facilities.
• Take measures to increase their participation in the process of policy
development related to disables, preparation, monitoring, evaluation,
coordination, network extension of plan and action plan.
• Launch disables prevention, curative and public awareness oriented programs
• Develop information coordinating system by up dating statistics of disables
and continue distribution of identity cards to disables.
• Strengthen institutions involved in the area of disables and to develop
necessary manpower for them.
Expected Output:
• Change in traditional attitude towards disables will occur through increase in
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awareness among disables and general public as the result of implementation
of the disability prevention and curative programs.
• Receive gradually all types of basic services including well-equipped health
services and free education by disables.
• Disables will have access to information and physical environment at policy
level and functional level.
• Coordination will take place at highest levels of all the concerned parties in
the execution of programs related to disables.
• Extension of disables rehabilitation programs will take place.
26.3.4 Programs and Outlay:

The disable sector related programs and outlay in order of priority is presented below.
(Rs. in millions)
a) (P1) 5 26.50 63.7 22.9 73.3
b) (P2) 3 14.00 33.7 07.3 23.3
c) (P3) 4 1.10 2.6 01.1 3.4
Total 12 41.60 100.0 3.13 100.0
26.4 Senior Citizens

During the Ninth Plan period, policy related to senior citizens was formulated, record
of senior citizens getting monthly allowance was maintained along with the works ,
such as, operation of old age home on pilot basis, health cure services and discount on
airfare were carried out.
Major obstacles of the Ninth Plan:
• Lack of appropriate budgeting,
• Absence of necessary legal framework
• Absence of work plan and networking
The long term target of this sector is to make the living condition of senior citizens
comfortable, secured and dignified by using their knowledge, skill and experience in
the socio-economic development of the country.
26.4.3 Tenth Plan:
a) Objective:
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The knowledge, skill and experience of senior citizens will be utilized in social
development works by making their life more comfortable, secure, respected and
ensured.
b) Major Quantified Targets:
• Make the health of senior citizens secured and satisfactory,
• Merge their knowledge and experience in the mainstream of national
development.
c) Strategy
It will be a tangible contribution to the economic development of the country, if the
nation could utilize the senior citizens' skill, knowledge and experienc e, which are but
valuable sources. It is also the duty of the society to provide different kinds of
services to senior citizens who have made important contributions at their prime
youth age, and whose life is getting more and more difficult due to physical weakness
caused by aging. As a matter of fact, it becomes the national obligation to make
necessary arrangements in different aspects, for instance, making their life easy in
particular, ensuring a dignified living condition, making realize the new generation
about their duty an obligation to respect the senior citizens and at the same time
creating congenial atmosphere for their protection and security in the society. It is
necessary, on the ground of social equity that the nation should develop concrete
policy including national programs for this. In this context, the major strategies for
this sector is as given below.
1 Utilize experience and knowledge of senior citizens (for examples, policy
development, income oriented program, consultancy)
2 Establish the rights of senior citizens along with formulation of necessary
legal framework for ensuring the protection of their economic, social
security, work plan, networking.
3 Undertake social security and rights oriented programs for senior citizens.
d) Policy and wo rk strategy:
§ Legal infra-structure network development(Related to strategy 1)
• Utilize the knowledge, skill and ability of senior citizens in the
development works.
§ Ensuring rights of Senior Citizens (Related to strategy 2)
• Prepare necessary laws and amend existing ones for rights of senior
citizens
• Coordinate with local institutions, non-government organizations and
civil societies for the works/programs related to senior citizens.
§ Social security and rights (Related to strategy 3)
• Encourage formation of community-based clubs, old-age homes along
with establishment and extension of pilot old-age home in five
development regions of the country for making the life of old people easy
and comfortable. Also, encourage the establishment of senior citizen
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clubs.
• Adopt policy for necessary arrangement to create geriatric ward in all
regional and zonal hospitals for providing appropriate health service to
senior citizens.
• Publicize to develop system of honoring, respecting and serving the
senior citizens of the country and include the subject matter of senior
citizens in the school level curriculum.
• By updating the record of senior citizens, the existing allowance of the
senior citizens will be reviewed.
• Implement social insurance scheme for senior citizens.
e) Program s:
• Formulation of acts and regulations relating to senior citizens
• Preparation of national plan of action and implement programs by develop
networking
• Encourage the non-governmental organizations and local institutions to
establish and operate centers for undertaking various programs relating to
religious work, recreation, sermonizing and income generating programs for
the senior citizens.
• Produce publicity materials oriented to create respect to senior citizens and
undertake publicity and broadcasting.
• Steps will be taken to provide rebates and facilities in the areas of health
service, transportation and entertainment.
• Measures will be taken for establishment and extension of geriatric wards
including well equipping them in private hospitals and also in the zonal,
regional and center. Also, steps will also be undertaken to organize mobile
health camps for providing health service and arrange gradually the increase
of treatment expenses of senior citizens.
• Program related to social security allowance distribution of the senior citizens
and up dating of their statistical record will be undertaken.
• Coordinate with various institutions and organizations including the
concerned parties involved in the area of senior citizens.
• Step will be taken to include topics/subjects about senior citizens in the
school level curriculum.
• Implement social insurance program for senior citizens in a coordinated
manner.
• Programs like social security, entertainment, health, etc. will be coordinated
through local institutions and civil societies.
• Legal arrangement including amendment in the clauses of existing acts and
regulations will take place.
• National action plan along with networking will take place.
• Establishment of pilot old-age homes in all development regions will take
place and execution of skill development programs in other old-age homes as
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well as proper use of knowledge, experience and skill of senior citizens will
be found.
26.4.5 Probable obstacles and risk in implementation and output
realization:
• Lack of financial resources
• Lack of coordination among government agencies, non-governmental
organizations, local institutions and civil societies.
26.4.6 Programs:
• The senior citizens sector related programs and outlay in order of priority is
presented below.
(Rs. in millions)
a) (P1) 2 27.2 74.4 18.7 65.2
b) (P2) 3 84.0 23.1 091.0 31.6
c) (P3) 5 9.0 2.5 9.0 3.2
Total 10 36.5 100.0 28.7 100.0
26.4.7 Log Frame:

The log frame relating to women development, children's rights, disables and senior
citizens sector is presented below. Detail is given in annex 3.
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3.18 Policy and Program Log frame- Women, Children and Social Welfare*
sustainable manner.
Sectoral Macro Objectives: Standard of living of women, children, disables and senior ( male and female old people) citizens will
be raised
Sectoral objectives: • Make the process of formulation, • Amendment in acts and • Human Development 1. Capacity development for • Social
Emerge contribution of women, coordination, evaluation and monitoring regulations. Report of Nepal increase in women discriminatio
children, disables, senior of policy and targeted programs related • Gender Development • Central Bureau of participation, increase n continued.
citizens and non-governmental to women participation sector effective. Index. Gender Sta tistics women's access to • Availability of
organizations (NGO) into • Increase women participation in all Empowerment Measure • Annual reports of line resources and abolition of all resources for
mainstream of national phases of cycles of all types of and participation rate of ministries. types of discrimination implementati
development programs including poverty alleviation women in policy • Social Welfare against women. on of welfare
and income generation programs formation. Council and district 2. Prepare national work plan policy.
implemented at local level. • Child mortality rate, administrative offices. related to children's right. • Political
• Amend legal discriminatory provisions school enrolmentrate, 3. Prevention of disables, instability
against women on the basis of equality birth registration rate, provide opportunity to
and international commitment. rates like child mirage, disables to lead a dignified
• Bring children's rights on the basis of child labor, nutrition, etc. life.
rights oriented concept in the • Average age of senior 4. Develop capability of senior
mainstream of national development. citizens. citizens, social security and
• Extension of disables' access to • participation of disables provide opportunity to lead
economic, social and all types of and service to them. – respectable life 5.
opportunities, deve lopment amendment Increase in institutional Creation of institutional
to suit the time demand of laws, policy structure. structure and strengthening
formation for ensuring protection of • Coordination among of existing structures.
economic and social security. NGOs. –Indicators of 6. Arrangement of co-working,
• Launch programs oriented towards population, social and coordination, monitoring and
social security and rights related to economic. evaluation with NGO/ civil
senior citizens societies.
* Quantified targets are based upon 6.2% economic growth (Detail is in annex 3)
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Annex 26.1: Program and Outlay
(a) Women:
(Rs\. In million)
S.N. Programs/ Activities Normal growth Low growth
rate rate
First Priority Program/ Projects:
1. Act refinement, policy development, formulation of national
action plan: 0.2 0.2
2. Awareness and training: 80 70
3. Reform in national women commission including institutions
involved in women development and gender equality: 400 350
4. Formation of women groups for increasing women's access
to economic resources, income generation and employment
and market management: 80 70
560.2 490.2
Total : 641 733
Percentage:
Second Priority Programs/Projects 187 100.4
5.Other: skill oriented training, flow of loan, income oriented
activiti es, formal and informal education, health, allocation of
economic resources, sanitation, nutrition, community activities,
etc.: 103.9 55.8
6. Control of girl trading and trafficking and sex exploitation,
work related to rehabilitation of women victimized in domestic
and other crimes: 290.9 156.1
Total: 333 233
Third Priority Programs/Projects 26 33
( Probable Projects): 0.1 0.1
7. Establishment of Gender Information Center and its
development: 873.4 668.6
8. Various programs related to inclusion of domestic labor of
women in the national accounting system and programs related
to national/international commitment: 0.2 0.2
Grand Total: 80 70
527
(b) Children's Rights:
(Rs. In million)
rate rate

1. Refinement of acts to ensure children's rights, 00.3 00.3
development necessary laws and formulation of national
action plan related to children's rights:
2. Awareness and training in connection with protection and 1.6 01.5
development of children's rights (including birth
registration, child labor, child marriage):
3. Free education and health cure service to disabled 16.4 15.0

children:
4. Rehabilitation works in connection with sex exploitation, ill- 24.6 22.5
behavior, trade and trafficking and mean child labor
including children in hardship in 5 development regions
and conduct of vocational training:
Total : 43.0 3. 93
Second Priority Programs/Projects

5. Children home construction and institutional reform: 5.0 01.0
6. Institutional reform of central and district child welfare 5.0 0.10
committees:
Total: 10.0 02.0
Third Priority Programs/Projects ( Probable Projects): 1.3 01.3
Percentage: 2.3 2.9

7. Grant and economic support to Nepal Children
Organization including NGOs involving in children's rights
for launching programs related to protection and
development of children's rights:
8. Establishment of National Resource Center:

9. Various programs will be launched in accordance with
national/international commitments: Grand Total:
Total 54.2 42.6
528
(c) Disables
(Rs. In million)
rate rate
1. Refinement of acts related to disables and formulation of 00.2 00.2
national action plan:
2. Disable prevention publicity program: 02.6 02.3
3. Launch program related to prevention, curative and 03.8 03.3
supportive for minimizing disability:
4. Implement employment oriented and leadership 15.0 13.0
development training program for disables:
5. Program related to distribution of Identity Cards of 04.9 04.2
disables:
Total : 2.65 22.9
6. Work related to service and human resource development 02.5 01.3
for disables:
7. Work related to management of information and statistical 01.5 00.8
collection system of disables:
8. Strengthening of institutions involved in the rehabilitation 10.0 05.2
work for disables and grant:
Total: 14.0 07.3
Percentage: 2.6 3.5
9. Establishment of National Disables Fund :
10. Disables' Home Construction and operation:
11. Various programs will be launched in accordance with
international commitments:
12. Monitoring and evaluation of projects and programs
implemented for disables.
Grand Total: 41.6 31.3
529
(d) Senior Citizens
(Rs.in million)
rate rate
1. Work related to acts, national action plan formulation and 1.6 1.1
statistics of senior citizens:
2. Work related to Treatment service of senior citizens and 25.6 17.6
work related to management:
Total: 27.2 18.7
3. Establishment of institutions, clubs etc. for institutional 4.7 5.1
development related to senior citizens:
4. Work related to senior citizens' national pension plan/ 3.0 3.3
economic condition reform and insurance system:
5. Launch awareness program for enhancing respect to 0.8 0.7
senior citizens:
Total: 8.4 9.0
Percentage: 2.5 3.2
6. Establishment of Senior Citizens Welfare Fund:
7. Senior citizen's capacity building and income generating
activities, etc.:
8. Impact study of old age allowance, review, study, etc.:
9. Undertake various programs in accordance with national/
international commitments.
Grand Total: 36.6 28.7
530
26.5 National/International Non-governmental
Organizations (NGOs/INGOs):
During the Ninth Plan period, the number of national/international non-governmental
organizations and civil societies has grown substantially in number along with the
activities of awareness, rehabilitation, income generating, etc. related to sectors like
women, children, community development, environment and human rights. The
coordination and the cooperation among the government, local institutions and
national /international non-governmental organizations (NGOs/INGOs) at the
working level have increased. Involvement of NGOs in the policy formation matter as
well as program implementation stage has notably increased.
Problems and Challenges encountered during the Ninth Plan:
Monitoring could not be effective.
Difficulty in making regularization of NGOs/INGOs' working, unable to assess their
contribution and difficulty to make responsible for their activities transparent,
liable and sustainable of such organization.
It was difficult to bring their activities in one door system.
26.5.2 Long-term vision:

The long term vision is to exploit the comparative advantages of the non-
governmental organizations (NGOs), social institutions and organizations by
encouraging them to participate actively as an efficient, transparent and clean
development partners, creating conducive atmosphere for their working in an
effective manner through the public enabling process to realize the social, economic,
environment and institutional goal.

Objective:
The objective of the Tenth Plan is to develop non-governmental organizations,
community based organizations and civil societies as partners of poverty eradication
and sustainable development programs by activating them in the sectors of
community development particularly related to health, education, environment
management and moral development as well as in the activities of increasing
awareness of the targeted groups, such as, children, women, disab les, senior citizens,
youth, backward class, ethnic groups and downtrodden communities.
Strategy:
Since, it is difficult for the government to get access in all the sectors in a
comprehensive way, role played by the non-governmental organizations, community
based organizations and civil societies have been more effective than that of
government in a number of sectors. As a result of liberal policy adopted by the
government, activities of non-governmental organizations and their service flow in
531
the communities have increased noticeably. To involve NGOs in the uplift of social
sector and in targeted group programs effectively is important from the point of social
and economic development.
1 Involve NGOs and civil societies as partners of socio-economic development
and procedure for effective coordination, monitoring and evaluation system
for their works will be simplified.
2 Code of conduct will be developed to make NGOs responsible and their work
transparent. The auditing system will be made result oriented and their
categorization will be carried out on the basis of their capacity and scope of
work.
b) Policy and Implementation Strategy:
§ Institutional Development (Related to Strategy 1)
• In order to maximize the benefit from the INGOs' resources, the
programs that they implement will be distributed geographically and
sectorally in a coordinated way.
• The INGOs will be motivated to implement the programs through local
institutions, national NGOs and other community based organizations
and such programs will be made as part of the local planning process for
their effectiveness.
• Institutionalization of monitoring and evaluation system will be
developed for effective working of INGOs and NGOs.
§ Partnership, Coordination and Simplified Procedure (Related to Strategy 2)
•By reviewing organizational and Institutional Act, Social Welfare Act
and other related acts to end the ambiguity, action will be taken for
appropriate policy for legal system improvement and administrative
arrangement.
• The existing status of resource mobilization of INGOs and NGOs, their
services and programme implementation will be reviewed, and one door
system will be implemented to facilitate them and help enhance their
performance.
• Prepare statistical database related to national and international non-
governmental organizations.
c) Programs:
• Formation of committee to assign task of making present vagueness clear
in the existing organizational and Institutional Act, Social Welfare Act
and other related acts.
• In order to maximize the benefit from the resources mobilized by the
international non-governmental organization (INGOs), interaction
program with the related agencies for their geographical and sectoral
programmes will be undertaken and bring more clarification about their
programs and activities.
532
• Institutional development of monitoring and evaluation system for
effective functioning of national and international non-governmental
organizations. Social welfare council will be strengthened.
• Undertake review of existing status of INGOs' and NGOs' resource
mobilization, service provided and their implemented programs and to
take measures to introduce one door system in order to ensure minimum
standard of their works and for convenience.
The expected outputs from various programs of the non-governmental organizations
are enhancing public awareness, community development and support in creating
employment opportunities for local people.
Probable Obstacles:
• Dependency syndrome: The tendency of general public to depend on
non-governmental organizations for their own works.
• The objectives of international non-governmental organizations may
bring distortion in the social structure.
• The existing INGO's working procedure give impression that the
members of the organization are the paid employees rather than the
volunteers of the organization, which will pose obstruction in the
mobilization public participation.
26.6 Drug Control

26.6.1 Background:
Drug abuse has become a global problem. The tendency of increasing abuse of drugs
among the youth has not only destroyed their future but also deteriorated the human
values and posed threat of disintegration of the social structure.
The drug abuse problem entered the country during 1960's, which has now grasped
young men and women from the urban areas of the kingdom Nepal has prepared a
master plan for drug abuse control and has put it into implementation in line with its
national and international commitment.
The Ninth Plan's targets and achievements:
• Different types of trainings, interaction, seminar, workshop, etc. were carried
out under the youth awareness and oriented programs and distributed various
awareness promoting publicity materials to alert general public against drug
abuse.
• The services like meditation (Bipasyana) and counseling an d day treatment
services were provided to the drug abusers along with the income generating
activities like envelop making, bee rearing, soap making, etc. under the
treatment and rehabilitation program designed for the drug addicts.
533
• Works, such as, information collection, record keeping and research as well
as supervision under the intoxicating drug supply control program were
continued. In addition, arrest of people involved in drug trafficking,
confiscation of intoxicating drug and destruction of crops were also carried
out.
Problems and Challenges:
• The public awareness campaigns, and preventive and curative programmes
failed to have tangible impact, and the number of drug addicts could not be
cut as expected.
• No effective control over national and inter national drug traffickers'
activities.
• Lack of control of intoxicating crops farming like cannabis and opium
cultivation in central and eastern terai region and some hilly areas of the
kingdom.
• Although limited control is found in the use of strong drugs like heroine
largely because of administrative control and high prices, pain killing
medicines and cough syrups are still in use. The chances of fatal diseases
like HIV/AIDS and Hepatitis "B" are high in the drug abusers who use
syringe.
• Lack of dependab le regional communication relations for drug control among
the countries having this problem. No effective coordination developed
among the agencies of government and private sector involved in this tasks
and lack of dependable statistics of drug abusers.
• The treatment of drug abusers and their rehabilitation confined in just a few
hospitals.
26.6.3 Long termvision:
The long term perspective of this sector is to create society free from drug abuse by
propagating perception through out the country that drug abuse hinders socio-
economic and intellectual development.
26.6.4 Tenth Plan:
a) Objective:
The objective of this sector in the Tenth Plan is to reduce drug trafficking and
drug misuse and to rehabilitate drug addicts through retaliatory and
preventive programmes.
b) Strategy:
From the social reform side, it is the primary duty of the state to eliminate increasing
social distortion caused by drug abuse. The control of drug abuse will assist although
indirectly to increase the national production (GDP) for the simple reason that it will
check the depletion of human resource caused by increasing influence of drug abuse
particularly in the youth community. On social ground, the timely launching of
sectoral targeted programs, designing according to the nature of drug abuse and
534
program of effective rehabilitation will be more logical to minimize the State
obligation. Major strategies are as follow.
1. The drug control programs will be implemented in a coordinated manner by
demarcating drug-addict influence areas and by involving government, non-
governmental organizations and local institutions throughout the country.
2. By increasing the participation of local representatives, community based
organizations and local elected bodies, the curative and preventive programs
on community basis will be undertaken along with adopting measures of
discouraging demand (demand contraction) of intoxicating drug with priority.
3. Institutional strengthening of various agencies involved in drug control
activities. Amendment will be made in the existing laws and regulation to suit
the demand time.
c) Policy and Implementation Strategies:
§ Control of Intoxicants (Drug) and Coordinated Effort: (Related to Strategy
1)
• The influence area of drug addicts and users will be demarcated. The
other types of crop farming will replace existing traditional cannabis
crop.
• Uncontrolled way of importing, sale and use of chemicals as well as its
subordinating materials will be controlled.
§ Reducing intoxicating drug in quantity (Related to Strategy 2):
• Community based organizations, local leaders and other non-
governmental organizations will be encouraged, in connection of drug
abuse control to launch the programs in the area of promotional, group
treatment and reform.
§ Institutional Strengthening (Related to Strategy 3)
• Arrangement will be made to bring under one umbrella the operation,
monitoring and evaluation of all the programs proposed for highly drug
affected areas of urban as well as urban oriented sector to increase their
effectiveness.
• By amending acts and regulation related to drug abuse, the use of
chemicals and its materials will be controlled except for medicine
production and industrial use.
• The capacity of governmental institutions involved in drug control
activities will be increased along with the work of discouraging the
production, sale and use of drug.
d) Programs:
• By demarcating the areas of drugs production, sale and distribution and use
and collecting statistical information, the "increase of public awareness
against drug abuse" program will be launched by involving government and
non-governmental organizations.
535
• Support will be provided to local institutions to formulate and implement
programs on drug abuse control as well as reform and rehabilitation of drug
addicts.
• Establish residential reform center, one in each development region of the
kingdom to provide services of curative, preventive and reform measures to
drug addicts along with their rehabilitation. Also, implement education
oriented program for the drug addicts and their family members of the reform
centers.
• Incorporation of drug abuse topic in the school and campus level curriculum.
• By amending the existing act, penalty amount will be increased for the
cultivators of restricted crops like cannabis and opium as well as to the
persons involved in drug trafficking, sale and use.
• The communication for information exchange between and among the
national and regional agencies involved in the control of drug trafficking and
sale will be encouraged.
• Monitoring system will be made effective to discourage miss-use of chemical
and related materials in other propose except in the production of medicine
and industrial use. Necessary training on drug abuse and control will be
provided to medicine manufacturer and drug dealers.
• The rate of decrease in drug addicts is expected to bring down total number
of drug abusers during the plan period.
• Efficiency will enhance by the establishment of communication international
networking for exchange of information.
• Reliable statistics and information will be collected on the number, status and
condition of drug abusers and addicts.
26.6.6 Probable Obstructions and Risk in the Implementation and

Expected Output:
• Financial problem may hinder implementing the programs, such as,
establishment of residential reform center in 5 development regions within
the plan period.
• The shortage of efficient manpower needed for the execution of curative and
rehabilitation work may be the problem.
• The enforcement of law and destruction of restricted crops like cannabis may
be difficult due to geographical remoteness of the country.
26.6.7 Achievement Monitoring Indicators:

• Number of drug abusers/addicts
• Confiscated quantity of intoxicating drugs
536
• Quantity of destroyed crops like cannabis crop
537
Chapter - 27
Targeted Programmes
27.1 Background
The targeted programmes have been put forward as a strategy of development for the
various ethnic groups, communities and areas unable to participate due to their low
capacity in the mainstream of market oriented development process, created by the
Tenth Plan, whose only objective is to alleviate poverty. The groups /communities as
well as the areas are not similar but they vary greatly in nature. Such groups include
women, ethnic groups and backward classes and communities of the remote areas,
poor, ultra poor and disadvantaged people as well as small farmer families.
Any place that is 25 km away from the nearest motor-able road is generally
considered as remote area. Similarly, the areas where more than 50 percent of
population is poor and the families have no extra income other than their own
household production and which is sufficient for less than 9 months are designated as
the poor areas . Likewise, whose income is sufficient for less than 3 months is
categorized as ultra poor family. As a matter of fact, the poor and ultra poor families
are unable to take advantage from the development programmes because of
ignorance, illiteracy, poverty, social backwardness and exploitation. Source of the
highly backward groups include the exploited castes (like Kami, Damai, Sarki,
Musahar), Chepang, Kamaiya, Badi ethnic community.
The girl children hardly get opportunity to go to school because they have to look
after their siblings . Besides, many of families are devoid of education due to poverty.
Many children are forced to engage in as girls are exploited sexually and they are
traded as a commodity. Also, most of downtrodden people from occupational who
depend upon their ancestral occupations for their livelihood have lost their jobs due to
modernization.
Taking regional perspective into consideration, 15 district headquarters have not been
connected by roads have not been competitive these districts because of high
production cost and high transportation cost, posing threat to these existing
professions. Recognizing these hardcore facts, the targeted programmes that suit to
different groups and geographical regions will be implemented during the Tenth Plan
period.
Arrangement has been made to reform in the existing operational process to make the
targeted programmes more effective in the Tenth Plan. With the objective of
implementing the targeted programmes through the local institutions with local
people's participation, extra grant-in-aid on the basis of poverty level of backward
areas will be provided. Likewise, by mobilizing particularly consumers' groups and
non-governmental organizations (NGOs) through Poverty Alleviation Fund, support
will be provided to quick return programmes to benefit the targeted groups.
539
On the basis of poverty mapping the sectoral programmes will be made focused
towards the area with high incidence of poverty, gender imbalance and socially
backward communities. The extension of rehabilitation and income generation
programmes will be undertaken for the families displaced and affected by wide
spread and insecure atmosphere of the country as well to make their life normal.
The targeted programmes that will be implemented under different sectors are
basically of two types.
Sectoral ta rgeted programmes

The programmes are related to two different categories of remoteness -- the first
category is based on remoteness from the access of transport facility and the second
one on the basis of prone to natural disaster particularly the flood and landslides.
Group targeted programmes

The groups targeted programmes will be of three types . These programmes directed
to the targeted groups based upon indicators like gender, caste and creed,
occupational and income level and status of access to resources, etc.
On gender ground, the status of women is extremely low with respect to income level
and human development index (HDI). Their capability has become limited. Likewise,
people of backward communities are also not better than the condition of women due
to prevalence of social taboos and evils, while people of some ethnic communities
have lost their ancestral jobs due to modernization and could not merge into
mainstreaming of development. Besides, among the population below the poverty
line, there are ultra poor families who are beyond the reach of resource access and
they also come under the targeted groups.
Forms of targeted programmes

Since the targeted groups and areas differ in character and there is no uniformity
among them, in some targeted places local level infrastructure development needs to
be focused, while in other targeted groups various types of supports may be required.
Considering the different types of supports to be provided to targeted group and areas,
the targeted programmes are categorized as mentioned below.
Geographical Area based Programmes
Construction of local level physical infrastructure and local level programmes .
Group based programme s

Arrangement of Grant-in-aid
Programme upgrading capacity by improving HDI index
Programmes for boosting up income generating opportunities
Food for work programme
540
Skill oriented training programme
Programme focused on any one of priority areas having comparative advantages
Programme related to increase access to productive resources

The Eighth and the Ninth plans have been implemented after the restoration of multi-
party democracy. In both periodic plans, targeted programmes focused on poverty
alleviation for backward and disadvantage communities . As a result, women literacy
rate has increased. There was some improvement in the social and economic
conditions of highly backward communities such as Chepang, Kamaiya, etc. Despite
their positive impacts, there were some negative effects of the programmes as well.
The negative effects had occurred in the sense that the budget allocated for targeted
groups were utilized by the well-to-do people as well. It happened because real
targeted group could not be identified distinctly.

The long term approach is to merge particularly backward areas and backward
classes / communities in the mainstream of development by eliminating existing
poverty, backwardness and inequality through the implementation of targeted
programmes.
27.4 The Tenth Plan

a) Objective
The main objective of the Tenth Plan is to improve income level and human
development index (HDI) of the people living below absolute poverty line,
particularly those who were unable to merge into mainstream of development, the
weaker sections having low capcity of the society and the people living in backward
region.
b) Strategy
The present day utmost need is to merge the people of various backward communities
and areas, which are left far behind because of their inability, into the mainstreaming
of development and to emancipate them from bondage of backwardness by
implementing targeted programmes. The targeted programmes will promote social
justice in the country and also help to maintain peace in the society. Targeted
programmes are not tied up with one particular sector but they can be related to a
specified sector or class according to the nature or characteristic of group/community.
The m i plementation of programmes related to individual capability building like
education, health, skill development and the targeted programmes aiming at
increasing access to resources and mobilization of social capital will help socio -
economic development. Since programmes put emphasis on decentralization process
as well as on involvement of consumers' groups, it naturally facilitates to promote the
541
transparency and good governance. In this context, major strategies are as follows.
Integrated and sector specific programmes will be implemented by identifying
and aiming at targeted groups /areas.
Poverty Alleviation Fund, the targeted programmes will be implemented through
concerned bodies/agencies in a coordinated manner by strengthening the
institutionalization.
Grant-in-aid for local institutions will be determined by applying poverty index
formula,
c) Programme s
Geographic Area based Programmes:
§ Construction of Local Level Infrastructure and Local Development
Programmes
Along with productivity oriented local infrastructure development activities,
multiple purpose local development programmes will be implemented for the
benefit of people having no other income sources except subsistence agriculture
and passing roaming life and who are living in geographically backward areas
without road access. Under such programmes, infrastructure development
activities for instance, drinking water, minor irrigation, foot/mule trails, schools
and health post buildings will be undertaken, as demanded by the people of
targeted areas / class. Necessary arrangement will also be made for skill
development, technical know-how, extension of agriculture technology, training,
micro finance, etc. for income generating opportunity as demanded by the people.
Such multi sectoral development programmes will be carried out focusing on
remote areas, where high incidence of poverty exists.
In the context of access, the source of livelihood of Nepalese people is cultivable
land, which is affected particularly by natural disaster. Mostly poor people own
such land. Again, the poor are unable to invest because of poverty, they are
affected by natural disaster from time to time as well and they are heavily
indebted; hence improvement of these areas come under the scope of the targeted
programmes. While designing and implementing the programmes like flood
landslide and river training works to protect the flood prone and landslide
occurring areas from time to time, priority will be given to those areas where the
poor.
Group based Programme
The group targeted programmes are relate to various sectors. Various
programmes related to different sectors that suit to groups' nature and capacity
and address the groups affected by poverty and low level of human index will be
launched. The empowering of women, the merging of poor and backward classes
in the mainstream of development as well as targeted programmes women of
vulnerable communities will come under this.
During the Ninth Plan period, although the system of bonded labourer (Kamaiya)
is abolished, no concrete actions were undertaken to increase access of Kamaiya
542
class to employment and productive resources that inc reases their income
opportunities. Hence, special attention will be paid to develop appropriate
programmes in the Tenth Plan period.
The poverty mapping will be carried out to assist to develop group programmes
by identifying the poor. The poverty motoring programmes will be carried out up
to the district level.
§ Poverty Alleviation Fund
The Poverty Alleviation Fund is established to operate targeted programmes in an

organized and systematic way and also, implement such programmes in a more
coordinated manner. The Fund will mobilize resources of government, donors as
well as NGOs for executing poverty alleviation programmes at the same time,
government, private sector and local institutions will also be mobilized for their
operation. The Fund will act as an autonomous body for such coordination work.
The targeted groups of the Poverty Alleviation Fund are people living below the
poverty line. Identification of targeted groups by undertaking field studies using
poverty mapping will be carried out and poverty alleviation programmes will be
implemented through the government, private sector and local institutions .
§ Empowerment and Mainstreaming
Programmes to contain floods and landslides and those for river training will be
carried out with priority in the areas affected by floods and landslides from time
to time and the areas owned generally by the poor.
§ Arrangement of Grant-in-aid
The grant-in-aid will be provided to meet transportation cost of the food grain as
well as other basic services. Such grant will be provided not to all but only to
some remote areas where there is concentration of targeted groups .
§ Programme to raise capacity building by Human Development Index (HID)
improvement
Improvement in individual capacity is a must to increase labor productivity;
therefore various kinds of financial supports will be made available to the groups
who have either no easy access or have difficult access to goods and services
needed for improving the human developm ent index. If the targeted groups are
concentrated in some particular areas, physical infrastructure facilities will be
developed to increase the support to such area. The scholarship programmes will
be launched to increase access to education, while primary health care
programme will be implemented in a decentralized manner . In this context, child
health and primary health care services will be extended so as to benefit the
backward classes.
§ Programmes of increasing income generating opportunities
Different types of income generation supportive programmes will be launched for
the people the labor, as they don't possess any skill, have no access to market and
technology, etc. The food for work programmes will be carried out to consent
543
physical infrastructure. Such type of supportive programmes will be implemented
particularly in food deficiency areas .
In the recent past, some groups have lost their traditional jobs due to
modernization. In order to solve the problem, different types of skill development
programmes aiming at specified groups will be undertaken. Market arrangements
for the produced goods and services under the programme will also be made.
The programmes, which put emphasis upon raising income level by developing
goods and services, which have comparative locational and group advantages will
be implemented. These programmes will be launched keeping in mind micro
hydro projects and eco-tourism . Similarly, the benefit will be provided to targeted
groups by arranging marketing outlet for their products. Programmes will also be
developed by concerning on one priority area, whic h have comparative
advantage.
Income generating opportunity will be available only if access to employment
opportunities and productive resources is made available. Hence, programmes,
for instance, providing land to Kamaiya, who were freed under abolition of the
Kamaiya system (bonded labor system ), providing forest on lease to poor people
so that they can get their livelihood from the forest products, providing micro
credit and skill to non-skilled persons and putting emphasis on appropriate
techno logy will be executed. Different types of targeted programmes s proposed
to implement are given in the table 27.1.
27.5 Implementation Arrangement

Since targeted programmes are launched for different groups and areas, the
implementing institutions /agencies are also of different types. The report of Nepal
Living Standard Measurement Survey (Second) will be made available by the second
year of the Tenth Plan. The targeted programmes relating to all sectors will be
prepared on the basis of the data after completion of the poverty mapping,.
Majority of programmes focused on geographical areas are related to the Ministry of
Local Development (MoLD) and the District Development Committees. The remote
area development programme and other rural development programmes are the
examples . In addition to this, there are number of programmes for the targeted groups
in the area of income generation run under the MoLD.
Also, the programmes formulated specially for the targeted groups are under the
implementation of the Ministry of Local Development. There are number of sectoral
programmes which are implemented by targeted groups as well as by the said line
ministry. While decentralizing the programmes as well as distributing the sectoral
programmes regionally by the line ministries, the priority will be accorded to targeted
groups and areas,.
The targeted programmes developed on the basis of comparative advantages are
being implemented by different agencies. The sectoral ministries are also involved in
the execution of these programmes. Different institutions are involved in the micro
financing. The Ministry of Local Development (MoLD), commercial banks,
544
Agriculture Development Bank, Grameen Bikas Bank (Rural Development Bank) and
Rural Micro finance Development Centers are providing micro credits against group
security to the people of targeted groups .
The NGOs and the civil society have played major role in identification and
implementation of various programmes designed for targeted groups . The policy will
be to involve them extensively in such programmes. In order to increase institutional
coordination in these programmes, it will be applied effectively and mobilized in the
Poverty Alleviation Fund.
27.6 Monitoring Arrangement

The poverty mapping will be carried out for the whole country in the Tenth Plan
period. In addition to it, a monitoring unit will also be created in the National
Planning Commission to undertake regular monitoring and follow-up of these
programmes. Side by side, the government will elevate the Poverty Alleviation. Fund
to an autonomous institution within the plan period. The Fund will provide financial
support through polycentric institutions for the targeted programmes and it will take
up monitoring this programme in totality.
545
Table 27.1: Targeted Programmes under various sectors
SN Agency/sector For targeted areas For targeted group: People with
disablities
Poor ethnic class Oppressed Women
1. Ministry of Various agriculture Easy access to Easy access to Easy access to Easy access to
Agriculture technologies and appropriate appropriate appropriate appropriate
production inputs for agricultural agricultural agricultural agricultural
the poor of remote technologies and technologies and technologies and technologies and
areas production inputs for production inputs for production inputs for production inputs for
the poor. the ethnic groups. oppressed class. the women.
Formation of separate Formation of separate Formation of separate Formation of separate
groups by identifying groups by identifying groups by identifying groups by identifying
poor ethnic group oppressed class w omen
2 Ministry of Local Cons truction of Food for work Food for work Food for work
Development infrastructures, e.g,
foot and mule trails in
the remote areas
where ultra poor live
3 Ministry of Women, Provide appropriate Arrange appropriate Provide appropriate Provide appropriate Increase
Children and Social training to women by training by forming training by forming training by forming representation of poor
Welfare forming groups groups of ultra poor separate groups of separate groups of and backward
w omen. ultra poor ethnic ultra poor women of communities in the
Rehabilitation of w omen occupational castes PCRW programme.
street children
4 Ministry of Industry, Support to Support to Support to Support to Support to
Commerce and establishment of small establishment of small establishment of establishment of small establishment of small
Supplies and cottage industries and cottage industries appropriate small and and cottage industries and cottage industries
to the poor for ultra poor. cottage industries for for oppressed class. for poor women.
At least 50% of the ethnic community. At least 25% of the At least 50% of the
trainees in various At least 25% of the trainees in various trainees in various
cottage training trainees in various cottage cottage training
programmes should cot tage training training programmes programmes should
be the poor programmes should should be from be women
be from ethnic oppressed class
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disablities
community
5 Ministry of Education Provide various non Provide informal Provide scholarship to Provide scholarship to Arrange informal
and Sport formal education and education to poor poor and intelligent the poor and education for the
increase female family whose literacy children of ethnic intelligent children of w omen whose literacy
enrolment, establish rate is below 15%. communities. oppressed class. rate is less than 15%.
child care centers for Find out reasons of Find out reasons of
the poor of remote dropout of children in Find out reasons of Find out reasons of dropout of children in
areas. the schools and solve dropout of children in dropout of children in the schools and solve
the problem. the schools and solve the schools and solve the problem.
the problem the problem
6 Ministry of Health Conduct health Conduct health Conduct special Conduct special Provide maternity Distribution of
camps regularly in the camps regularly in the health camps for health camps for health care service to appropriate
remote areas. ultra poor area. ethnic communities in oppressed class. poor women. means/equipments
the remote areas. to the people with
Healthy sanitation and Healthy sanitation and Healthy sanitation and Healthy sanitation and disabilities
public awareness public awareness public awareness public awareness
7 Ministry of Physical Housing facility for Housing facility for Housing facility for
Planning and Works homeless poor homeless ethnic homeless oppressed
communities classes
8 Ministry of Water Provide grant to micro Provide grant to poor Provide grant to poor Provide grant to poor
Resources irrigation in the for micro irrigation ethnic communities oppressed class for
remotest and arid for micro irrigation micro irrigation
areas
9 Ministry of Forest Support to Arrange leasehold Arrange leasehold Arrange lease forest At least 40% should
and Soil appropriate herbal forest as well as forest as well as as well as leasing of be women in the
Conservation farming in remote leasing of community leasing of community community forest for forest users
areas. forest for the poor forest for the ethnic the oppressed class committee.
forest users' groups forest users' groups forest users' groups
10 National Planning Establishment of
Commission poverty mapping unit
11 Poverty Alleviation Financial support to Financial support to Financial support to Financial support to Financial support to
Fund poverty alleviation poverty alleviation poverty alleviation poverty alleviation poverty alleviation
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disablities
programmess through programmes through programmes through programmes through programmes through
the NGOs in the the NGOs for poor the NGOs for poor the NGOs for poor the NGOs for poor
remotest and wide and ultra poor families ethnic classes oppressed classes. w omen.
spread of poverty
areas.
12 Non-governmental Launch poverty Launch poverty Launch poverty Launch poverty Launch poverty
Organizations alleviation alleviation alleviation alleviation alleviation
(NGOs) programmes based programmes based programmes based programmes based programmes based
on social mobilization on social mobilization on social mobilization on social mobilization on social mobilization
in the poorest areas for the poor for ethnic groups. for oppressed classes for poor women.
households
13 Ministry of Finance Provide loan to poor Provide loan to ethnic Provide loan to
for foreign jobs group for foreign jobs. oppressed class for
Arrange special grant Arrange special grant foreign jobs.
for the poor for ethnic groups Arrange special grant
for oppressed
classes.
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Chapter - 28
Dalits and Neglected Communities
28.1 Background
All-round development is possible only if the multi-ethnic groups, multi- lingual and
various groups and communities within the country develop in proportionate manner .
Such type of development will help to utilize their inherent skill, ability and
knowledge in the nation development process on the one hand, and on the other ,
assist to uplift the living standard of the dalits, neglected, downtrodden and oppressed
classes by creating employment opportunities through the mobilization of local
resources . Taking note of this fact, various programs are being implemented to uplift
of this communit y. Serious efforts are still needed to bring this class of people who
have been back-warded from every aspect of socio-politico-economic issues because
of the prevalence of aged old poverty and social deprivation. In number of places, this
section of the population could not get social respect in practice due to existence of
caste system (though termed illegal) and inhuman behavior because of ineffective
enforcement of acts, which categorically has made the caste system punishable. As a
matter of fact, the community could not fully-establish its role in the socio-economic
development of the country. The reasons behind such scenario are lack of proper
coordination among various agencies in the implementation of targeted programs;
absence of proper linkage between needs and targeted programs, for they were
implemented without adequate study by the center; their backwardness in educational
field and awareness level; and failure to mainstreaming such community in
development activities as an important stakeholder. Keeping these limitations and
weaknesses in mind, in order to identify this class /community, extensive study and
research work will be undertaken to explore development possibilities of this
community. Also, special steps will be taken to implement the outcome of research
and studies for their betterment during the Tenth Plan period. The programs will be
initiated from the very beginning of the Tenth Plan to involve them, as co-actors and
partners, in the mainstreaming of nation building activities .
28.2 Review of the Ninth Plan:

The Ninth Plan had given major role to the government to create a congenial
atmosphere for exploiting inherent potentiality, skill and knowledge with the people
of the oppressed and neglected communities for increasing their living standard
through their involvement and participation, as co-actors and partners along with
other communities of the country. The Ninth Plan had adopted the objectives to end
the existing gap between the people of oppressed groups and other communities by
abolishing prevailing social discrimination of the country and to eliminate the poverty
549
and unemployment prevalent among oppressed and neglected community within the
next 20 years period as envisaged in long term perspective. The policies and
implementation strategies formulated to realize the objectives were to empower these
groups economically and socially, to conserve and modernize their professional skill
and jobs, to increase access to loan through the creation of social capital, to make
obligatory to allocate cer tain percent of grant-in-aid provided by the government to
the local bodies (i. e., DDCs and VDCs) for their economic uplift and development, to
expand coverage of scholarship program in the secondary and higher education and to
provide this section/class access to technical education. During the period,
scholarship was provided to 513 students from oppressed society in higher education
and 5,183 in school level under the neglected, dalits and oppressed community
upliftment programme. However, Rs.25 per month as scholarship provided to
children of oppressed community by the Ministry of Education and the various kinds
of support programs lunched by different NGOs and social organizations as well as
their achievement has not been accounted. During the period, seven projects were
implemented in the areas of health, sanitation and drinking water for the backward
ethnic groups. In addition, it is recorded that financial support was made available to
various helpless-oppressed-children orphanage homes. The seminars were conducted
and weekly radio broadcasting program was operated to increase public awareness
about problem of backward ethnic community at the national level for their
upliftment. Moreover, 65 income and skill oriented projects were implemented in 37
districts of the kingdom. The employment oriented computer training courses were
organized for the unemployed individuals of oppressed classes. The National Dalit
(oppressed) Commission was constituted for the protection of their rights. The acts
and regulations in this area were formulated as well as work related to setting up
institutional structure has been undertaken.
28.3 Long term vision:

The long term vision is to raise the living standard of dalits and neglected
communities by empowering them on the basis of equality, and mainstream them into
the development efforts while enhancing their self respect..
28.4 Objectives of the Tenth Plan:

Dalits, who have been lagged behind in the society due to the old social systems and
beliefs, will be empowered on the basis of equality, and their access to the
development efforts will be enhanc ed.
a) Strategy
Traditional social systems and beliefs have made some sections of the society socially
and economically backward. It is necessary to undertake programs of correcting
various human development index related to this section of the population through
550
targeted programs, since they are generally isolated from the mainstreaming of
development. The implementation of programs, such as, making these people
capable, for greater representation in the political process, providing access to various
income generating activities will not only promote social justice but also contribute to
social development. In this context, the strategies of the plan are as mentioned below .
1. By identifying oppressed, downtrodden, neglected communities the social
oppression and discrimination against them will be abolished through the
economic and social development of this class.
2. Through social and economic empower ment, their knowledge, skill and
intelligence will be mainstreamed in the development process, and their
possible contribution in the national level will be identified and encouraged
to implement.
3. The traditional occupations of the downtrodden and oppressed community
will be modernized and the goods produced by them will be made
competitive. The institutional arrangement for marketing of such products
will be undertaken.
4. The dalits and oppressed's social dignity promoting programs will be
emphasized, while appropriating national productive resources and
opportunities.
b) Policy and working policy
§ Socio-economic development (related to strategy 1)
• Special measures will be taken to increase access of this group to
programs like education, health, sanitation, etc .
• The programs to ensure the rights and development of downtrodden
community will be formulated and implemented under the sectoral
ministries and local le vel bodies (like DDC & VDC).
• Priority will be accorded to dalit (oppressed class) representation in all
types of users' committees formed for development works, in the school
management committees, local bodies , NGOs and social organizations.
• Necessary arrangement will be made for coordination by undertaking
monitoring and evaluation of the I/NGOs' programs.
• Efforts will be made from the government, NGOs and private sector to
put an end to caste discrimination by identifying discriminatory situation
against dalit community.
§ Empowerment (related to strategy 2)
• The award of scholarship program will be extended to increase the
access of the dalit community to education for wide coverage. Likewise,
access of dalit and neglected community to technical subjects under
higher education will also be increased along with the extension of
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programs related to educational scholarship for this community will be
effectively implemented.
• The idea that the inherent skill, efficiency and specialization traits
possessed by the dalit community is the asset of the nation will be
propagated.
• The dalit and oppressed community will be empowered economically
and socially by involving them in the development process by
implementing targeted programs. In such programs, dalit women will be
given due priority.
• Emphasis will be given to institutional empowering of the National Dalit
Commission.
§ Modernisation of traditional skill s (related to strategy 3)
• The ancestral occupational skills and jobs of the dalits and neglected
communities will be conserved and modernized. Their traditional
occupations will be developed as an alternative as well as a dign ified
source of employment. Access to institutional credit will be increased
through the programs like social savings mobilization and loan.
• By providing credit and refining their skills, people of the dalit and
oppressed community will be attracted in foreign employment
opportunities.
§ Increase social prestige (related to strategy 4)
• The subjects on dalit and oppressed community related to their
problems, untouchability and existing conservatism in the school level
curriculum will be included and topics of discrimination will be taken out
to increase public awareness.
• Major role will be given to local bodies (like DDC &VDC) to formulate
as well as implement programs for economic improvement and social
upliftment of dalit community.
28.5 Programs:
28.5.1 Social Programs:
• Various programs will be undertaken to discourage the religious and
social conservatism prevalent in the non-dalit community and to wipe
out the century old inferiority complex of dalit community.
• Decision making capacity and leadership quality in the dalit women will
be developed by abolishing domestic violence and other types of
harassment against women.
28.5.2 Educational Program:
• Free education up to secondary level will be provided to the children of
school going age of all dalit communities.
552
• The access to higher education particularly technical and vocational
institutions will be made easy for dalit communities .
• The participation of the dalit communities in the education centers is
poor. It will be increased by appointing dalit females if available and in
case they are not available other male members from that community will
be appointed to school teaching posts.
• The stipend received by the students of dalit communities will be
increased and manage all types of scholarships . The campaign for
bringing public awareness in the society will be initiated by mobilizing
dalit students receiving stipend.
• By preparing curriculum, which develops and promotes skills of dalit
communities, arrangement will be made to provide technical and
vocational education.
• I/NGOs will be encouraged to use more service of dalit and oppressed
communities by recruiting them in the posts to the possible extent as well
as in the local level programs related to them .
• Special programs will be launched to educate the people of dalit and so
called untouchables like Musahar, Batar, Doom, Halkhor and such other
who are educationally backward. In such programs, special attention will
be paid to women of dalit community
• The dalit literacy campaign will be made as an important part of the
National Development Volunteers Service.
28.5.3 Health Program
• Awareness will be increased through mobilization of social
organizations, government institutions and NGOs to improve the life
style, balanced diet including dietary habit and sanitary condition of the
dalit and neglected community.
• Increase access of dalit and oppressed community to primary and bas ic
health services.
• By providing safe and pure drinking water to dalit and oppressed
community, special health care service will be made available to pregnant
women and women of maternity stage.
• Health services will be provided with priority to dalit community under
the programs lunched by the health institutions providing basic and
primary health care services, such as the mobile health camps. Like
manner, if the training and public awareness related seminars are to be
conducted, it will be organized in the localities inhabited by dalit
communities. Special arrangement will be made to provide drinking
water and sanitation in their settlement areas. Also, dalit people are
encouraged to run programs related to drinking water and sanitation
through the ir users community.
553
• Infant mortality rate, child mortality rate and maternal mortality rate are
quite high in the dalit community. In this context, this community will
be made as the target group of health and family planning programs.
• Priority will be given to dalit women in the selection of female health
workers or female volunteers so long as they are available.
• Awareness programs relating to health care for dalit community in the
districts particularly maternity health care of dalit women will be
launched.
• Health care service will be provided on regular basis by identifying the
areas where there is major health problem with the young girls and
women in dalit community.
28.5.4 Economic Program:
• Special priority in land distribution will be given to homeless people of
dalit communities.
• While providing foreign employment to people of dalit community under
the government initiatives, their traditional skills and resource will be
modernized and training will be provided to make their service suitable to
foreign jobs.
• Loan in easy term will be made available to people of dalit community to
run their traditional businesses . Special training will be provided to
modernize their traditional skills.
• There are people of dalit community who have skills but have no formal
certificate. This is a bottleneck to have jobs. So, measures will be taken
to determine the level of skills and provide them certificate by skill
testing.
• Priority will be accorded to dalit community people in the governmental
and non-governmental employment.
• In order to make professional skills of dalit community prestigious and to
merge them into the mainstreaming, the interest will be created in their
occupational skill in the schools.
28.5.5 Study and Research Program:
• Under the government and the non-government sector, people will be
encouraged to conduct studies and carry out research works to identify
population of different groups of dalit communities and different aspects
of their life.
28.5.6 Institutional Arrangement:
• The District Development Committee will be asked to formulate the
programs for the socio-economic development of dalit community of the
district at the time of district development plan preparation.
554
• Each District Development Committee will be asked to prepare the
docum ent on the status and problems of the dalit communities of their
district.
• In order to coordinate all types of governmental and non-governmental
district level dalit development programs and to formulate plan and
policy as well as to make responsible of their execution as per local
requirement, the responsible person/agency will be pin pointed and focal
point will be created in the District Development Committees.
• The process of creating committee at local level to look after the status of
dalit communities, as watchdog will be initiated. The committee will
submit its annual report to its parent organization.
• The agencies of government, non-governmental organizations, social and
community based organizations working at grass root level will be
activated to identify problems and issues as well as for the solution of the
area specific dalit community.
• By way of coordination, duplication in programs related to uplift and
development of the dalit communities of various line ministries,
departments and NGOs and INGOs will be avoided. The National Dalit
Commission and the Committee on uplift of the Dalit , oppressed and
neglected communities are working separately at present. They will be
merged into one single institution for the preparation of appropriate
policy and programs in order to implement all the activities relating to
them in an integrated manner.
28.6 Monitoring Arrangement:

Arrangement will be made to monitor the implementation of the programs by the
users groups and the related local institutions, since these programs prepared for dalit
communities will be run under the committee represented by local institution, non-
government organization and consumers' group. Also, considering the nature of the
programs, arrangement will also be made to monitoring and evaluation of such
programs at higher level, such as, the District Development Committee, line
ministries, the National Dalit Commission and the National Planning Commission.
The outlay allocated for the proposed programs is included in the local development
sector.
Total outlay for the sector is Rs.1,600.00 million, of which Rs.500 million at the
minimum will be borne by the Poverty Alleviation Fund and Rs.1,100.00 million will
be the grant-in-aid provided to the local bodies (like DDCs), but excluding the
resources allocated for the targeted programs of sectoral ministries.
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Chapter - 29
Indigenous People and
Ethnic Groups
29.1 Background:
Nepal is a country with multi-ethnic, multi-lingual, multi-religious people and diverse
culture. This vast diversity is the most unique feature of Nepal as a country. Of total
inhabited communities, there are 59 groups belong to indigenous/ethnic communities.
Again, 59 indigenous /ethnic groups comprise of minor populated groups like
Bankariya, Kusunda,Chhierotan, Kushabadiya, Raote, Surel and groups having more
than million populations, for example, Magar, Tharu, Tamang, etc . Majority of
indigenous people and ethnic groups are weak economically, socially, educationally
and politically. Moreover, these groups are deprived of various types of facilities . The
gap in their level of development is still very significant. In such situation, it is felt
necessary to have well-balanced progress of each community and ethnic group for the
country's all-round development. The special features of the ethnic groups are in fact
the asset of the nation. The concept that development of the nation is only possible
through promotion of their special features is therefore necessary.
The government with the objective of enabling people of various indigenous and
ethnic groups settled all over the kingdom has undertaken, from time to time,
different types of programs to improve their socio-economic condition for their living
a decent and prosperous life. Among such various programs, the notable one is the
Praja and other indigenous people/ethnic group development project. It is
implemented under the title of "The Targeted Group Development Program ." Despite
the fact that the Praja Development Program was implemented in four districts, viz.,
Gorkha, Dhading, Chitwan and Makwanpur, still the socio-economic progress of
these targeted groups has not taken place. The Formation Order of the National
Ethnic Group Development Committee 2054 BS was issued as it was felt that
institutional and well-managed efforts are to be made in this direction. Although the
programs relating to the indigenous people and ethnic groups with the objective of
their all-round development were implemented since a long time, noticeable changes
have not occurred in them. These targeted groups have not been included in a
comprehensive way in the development programs for substantial socio-economic
changes. Although after the restoration of multiparty democracy in the country,
interest was shown in their institutional active participation and their rights, various
development indicators substantiate that the indigenous people and ethnic groups
were isolated from merging into the mainstreaming of development and they could
not be active partners in the overall development of the country. Motivation is
necessary, therefore, to make advancement to conserve and develop indigenous
people and ethnic groups in the various fields like, economic, education, social,
lingual, culture, etc. in a sensitive manner, by realizing that their contribution is
557
equally required as of other communities' in the proportionate and balanced
development of the nation.

Since the Eighth Plan period under social welfare various programmes aiming at
economically, educationally, socially backward communities were implemented but
the indigenous people and ethnic groups scattered all over the kingdom could not reap
substantial benefits. Taking note of weakness and limitations in earlier programs, the
Ninth Plan (1997-02) had incorporated special policy and programs related to
indigenous people and ethnic groups . The programs included in the plan were
launched with the objectives of eliminating existing social disparities by improving
their socio-economic condition, raising overall cultural status of the nation by
undertaking research works on their cultural heritages and also to conserve them,
enhance their capability through empowering them economically, socially and
communally and lastly, involving them in the nation building task through ensuring
their access to resource by promoting knowledge and skill along with the
modernization of their traditional occupations .
Over the period of the Ninth Plan, under the institutional arrangement, Indigenous
People /Ethnic Group Uplift National Academy was established, however, the
committees on indigenous people /ethnic group in all the 75 districts of the country
could not be formed as targeted.
Under the human development program, the students of the indigenous people and
ethnic group, who studied in the higher education with technical as well as non-
technical subjects were encouraged by providing scholarship/stipend.
The traditional knowledge and skill based professions and employment oriented
programs have benefited specially to youth, both male and female, as well as women.
The public awareness was raised in the highly backward indigenous people and ethnic
groups in the fields of education, health, legal matter, sanitation and environment,
culture, women awareness and ethnic groups identification. The course books in the
ethnic languages / dialects of Bantawa Rai, Kulung Rai, Limbu, Tharu, Tamang,
Baramu, Magar, Gurung were writtten and informal classes were run using those
books. Dictionary in the languages of ethnic groups like Bantawa Rai, Gurung,
Margar, Yakkha, Serpa, Dura, Majhi and Sunuwar is under preparation. The real
status of various indigenous people and ethnic groups was identified and papers were
prepared on different aspects of the communities by conducting various research
works and studies . Income generating programs had been launched for some ethnic
communit ies for their economic upliftment. Similarly, various programs relating to
indigenous people's culture, festivals, pligrimage conservation are still continuing.
Despites the fact, indigenous people and ethnic groups as a whole could not be
benefited as envisaged from these programs. The weaknesses of the programs are
mentioned below.
• Lack of information and statistics on real status of ethnic groups .
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• There are no committees of indigenous people and ethnic group at the local
level; hence the targeted program s are directly implemented by the center,
which has made difficult to run the programs smoothly, well-managed and
effectively. This happened due to lack of timely monitoring.
• Failure to involve highly backward, and virtually no access to indigenous
people and ethnic groups in the socio -economic upliftment programs.
• No effective programs on education, health, etc. for endangered and
backward indigenous /ethnic communities and no special program of
scholarship from the school level was lunched.
• No responsibility was given to sectoral ministries for the programs
implemented in the area of target groups .
• Lack of policy in respect of development of expertise in the indigenous and
ethnic communities. There was no provision of expertise development in the
programs implemented by various ministries.
• Incapability of active organizations involved in the task of uplifting
indigenous people and ethnic groups.
• Unclear about the national concept on skill, knowledge, technology and
capacity of indigenous people and ethnic groups .
29.3 Long Term vision:

The long term vision is to boost up indigenous people and ethnic groups and achieve
their all-round development in the areas of economic growth, education, social and
cultural upliftment by maintaining ethnic diversity and mainstreaming them into
national development on the basis of equality.
29.4 The Tenth Plan:

Objective:
The objective is to provide development opportunities by empowering the backward
people and people of indigenous and ethnic groups who are unable to participate
actively in the development mainstream.
Strategy:
Some of the indigenous people and ethnic groups are far behind the mainstreaming of
modern development because of geographic remoteness, harsh climatic condition and
conservative traditional social values . It is possible to make concrete contribution in
the promotion of social justice by undertaking the works like capability enhancement,
individually and in the group as well as their active participation in the social and
political process for mainstreaming them into development process. It will help even
to sustain development of social and economic sectors of the country. Against this
backdrop, the major strategies of this sector are as follows:
559
1. Assist to create an egalitarian society by making all-round development of
indigenous people and ethnic groups through the programs related to social,
educational, economic and cultural development as well as uplift indigenous
people and ethnic groups.
2. Protect and promote the language, scripts, culture/literature, art, history of
indigenous people and ethnic groups.
3. Protect and promote traditional skill, technology and specialized knowledge
and assist to utilize them in commercial purpose.
4. Indigenous people and ethnic groups will be made partners in the
mainstreaming of overall development by fostering good relationship,
goodwill and respect among the various indigenous people, ethnic groups,
castes and communities .
b) Policy and working policy:
§ All-round development and egalitarian society (Related to strategy 1):
• Arrangement will be made to implement the on-going targeted programs
of indigenous and ethnic groups, making necessary structural and
institutional reforms effective.
• Priority will be given to persons of highly backward and endangered
indigenous people and ethnic groups for admission in technical and non-
technical subjects under higher education. Similarly, the scholarship
program will be extended for the children of that community in the
schools and it will be made effective.
• Priority will be given to establish schools and health posts for that
community and areas to increase their access to education and health care
services .
• In order to make active participation in the development activities,
awareness among economically backward indigenous people / ethnic
communities in the matter of education, health, economic and social will
be increased. The employment and profession oriented programs will be
implemented with the intention of minimizing economic and social
imbalances existed between the indigenous people /ethnic groups and the
advanced ethnic communities.
• Women of indigenous / ethnic groups will be empowered by extending
women development programs.
• The capacity of women of indigenous / ethnic group will be developed by
providing legal protection of their traditional development friendly rights.
• Mandatory arrangement will be made to analyze the status of indigenous
people and ethnic groups of the district in the time of formulation of
district plan by the local institutions particularly District Development
Committee.
§ Conservation of cultural heritage (Related to strategy 2)
560
• Steps will be taken to establish model village or museums to enable the
identification of multi-lingual, multi-religious, multi-culture of the
country.
§ Traditional skills and specialization (Related to strategy 3)
• Indigenous people and ethnic group will be made partner in the process
of national development through conducting research, conservation and
promotion of diverse culture, language, knowledge and skills inherent in
them.
• The National Academy for Development of Indigenous Nationalities Act,
2058 BS with the objectives of protecting the rights of indigenous people
and ethnic groups as well as protection and conservation of their culture,
language and diverse knowledge has been promulgated. The Academy
will be established and strengthened.
§ Mainstreaming (Related to strategy 4)
• The indigenous people and ethnic groups will be empowered through
decentralization, local community development, human resource
development and mobilization, efforts of poverty alleviation and lingual
and cultural institutions.
• The programs of various agencies of His Majesty's Government will be
targeted to those groups and to those areas where majority of indigenous
people and ethnic groups reside. Special arrangement will be made for
monitoring and evaluation of investment programs launched by the non-
governmental organizations to uplift indigenous people and ethnic
groups.
29.5 Programs
a) Institutional Arrangement :
In order to protect and promote indigenous/ethnic people's rights, language, culture
and various knowledge, the Indigenous People/Ethnic People Upliftment National
Academy will be strengthened and district based units to monitor indigenous/ethnic
programmes will be established in all 75 districts. These units will play crucial role
in central policy formulation and implementation by working in close cooperation
with DDCs.
Arrangement has been made to submit programs to concerned agency for their
approval. Such programs are to be formulated by identifying needs of the targeted
groups and upon their approval, implementation will be carried out by the respective
groups. Likewise, arrangement will be made to program monitoring and supply of
technical and expert service as per necessary will be done though district level units.
b) Language and Cultural Development :
• Accepting the diversity of language and culture of the country as an asset,
protection, conservation and development of the languages will be
561
undertaken by categorizing indigenous and ethnic languages into four groups
viz. endangered, without traditional scripts, moving towards traditional script
and established traditional scripts. System of providing basic education in
their own mother tongue, as a medium of instruction, will be initiated by
developing curriculum, course books, and support materials in their mother
tongues. The teachers teaching in their mother tongues will be produced.
• The cultural heritage of indigenous people/ethnic group, which are important
and valuable national cultural heritage will be protected, conserved and
developed by identifying, conducting studies and research and documenting
them. Support will be provided in the establishment of museums and model
villages for the protection of these assets at the center and the local
communities .
• Awareness oriented programs emphasizing on health, family planning,
maternity and child welfare, environment and sanitation and women
empowerment, targeted to indigenous and ethnic communities will be
launched for the protection of language, social and cultural system. They will
be motivated to participate actively in the development by identifying their
needs and problems by themselves .
• Special campaign program will be organized for informal education by
mobilizing organizations and NGOs based on institutions, organizations and
communities of indigenous people and ethnic groups for the growth of their
literacy rate. System of providing informal education in the medium of
mother tongs will be started. Priority will be accorded to establish schools
and health centers for these group and areas with a view to increase access to
education and health cure services .
c) Human Resource Development :

• Emphasis will be given to human resource development for overall
advancement and empowerment of indigenous people/ethnic groups . The
programs, namely, special motivation, from the primary to higher secondary
education for the students of highly backward and endangered indigenous
/ethnic group, special scholarship arrangement for technical and non-
technic al higher education, awareness program for education development
and literacy campaign will be continued.
• The programs, which protect, conserve and use of the traditional knowledge,
skill and technology of indigenous people/ethnic groups will be implemented.
Likewise, occupation and the employment oriented training will be arranged
to provide employment opportunities . In order to make training more
effective, His Majesty's Government will provide necessary policy and
technical support.
d) Social and Economic Development :

• Under the poverty alleviation program, the occupations based upon the
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interest of indigenous people /ethnic group and their traditional skill,
craftsmanship and knowledge will be protected and modernized along with
the implementation of programs, targeted to them like market management,
social development, rehabilitation of particular indigenous people in order to
improve the condition of the people living below absolute poverty line and to
reduce the gap existed between indigenous people / ethnic groups and other
ethnic communities.
• Indigenous people /ethnic group will be involved to the maximum in the plan
formulation process, implementation and management of the development
projects with the objective that they could reap the benefits from the
development projects.
29.6 Special Arrangement:

Specified percentage of grant-in-aid provided by His Majesty's Government to the
District Development Committees and the Village Development Committees will be
encouraged to spend in the development programs for indigenous people and ethnic
groups.
29.7 Monitoring and Evaluation:

The monitoring and evaluation of the programs implemented categorically for the
indigenous people/ethnic group will be carried out by the local indigenous people
group in the initial stage. The district level programs will be regularly reviewed and
monitored by the district level units in coordination with Ministry of Local
Development and the National Academy for the Development of Indigenous
Nationalities . The central secretariat/ office will coordinate all programs implemented
in the kingdom and monitor and evaluate them. Report will be made available to the
Ministry of Local Development. The National Academy will also conduct
evaluation study on the effectiveness and sustainability of investment provided by His
Majesty's Government.
The total outlay for the sector is Rs.1,600.00 million, of which Rs.500 million at the
minimum will be borne by the Poverty Alleviation Fund and Rs.1,100.00 million will
be the grant-in-aid provided to the local bodies (like DDCs), but it excludes the
resources allocated for the targeted programs by the line ministries .
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Chapter - 30
Local Development
30.1 Background
The major aspect of local development is to explore and identify the development
programs, mobilize local resources in a coordinated manner, and run these programs
using local skills and technology for meeting the needs of local people. The main
concept of local development is to sustain local development through the active
participation of local people in project selection, formulation, implementation, repair
and maintenance of local level projects.

• Rural Community Infrastructure Work (RCIW) implemented in 20 districts in
the beginning of the Ninth Plan has been extended to 35 districts including
remote districts of the Far and Mid Western Development Region of the
kingdom. This program has constructed 2,361 km rural roads, 1,532 km
mule track, and irrigation channel for irrigating 253 ha, 148 km river control,
and 53 ha fishpond. Similarly, this program has completed 101 ha of
agricultural forest development and 382 ha of community forest
development. This program has covered 198,000 households and benefited
altogether 296,000 laborers including 207,000 male laborers and 89,000
female laborers.
• Rural Infrastructure Development Program (RIDP) undertaken with the loan
of Asian Development Bank in Baglung, Kavre, and Tanahu altogether in
three districts has completed construction of 161 km rural roads and 21
community buildings.
• Rural Infrastructure Program (RIP) implemented with the loan of The World
Bank in eight districts has completed the regular maintenance of 829 km
roads and rehabilitation and periodic maintenance of 288 km roads.
• Agricultural Road (AR) Program has completed construction of 326 earthen
roads; in addition, 47 District Development Committees have prepared
District Transport Master Plan (DTMP) under this program. Local
Development Work Program has completed construction of 1,619 km rural
roads and 536 km mule track.
• Suspension Bridge Program has constructed 75 suspension bridges along the
main track, and has been constructing six suspension bridges. Local Trail
Suspension Bridge Program has constructed 133 suspension bridges and has
been constructing 174 suspension bridges. Similarly, BBLL has constructed
793 suspension bridges.
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• Similarly, District Road Support Program (DRSP) implemented with the
assistance of the Swiss Government has constructed 41 km roads in six
districts, and has rehabilitated and repaired 109 km roads.
• Rural Access Program (RAP) has initiated the first phase of work in six
districts.
• Poverty Alleviation Project implemented in eight Terai districts of Western
Nepal with the loan assistance of International Fund for Agricultural
Development (IFAD) has provided 9,841 persons with agriculture and
livestock develo pment training, 394 with farmers' study tour, 2,676 with skill
training, 131 trainers' training, 561 with community forest nursery training,
3,833 with community health and sanitation education and people's
awareness training. Similarly, it has constructed 24 vegetable production
demonstration plots, 25 community forest nurseries, 340 culverts, 224
community hand pumps for drinking water, 10 community fishponds, 267
group shallow tube wells, 9 lift pumps, and 10 row er pumps. In addition,
during the plan period, it has distributed 38,281 fruit saplings and has
provided the under Freed house construction grants to 3,149 families Bonded
Labourer Rehabilitation Program. During the plan period, it has invested Rs.
131.4 million in loans benefiting 18,424 women.
• Remote and Special Area Development Program implemented by the Remote
Area Development Committee in 22 remote districts of mountain and hill
areas especially of the northern part of the kingdom and other three districts
altogether in 25 districts has completed 18 micro-hydro projects, 65
suspension bridges, 126 drinking water projects. Similarly, it has constructed
236 km mule track, surface irrigation facility for 1,122 ha; and has provided
416 persons with income generating and skill training.
• In course of identifying indigenous/ethnic people 59 nationalities have been
listed. Indigenous and Ethnic Peoples' Development National Academy Act
of 2058 (2001) has been enacted to set up a separate academy with the
objective of bringing them to the mainstream of development. Publication of
books on the disappearing languages of nationalities, making of two
documentary films on preservation and promotion of the culture of
indigenous people and nationalities, awareness programs through various
organizations, leadership development training and various income
generating programs for the development of Tharu people in the Terai area
have been implemented. Similarly, literacy training, capacity building and
agricultural skill trainings have been conducted for the Chepangs living in
Dhading, Chitwan, Gorkha and Makwanpur districts. Gomba Management
and Development Board has repaired and maintained various Gomba
(Buddhist monastery) throughout the kingdom. It has published a Himali
Children Text Book and a souvenir, and conducted a study tour for program
Lamas from different parts of the country.
• National Dalit (under privileged people) Commission has been set up for
development of downtrodden, oppressed and under privileged people. A
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work on preparing a Dalits' Rights Preservation Bill is ongoing. Programs
targeted at the development of this class of people are implemented through
Downtrodden, Oppressed and Under Privileged Peoples' (Dalits)
Development Board. Such programmes particularly the programmes on
providing scholarships for the intelligent students belonging to this class of
people, health services and income generating training have been ongoing.
During the Ninth Plan period, 7,431 students at schools and at the higher
educational institutions have received scholarships through the Dalit
Development Board.
• Elected representatives to the local bodies have received the training on the
Local Self-governance Act and the orientation training on the related subject
matters. In addition, the program on institutional development of the Local
Development Training Academy has been implemented.
• Thirty-five District Development Committees have prepared their periodic
district development plans.
• Project monitoring and management capability of all District Development
Committees and municipalities has increased.
• The tradition of handing over the development projects implemented by the
line agencies at the local level to the local bodies has been initiated.
• The responsibility for solid waste management in municipalities has been
delegated to the concerned municipalities since the beginning of the Ninth
Plan. Short-term and long-term policies on landfill sites have been adopted to
resolve the issues of landfill sites. In this context, eight-kilometer approach
road out of the 12 km long approach road to the Okharpauwa landfill site has
been graveled during the Ninth Plan period; one bridge was completed out of
two to be constructed; short-term site is under construction, and efforts are
being made to mobilize the private sector for the solid waste management.
• The entire population of the Padampur VDC affected by the National Park in
the Chitwan district has been allocated 1, 600 bigha (1,088 ha1) land. Seven
hundred and twenty two (722 bigha = 491 ha.) bigha land out of the total land
has been delineated for distribution; compensation for 381 bigha (259 ha.)
has been paid; 1,204 households have been transferred; forest land of 1, 455
bigha (989 ha) has been cleared and made a plot, and other construction work
such as 11 buildings, drinking water system, 25 km road and culvert has been
completed.
Issues and challenges
The major problems in the field of local development have been seen as lack of
clarity on the role and the structure of Ministry of Local Development as required by
the changed situation, lack of clear definition of local level programs, and lack of
having clear vision of local bodies about their long-term and immediate development.
1
Computed at one bigha = 0.6799 ha.
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The challenges relating to local development are inability to prioritize projects based
on local needs and locally available resources, continued tradition of the central
decision making on even small projects, inability to effectively mobilize local users'
groups, inability to complete projects on schedule and in the appropriate quality,
unavailability of necessary manpower for implementing local development programs
at the local level, unable to make anticipated institutional development of local bodies
for management, implementation and monitoring of programs, unable to introduce
financial discipline and so on.
Other challenges are lack of internalization of the programs related to local
development and the programs implemented with assistance of the government, non-
governmental organizations and donor agencies; donor agencies setting up their own
parallel structures for implementation of their programs; and implementation of local
level pilot projects non-coherent to the local conditions. In addition to this
implementation of programs without evaluation and identification of the local ability;
duplication of local level programs; not conducting feasibility study on the programs
related to rural infrastructure development; and implementation of projects beyond
the monitoring ability of local bodies are some other challenges in this sector.
30.3 Long-term vision

The long-term vision of local development is to provide the people of different
classes and community with an equal opportunity of access to basic services, benefits
and resources, and to create flourishing civil society with their active participation,
and to make improvement in the living standard of the local people with the
coordinated efforts of the well organized local bodies.
30.4 The Tenth Plan

(a) Objective
Minimize poverty by making available local people particularly the people of socially
and economically backward areas, caste, nationalities and groups an easy access to
services and benefits made locally available.
(b) Quantitative target
Local resources , means, and ability will be utilized at maximum for meeting the basic
needs. The goal of local development will be to support the national goal of poverty
eradication by implementing development programs at the local level through
mobilization of local bodies and civil societies so that local people particularly the
people of the socially and economically backward class will have increasing access to
development, operation and use of social, economic , institutional and physical
infrastructures. The following quantitative progresses in local development will be
made during the Tenth Plan period:
• Periodic plans of all districts and municipalities will be prepared and
implemented.
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• Information center (including Geographical Information System, GIS) will be
set up and strengthened at all DDCs and municipalities. Information system
will gradually be set up and operated at VDCs too. Poverty mapping will be
implemented in selected districts.
• District Transport Master Plan will be prepared in all districts.
• Local Development Fund will be set up at local bodies (DDCs, VDCs and
municipalities).
• Various village development programs and other target programs will be
implemented by coordinating with all programs implemented through social
mobilization in all VDCs.
• Every year 1,200 km rural and agricultural roads, and 600 km earthen roads
will be constructed, 250 km gravel roads will be rehabilitated, 5,000 km will
be regularly repaired and 600 km will be periodically repaired; altogether
20,000 km roads will be operational at the end of the Tenth Plan.
• Similarly, 500 new suspension bridges will be built; 1,200 bridges will get
comprehensive repair and maintenance; 2,000 suspension bridges will get
minor maintenance.
• A labor-intensive and environment friendly technology training center will be
set up and operated for making the local infrastructure development work
qualitative and effective.
• Training will be provided to 1,200 DDC office holders, 50,000 VDC office
holders and 1,500 municipal office holders (including women
representatives) in the first year and the second year of elections. In addition,
study tour and orientation training will be provided to 52,600 persons.
• Training suitable to their responsibility will be provided to assistant level
staffs of the second grade working at the local bodies.
• Poverty alleviation, social mobilization and self-employment programs will
be implemented at all Village Development Committees and municipalities
benefiting the households concerned with these programs.
• A computerized accounting system will be introduced at all DDCs and
municipalities, and at some VDCs.
(c) Strategy
The local bodies can play an important role in mobilizing locally available resources
and manpower for fast and high economic growth of the country as shown by the
effectiveness of the locally implemented programs. Similarly, poverty among the
backward classes and in the target areas can be reduced through the local
development by implementing various development programs in a planned manner
based on the nature of poverty and on the area specific poverty. This will contribute
to the social development too. Small-scale rural infrastructure development, social
capital mobilization, skill development and various income generating activities can
make special contribution to it. Similarly, programs on institutional development and
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strengthening of various concerned agencies will be equally important in making
local development more effective. In this context, the main strategies of this sector
will be:
1. Direct involvement of stakeholders will be in every phase of plan formulation
implementation, monitoring and evaluation of development programs to be
implemented at the local level;
2. Focus of local development programs will be on the people of neglected and
oppressed caste and nationalities, backward groups, and on backward
geographical areas identified based on locally available resources and on a
development indicator; implementation of special programs will be done
targeting the area and the community having the inc omes below the national
average;
3. Continuous enhancement of coordination and cooperation among the
programs implemented at the local level.
4. Use of environmental friendly and labor-intensive technology for
implementation of development programs at the local level.
(d) Policy and work ing policy

§ Local development plan and involvement of stakeholders (related to
strategy 1)
• During the plan period, all District Development Committees,
Municipalities and Village Development Committees will complete their
periodic plans, make sure their work areas and will effectively prioritize
their plans and implement them in cooperation with non-governmental
organizations, civil societies and private sector.
• A mechanism will be developed and expanded for making effectiv e inter-
relationship between rural urban partnerships.
• Responsibility for formulating and implementing programs on the
construction of rural infrastructure will be delegated to the local bodies.
Local level development work will strictly follow the periodic plan and
the sector wise master plan of a concerned agency. Such a plan will be
applicable in the areas where a master plan has been introduced.
• Programs on rural infrastructure construction will be categorized; then
the programs to be implemented by the central agency will be included in
the implementation list only after the feasibility study. Ongoing
programs will be prioritized; and then the prioritized programs will be
provided with necessary resources. A tradition will be set for
implementing sm all-scale programs at the local level pursuant to a master
plan. Provision will be made for integration of population management,
environmental protection and development through spatial planning in
the plans prepared by the local bodies.
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• Norms will be prepared and implemented for construction of roads,
buildings and other physical work in municipalities, surrounding VDCs
and urbanizing areas.
• A single policy will not be adopted at all level on formulation of the
policy on allocation of natural resources for the use of local bodies, and
on formulation of any other policies too, and policy formulation will be
coordinated with the local bodies for making polices suitable to local
conditions.
• Local level projects and programs implemented with the assistance of
donor agencies will be internalized within local bodies.
• "Fund" set up for the purpose of repair and maintenance of rural
infrastructures will be effectively implemented.
• A policy provision will be made for using the knowledge and skills of
retired servic e men, police, civil servants, teachers and so on. Local
bodies will be encouraged in using such manpower to offset the shortage
of skilled manpower at the local level.
• A process will be initiated for considering remittances as local resources
for mobiliz ing resources.
• A provision will be made for integrating vital registration program with
the family statement, and will be implemented effectively.
• Users' groups will be formed for implementing programs at the local
level, and priority will be given to the users' groups already formed.
§ Implementation of target programs at the local level (related to strategy 2)
• Target programs will be implemented through "Local Development
Fund" at the local level in an integrated manner; and linkage with the
Poverty Alleviation Fund at the center will be established. During the
Tenth Plan period, various poverty alleviation programs will be
implemented in each VDC area through social mobilization; these
programs will create self-employment opportunities at the local level, and
will increase income of local people. Currently, poverty alleviation
programs such as Bisheswor among the poor, women's awareness, micro-
credit and village development are scattered in various parts of the
kingdom; they adopt various social mobilization process; special
attention will be paid to bring them together to agree on a basic process
of social mobilization for uniformity and for avoiding duplication of
programs. Provision will be made for evaluation of these programs based
on certain criteria of its effectiveness and performance. To this end,
poverty mapping will be done, and programs will be prepared based on it.
Supplementary programs will be implemented in coordination with basic
programs. Local bodies will play a decisive role in avoiding duplication
of programs, and in making programs effective.
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• Evaluation of the investment made in the remote areas and of its progress
so far will be done; the definition of remote area will be revised based on
the certain norms; and then strategy and programs will be prepared
accordingly. An appropriate new institutional structure will be set up for
this purpose. Remote areas will be considered, as the source of resources
and a plan will be formulated and implemented accordingly.
• A handbook of local infrastructure construction particularly roads,
drinking water system, and rural electrification and irrigation system will
be prepared and implemented. The community auditing of these
infrastructures will be done.
§ Coordination and network (related to strategy 3)
• District Development Committee will be made more capable and
responsible for effective monitoring and evaluation of projects
implemented at the local level. Relation between the regional office of
National Planning Commission and the local bodies, VDC/municipalities
and District Development Committee will be further strengthened for
effective plan formulation, monitoring and evaluation work.
• Devolved function and services will be carried out with due effectiveness
at the local level.
§ Use of environment friendly and labor-intensive technology (related to
strategy 4)
• A handbook of Green Road C oncept will be prepared and implemented
for paying attention to the preservation of greenery at the time of
constructing local infrastructures in a sustainable way.
• The concept of systematic settlement will be put into practice by
preparing and implementing a land-use plan appropriate to the
geographical feature of rural areas.
(e) Program
During the Tenth Plan period, local development programs will be implemented in
the following priority order:
1. Policy and institutional reform program
During the Tenth Plan Period, organization of Local Development Ministry will be
developed and improved; inter-ministerial coordination will be established for
strengthening the local level planning system; technical assistance will be provided to
the local bodies for formulating and implementing programs; improvement in
information management system and monitoring system will be done; categorization
of district, municipal and village level programs will be done, and monitoring of local
development program will be implemented.
2. Local body strengthening program
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Participatory District Development Program, Local Governance Program, Rural
Urban Partnership Program, Urban Development through Local Efforts, Local
Governance Strengthening Program and so on will be implemented in a coordinated
manner to set up necessary modern information management system, planning
process management and to conduct other sectoral activities for strengthening local
bodies pursuant to Local Self-governance Act and Rules. Assistance for these
programs will be available from various donor agencies. Various economical, social
and capacity building programs will be implemented for protection of privileges and
rights of women and children to development; Decentralized Action for Children and
Women (DACAW) program will be implemented with the financial and technical
assistance of UNICEF in 25 districts of the kingdom. These programs will be
implemented with the cooperation of all stakeholders at the local level.
3. Financial resource management program
Local bodies Development grant program, improvement in accounting system and
auditing program and programs on local body financial institutions will be
implemented during the Tenth Plan period in course of implementing
recommendations made in the report of the Local Body Fiscal Commission 2057
(2000). It is expected that these programs will make important contribution to the
management of the financial sources of the local bodies.
4. Human resource development program
Programs on seminar, training and study tour will be conducted for office holders and
staff of the local bodies and for increasing the ability of the local bodies. Institutions
such as Nepal Agricultural Research Council (NARC) and Council of Technical
Education and Vocational Training (CTEVT) will be linked with local bodies to
provide training for the office holders and staff of local bodies, and for meeting the
demand for skilled and technical manpower at local level and for increasing their
ability. Necessary initiative will be taken to strengthen Local Development Training
Academy and to set up Labour-intensive Technical Training Center.
5. Integrated reproductive health and population education program
This program implemented with the assistance of United Nations Population Fund
has remained an integral part of the local development training program. This
program includes training on reproductive health, training on population education
and gender equality, and other training. This program will be conducted in six
districts during the Tenth Plan period too.
6. Local Infrastructure Development Program
Local infrastructure development programs such as road transport, river/landslide
control, suspension bridge, small-scale irrigation, drinking water and sanitation, rural
hydro-electricity and so on will be implemented in the rural hill areas.
Ongoing infrastructure programs implemented by Local Development Ministry are as
follow:
§ Rural Community Infrastructure Works Program
Rural community infrastructure works program implemented with the assistance
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of the World Food Program includes: construction of rural roads in 45 districts of
the kingdom in a phase wise manner; construction, repair and maintenance of
small-scale irrigation canals and ponds in terai districts, construction of mule
track, protection of river bank and small-scale flood control in the mid hills. This
program has been initiated since the FY 2052/53 (1995/96). During the Tenth
Plan, it has a target of constructing 440 km rural roads in 30 districts.
§ Rural Infrastructure Development Program
Low cost environment friendly rural road construction program implemented
with the loan assistance of Asian Development Bank and with the people's
participation in three districts such as Baglung, Kavre and Tanahu has been
ongoing since the FY 2052/53 (1995/96). During the Tenth Plan, it has a target
of constructing 500 km rural roads.
§ Rural Infrastructure Project
This project has been implemented with the loan assistance of the World Bank
using labor-intensives cost effective technology in the kingdom's eight districts
such as Dhading, Kaski, Shyangja, Palpa, Nawalparasi, Rupandehi,
Sankhuwasabha and Kapilbastu since the FY 2055/56 (1998/99). During the
Tenth Plan, it has a target of constructing 400 kms rural roads and repairing and
maintaining 1,000 kms of rural road.
§ District Road Support Program
This program has been ongoing with the grant assistance of the Swiss
Government in eastern and central region's six districts such as Kavre,
Sindhupalchok, Dolkha, Ramechhap, Sindhuli and Okhaldhunga. This program
has been constructing, repairing and improving rural roads. During the Tenth
Plan, it has a target of constructing 400 kms rural roads and of repairing and
maintaining 300 kms.
§ Rural Access Program
This program has been implemented with the assistance of the British
Government in hill and remote districts since FY 2057/58 (2000/01). The
objective of this program is to develop physical infrastructures and to improve the
living standard of the poor through the rural transport infrastructure development.
This program has a target of constructing 500 km of rural roads in Bhojpur,
Sankhuwasabha, Khotang, Accham, Doti and Dailekh districts.
§ Rural Agricultural Road and Local Development work program
The Agriculture Perspective Plan has the provision for connecting agricultural
production pocket areas with the nearest road to increase the private sector
economic activities for supporting the marketing of the agricultural products
produced in the important agricultural production pocket areas. This program has
been implemented since FY 2054/55 (1997/98) to connect such pocket areas with
the nearest road. During the Tenth Plan, it has a target of constructin g 500 km
earthen roads and 600 kms gravel road.
Similarly, the local development work program has a plan to provide assistance in
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constructing rural road, mule track and other smaller tracks in various districts
according to the local demand.
§ Large and local level suspension bridge repair and maintenance
Construction of large suspension bridges on main trails of various districts, and of
local level suspension bridges according to the local people's demand, has been
ongoing with the grant assistance of the Swiss Government. During the Tenth
Plan, it has a target of constructing 500 new suspension bridges, conducting
large-scale repair and maintenance of 1,200 suspension bridges, and of doing
general repair and maintenance of 2,000 suspension bridges.
§ Rural drinking water and sanitation programm e
The third phase of this program implemented with the grant assistance of the
Government of Finland has been ongoing in six districts of Lumbini Zone, and
Parbat and Tanahu districts. This program will continue during the Tenth Plan.
§ Local Development Fund Programm e
The Local Development Fund program implemented with the assistance of the
United Nations Capital Development Fund (UNCDF) has been ongoing in eight
districts such as Udayapur, Tehrathum, Dhanusha, Dolkha, Kavre, Kaski,
Rupendehi and Accham. During the Tenth Plan, this program will continue. This
program will construct small-scale infrastructures such as drinking water system,
rural road, irrigation system, school building, small hydro-electricity, and health
post. This program will be extended to additional districts depending on its
effectiveness. In addition, local bodies will directly implement small-scale
infrastructure development programs and various other activities. This will
increase the ability of local bodies.
7. Economically backward area and economically backward people's
upliftment and development program
Remote and special area development program has been ongoing in 25 districts of
the northern part of the kingdom particularly the districts of Himalayan area and
the districts of special areas. During the Tenth Plan period, remote areas will be
redefined based on certain norms; and programs will be prepared accordingly.
Remote areas will be considered as the sources of resources, and programs will
be prepared and implemented using locally available natural resources at
maximum. This program will run activities such as capacity improvement of
community and of institutions working in community, income generating, social
sector development, infras tructure development, herbs preservation and
promotion, employment and skill training focusing on remote and backward
areas.
During the Tenth Plan, special programs will be implemented on uplifting
backward indigenous people, people of backward nationalities, neglected,
oppressed and under privileged (Dalit) people. These programs will pay special
attention to preserve languages and culture of indigenous people and nationalities,
and the vanishing nationalities; in addition, these programs will modernize the
occupation of the Dalit people and make it honorable and respectable. These
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programs will be made effective by coordinating with other agencies, as they
need multi-sectoral coordination.
8. Social mobilization and self-employment program
Various targeted programs will be implemented for creating income generation
and employment opportunities, and for assisting in sustainable poverty alleviation
by mobilizing local resources with direct involvement of local people, and by
using local skills and technolog ies. To this end, the Local Development Fund
gets institutionally strengthened at the local level. The Tenth Plan will continue
implementation of the Western Terai Poverty Alleviation Program me with the
assistance of International Fund for Agriculture Development (IFAD). The
Western Upland Poverty Alleviation Program will be implemented as a new
programme. Similarly, Tenth Plan will expand and implement special social
mobilization programs such as village development program, Bisheswor among
the poor and so on.
Rural development projects will be implemented in various districts of the
country with the objective of improving the living standard of local people
through economic and social development in rural areas. Tenth Plan will continue
various programs such as drinking water, irrigation, agriculture, forest, livestock
health, education and infrastructure development particularly in Gorkha,
Lamjung, Bhojpur, Sankhuwasabha, Gulmi and Agharkhanchi districts. German
Government and European Union will provide necessary support for these
programs.
9. Other Programs
§ Solid waste management
The volume of solid waste have considerably increased in Kathmandu and in
other towns due to population growth, rapid urbanization, and expansion of
industry, trade and commerce, and economical, social and cultural activities. The
problem of solid waste management in municipalities has been challenging to the
concerned authorities for some time due to the lack of appropriate landfill sites.
In the past, despite various efforts made to find landfill sites, there had been no
success in finding an appropriate landfill site in the Kathmandu Valley. Work on
solid waste management in the Kathmandu Valley is ongoing. During the Tenth
Plan period, priority will be given to the infrastructure development for building a
long-term landfill site on the Okherpauwa-Banchare hill. Other municipalities
will be encouraged in formulating and implementing appropriate program on
solid waste management.
§ Padampur Resettlement Program
The government set up Padampur Resettlement Development Board in 2052
(1995) with the objective of resettling the population of Padampur VDC to
Jutepani VDC in Chitwan after clearing the forest in Jutepani and then to include
Padmpur VDC in the area of Royal National Park. This Board has been working
on distribution of compensation for land, plotting of land and then turning it over
to the displaced people, and on resettlement of households, construction of
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necessary drinking water system, public building, paths and culvert in the new
settlement area.
§ Environment management
Environment management program will be implemented in 15 districts in order to
enable the people living in the industrial area live a healthy life. In addition,
Environment Management Program will be implemented at the local level with
the assistance of the Government of Finland. This program will be implemented
in three municipalities and seven VDCs.
30.5 Policy-legal-institutional improvements and provision for

their implementation
The government will make necessary policy, legal and institutional
improvements in order to implement or to get implemented local level
development activities effectively, and to make available benefits from the
development to the economically and socially backward area and community,
and thus alleviate the poverty.
a) Policy improvement
• In case periodic plans prepared by local bodies with local resources and
resources provided by the center cannot deliver basic services or plans
prepared with the resources received from the center according to the
norms to be provided for the backward area and community cannot
deliver basic services, then the center will provide required resources for
making available basic services at the local level.
• Criteria for selecting and prioritizing local de velopment programs after
the categorization of various areas based on scientific norms will include
a regional development indicator, and locally available resources and
people's participation to be made available.
• Savings mobilized by community organizations will be considered as
local resources.
• Coordinated role of local bodies will increase in mobilizing local
development fund.
• The current provision for local infrastructure development strategy, local
road maintenance planning and local infrastructure repair-maintenance
fund will be reviewed and improved.
b) Legal improvement
• Dalit Uplift Bill will be prepared and implemented.
• Necessary improvement will be made in other laws and rules.
• Provision will be made for enabling VDCs/municipalities to use legal
authority for the benefits of the people.
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c) Institutional improvement
• The role and the responsibility of Local Development Ministry and
concerned departments and agencies will be made clear; their structural
improvement will be done according to the concept of decentralization;
and planning management sector will be strengthened. This ministry will
be developed as a cooperating ministry at the center for enhancing the
capabilities of local bodies.
• Local Development Training Academy will have institutional
improvement and timely changes; it will be developed as an institution of
local bodies. The role of the training centers under it will be reviewed,
and a mechanism will be developed for making them enable to run on
their own resources. The role of this academy will be made clear in
improving the capability of local level office holders and staffs; and the
relation between the similar non-governmental organizations will also be
made clear.
d) Implementation provision
• Local bodies will prepare periodic and annual plans consistent with local
needs, national policy and priority, and will set monitoring and
evaluation indicators at the time of preparation of these plans. These
periodic local level plans will be integrated with the central plan and the
annual district development budget.
• Stakeholders will directly participate in every phase of plan
identification, formulation, implementation, monitoring and evaluation at
the local level.
• A list of areas and communities deprived of basic services will be made,
and then will be made resources available to them based on priority for
their development.
30.6 Programs and policies for gender equality

Sustainable and balanced development of society will not be possible without men
and women having equal opportunity for their development and behavior except for
the natural difference. Women's population is the half of the total population. Gender
equality is possible only with equal economical, social, political and legal provision
for development of women and men equally, and accordingly putting it in practice.
During the Tenth Plan period, attempts will be made to achieve gender equality
through the following local development programs:
• Increase in active representation of women representatives;
• Provision for training women representatives;
• Increase in women's participation in policy decision making, plan
formulation, implementation and monitoring of local development programs;
• Women's empowerment for implementation of local development programs;
creation of opportunities for women's access to employment and assets
578
through the integration of skill and capability development programs;
• Selection of programs that will increase women's access to services and
benefits;
• Increase in women's awareness of prevention and control of domestic
violence;
• Increase in women's access to institutional improvement and management of
local level periodic plan implementation, it will contribute to gender equity;
• Independent monitoring and evaluation of contribution made by the
distribution of available resources to gender equality will be done; results of
such monitoring and evaluation will be the feedback for formulation and
implementation of policy and programs on gender equality, and for resource
allocation and for comparative evaluation of achievement of these programs.
30.7 Possible obstacles and risks regarding the

implementation of programs and achievement of
progress
The following subject matters might influence the achievement of progress of the
local development programs:
• Institutionalization of and im provement in organization of local bodies, and
availability of staff;
• Devolution of local development programs to concerned local bodies in a
phase wise manner;
• Implementation of programs and budgets of periodic plans of local bodies in
coordination with the central plan;
• Assistance of donor agencies.
30.8 Progress monitoring indicators

30.8.1 Detailed description of progress monitoring indicators of local
development programs is given in the program log frame
30.8.2 Progress monitoring indicators of policy improvement, and

Institutional development
• Implementation of Local Self-governance Act and Rules;
• Implementation of periodic plans of local bodies;
• Construction, repair and maintenance of rural roads pursuant to the
Agriculture Perspective Plan.
• Local bodies' decision making process and implementation.
30.9 Program and budget

579
Summary of programs and budgets of the local development sector is given
in the following priority order. Detailed programs and estimated budgets are
given in the Appendix 30.1
(Rs in million)
Priority Number of Expected growth rate General growth rate
order programs Amount % Amount %
A (P1) 10 5894.9 23.9 4501.4 23.9
B (P2) 9 16453.0 66.6 12563.4 66.6
C (P3) 7 2352.1 9.5 1796.1 9.5
Total 26 24700.0 100 18861.0 100
30.10 Log frame

The log frame of this sector is as follows:
580
Policy and Program Log Frame- Local Development *
Comprehensive sector objective: Reduction in poverty due to the easy access of local people part icularly of the economically
and socially backward area, caste, nationalities and class to the services made locally vailable.
Sector • Stakeholders will directly participate • Creation of 300,000 self- Report of Local 1. Organizational strengthening Donor agencies
objective in every phase of development plan employments Development of local bodies will keep up
Reduction in preparation, implementation, • Creation of 40 million Ministry and 2. Increase in the resource committed
poverty due to monitoring and evaluation at the (400,000x100) man - Department. mobilization ability of local assistance.
the access of local level . days of employments Studies and bodies.
local people • Focus local development programs due to construction work reports made by 3. Improvement in the standard of
particularly of on the people of neglected and including the the local bodies. delivering services by local
the economically oppressed caste and nationalities, construction of Report on target bodies.
and socially backward class and backward infrastructures. group and on 4. Durability of,
backward area, geological area based on • Increase in internal nationalities' construction/repair,
caste, development indicators and resources of local academy. Report maintenance of, and use of
nationalities and resources available at the local level. bodies by at least 50%. on regional and physical infrastructures at the
class to the • Beneficiaries of the infrastructure local level.
• Continuously increase coordination
services made and cooperation among the program will be at least work program 5. Implementation of income
locally available. programs to be implemented at the 30% people of the generating programs at the
local level. backward caste, local level.
• Implement development programs at nationalities and class. 6. Social and economical capital
• Women's participation in formation and social
the local level using environment
the program will be 40% transformation due to social
friendly and labor-intensive
mobilization at the community
technology.
level.
*Quantitative targets based on growth rate of 6.2% (Details given in Annex 3)
581
Appendix 30.1: Program and estimated budget
(Rs million)
S. No. Name of project Expected General

First priority
1 Indigenous people, nationalities development national academy
(including gomba and praja) 122.2 93.3
2 Solid waste management program 137.1 104.7
3 Rural community infrastructure work program (RCIW/WFP) 1708.5 1304.6
4 Rural drinking water and sanitation project (FINNIDA) 866.8 661.9
5 Western Terai poverty alleviation project (IFAD) 593.7 453.3
6 Large and local level suspension bridge construction and repair 737.7 563.3
7 Padampur resettlement development board 135.5 103.5
8 Rural approach program (RAP/DFID) 1003.1 766
9 District road support program (DRSP/SDC) 412.3 314. 8
10 Western high hill area poverty alleviation project (IFAD) 178.1 136
Total 589.50 5895
Second priority
11 Manpower, communication, environment management and
project monitoring 17.8 13.6
12 Downtrodden, oppressed and Dalit development board 55.6 42.5
13 District infrastructure development offices 493.9 377.1
14 Grants to District Development Committees 4002.5 3056.3
15 Grants to municipalities 988.3 754.6
16 Grants to VDCs 9528.9 7276.3
17 Local development work and agricultural road project 890.7 680.2
18 Local level environmental management program (FINNIDA) 228.2 174.3
19 Local self-governance strengthening program 247.1 188.7
Total 1645.30 16453
Third priority
Total 2352. 1 1796. 1
20 Population education program (UNFPA) - -
21 Local Development Training Academy - -
22 Remote and special area development program - -
23 Rural infrastructure development program (RIDP/ADB) - -
24 Rural infrastructure project (RIP/WB) - -
25 Rural development program - -
26 Rural road repair and maintenance fund - -
Total 24700. 0 18861. 0
Note: Out of the grants that go to the local bodies (District Development Committees, municipalities
and Village Development Committees) Rs 1.1 billion will be used for uplifting indigenous
people and nationalities; and Rs 1.1 billion for implementing neglected, oppressed and Dalit
uplifting program, thus total Rs 2.2 billion will be used for uplifting the under privileged
people.
582
Chapter - 31
Good Governance, Development
Administration and Human Rights
31.1. Background
In the past, the State had made many efforts to deliver public services, materials and
benefits according to the demand by improving the public administration. However,
the task of making the public administration productive, efficient, cost-effective,
service-oriented, transparent, and initiative taking, and developing it as a responsible
and effective institution has been a challenge yet. Currently, the concept of delivering
public goods and services to the entire people in joint efforts of the state, the private
sector and the civil societies effectively, timely and easily has been prevailing
throughout the world. In this context, Nepal also has initiated an improvement
process for putting this concept into practice through the governance improvement
program. Various efforts have been ongoing to increase the women's participation in
the public administration in Nepal.
The entire population needs to have the sense of good governance by creating an
environment by ensuring human rights as provided by the Constitution, by making
the public service distribution process cost-effective, qualitative, effective and
responsive using the available resources at maximum.
Many efforts have been made to effectively protect and promote the fundamental
rights and basic human rights of the people as provided in the Constitution of Nepal
of 2047 (1990), according to the commitments made in various international forums,
and according to the principles and policies of the State.
Reform efforts initiated in the good governance, development administration and
human rights sector have to be effectively continued during the Tenth Plan period by
implementing programs on the entire governance improvement, on the improvement
of capacity and the efficiency of civil and judicial administration, on the increase in
the financial efficiency of public expenditure, and on the institutional capacity
development and so on for establishing good governance, for improving the
development administration and for strengthening the human rights sector.
31.2. Review of the Ninth Plan

a) Progresses in comparison with the targets of Ninth Plan
The following progresses have been made during the Ninth Plan:
1 Structural design of administrative reform : Administrative Reforms
Coordination and Monitoring Committee was set up under the chairmanship
583
of the Prime Minister to institutionalize the administrative reform, and to
provide necessary guidance and coordination with other agencies for it; and
Administrative Reform Committee was constituted under the chairmanship of
the Minister for General Administration for coordinating with administrative
reform tasks, policy formulation and implementation to regularize the
administrative reform process.
2 Preparation of a master plan: A 25-year public administration master plan
was prepared; actions plans and necessary strategy of the administrative
reform with the assistance of Asian Development Bank have been explicitly
formulated based on the important points identified in the master plan; in
course of undertaking this task, the governance improvement program was
initiated in the final year of the Ninth Plan.
3 Legal and procedural reform for good governance: The following tasks
have been undertaken for further regulating the good governance procedure:
a) Amendments to Anti-corruption Act, and Commission for Investigation
of Abuse of Authority Act have been made to make the corruption
control and abuse of authority control tasks effective. After the
amendments of the Acts, the Commission has intensively and effectively
conducted investigations into corruptions and abuse of authority.
b) Expediting services provided by His Majesty's Government of Nepal
Directives 2056, (1999), Internal Management Directives 2058 (2001),
Civil Servant Management Directives 2058 (2001), Promotion Directives
2058 (2001), and Duties and Code of Conduct Directives 2058 (2001)
have been prepared and implemented. A Bill concerning rights to
information has been prepared for making the administrative
management transparent.
c) A preliminary study on formulation of Governance Act has been
completed.
d) Preparation has been completed to implement Service Contract
Directives for contracting out the services of peon, gardener, security,
and cleaner s.
e) Local Self-governance Act and Rules have been implemented to balance
the role of local bodies and the private sector in development pursuant to
the concept of good governance and decentralization. Taxes levied by
the central level agencies have been turned over to local bodies for
making necessary resources available.
4 Morale and motivation of employees: Salaries of government employees
have been increased by 50% to 80% since the FY 2057/58 (2000/01). Civil
Service National Training Policy of 2058 (2001) has been implemented to
make up-to-date improvement in the training management. The practice of
awarding the best employee among the civil servants has been initiated.
5 Management auditing: The first amendment to the Civil Service Act of 2055
(1998) has made the provision for management auditing to make the civil
584
administration effective; accordingly the Ministry of General Administration
has been conducting management auditing regularly.
6 Functional structure: Functional review and organizational strengthening of
central level government institutions have been done to make the
administrative units clean and efficient. The 1,045 positions that were
deemed unnecessary have been cut off. Similarly, voluntary retirement
benefits have been given to 2,220 staffs; an arrangement has been made to
cancel these vacant staff positions.
7 Creation of networking of civil servants: Preparation of a civil service
database by computerizing the record of civil servants kept at the Civil
Servants' Registration Office has been almost completed. Improving the
standard of this database for con verting it into a report, as required, and
coordinating staff positions with the staff position management, and creating
networking of staff positions have been ongoing.
8 Examination system and curriculum : Public Service Commission has made
timely improvement and refinement especially in the examination system and
the curriculum of the section officer (non-technical) position with the
objective of appointing qualified persons to the civil services as required.
9 Human Rights: Main aspects of human rights conc erning children, women,
nationalities, minority and dalits, labor, education and culture, environment
and development, health and so on were included in the Ninth Plan under
various headings of the program implementation although a separate chapter
of human rights was not included in it. During this period, Human Right
Commission Act of 2053 (1996) was enacted; and National Human Right
Commission was set up pursuant to this Act.
b) Problems of and challenges faced in the implementation of the
Ninth Plan
During the plan period, major problems had been: no coordination with the agencies
implementing policies and programs; no clarity of detailed procedure and process of
implementing the approved programs; and lack of norms and indicators of measuring
the achievements of targets. Main problems had been: no prioritization of programs,
no sufficient homework done for managing implementation of programs; unable to
deliver services and materials easily to the people; and unable to give the sense of
good governance during the period of Ninth Plan. An additional problem had been:
unable to conduct the monitoring and evaluation of program implementation
effectively. Quick transfer of project chiefs and development program managers had
contributed to the delay in implementation.

a) Objective
585
1 The objective of the good governance and development administration sector is
to support sustainable economic development and poverty alleviation creating an
environment for good governance by making timely improvement in the judicial
administration, and by making the public administration competitive, cost-
effective, transparent, service-oriented, responsible and gender sensitive.
2 The objective of the human right sector is to support the poverty alleviation task
by linking the national development program with the human right development
and by using the limited resources available for ensuring fundamental human
rights of Nepalese people as provided in the Constitution of Nepal of 2047
(1990), and pursuant to the commitments made in various international forums,
and various international conventions endorsed by Nepal
b) Strategy
It is necessary to give the entire population the sense of good governance by creating
an environment for the people to easily enjoy the human rights provided by the
Constitution, by making the delivery of goods and services cost-effective, qualitative,
efficient and responsible, by using the available resources at maximum . In this
context, the State's guiding principles, policies, and various commitments made in
international forums are also important.
Making the public administration effective will yield maximum results of public
resources invested in various sectors due to their proper use; it will control
corruption, abuse of authority and leakage of revenues, it will contribute to the
development of a system of the people keeping watch on development work and on
delivering services and benefits; this will make possible to complete development
work and to deliver services and benefits at less cost and time; all these things will
make significant contribution to the high economic growth and fast social
development. The effective and efficient public administration will create an
environment for all people to participate in development, for enhancing the ability of
local bodies and then for turning over power to them, and it will develop the culture
of respecting human rights; consequently the target people will benefit from all these
things; and then people will have the sense of good governance. In this context, the
main strategies of this sector are as follow:
§ Strategies concerning the objective No. 1
1 Identify the competitive advantage of the government, the civil society
and the private sector for delivering services to the people; improve
qualitative and quantitative services and materials to be delivered by the
government to the people by using such advantage.
2 Prepare a transparent plan on the career development of civil servants
from the appointment to the retirement in order to increase the efficiency
of the entire civil service. Encourage women's participation in the civil
service.
3 Give a proper shape to the civil service for making it clean and prompt.
Increase the financial efficiency of the civil service.
586
4 Increase the institutional ability of agencies engaged in controlling
corruption and abuse of authority.
5 Strengthen the system of evaluating and monitoring development
policies, programs and projects
6 Develop the culture of respecting human rights effectively preserving,
promoting, and honoring fundamental human rights provided by the
Constitution of 2047 (1990), and the human rights mentioned in various
international conventions endorsed by Nepal.
7 Make the task of preparing and refining laws, modern, transparent and
standard. Place emphasis on reforming the judiciary.
c) Policy and work plan
§ Leadership and capacity enhancement with qualitative and quantitative
improvement of the services and materials provided by the government
(Concerning the strategy No. 1).
• Interact and co-work with various stakeholders and civil societies
in order to make the political and high managerial leadership aware
of and committed to the reform process.
• Initiate the process of improving performances of certain
ministries; in addition, involve civil society in the performance
evaluation of agencies that deliver public services.
• Prepare an individual civic charter of each administrative units
working at the central and at the local level.
• Encourage non-governmental organizations, community
organizations and institutions, users' groups and the private sector
in delivering services and materials to the people.
• Turn over the tasks performed by the central level agencies to the
local bodies as many as possible. Adopt the policy on contracting
out non-core services.
• Set the service standard of and the annual performance
improvement plan of the agencies that directly deliver services to
the people.
• Adopt the policy on promoting transparency in and responsibility
for the performances of the government agencies.
§ Enhancing the efficiency of the civil service (Concerning the strategy No.2)
• Adopt the further effective policy on recruiting and promoting civil
servants based on their merits in order to make the civil service
effective, in addition to making training job-oriented. Implement a
transparent policy on the transfer of civil servants for making the
civil servant transfer system effective.
587
• Adopt the policy on implementing an Affirmative Action Plan for
increasing the women's participation in the civil service.
• Make improvement in the technique of examinations given to
recruits for increasing the job efficiency of Public Service
Commission.
• Prepare a long-term policy on the salary of civil servants making
structural changes in it.
§ Enhancing financial efficiency of the civil service (Concerning strategy No.
3)
• Adopt the policy on proper sizing of the civil service reviewing the
number of civil servants required and cutting off the unproductive
staff positions for making the civil service clean and prompt.
§ Curtail corruption and abuse of authority (Concerning strategy No. 4)
• For the total system of good governance, legal provisions will be
developed against currency laundering, and anti-corruption strategy
will be formed. The institutions like Commission for Investigation
of Abuse of Authorities and National Alertness Centre will be
strengthened
§ Monitoring and evaluation of development efforts (Concerning strategy No.
5)
• Strengthen the monitoring and evaluation system for monitoring
and evaluating the implementation of policies, programs and
projects to complete them at the estimated cost and time, and to
achieving the anticipated results in quantity and in appropriate
quality.
§ Promotion of human rights (Concerning strategy No. 6)
• Link the human right program with the national development
program based on the available resources for implementing the
commitments made to human rights in various international
forums, and for effectively protecting and promoting human rights
mentioned in various international conventions and ratified by
Nepal, and fundamental rights provided by the Constitution of
Nepal of 2047 (1990).
§ Institutional improvement in judiciary (Concerning strategy No. 7)
• Place emphasis on development of necessary basic services,
institutional aspect and manpower for making the quality jobs of
preparing new human rights laws and refining the prevailing
human rights laws, and for making these laws pursuant to the
international standard.
588
• Develop physical infrastructures and institutional capacity of law
courts, and develop manpower required for them.
d) Program
1 Good governance program
The government has initiated the governance improvement program focusing on
the following five main activities :
§ Develop ability and leadership of the reform process
• Launch programs on developing job efficiency of civil servants in
addition to developing an expert based system of increasing the job
efficiency of management.
• Place emphasis on launching people' awareness programs in
addition to involving civil society in making the political
leadership aware of the technical aspects of the governance
improvement process and in developing the commitments of the
political leadership to the governance improvement process.
• Make sustainable changes in and development of dedicated
managers and experts required for the government units selected
for governance improvement.
• Increase the participation of stakeholders and civil society in the
governance improvement process by creating people's awareness of
the improvement process.
§ Increase the financial efficiency of civil administration
Cut off the unnecessary and unproductive expenditures; make effective use of
limited resources; and increase the financial efficiency of the development work,
of the materials and services delivered to the entire population, by launching the
following activities :
• Make provision for procuring basic services on contract and for
turning over the tasks that can be undertaken by local bodies, non-
governmental organizations, users' groups and private sector to
them.
• Manage the temporary vaca nt staff positions transferring the
temporary staffs working at development projects to the new
projects of similar nature, and do not fill up the vacant staff
positions in such projects.
• Do not set up new offices pursuant to the Development Board Act.
• Link the records of civil servants at the Civil Servants Registration
Office with the staff position management system and the pay roll
of civil servants at the Ministry of Finance; minimize the
expenditures on salary and other operations; and thus achieve the
financial efficiency.
589
§ Enhance efficiency and motivate civil servants
Launch the following activities for increasing motivation and job efficiency of
entire civil servants :
• Increase the work efficient of staffs by adopting the modern
methods of human resources development in the required sectors
identified by the studies and research conducted under the
governance improvement programs.
• Prepare a new policy on salary based on the study of various
theoretical and practical aspects of it; set salary scales based on this
policy to motivate even managers; set up a system of having a wide
range of salary scales, and of giving additional financial benefits
based on the performance.
• Make necessary legal reforms for promoting a system of recruiting
and promoting staffs based on their merits.
• Prepare an action plan on manpower development at every
ministry; link staff training with the skill development of staffs and
with the achievement of an institutional objective.
• Make legal provision for making responsibilities and authorities of
managerial staffs clear.
• Adopt an affirmative action plan on increasing the participation of
women in the civil service.
• Prepare and implement human resource development program after
conducting necessary studies and researches on performance
development of civil servants.
• Strengthen Nepal Administrative Training Academy; and integrate
other training centers with it based on their ability.
• Test and streamline the disciplinary actions for reducing delay in
the process of delivering services, and for increasing work
performance of civil servants; prepare transparent criteria for
rewarding civil servants, and strictly implement the punishment
provision too.
• Strengthen Public Service Commission; and continuously improve
the examination system and curriculum.
• Make provision for the persons wishing to join the gazette third
class positions of His Majesty's Government of Nepal compulsory
to take pre-service training. Make provision for the Public Service
Commission giving an examination to the persons after they have
received the pre-service training, and then publish the list of
successful candidates for the job in a merit order.
§ Honesty, corruption control and transparency
590
Launch the following activities for preparing a strong legal structure for
controlling corruption and developing the strong tradition of its effective
implementation:
• Increase consciousness of corruption and be on the alert against
corruption.
• Develop a mechanism for watching the assets earned by the high
level managers and the political leaders, and their conduct.
• Launch activities of increasing the advocacy skills at anti-
corruption, and activities of research on anti-corruption.
• Increase the ability of agencies involved in corruption control.
• Create a favorable environment for controlling corruption by
providing physical facilities and by providing professional training
to officers and staffs that conduct investigation into corruption.
• Prepare a national anti-corruption strategy, and prepare action
plans of every ministry and of central level administrative units on
implementing it.
• Make additional legal provision for stopping money laundering,
and for taking actions against the people earning assets through
various illegal sources and means.
• Make necessary legal provision for safeguarding staffs or officials
who give information on irregularities and corrupt actions taking
place at their offices.
§ Improve job performances of government agencies
Launch the following activities for strengthening a job-oriented management
system by adopting a most recent technology of the public management for
improving the quality of services and materials delivered to the people:
• Set up and implement a Performance Incentive Fund for improving
the standard of performances of ministries.
• Prepare and implement an annual job performance improvement
plan of the ministries that deliver services; set the norms of
services.
• Initiate the review process for improving the financial efficiency of
the civil service; use the money thus saved for developing the
ability of staffs, for improving this process and for procuring the
experts' services.
• Provide managerial training and training on analyzing problems on
the job-site; launch activities of developing skills in designing the
possible professional solutions of problems under this training
program; make publication of results of the annual plan mandatory.
• Make provision for regularly publishing the cost and the quantity
of services delivered to the people by the government units
responsible for delivering services and materials.
591
2 Monitoring and evaluation
Launch the following activities for strengthening the monitoring and evaluation
system for achieving anticipated benefits of development policies, programs and
projects at the estimated cost and time by making their implementation effective:
• Activate and make effective the National Development Action
Committee and the Ministerial Development Action Committee on
Monitoring and Evaluation and other concerning agencies.
• Develop and refine indicators concerning the monitoring and
evaluation at various levels, and conduct regular monitoring and
evaluation based on these indicators.
• Regularly monitor progresses of and expenditures on projects; link
the budget release with the progress.
• Make provision for regularly monitoring the programs targeted at
the poverty alleviation.
Detailed policy, program concerning monitoring, and evaluation are given in a
separate chapter .
3 Decentral ization
Implement programs on increasing the people's participation in development
work through decentralization for creating the people's sense of ownership of and
responsibility for local development work and for using local resources properly
by involving common people in plan preparation, implementation, monitoring
and evaluation. To this end, place emphasis on the institutional development and
ability development of local bodies.
Detailed policy, program concerning decentralization are given in a separ ate
chapter.
4 Human rights protection and promotion program
Launch the following programs on protecting and promoting human rights:
• Prepare and implement a national action plan on human rights.
• Implement programs on subjects such as children, women,
nationalities, minority and dalit, labor, education and culture,
environment and development, health, jail, judicial administration,
law and legislation and conflict management and so on concerning
human rights staying within the limit of available resources.
• Implement various awareness programs on increasing people's
concern for implementation of the national action plans and other
programs concerning human rights, and for effectively
implementing various international conventions on human rights
endorsed by Nepa l.
• Make timely improvement in the prevailing laws based on the
international norms of human rights.
592
• Conduct programs on the institutional strengthening of National
Human Rights Commission, Women's Commission, Dalit's
Commission, Nationality Academy and other institutions
concerning human rights.
• Gradually include a course on human rights in the curriculum of
educational institutions, and governmental training centers and
training academies for developing the culture of respecting human
rights.
5 Judicial refo rm program
• Prepare and implement programs on the institutional development
of Ministry of Law, Justice and Parliamentary Affairs, and on
development of the ability of its staffs for making the job of
preparing and refining laws high quality.
• Develop manpower and improve physical facilities of law courts
for enabling them to deliver justice promptly, fairly, easily and
transparently; and use the modern information technology for
making the record system more orderly. Make the institutional
reform of judicial academy for increasing the skills of the
manpower engaged in the law and justice sector.
31.4. Anticipated achievement

• People will have the sense of receiving services, benefits and
products from the governmental service providers as they have
anticipated.
• Informing the people about services and benefits to be delivered by
the government will ensure people's access to such services and
benefits.
• Corruption, abuse of authority and revenue leakage will be under
control.
• A system of people watching the development work, and the flow
of services and benefits will be in place; so completion of
development work will be at less cost and time; flow of services
and benefits will also be at less cost and time.
• Abuse of authority will be under control due to reduction in the
discretionary authority.
• Maximum benefits of public expenditure will be due to the proper
use of it.
• Women's participation in the civil service will increase.
• People's trust in the politics and in the administration will increase.
• Laws and procedures w ill be sincerely followed.
593
• An incentive to work hard will increase, and morale will be high in
administration.
• An environment for developing the ability of local bodies, for
delegating authority and for creating the participation of all people
in developme nt, will be in place.
• Fundamental rights provided by the Constitution of Nepal of 2047
(1990) and the international conventions concerning human rights
endorsed by Nepal will be effectively implemented.
• Culture of respecting human rights will develop.
594
3.20.1 Policy and Program Log Frame- Good Governance and Development Administration*
Sector objective • Improve quantity & quality of the • Increase in the • Auditor 1. Leadership and capacity Political
Provide support for services and materials to be percentage of the General's development program commitment
achieving the poverty delivered by the government. progresses of report 2. Civil servants' to the reform
alleviation & • Increase the performance development • Various performance capacity & efforts will not
sustainable capability of the entire civil service. projects. parliamentary motivation building have
economical & social • Encourage the involvement of • Number of committees' program. continuity.
development by women in the civil service. economical and reports 3. Setting up good conduct,
creating the sense of • Make the civil service of an administrative • National corruption control and
good governance in appropriate size for clean & prompt irregularities. Human Right transparency expansion
the minds of people services, & increase the financial • Cost and time Commission's program
making the public efficiency of the civil service. required for report 4. Performance
management • Increase the institutional capacity delivering services to • Public improvement of the
/administration of the institutions involved in the people. Service government agencies
competitive, cost- control on corruption and abuse of • Monitoring and Commission's program.
effective, transparent, authority. evaluation indicators report 5. Monitoring and evaluation
service-oriented, • Strengthen the system of at various levels. • Annual report strengthening program
result- oriented, monitoring and evaluation of • Provision for linking on staff
responsible & gender development policies, programs the budget release vacancy
equality oriented. and projects. with the progress of positions.
project.
• Number of women in
the civil service.
*
Quantitative targets based on growth rate of 6.2%
595
3.20.2 Policy and Program Log Frame- Human Rights*
Sector objective: • Develop the culture of • Improvement in the --- 1. Promotion of human ---
Support the respecting human rights by human rights situation. rights.
poverty alleviation effectively protecting, promoting 2. Institutional
task by ensuring and honoring the fundamental improvement in the
the fundamental human rights enshrined in the judiciary.
human rights of Constitution of Nepal of 2047
Nepalese people, (1990) and in the international
and by linking the conventions ratified by Nepal.
human rights • Make the job of preparing and
development task amending laws modern,
with the national transparent and qualitative.
development • Place emphasis on institutional
program improvement in the judiciary.
* Detailed quantitative targets based on 6.2% growth rate are given in the annex 3
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Chapter - 32
Decentralization
32.1. Background
The decentralization is considered as the backbone of the democratic exercise in
Nepal, and is based on the basic principles of people's participation and
empowerment. In order to take the benefits of democracy to the people particularly
the weakest at all levels, it is necessary to make them socially and economically
strong to enable them to enjoy their rights. To this end, it is necessary to further
develop the concept of local self-governance for creating an environment for
effectively implementing programs useful to the people by evenly involving the
governmental, non-governmental organizations and the private sector in various
aspects of planned development. On the one hand, it is necessary to lim it the
government's role in the development to monitor and facilitate development work and
formulate polices on development, and on the other hand, it has been indispensable to
adopt the policy on inspiring the people for their participation in development, and to
strengthen the local self-governance system and make it strong, receptive and
responsible to the people.
The Tenth Plan will adopt policy on institutionalizing decentralization and on
increasing investment in creating an opportunity for making local bodies capable and
equipped with resources, and in creating an environment for involving them in policy
formulation and implementation at the local level, and for making them responsible
and accountable.

In the course of strengthening the decentralization process, Local Self-governance
Act, 2055 (1999), Local Self-governance Rules, 2056 (2000), Local Body (financial
administration) Rules, 2056 (2000) have been implemented during the Ninth Plan
period. The government, civil society, private sector and donors from the same
platform have prepared a detailed draft outline of action plans on the preparation of
decentralization action plans . Necessary amendments have been made to some Acts
and Rules conflicting with the Local Self -governance Act and Rules as required for
implementing the development work in a more coordinated manner . Local Body
Fiscal Commission has been set up for making necessary improvement in the fiscal
decentralization; and it has prepared a report on it. Permanent Fiscal Commission has
been set up for overseeing its implementation aspect from the institutional point of
view . The concerned ministries of His Majesty's Government of Nepal, civil society,
local bodies and donors have been making efforts to prepare a directive to strengthen
local bodies and make them active in a decentralized manner; a focal point has been
set up at the ministry level for watching over matters concerning decentralization.
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Devolution of small-scale infrastructure program and programs such as basic
education, primary health care, and agricultural extension to local bodies has been
initiated. Periodic plans have been prepared in 35 districts, and district transport
master plans have been prepared in 47 districts. The process has been initiated in 19
districts. Programs such as Participatory District Development Program (PDDP),
Local Governance Program (LGP), District Partner Program (DPP) and
Decentralization Advisory Support Unit (DASU) have been implemented for
enhancing the capability of local bodies .

Unable to have immediate amendment of the Acts conflicting with the Local Self-
governance Act, 2055 (1999) despite various efforts; lack of action plans; unable to
meet the manpower required at the local level with the setting up of Service
Commission; unable to adopt concrete policies on the fiscal decentralization; and the
lack of feasibility study on increasing internal resources at the local level etc. are
some of the major problems in decentralization process. Main problems at the central
level have been : unable to have sufficient action-oriented commitment to
decentralization; unable to internalize the local development programs implemented
with the assistance of donor agencies, and unable to make them sustainable; and
unable to have clear concept of and programs on delegating authority and handing
over programs to the local bodies . Other prevailing problems have been: non-
governmental organizations and civil societies have been implementing programs
independently at the district level without swapping knowledge and transparency of
their work because of not having clear categorization of jobs to be done by them;
local bodies have not identified their resources and have not been able to share these
resources among themselves; local bodies have been institutionally weak; no healthy
transparency has been seen in the implementation of their programs; and targeted
programs have not totally reached the target people.
32.3. Long-term vision

The long-term vision of decentralization is to devolve authority, accountability,
resources and manpower to the local bodies; develop and create a mechanism for
institutional development and an action-oriented structure of the local bodies,
mobilize and collect resources at the local level; set up civil societies with the
people's participation; develop an effective mechanism for developing local
leadership accountable to the people; encourage the private sector participation in
delivering services for sustainable development and fully set up a local self-
governance system .

a) Objective
The objective of the Tenth Plan is to alleviate poverty by involving majority of the
people in the dec ision-making process and in the governance system, and
empowering them for implementing the development process.
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b) Strategy
Development benefits will reach majority of the people if the decision-making
process is made as desired by the people and if they are empowered. Decentralization
will actively involve all people in the development process, and will make the
development fast, and will more proportionally distribute benefits of development to
all concerned. Pursuant to the decentralization policy, mobilization of local resources
will be done primarily at the local level; local bodies will make decision on and take
leadership of the local level development work; all these things will bring
transparency in the implementation of development work, and will support good
governance. In this context, the main strategies of this sector will be as follow :
1. Give autonomy to the local bodies for performing duties pursuant to the
objective of the Local Self-Governance Act, 2055 (1999).
2. Enhance the institutional capacity of local bodies for enabling them to deliver
services to the people, and for enabling them to function responsibly.
3. Enhance the people's participation in the local development process
extensively.
4. Make local bodies capable of mobilizing internal and external resources.
c) Policy and working policies

During the Tenth Plan period, policies and action policies concerning the
decentralization sector will be as follow:
§ Autonomy of local bodies (related to strategy 1)
• Implement the provisions made for delegating authorities in the Local
Self-governance Act, 2055 (1999) in a timely order . Pursuant to the
provision made in this Act, categorize responsibility and programs to be
implemented at the central level and at the local level, and devolve the
local level programs and the responsibility to the local bodies.
• Revise the Local Self -Governance Act and Rules effectively and timely;
and amend other Acts conflicting with this Act. Prepare and implement
decentralization implementation action plans on the tasks and resources
to be developed by various agencies of His Majesty's Government of
Nepal to the local bodies .
• Make improvement in the structure of the Ministry of Local
Development for making its responsibility clear and for playing its role as
a facilitator in implementing and in getting implemented the provisions
made in the Local Self-Governance Act at the local level.
• Implement the recommendations made by the Local Body Fiscal
Commission for fiscal decentralization as scheduled.
• Implement the actio n plans on the tasks to be delegated by various central
agencies of His Majesty's Government of Nepal to the local bodies as
scheduled. Make job responsibility of local bodies and line agencies of
His Majesty's Government of Nepal clear at various levels.
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• Strengthen the regional offices for enabling them to prepare programs,
coordinate implementation of programs, and then to monitor and evaluate
the programs because the regional offices need to coordinate neighboring
districts with each other for local development program . In the context of
decentralization at the regional level, make explicit the responsibility and
authority of the regional administrator and the regional level offices, and
make institutional development of these institutions for preparing and
implementing development activities, for periodic monitoring and
evaluation of these activities and for delivering services effectively.
• Make effective improvement in policies, laws and institutions, and make
their implementation process effective.
§ Institutional capacity development (related to strategy 2)
• Local Service Commission will be set up and local bodies will be
provided with efficient and skilled manpower .
• Categorize all local bodies; and increase their financial management, plan
preparation and monitoring, and internal management capacity.
• Review the structure and the number of local bodies, and the number of
elected office holders as required.
• Review the role of Local Development Training Academy and other
training centers under it; develop a mechanism for enabling it to run on
its own resources by increasing the participation of local bodies in it and
their ownership on it. In addition, link agencies such as Nepal
Agricultural Research Council (NARC) and Council of Technical
Education and Vocational Training (CTEVT) with the local bodies for
supplying manpower such as local level officers, staffs and other
manpower required at the local level, and increase their capacity.
§ People's participation (related to strategy 3)
• Increase the local people's participation in the decision-making and
implementation process.
• Place special emphasis on women's empowerment and on their access to
the participation in management for increasing gender equality at the
local level.
• Make special provision for women's leadership training.
§ Internal and external resource mobilization (related to strategy 4)
• Gradually increase the resources to be made available by the center to the
local bodies based on their need, absorption capability and practicality.
• Increase the internal resources at the local level based on the feasibility of
internal resource mobilization; and make the expenditure process
effective.
• Encourage the local bodies in mobilizing the resources of non-
governmental organizations and international non-governmental
organizations for the local level development programs.
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During the Tenth Plan period, following policy improvement, legal improvement and
institutional improvement will be made for the pover ty alleviation by making
decentralization efforts effective, and by providing the benefits of decentralization to
the economically and socially backward areas and communities:
§ Policy reform s
• Make improvement in the policies of the line agencies that conflict with
the provisions made in the Local Self-Governance Act and Rules.
• Decentralization is not the responsibility of any single ministry or agency
but a national policy to be adopted by the nation as a vehicle for
delivering services and as a means of all-round development of the
nation; so, accordingly devolve activities implemented by the center to
the local bodies.
§ Legal reform s
• Amend all Acts and Rules conflicting with the Local Self-governance
Act and Rules .
• Reforms and amend the Local Self-governance Act and Rules as required
for making them practicable.
• Make improvement in the Local Self-governance Act, 2055, the Local
Self-governance Rules, 2056, Local Body (financial administration)
Rules, 2056 and other local body regulations for development of the local
self-governance system; simplify procedures and make them transparent
for making the people's representatives responsible and accountable to
the people.
• Make explicit the role of people's representatives in the local bodies;
prepare and implement their code of conduct.
• Prepare and implement a Local Service Act.
§ Institution al reform s
• Review the level wise structure and the institution wise structure
(political and administrative) of local bodies, and their number;
accordingly make improvement in and development of their organization.
• Review the number and the structure of local bodies .
• Increase the institutional capacity of local bodies for enabling them to
perform the tasks as prescribed by the Local Self-governance Act. The
Ministry of Local Development will play the facilitating role in this
matter.
• Eliminate the practice of implementing parallel programs by line agency
offices; gradually increase the number of programs implemented through
a local body.
§ Implementation
• All concerned responsible ag encies will implement the programs
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according to the decentralization implementation plan.
• Decentralization Implementation and Monitoring Action Committee will
monitor policy reform and implement reform programs.
• Adopt the policy on devolution of the activities implemented by the line
ministries/agencies at the local level to the local bod ies pursuant to the
Local Self-Governance Act; and include the monitoring and review
activity in their regular activities; and inform ab out it to the
Decentralization Implementation and Monitoring Committee.
• Develop local bodies into self-reliant and automatically self -propelling
viable institutions.
d) Programs
During the Tenth Plan period, the concept of decentralization will be practic ed in
such a way that the local bodies can have the sense of it. To this end, following
programs will be implemented:
1. Policy and institutional reform program
This program includes the following: Local Development Ministry's
organizational development and improvement, Inter-ministerial coordination,
preparation of code of conduct for controlling the abuse of authority of local
bodies, provision for setting up a human resource development unit at the local
level, local body monitoring, E-governance program, categorization of district,
town and village level programs and so on.
2. Financial resource management program
This program includes the following: grant distribution to the local bodies,
handing over of financial sources, strengthening the local body tax system,
setting up an audit board, preparing and implementing a computerized package of
accounting system, making institutional provision for settling irregularities in the
accounts of local bodies, and setting up a Local Development Fund at all districts.
3. Local body strengthening program
This program includes the following: review the boundary/structure/number of
local bodies, review the functions, duties and authority of local bodies and office
holders, make improvement in and amendment to the Local Self -governance Act
based on these reviews, enact a law for setting up a Local Service Commission,
prepare rules and regulations for simplification of procedures of local bodies, take
necessary initiatives for categorization and institutional improvement of local
bodies and for gradually setting up branches of line agencies .
4. Strengthening the planning system of local bodies
This program includes the following: setting up and managing a modern
information system (GIS, MIS), strengthening a planning system, preparing a
periodic plan and conducting mid-term evaluation of it at the local level, and
monitoring, reviewing and evaluating an annual district development plan.
5. Manpower development program
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This program includes: orientation of local people's representatives, and study
tour/orientation/training of local people's representatives, and study
tour/orientation/ training of staffs of all levels performing tasks concerning
decentralization.
Although the Local Self -governance Act, 2055 has the provision for the
functions, duties and authority of local bodies, they have not been able to fully
perform functions, duties and enjoy authority. Therefore, attempts will be made
for the local bodies to enjoy authority and perform duties pursuant to the Act. To
this end, the following activities as a single package program will be
implemented:
• Identify and categorize the tasks at each level to be devolved to the local
bodies and then handover the tasks to the concerned body.
• Make budget available to the local bodies for the tasks devolved to them,
and let the local bodies implement the budgets.
• Make fiscal decentralization effective for making local bodies self-
reliant, for strengthening the accounts and the accounting system of local
bodies and for making them transparent, and for running the local bodies
responsibly.
• Make provision for essential staff and budget expenditures required for
performing the delegated tasks. Encourage the local bodies in procuring
services on contract.
• Develop a system of making the people's representatives directly or
indirectly accountable to the people, and the staffs to the local body for
strengthening a local development system and making it competent,
participative and transparent, and for ensuring the local good governance.
• Make the monitoring and evaluation system effective; make the
decentralization and local self-governance system competent, strong and
accountable based on the feedback received from the monitoring and
evaluation.
32.5. Possible obstacles and risks regarding the

implementation and achieving benefits
• If, the center's investment becomes insufficient in the periodic plans of
local bodies.
• If, the line ministries cannot prepare and implement concrete programs
on the decentralization sector.
• If, the high level Decentralization Implementation and Monitoring
Committee becomes weak in taking responsibility, becomes less capable
and less effective.
32.6. Progress monitoring indicators

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The policy of the Tenth Plan will be to make decentralization as a medium of good
governance, to make the local self -governance system accountable to the people,
service-oriented, result -oriented, transparent and just. To this end, the need for policy
reform is recognized. Two aspects of policy reform are: institutional provision and
provision for monitoring indicators.
Institutional provision: Decentralization Implementation and Monitoring
Committee will be the institution responsible for the policy reform in
decentralization.
Indicators: Policy reform will be possible only if the Decentralization
Implementation and Monitoring Committee and line ministry/line agencies work for
making the monitoring work dynamic. So, policy will be formulated on making the
central level agencies focusing more on policy work, on facilitating and monitoring
work than on implementing programs. Accordingly, indicators will be prepare and
monitoring will be done.
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Decentralization: Policies and programs log frame*
Sector objective : Increase the capacity of local bodies in delivering services effectively at the local level
Implementation • Provide local bodies with autonomy • Local Self- • Annual report of 1. Local body strengthening Stakeholders will
of decentralized to perform tasks pursuant to the governance Act, Decentralization program keep up their
procedures at objective of the Local Self- 2055 will be fully Implementation and 2. commitments.
Strengthening the planning
the local level governance Act, 2055. implemented. Monitoring system of local bodies.
• Enhance the institutional capacity of Committee.
3. Financial resource
local bodies. • Annual reports of the management program.
Local Development
• Increase people's participation in
Ministry/Report on th e 4. Human resource
the local development process development program
final evaluation of the
extensively.
Tenth Plan 5. Policy and institutional
• Make the local bodies capable of reform program
mobilizing internal and external
resources.
* Quantitative targets based on the 6.2% growth rate details are given in annex 3.
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Chapter - 33
Monitoring and Evaluation
33.1. Background
The Tenth Plan is a poverty reduction strategy manifesto of Nepal. Monitoring and
evaluation of the poverty reduction strategy should not only be limited to the
monitoring of the progresses of development programs and projects but also should
cover the monitoring and evaluation of the impact of these programs and projects on
the poverty alleviation. The monitoring and evaluation of the impact of these
programs and projects on the poverty alleviation will make it possible to evaluate the
strategies of the poverty alleviation and then make necessary improvement in and
refinement of these strategies. The monitoring and evaluation have the following two
aspects:
a) Monitoring and evaluation of the progresses of programs and projects at the
implementation level.
b) Monitoring and evaluation of the impact of these programs and projects on
the poverty alleviation.
On the one hand, we have the experiences of not being able to complete various
development projects and programs implemented annually with the objective of
achieving economic and social development targets at the estimated cost and time. On
the other, we have the problems of repeatedly having the same weaknesses in the
implementation of programs and projects. From the above, it is clear that the
implementation of programs and projects has been weak. Therefore, the entire
population has been deprived from reaping the benefits of the huge investments made
in development. One of the main reasons for the weakness in the program and project
implementation is that the current monitoring and evaluation system has not been as
effective as required. In this context, it is necessary to strengthen the current
monitoring and evaluation system and make it result-oriented for effectively
implementing the programs and projects pursuant to the approved policies to achieve
the objectives and the goal set in the Tenth Plan.
There has not been clear provision for the monitoring and evaluation of the impact on
the poverty reduction as yet. However, data and indices required for it are available in
the reports on the national household surveys conducted with various objectives from
time to time. A poverty monitoring and evaluation system is set up by providing
continuity to these data and indices with a view to make these data and indices
available at district level.
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In the course of strengthening the progress monitoring and evaluation system, Project
Performance Information System (PPIS ) based on computer software has been set up
at the Central Monitoring and Evaluation Division (CMED) of the National Planning
Commission Secretariat (NPCS). The computer software has been installed on
experimental manner in order to collate up to date information of projects and
programs in an integrated manner. Provision has been made for project documents
compulsorily having log-frames for improving the project preparation,
implementation, monitoring and evaluation. In addition, provision has been made for
categorizing the projects and programs that need to be effectively implemented as
core projects/programs and monitor them on monthly and trimester basis,
respectively. In course of evaluating the completed projects and providing feedback
to the planning process, nine completed projects were studied for their effectiveness
during the Ninth Plan period. Similarly, provision has been made under which the
Ministry of Women, Children and Social Welfare is responsible to monitor and
evaluate programs of non-governmental organizations, and then to prepare an annual
report on them. Under a different provision, joint team of the Ministry of Women,
Children and Social Welfare, Social Welfare Council and National Planning
Commission have to inspect programs implemented by intern ational non-
governmental organizations.
The Ninth Plan had no provision for an independent monitoring of poverty under the
assumption that the broad monitoring and evaluation system would cover it; however,
household surveys with the objective of indicating the status of poverty had been
conducted during this period. The Nepal Living Standard Survey (NLSS) conducted
before the implementation of the Ninth Plan had been the main source of the poverty
indicators. Nepal Population and Health Survey, Between Census Household
Information Monitoring & Evaluation System (BCHIMES), a Labor Force Survey
and many other important surveys have been done during the Ninth Plan period. An
objective has been set to conduct a Second Nepal Living Standard Survey in the first
year of the Tenth Plan. As reliable data have not been available at the district level
yet; some studies have been done during this period for establishing poverty
monitoring system by making data available at the district level.
Monitoring and evaluation system has not been strong and institutionalized.
Ministerial Development Action Committee (MDAC) and National Development
Action Committee (NDAC) set up at the ministerial level and at the national level,
respectively, have not met as scheduled. In addition, the mechanism for implementing
and monitoring the decisions made by these committees have not been
institutionalized yet. Similarly, availability of data on time has not been effective too.
On the whole, this task has not received due attention. Similarly, a system of the
poverty monitoring has also not been set yet. Previous household surveys were not
conducted in an integrated manner . Hence, various surveys could not be
complementary to each other. There is a problem in comparison of indices as such
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indices are estimated on different definitions.
33.3. Long-term Vision

Public sector development activities will be implemented at both central and local
levels. Local bodies will play an increasingly important role in the implementation of
development work at the local level. Hence, there will be diversification in the
implementation. The long-term concept of the Plan is to implement a systematic and
modern monitoring system that covers monitoring the implementation of the targeted
programs on the poverty alleviation and of the programs implemented at all levels.

a) Objective
1. Render program and project monitoring and evaluation effective
2. Develop a poverty monitoring system
3. Conduct evaluation of policies
b) Strategy
The Plan preparation and implementation system alone cannot ensure quality results.
The monitoring and evaluation will help to ascertain whether projects and programs
have been heading towards right direction. It will also assist in determining the
contributions made by the programs in achieving the national objective of poverty
reduction, and in ascertaining the progresses in regard to high economic growth,
social development, target programs and good governance. Eventually, it also helps
in preparing future plans and policies. It is necessary to set up a strong information
system, and then introduce it for making public the reports on monitoring and
evaluation of projects at the projec t level, of programs at ministerial and departmental
level, of the poverty measurement at the national level. This will contribute to the
promotion of transparency and good governance. This will also contribute to
effectively implement the projects and programs that will achieve a sustainable high
economic growth rate, and to provide future guidance to the social development
programs and the targeted programs. The major strategies in this regard will be as
follows:
1. Develop a monitoring and evaluation system for monitoring and
evaluating the physical progresses and qualities of progress vis-a-vis the
cost and time used.
2. To carry out expenditure tracking in prioritized sectors with special
priority.
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§ Strategy concerning the objective No. 2
3 Set up a system capable of conducting the monitoring of poverty at the
levels from the center to the districts in order to ascertain the impact on
the poverty.
§ Strategy concerning the objective No. 3
4 Carry out evaluation of the poverty reduction strategy and other various
policies in terms of their impact in poverty alleviation and bring about
reforms in policy aspects accordingly.
c) Policies and Operational Policies
§ Development of effective monitoring and evaluation system (concerning
strategy No. 1)
• A system will be developed to identify the achievement indicators of
projects and programs in addition to their physical progresses in order to
compare such the indicators against the resources spent on them. Such a
monitoring system will not be limited to the center but will also be
introduced at the local level so that local bodies could make use of it.
• The progress monitoring has became a problem as data could not be
collected on time. Emphasis will be placed on the use of information
technology for supplying data to the monitoring units without delay and a
computerized global network will be developed for making the current
system up-to-date.
• The Policy Action Matrix used in the formulation of the Tenth Plan helps
in establishing linkages between objectives, strategies and programs and
ultimately facilitates policy evaluation. Hence, guidelines will be
developed in this regard and concerned personnel will be trained on it.
• The log-frame concept initiated for the effective monitoring of projects at
implementation level will be broadened with regular training.
• As the responsibility for implementing development projects is being
gradually transferred to the local bodies, it is important that their
monitoring ability be strengthened. A system will be set up to make such
monitoring reports available at the center .
• At the district level, District Development Committees will monitor and
evaluate local level development projects to be implemented during the
plan period. Review mechanism existing at the ministerial level will be
utilized not only to monitor projects and their performance indicators, but
also to see their impact in poverty alleviation. NDAC will place emphasis
on priority projects and programs. To supplement monitoring and
evaluation system institutional arrangements will be made to carry out
quality audit of construction works.
609
• A provision will be made under which each member of the National
Planning Commiss ion will be given the responsibility of monitoring
development activities in each development region.
§ Special monitoring of appropriated budget expenditure (concerning
strategy No. 2)
• National Planning Commission will monitor regularly and intensely a
number of projects that have been identified as priority one projects.
§ Poverty monitoring (concerning strategy No. 3)
• Priority will be accorded for evaluating the plan in terms of it's impact on
the lives of general public in general and poverty reduction in particular.
• A strong system of monitoring poverty from the national level to the
district level will be developed. Various household surveys will be made
supplementary to each other. As the poverty monitoring system has not
been institutionalized, the description of provision made for it in the
Tenth Plan is given below in a separate section.
• A policy of publicizing reports at various levels will be applied. Under
this provision, a report on poverty measurement as well as on economic
growth, social development, targeted programs and good governance will
be publicized at the national level. The reports will also be publicized at
project and department/ministry level, the latter focusing on programs.
§ Impact evaluation of the policies on the poverty alleviation (concerning
strategy No. 4)
• The system of research, monitoring and evaluation of economic, social
and other policies will be strengthened.
33.5. Progress monitoring

Although there have been institutional arrangements for monitoring development
projects and programs, there are still some weaknesses in achieving expected benefits
from such arrangements. Right Honorable Prime Minister is the chairperson of the
NDAC, the apex body of such structure. NDAC resolves the problems that cannot be
resolved at the ministerial level committee and the ones that involve cross-ministerial
and policy issues . The CMED submits monthly monitoring reports on the core
projects to the office of the Prime Minister .
At the ministry level, there is MDAC to be headed by concerned minister /state
minister. This Committee the progress projects/programs under the ministry and
resolve the problems. This committee submits the problems that cannot be resolved at
the ministerial level to the NDAC for discussion. This Committee receives
information, data and reports from the Monitoring and Evaluation Division/Section of
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ministries for this purpose.
The CMED monitors priority one projects and concerned sectoral divisions monitor
other projects. Regional Planning Offices of National Planning Commission are also
involved in monitoring and evaluation of development projects and programs.
Various efforts have been made to process and integrate information required by
manuals, performance indicators and to simplify and clarify monitoring and
evaluation proc ess. The mandatory log frame attached to the projects at the time of
their preparation will be the basis for monitoring. The policy and program matrix of
the Tenth Plan will form the basis for monitoring. Necessary improvement will be
made in the current formats and manuals based on these policy and program log-
frames .
The progress monitoring will be associated with the poverty monitoring by further
strengthening the current institutional mechanism of monitoring. This will help in
regularly evaluating the poverty reduction strategy. Modern information technology
will be extensively used in progress monitoring and poverty monitoring and effective
system of information flow will be developed as well.
33.6. Poverty monitoring

The poverty monitoring system has not been systematically set up yet; so, the
following poverty monitoring system will be developed and implemented during the
Tenth Plan:
It is necessary to evaluate the strategies of achieving the poverty reduction goal set by
the Tenth Plan, and to monitor the status of the poverty for timely improvement in
these strategies . To this end, a strong system of poverty monitoring is essential. A
strong monitoring system will be put in place by ascertaining institutions to be
responsible for identifying the indicators of measuring the poverty, for identifying the
data collecting methodology and for processing and analyzing the collected data.
It is necessary to monitor the results, achievements and the benefits and impacts of
the achievements, and the resources spent on monitoring poverty and of the poverty
alleviation efforts. In totality, resources spent means the resources allocated to
various programs. These data are available in the progress reports of the Ministry of
Finance. Progresses and achievements of programs are available in the concerned
ministries . In addition to this, it is necessary to make clear provision for monitoring
benefits and impacts of development programs.
Extensive discussions have been held on identifying poverty indicators at the people's
level at various times. District level, regional level and national level discussions, and
consultation programmes were organized for identifying poverty monitoring
indicators. National Planning Commission, non-governmental organizations and other
institutions have participated in these discussions. Poverty comprises human
development indicators and social evils indicators in addition to income-poverty
indicators; so, poverty-monitoring indicators have been identified taking into
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consideration of all these indicators. The long-term goal set by the Ninth Plan based
on the poverty indicators are also taken into account for identifying and preparing the
poverty indicators. United Nations has identified millennium development goals and
indicators, and has set the worldwide goal for monitoring these indicators. Those
indicators are also included in the indicators for poverty monitoring. The following
indicators are identified and prepared for monitoring poverty pursuing the appropriate
process and based on the criteria. Work is ongoing for finalizing the nomenclature of
these indicators.
Poverty monitoring indicators
Goal Physical progress/ achievement Poverty indicators Sources of
indicators information
Make • Access to production • Population below poverty • Nepal Living
improvement in resources (micro credit, line, poverty incidence Standard Survey
the extreme income-generating training, and poverty gap (intensity (NLSS)
poverty; and entrepreneurial training) and depth) • Other household
reduce the • Access to market • Income distribution & the surveys
number of • Time required to reach the very poor people's share • Records of various
people living nearest road of national consumption agencies
below the • Employment opportunity • Unemployment & under • Employment and
poverty line to • Macro economic indicators: employment labor survey
30% economic growth rate, inflation • Percentage of household • National
rate, revenue growth rate, income spent on food population census
revenue to gross domestic • National
product ratio agricultural census
• Industrial census
• Report on poverty
monitoring
prepared by NPC
Make • Population growth rate • Literacy rate • NLSS
improvement in • Number of schools • Net enrolment rate • Household survey
human • Time required to reach school • School dropout rate • Records of
development • Ratio of students to teacher • Percentage of children of Ministry of
index (education) • Physical facilities at schools the age group 6-14 never Education
• Budget allocated to and attending school • National
expenditure on education • Percentage of expenditure population census
on education used for • MOF
basic education
Make • Number of children immunized • Infant mortality rate • NLSS
improvement in • Time required to reach the • Child mortality rate • Nepal population
human nearest health center • Maternal mortality rate and health survey
development • Ratio of health workers to the and percentage of • Household survey
index (health) population maternity services to be conducted in
• Number of family planning received from skilled between two
devices distributed health workers population
• Number of people provided • Reproductive health and censuses
with maternity services family planning device use • Records of
• Number of people benefited rate concerned agency
from drinking water and • Life expec tancy • MOF
number of projects • Total fertility rate
• Children benefited from • Percentage of population
malnutrition reduction program enjoying drinking water
• Time required for fetching facility
drinking water • Percentage of children
• Budget allocated to & affected by malnutrition
expenditure on health & • Percentage of expenditure
612
Goal Physical progress/ achievement Poverty indicators Sources of
indicators information
drinking water on basic health & drinking
water
Make • Scholarship to women • Ratio of women's literacy • NLSS
improvement in • Reservation provided by to men's literacy • Records of
gender equality political parties for women • Ratio of boy's enrollment concerned
• Women officers working at the to girls' enrollment at agencies
institutions of the government primary & secondary • Other
& the non-governmental sector schools contemporary
• Provision for training women • Ratio of women active in studies
specially for promotion in political parties to men
administration • Percentage of women
• Women teachers will be 50% holding positions at the
at the primary education political and various
organized sectors
• Percentage of women
teachers at the primary
education
Make • Number of scholarships • Income/consumption • NLSS
improvement in • Number of teachers belonging status of Dalit/backward • Household survey
the poverty and to Dalit/backward class people • Records of the
human • Percentage of students' • Literacy rate Department of
development enrollment belonging to • Percentage of children of Education
indicators of Dalit/backward people the age group 6-14 never • Nepal Population
backward • Number of Dalit/backward attending school. and Health Survey
group/caste/area students at technical schools • Infant mortality rate
• Number of Dalit/backward • Child mortality rate
female health volunteers • Maternity services
• Provision for a mobile health received from skilled
team at the Dalit settlement. health workers
• Lie expectancy
• Total fertility rate
Such indicators are prepared for monitoring disaggregated figures by district level
and for monitoring the status of people belonging to the backward group and area so
that monitoring of the success made in reducing the poverty of the people belonging
to the backward group and area can be done.
a) Data collection
The data and information on benefits and impact are generally collected in course of
the program implementation but not collected from the stored database hence; a
separate survey is required for it. Conceptually, agencies other than the implementing
agencies conduct such surveys for unbiased evaluation of programs. So, separate
budget allocation of is required for such surveys . Generally, such statistics can be
divided into quantit ative and qualitative. Indicators of the income-poverty are
quantitative and so collection and processing of data for these indicators is very
expensive. Human development indices are qualitative for which data collection is
easy and cheap. Large sample size is required for collecting the statistics on some
indicators; such a large size sample group may not be available in a small area; in
addition, collection of data is difficult and expensive. For example, number of sample
groups required for collecting statistics on the maternal mortality rate has been
insufficient at the district and the village level; even if sufficient number of sample
613
groups is available in some areas the collection and processing of data will be costly
in comparison to the national level survey of the maternal mortality rate. In view of
all these, the following arrangements are made for collecting data:
Poverty mapping: The population census conducted every 10 years provides various
data on population and the description of population engaged in various economic
activities based on caste and ethnicity. The data generated by the population census
and other social and economical statistics generated by the NLSS will be used for
poverty mapping in the country.
Nepal Living Standard Survey (NLSS): National household surveys were conducted
in various time with special objective and income-poverty were estimated based on
the data generated by such surveys. The NLSS was conducted in 1995/96 with the
objective of measuring the living standard of the people by using the living standard
measuring methodology developed by the World Bank. The second phase of this
survey is being conducted in 2002/03. This survey will provide various data on
income-poverty, human development and on some aspects of social evils; so, this
survey will be conducted in every five years. This survey is heavy and costly. This
survey will provide the estimated data on the nation and of the main ecological
regions in every five years. This survey will not generate statistics at the district level.
Household survey for collecting data in the years between the Nepal population
health survey and the population census: The NLSS conducted in every five years
alone will not be able to meet the data required for monitoring and evaluation.
Therefore, a household survey will be conducted in coordination with the Nepal
population health survey and the population census every two years to collect more
detailed data on the social sector than that of the Nepal population health survey.
These surveys will provide data on the nation and the main ecological zones in every
two years. In addition, a feasibility study on the possibility of conducting an
integrated survey on collecting data on social and economical indicators together will
also be done by these surveys .
District level household survey for quality data: In the context of a district level
periodic plan and the Local Self-governance Act, the need for the social and
economic data at the district level has been felt. The grant provided by the center to
districts cannot be distributed according to their needs in the absence of good quality
data. Therefore, conducting a district level household survey has been necessary for
the district level data. However, a district level househo ld survey is done for
collecting qualitative data because conducting a survey like NLSS for collecting
district level data in all districts becomes heavy and expensive. Mobilizing resources
for conducting a district level household survey in all 75 distric ts in one year will be
difficult; therefore, a plan is prepared to conduct a district level household survey in
some districts every year so that such a district level household survey will cover all
75 districts every four year in between two NLSS. Enumerators will visit each
household once for collecting necessary data, and then process the data in districts.
District Development Committees will participate in these tasks .
614
Such a district level household survey will not collect quantitative data. Hence,
thinking is underway on computing household consumption statistics based on the
data collected by the district level household survey and the data collected by the
NLSS taking the survey year as the base year. Efforts will be made to integrate the
national level NLSS and the district level household survey for making them
supplementary to each other.
b) Ecological and administrative areas that will have statistics
The statistical indices will be available at various levels in view of the nature of
poverty, improvement in it and the geographical boundaries of the plan formulating
bodies.
Comprehensive economic indicators and sector-wise government expenditures will
be available at the national level only. Statistics on employment, incomes and their
distributio n and level of consumption and other human development indicators will
be available at the national level and at some main ecological zones too. The NLSS
and other surveys will provide such data.
Statistics on the access of the people to the basic services concerning human
development at the local level, human development indicators suggesting the sense of
the availability of basic services, and qualitative indicators concerning poverty will be
available at the district level. To this end, provision will be made for conducting a
household survey that will assist in estimating district level data.
c) Institutional requisite
Statistics on resources spent on poverty alleviation and on the benefits from them will
be available at the Ministry of Finance, at the concerned Ministry and at other
agencies of HMG/N in their regular MIS. Central Bureau of Statistics (CBS ) and
District Statistics Offices will collect data and process them. Services of experts are
required to scientifically and reliably collect data, and process them . The CBS will be
strengthened and mobilized for this purpose. DDCs will assist the district level offices
of the CBS in the district level household survey if districts need to collect specific
district database, and in processing the data as required by districts.
The NPC will prepare and publish the report on the poverty monitoring and the
efforts made to alleviate the poverty. Comprehensive economic statistics and other
statistics received from various surveys will be used for preparing this report. Nepal
will prepare its millennium development progress report based on this report too.
A regular survey or a system has not been set to conduct the poverty monitoring yet.
The current monitoring system is structured for evaluating the progresses of
development projects and programs. Improvement in its objectives and in its
implementation is necessary. The NPC will prepare and publish reports on the
poverty alleviation and on the evaluation of the programs and policies implemented
for poverty alleviation.
615
33.7. Policy monitoring and evaluation
Evaluation of usefulness and effectiveness of the action plans and policies
implemented for poverty alleviation will be done two times during the plan period
based on analysis of the data received from the monitoring of poverty. The first
evaluation i.e. evaluation of the four major strategies adopted for the poverty
reduction along with the progress evaluation of the plan will be done at the time of
mid-term evaluation of the plan. Evaluation studies on sustainable and high economic
growth, development of social sector, targeted programs and good governance will be
done, and reports on them will be prepared. Similar evaluation studies will be done in
the last year of the plan before preparing the approach paper for the next plan. These
studies will provide important feedback to future plans for their policy improvement.
The provision for conducting an annual assessment of the action plans will be
strengthened in addition to performing such periodic evaluations .
The Tenth Plan has set the target for some main income-generating and human
development indicators, accordingly has estimated the economic growth rate, sector-
wise growth rates, availability of resources and their growth rates, investment rate,
ratio of revenue and investment to GDP, inflation and it has also allocated resources
sector-wise. The monitoring of these indicators will make the monitoring and
evaluation of poverty alleviation strategies easy; hence, targets for these indicators are
as follow:
616
Institutional Structure of the poverty alleviation monitoring1
Central Bureau of Statistics Poverty Alleviation &

(For various household surveys) Employment Promotion Division
(For monitoring report)
Various ministries of Hi s
Majesty's Government of
Nepal: Information on Central Monitoring & NPC's Regional Offices
progress of and expenditure
Evaluation Division (For progress monitoring)
on program
(For progress monitoring)
DDC Advisory Committee:

Advice to district level
household surveys
1
Finalizing this institutional structure of the poverty monitoring is ongoing
617
Overall economic indicator
Description 2058/59 Tenth

(2001/02) Plan
Economic growth rate (%) -0.6 6.2
Agricultural growth rate (%) 2.2 4.1
Non-agricultural growth rate (%) -2.3 7.5
Ratio of investment to gross domestic product (%) 24.4 29.0
Ratio of national savings to gross domestic product (%) 17.4 23.1
Revenue growth rate (%) -2.6 9.5
Consumer price increase (%) 2.9 5.0
Allocation of government sector capital investment (x Rs 10 - -
million) - 3180.6
Agriculture - 141.9
Industry and mines - 201.2
Trade, hotel, restaurant - 3333.7
Electricity, gas and water - 3436.6
Transport and communication - 269.2
Finance and property (house and land) - 6410.4
Social service
Poverty and human development indicators

Description 2058/59 2063/64
(2001/02) (2006/07)
Population under the poverty line (%) 38 32
Literacy (%) 49.2 63
Women's literacy (%) 35.6 55
Enrollment at the primary education (%) 80.4 90
Enrollment at the lower secondary education (%) 58 65
Infant mortality (per 1000) 64.2 45
Child mortality (per 1000) 91 72
Life expectancy (years) 61.9 65
Maternity service provided by skilled health worker (%) 13 18
Family planning device users (%) 39.3 47
Population having drinking water service (%) 71.6 85
Total fertility rate (%) 4.1 3.5
Population growth rate (%) 2.25 2.1
618
33.8. Poverty monitoring framework
A detailed poverty-monitoring framework containing institutional structure of the
poverty monitoring and sources of information, action plans on household surveys,
indicators for poverty monitoring and participative methods to be adopted in this
process will be published in the first year of the Tenth Plan.
33.9. Projection of development expenditure

The monitoring and evaluation program will be given the first priority. Necessary
development budget for this program is included in the Planning and Statistics.
Budgets for regional monitoring and evaluation will be included in the concerned
regional programs.
619
Chapter - 34
Development of Planning and
Statistics
34.1. Background
Development planning process is dynamic . So, it is necessary to study continuously
and analyze it, and explore new techniques of it. We will be able to set the national
goal, and prepare long-term and periodic plans, and be able to choose correct
programs if we are able to timely analyze the international development sequences
and have the knowledge of its direction then the development process in the country
may take a spec ific direction.
It is necessary to prepare, assess, monitor and evaluate development policies,
programs and projects based on the up-to-date and reliable statistics to achieve the
targets and objectives set in the periodic plan. To this end, plan preparation, policy
analysis, project evaluation system and data collection, processing, analysis and
presentation need to be made more scientific, standard and practical. In addition, it is
necessary to avoid duplication of data collection, to collect necessary statistics on all
aspects of the economical and social sectors, to maintain the standard of collected
statistics comparable to the international standard, to maintain coordination with
collected statistics, to analyze them properly, and to make them easy to use and useful
to the users.

The mid-term evaluation of the Ninth Plan has been completed; and the approach
paper for preparing the Tenth Plan has been prepared based on the results of the mid-
term evaluation, and endorsed by the National Development Council; and the Tenth
Plan has been prepared based on the approach paper. Preparing a poverty map and
compiling statistics using the geographical information system have been initiated
under the planning strengthening program . A computer network has been set up at
the National Planning Secretariat; the website design of the National Planning
Commission has been up-dated. An Interim Poverty Reduction Strategy Paper
(IPRSP ) has been prepared and used for preparing the Tenth Plan in to view of
making the planning process participative, fact based and effective.
The National Population Census of 2058 (2001), the National Agricultural Census of
2058 (2001) and the pilot work of the National Industrial Census have been
completed during ht e Ninth Plan period. In addition, estimations of the national
accounts have been published annually.
34.3. Problems and challenges
620
The following problems and challenges have been observed in the planning and
statistics sector during the Ninth Plan period:
1. Prioritization of development programs and projects has not been done based
on their economical and social impact analysis and on the resource
availability yet; and the project completion rate has been minimum due to the
weakness of the monitoring and evaluation of programs and projects.
2. Some sectors lack the statistics but other sectors have multiple statistics and
even duplication of statistics required for the development and planning
process. In addition, the reliability of statistics has been questionable.
3. Economic planning group has not been set up for strengthening the economic
planning and statistics services yet.
34.4 The Tenth Plan
a) Objectives
1. Explore the ways and means of alleviating the poverty of the people in
general, and of making improvement in the living standard of the entire
population including the people of the backward class and the backward area;
coordinate the preparation of long-term and periodic plans, policy
formulation, resource projection, selection and approval of development
projects and programs with the monitoring of implementation of, and
evaluation of development programs.
2. Make the development planning process standard and reliable; make it
effective based on statistics and information; make periodically available up-
to-date, qualitative and reliable statistics on the status, tendency and condition
of every aspect of the national life.
b) Strategies
Development of an appropriate and strong data base will contribute to the
comprehensive monitoring and evaluation of various aspects of the plans on
economic growth and social development, and contribute to the effective preparation
of future programs. Plan preparation is a dynamic process. So, it is necessary to be
familiarization with the contemporary national and international plan ning process. It
is necessary to pay attention to the aspects such as resource mobilization for the
poverty alleviation of and improvement in the living standard of the entire population,
coordination of an appropriate process for identification of programs and policies,
and development of capacity of analyzing and prioritizing plans.
The following strategies for planning and statistics sector have been set to make the
data system coordinated, authentic and reliable, to carry out the institutional
strengthening of the sectors concerned with the planning and statistics sector and to
develop the manpower required for them, and thus, develop the capacity of
implementation and monitoring of the entire national strategy.
§ Strategies concerning objective No. 1
1. Develop the project and program selection and approval process in such a
621
way that it will be transparent and participative, and it will be based on
the economical and social analysis, and resource availability, and it will
assist in achieving the objective and the goal of the periodic plan.
2. Carry out institutional strengthening of agencies involved in the planning
and statistics sector, and develop manpower for them .
§ Strategies concerning objective No. 2
3. Make statistics authentic, qualitative, reliable and user-friendly by
making data collection, survey, processing and analysis of data effective.
4. Prepare and implement a specific action plan on conducting poverty
survey, living standard survey, labor power survey, environment survey,
reproductive health survey, economical and social survey, and household
survey regular, periodic and comparable.
c) Policy and action policy
§ Plan strengthening program (related to strategy 1)
• Set up an Analysis and Research Unit at the National Planning Secretariat
for increasing its ability and effectiveness, for its institutional
strengthening, and for prioritizing, selecting and approving development
projects and programs based on the economical and social analysis.
• Make provision for timely informing the public about the achievement
and progress of the periodic plan by developing the poverty monitoring
system.
• Make provision for standardizing and regularizing the policy and project
monitoring process for evaluating the impact of a specific policy or
project on the concerned benef iciaries .
• Strengthen the Regional Planning Offices for effectively monitoring and
evaluation of the usefulness and effectiveness of the programs turned
over to District Development Committees.
§ Institutional Strengthening (related to strategy 2)
• Implement necessary programs on professional and capacity development
of the manpower involved in the planning process, and on retaining high
quality manpower in the planning process for making the economic
planning service/group effective and action-oriented.
§ Statistics development program (related to Strategy 3)
• Institutionally strengthen the Central Bureau of Statistics transforming it
into a focal point and authentic agency for making the statistics build-up
process more useful, reliable, timely and high quality; and also make
necessary amendment to laws, and implement the program on developing
the manpower and the capacity of the staffs engaged in this department to
this end.
• Gradually implement the entire subject maters contained in the National
Statistics Plan as required.
622
§ Implementation of specific action plan (related to Strategy 4)
• In addition to implementing program on strengthening a National
Accounting System, prepare and implement an integrated action plan on
providing necessary information in the specified time about the indicators
concerning the objectives of the millennium development goal and the
indicators set in the Tenth Plan, and on avoiding the duplication of
various surveys to be done for getting information on social and
economical indicators.
34.5 Anticipated achievement

The following are the anticipated achievements of the implementation of all these
policies and programs:
1. The program and project completion rate will increase due to the effective,
participative and qualitative development planning process in addition to
providing support for achieving the goal of the plan.
2. The development of statistics and the survey process for statistics will be
regular, credible and reliable.
3. The institutions involved in the planning and statistics will be strengthened;
and continuity of the services of quality manpower in this sector will be
insured too.
623
Annex
Annex One
Summary of the Tables of the Ninth Plan
Table Contents Pages
No.
1 Gross Domestic Product (at Current Price) A-1
2 Gross Domestic Product (at constant price at 1996/97) A-2
3 Total and Sectoral Economic Growth Rate A-3
4 Sectoral Contribution in Gross Domestic Product A-4
5 Total Fixed Capital Investment by Sectors and Growth Rate A-5
6 Total Fixed Capital Investment by Sectors and Growth Rate (Constant price at A-6
1996/97)
7 Consumption, Saving and Investment A-7
8 Regular Expenditure A-8
9 Development Expenditure A-9
10 Target and Achievements of Development Expenditure by Economic Sector A-10
(Constant price at 1996/97)
11 Achievement in Development Expenditure by Economic Sectors (at current A-11
prices)
12 Achievement in Development Expenditure by Economic Sectors (Constant A-13
prices at 1996/97)
13 Revenue (at current price) A-15
14 Revenue (Constant price at 1996/97) A-17
15 Composition of Revenue A-19
16 Position of Government Finance (at current price) A-20
17 Position of Government Finance (Constant price at 1996/97) A-21
18 Deficit Finance A-22
19 Deficit Budget A-23
20 Financial Target and Achievements of the Ninth Plan (Constant prices at A-24
1996/97)
21 Share of Foreign Aid in Development Expenditure (Percentage) A-25
22 Monetary Survey A-26
23 Factors Affecting on Money Supply A-27
24 Sources and Uses of Resources of Commercial Banks A-28
25 Credit Flow of Commercial Banks by Purposes A-29
26 National Urban Consumer’s Price Index A-30
(Base year 1996/97 =100)
27 Situation of Balance of payment (at current price) A-31
28 Situation of Balance of payment (Constant Prices at 1996/97) A-32
29 Export of Major Commodities to India (In Current Price) A-33
30 Export of Major Commodities to Other Countries (In Current Price) A-34
31 Balance of Payment (In current Price) A-35
32 Balance of Payment (Constant Price at 1996/97) A-36
33 Foreign Exchange Holding of Banking System A-37
34 Some Major Economic Targets and Status of Achievements of the Ninth Plan A-38
35 Some Major Physical Targets and Status of Achievements of the Ninth Plan A-39
Table 1: Gross Domestic Product (at Current Price)
(Rs. in million)
Sectors 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02* Annual

average
growth (%)
Agriculture, Irrigation and Forestry 10875 112495 132373 145131 151059 158439 7.9
Non-agriculture 160785 177303 197645 221130 242490 244513 8.8
Industry, Mining and Quarrying 26311 28540 32022 35365 37419 34859 6.0
Electricity, Gas and Water 4457 4383 4632 5942 6987 8114 13.2
Construction 29263 30483 33262 37382 39584 42232 7.7
Trade, Hotel and Restaurant 30551 33687 39313 42895 44572 40391 6.0
Transportation and Communication 19315 22598 24631 29336 33297 34664 12.5
Finance and Real Estate 27157 29778 33203 36919 41634 43494 9.9
Social Services 23731 27834 30582 33281 38997 40759 11.5
GDP (at factor cost) with Banking services 269570 289798 330018 366251 393549 402952 8.4
Less Imputed Value of Banking Services 7009 7896 9438 10708 11912 12269 12.0
GDP (at factor cost ) without Banking Services 262561 281902 320580 355543 381637 390683 8.3
Plus Indirect Taxes (Net) 17952 18943 21456 23945 28637 29580 10.7
Total GDP (at Producer’s price) 280513 300845 342036 379488 410270 420263 8.5
* Revised Estimates, Source: Central Bureau of Statistics
A-1
Table 2: Gross Domestic Product (at constant price at 1996/97)
(Rs. in million)
Sectors 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02* Annual

average
growth (%)
Agriculture, Irrigation and Forestry 108785 109712 112828 118349 124831 127614 3.3
Non-agriculture 160785 168835 178327 190511 198730 194237 3.9
Industry, Mining and Quarrying 26311 27179 28594 30611 31775 28812 2.0
Electricity, Gas and Water 4457 4272 4514 5162 5645 5955 6.1
Construction 29263 29908 31942 35009 35312 35657 4.1
Trade, Hotel and Restaurant 30551 32310 33566 35837 36381 32455 1.4
Transportation and Communication 19315 20875 22294 23860 25337 25774 6.0
Finance and Real Estate 27157 28751 30189 31723 32269 33051 4.0
Social Services 23731 25539 27228 28309 32011 32534 6.6
GDP (at factor cost) with Banking services 269571 278545 291155 308859 323561 321851 3.6
Less Imputed Value of Banking Services 7007 7597 8124 8886 9625 9634 6.6
GDP (at factor cost ) without Banking Services 262561 270948 283031 299973 313936 312217 3.6
Plus Indirect Taxes (Net) 17952 17783 18588 20039 21325 21201 3.4
Total GDP (at Producer’s price) 280513 288732 301699 320013 335261 333418 3.6
* Revised Estimates, Source: Central Bureau of Statistics
A-2
Table 3 : Total and Sectoral Economic Growth Rate
(in percentage)
Sectors Targeted 1997/98 1998/99 1999/00 2000/01 2001/02* Annual average

growth rate of growth rate of
Ninth Plan Ninth Plan
Agriculture, Irrigation and Forestry 4.0 0.9 2.8 4.9 5.5 2.2 3.3
Non-agriculture 7.3 5.0 5.6 6.8 4.3 -2.3 3.9
Industry, Mining and Quarrying 9.1 3.3 5.2 7.1 3.8 -9.3 2.0
Electricity, Gas and Water 10.4 -4.2 5.7 14.3 9.4 5.5 6.1
Construction 5.9 2.2 6.8 9.6 0.9 1.0 4.1
Trade, Hotel and Restaurant 7.4 5.8 3.9 6.8 1.5 -10.8 1.4
Transportation and Communication 8.7 8.1 6.8 7.0 6.2 1.7 6.0
Finance and Real Estate 5.8 5.9 5.0 5.1 1.7 2.4 4.0
Social Services 7.0 7.6 6.6 4.0 13.1 1.6 6.6
GDP (at factor cost) with Banking services - 3.3 4.5 6.1 4.8 -0.6 3.6
Less Imputed Value of Banking Services - 8.4 6.9 9.4 8.3 0.1 6.6
GDP (at factor cost ) without Banking Services 6.0 3.2 4.5 6.0 4.7 -0.6 3.6
Plus Indirect Taxes - -0.9 4.5 7.8 6.4 -0.6 3.4
Total G DP (at Producer’s price) 6.5 2.9 4.5 6.1 4.8 -0.6 3.6
* Revised estimates, Central Bureau of Statistics
A-3
Table 4 : Sectoral Contribution in Gross Domestic Product
(in percentage)
Sectors 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02*

Agriculture, Irrigation and Forestry 40.4 38.8 40.1 39.6 38.4 39.3
Non-agriculture 59.6 61.2 59.9 60.4 61.6 60.7
Industry, Mining and Quarrying 9.8 9.8 9.7 9.7 9.5 8.7
Electricity, Gas and Water 1.7 1.5 1.4 1.6 1.8 2.0
Construction 10.9 10.5 10.1 10.2 10.1 10.5
Trade, Hotel and Restaurant 11.3 11.6 11.9 11.7 11.3 10.0
Transportation and Communication 7.2 7.8 7.5 8.0 8.5 8.6
Finance and Real Estate 10.1 10.3 10.1 10.1 10.6 10.8
Social Services 8.8 9.6 9.3 9.1 9.9 10.1
GDP (at factor cost)** 100.0 100.0 100.0 100.0 100.0 100.0
* Revised estimates
** Including banking service
A-4
Table 5 : Total Fixed Capital Investment by Sectors and Growth Rate
(Rs. in million)
Fiscal Year Total Fixed Capital Investment Change in Stock Total Investment Growth Rate (%)
Private sector Public Sector Total (Rs.) (Rs.)
(Rs.) (Rs.) (Rs.)
1996/97 41402 19392 60794 10290 71084 -
1997/98 42802 22573 65375 9353 74728 5.1
1998/99 41381 23888 65269 4792 70061 -6.2
1999/00 46873 26436 73309 18333 91642 30.8
2000/01 46801 31268 79069 19442 97511 6.4
2001/02* 49159 32085 81244 21309 102553 5.2
Total of the Ninth Plan 227016 136250 363266 73229 436495 8.3
* Revised estimates
A-5
Table 6 : Total Fixed Capital Investment by Sectors and Growth Rate (Constant price at 1996/97)#
( Rs. in million)
Fiscal Year Total Fixed Capital Investment Change in Stock Total Investment Growth Rate (%)
Private sector Public Sector Total (Rs.) (Rs.)
(Rs.) (Rs.) (Rs.)
1996/97 41402 19392 60794 10290 71084 -
1997/98 41077 21663 62740 8976 71716 0.9
1998/99 36491 21065 57556 4226 61782 -13.9
1999/00 39522 22290 61812 15458 77270 25.1
2000/01 38236 25546 63782 15884 79666 3.1
2001/02* 39015 25464 64479 16912 81391 2.2
Total of the Ninth Plan 194341 116028 310370 61455 371825 3.5
* Revised estimates
# Used GDP a defla tor at (1996/97=100).
A-6
Table 7 : Consumption, Saving and Investment
(Rs. in million)
Fiscal year/Description 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02* Annual
average
growth (%)
( at current prices)
Gross Consumption 241351 259407 295473 322526 350080 371517 9.0
Gross Domestic Saving 39162 41438 46563 56962 60190 48745 5.4
Gross National Saving 44831 48621 58649 71406 77818 73178 10.8
Gross Investment 71084 74728 70061 91642 97511 102553 8.3
(constant price at 1996/97)##
Gross Consumption 241351 248951 260558 271944 286013 294855 4.1
Gross Domesti c Saving 39162 39768 41061 48029 49175 38687 0.6
Gross National Saving 44831 46661 51719 60207 63577 58078 5.7
Gross Investment 71084 71716 61782 77270 79666 81391 3.5
Ratio in Gross Domestic Product
Gross Consumption (%) 86.0 86.2 86.4 85.0 85.3 88.4
Gross Domestic Savings (%) 14.0 13.8 13.6 15.0 14.7 11.6
Gross Investment (%) 25.3 24.8 20.5 24.1 23.8 24.4
Ratio of Gross National Saving and Gross National Product (%) 15.7 15.8 16.6 18.2 18.2 16.5
Proportion of Gross Domestic Savings in Gross Investment (%) 55.1 55.5 66.5 62.2 61.7 47.5
Proportion of Gross National Saving in Gross Investment (%) 63.1 65.1 83.7 77.9 79.8 71.4
* Revised Estimates,
## Used GDP a deflator at (1996/97=100)
A-7
Table 8 : Regular Expenditure
(Rs. in million)
Fiscal Year At current prices Percentage Growth At 1996/97 prices** Percentage Increase
1996/97 24181 - 24181 -
1997/98 27174 12.4 25092 3.8
1998/99 31048 14.3 25744 2.6
1999/00 34523 11.2 27685 7.5
2000/01 42769 23.9 33466 20.9
2001/02* 49150 14.9 37376 11.7
Total of the Ninth Plan 184664 15.3 149363 9.3
* Revised estimates
** Used National Consumer Price Index as a Deflator at (1996/97=100)
A-8
Table 9 : Development Expenditure
(Rs. in million)
Fiscal Year At current prices Percentage Growth At 1996/97 prices Percentage Increase
1996/97 26543 - 26543 -
1997/98 28944 9.0 26726 0.7
1998/99 28531 -1.4 23658 -11.5
1999/00 31749 11.3 25460 7.6
2000/01 37066 16.7 29003 13.9
2001/02* 31900 -13.9 24258 -16.4
Total of the Ninth Plan 158190 4.3 129105 -1.1
* Revised estimates
** Used National Consumer Price Index as a Deflator at (1996/97=100)
A-9
Table 10 : Target and Achievements of Development Expenditure by Economic Sectors
(Constant price at 1996/97)
(Rs. in million)
Sectors Target of the Ninth Plan Achievements of the Ninth plan Achievement in percentage
Rs. % Rs. %
Economic Service 55789 29.4 29329 22.7 52.6
Agriculture, Irrigation and Forestry 51284 27.1 24847 19.2 48.4
Industry and Mining 1588 0.8 2033 1.6 128.0
Trade, Hotel and Restaurant * 2917 1.5 2449 1.9 84.0
Infrastructure 68801 36.3 46070 35.7 67.0
Transportation and Communication 33340 17.6 22685 17.6 68.0
Electricity and Energy ** 35461 18.7 23385 18.1 65.9
Social Services *** 63388 33.4 51540 39.9 81.3
Miscellaneous**** 1602 0.9 2166 1.7 135.2
Total 189580 100.0 129105 100.0 68.1
* Included Commerce, Tourism and Labour include d.

** Alternat e energy included.
*** Expenditure in Financial Sectors (Finance and Real Estate) by Ministry of Finance and Expenditure for Control on Drug
Abuse by Ministry of Home included.
**** Public Finance and Economic Administration, General Administration, Planning and Statistics, Supply and Constitutional
Organs also included.
A - 10
Table 11 : Achievement in Development Expenditure by Economic Sectors (at current prices)
(Rs. in million)
S.N. Description Ninth Plan Total Proportion Annual
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 of Average
Expenditure growth
(%) rate (%)
1 Economic services 59.3 2.3
(1.1+1.2+1.3+1.4) 17055 17900 17324 18649 21114 18819 93806
1.1 Agriculture, Irrigation and 19.3 4.7
Forestry (1.1.1-1.1.4) 5353 5228 5650 5917 7103 6617 30515
1.1.1 Agriculture 1890 2144 1926 2090 2329 2595 11084 7.0 6.9
1.1.2 Irrigation 2727 2438 2941 3045 3953 3176 15552 9.8 4.8
1.1.3 Forestry 464 410 481 519 479 564 2453 1.6 4.7
1.1.4 Land reform and survey 273 236 303 264 342 282 1426 0.9 2.8
1.2 Industry and Mining 264 477 289 834 367 522 2489 1.6 43.2
1.3 Commerce, Tourism, 3.4 15.0
Labour, Supplies and
Hydrology (1.3.1-1.3.5) 590 682 996 1382 1232 1053 5345
1.3.1 Commerce 34 199 410 360 360 89 1416 0.9 100.5
1.3.2 Tourism 204 160 154 222 384 318 1237 0.8 15.0
1.3.3 Labour 56 58 53 61 74 117 363 0.2 17.9
1.3.4 Supplies 258 225 200 505 250 406 1585 1.0 28.1
1.3.5 Hydrology 39 41 180 235 164 123 743 0.5 63.2
1.4 Infrastructure (1.4.1-1.4.2) 10848 11513 10389 10516 12413 10627 55457 35.1 0.2
1.4.1 Transportation and 17.3 -6.0
Communication (1.4.1.1-
1.4.1.2) 6401 6808 5577 4978 5599 4473 27435
1.4.1.1 Road Transportation 5006 5002 4681 4278 4846 3738 22544 14.3 -4.9
1.4.1.2 Civil Aviation 299 618 431 418 509 371 2347 1.5 13.6
1.4.1.3 Communication 1096 1188 466 283 244 364 2545 1.6 -11.2
A - 11
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 of Average
Expenditure growth
(%) rate (%)
1.4.2 Electricity and Energy 4447 4705 4811 5538 6814 6154 28022 17.7 7.3
2 Social Services (2.1-2.5) 9281 10324 10265 12406 12873 11079 56947 36.0 4.3
2.1 Education 2356 2037 1641 2574 2784 1966 11002 7.0 0.5
2.2 Health 1621 2076 1677 2127 1972 2143 9995 6.3 7.4
2.3 Drinking Water 1327 1670 1867 2423 2407 2123 10490 6.6 11.0
2.4 Local Development 3623 3679 3969 4137 4626 3644 20054 12.7 0. 9
2.5 Other Social Services 3.4 36.2
(2.5.1-2.5.5) 354 862 1111 1146 1083 1203 5405
2.5.1 Population and 0.1 25.2
Environment 13 20 24 28 34 37 142
2.5.2 Women and Social 0.4 194.7
Welfare 11 9 93 153 180 190 626
2.5.3 Youth, Sports and Culture 135 581 828 346 240 260 2255 1.4 58.5
2.5.4 Housing 191 220 96 415 348 307 1386 0.9 52.8
2.5.5 Others 5 32 71 204 280 409 996 0.6 179.5
3 General Administration 0.6 49.6
(3.1-3.2) 52 66 100 137 323 310 936
3.1 Administration Reform 35 46 79 108 24 107 365 02 80.6
3.2 Economic Administration 0.4 194.1
and Planning 17 19 21 29 299 203 570
4 Constitutional Organs 0 4 29 27 61 74 194 0.1 -
5 Miscellaneous 155 651 813 531 2695 1618 6308 4.0 135.6
Total Development 100.0 4.3
expenditure 26543 28944 28531 31749 37066 31900 158190
A - 12
Table 12 : Achievement in Development Expenditure by Economic Sectors (at 1996/97 Constant prices)
(Rs. in million)
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 of Average
Expenditure growth
(%) rate (%)
1 Economic services 59.4 -3.0
(1.1+1.2+1.3+1.4) 17055 16528 14365 14955 16521 14311 76681
1.1 Agriculture, Irrigation and 19.2 -0.8
Forestry (1.1.1-1.1.4) 5353 4827 4685 4745 5558 5031 24847
1.1.1 Agriculture 1890 1980 1597 1676 1823 1973 9049 7.0 1.5
1.1.2 Irrigation 2727 2251 2438 2442 3093 2415 12639 9.8 -0.8
1.1.3 Forestry 464 379 398 416 375 429 1997 1.5 -0.8
1.1.4 Land reform and survey 273 217 251 212 267 214 1162 0. 9 -2.8
1.2 Industry and Mining 264 441 240 669 287 397 2033 1.6 36.3
1.3 Commerce, Tourism, 3.4 8.4
Labour, Supplies and
Hydrology (1.3.1-1.3.5) 590 630 826 1108 964 801 4329
1.3.1 Commerce 34 183 340 289 281 68 1160 0.9 86.2
1.3.2 Tourism 204 147 128 178 300 242 995 0.8 9.5
1.3.3 Labour 56 53 44 49 58 89 293 0.2 12.2
1.3.4 Supplies 258 208 166 405 196 309 1282 1.0 22.2
1.3.5 Hydrology 39 38 149 189 129 94 598 0.5 51.1
1.4 Infrastructure (1.4.1-1.4.2) 10848 10631 8614 8433 9713 8081 45472 35.2 -4.9
1.4.1 Transportation and 17.6 -10.9
C ommunication (1.4.1.1-
1.4.1.2) 6401 6287 4625 3992 4381 3402 22686
1.4.1.1 Road Transportation 5006 4618 3881 3430 3792 2843 18564 14.4 -10.0
1.4.1.2 Civil Aviation 299 571 357 335 398 282 1943 1.5 7.3
A - 13
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 of Average
Expenditure growth
(%) rate (%)
1.4.1.3 Communication 1096 1097 386 227 191 277 2178 1.7 -15.4
1.4.2 Electricity and Energy 4447 4344 3989 4441 5332 4680 22786 17.6 1.7
2 Social Services (2.1-2.5) 9281 9532 8512 9949 10073 8425 46491 36.0 -1.2
2.1 Education 2356 1881 1361 2064 2178 1495 8979 7.0 -4.4
2.2 Health 1621 1917 1391 1705 1543 1630 8186 6.3 1.9
2.3 Drinking Water 1327 1542 1548 1943 1884 1614 8531 6.6 5.0
2.4 Local Development 3623 3397 3291 3317 3620 2771 16396 12.7 -4.6
2.5 Other Social Services 3.4 28.1
(2.5.1-2.5.5) 354 795 922 919 847 915 4398
2.5.1 Population and 0.1 18.3
Environment 13 18 20 23 27 28 115
2.5.2 Women and Social 0.4 170.8
Welfare 11 9 77 123 141 144 494
2.5.3 Youth, Sports and Culture 135 536 687 277 188 198 1886 1.5 47.8
2.5.4 Housing 191 203 79 333 272 233 1121 0.9 46.4
2.5.5 Others 5 30 59 164 219 311 782 0.6 162.3
3 General Administration 0.6 42.0
(3.1-3.2) 52 61 83 110 253 236 742
3.1 Administration Reform 35 43 66 87 19 81 296 0.2 71.5
3.2 Economic Administration 0.3 183.9
and Planning 17 18 17 23 234 154 446
4 Constitutional Organs 0 3 240 21 48 56 152 0.1 -
5 Miscellaneous 155 601 674 426 2108 1230 5040 3.9 123.4
Total Development 100.0 -1.1
expenditure 26543 26726 23658 25460 29003 24259 129105
A - 14
Table 13 : Revenue (at current price)
(Rs. in million)
S. No Description of Revenue Ninth Plan Ninth Plan
Proportion Annual –
of Average
1996/97 1997/98 1998/94 1999/00 2000/01 2001/02 Total description growth rate
(%) (%)
1 Custom Duties 8309 8502 9518 10813 12552 13641 55026 25.9 10.5
1.1 Import Tax 7093 7019 7698 8960 10392 10851 44921 21.2 9. 1
1.2 Export Tax 168 217 378 433 492 961 2481 1.2 45.4
1.3 Indian Excise Refund 1009 1102 1206 1332 1456 1511 6607 3.1 8.4
1.4 Others 39 164 235 89 212 318 1017 0.5 97.7
2 Tax on Consumption and 32.3 8.5
Product of Goods and
Services 10775 11250 11719 13387 16514 15992 68502
2.1 Excise Duty 2298 2886 2953 3128 3771 3797 16525 7.8 11.0
2.2 Sales Tax 7127 7123 7882 9855 12048 11890 48798 23.0 11.3
2.3 Others* 1351 1241 884 405 335 315 3180 1.5 -22.9
3 Land Revenue and 2.1 2.3
Registration 1015 1004 1003 1016 613 928 4564
3.1 Land Revenue 6 4 1 5 5 0 15 0.0 7.9
3.2 Real Estate and 2.1 2.6
Registration 1010 1001 1002 1011 608 928 4549
4 Property, Profit and Income 18.4 18.1
Tax 4325 5184 6513 7936 9546 9837 39015
4.1 Income Tax 3969 4686 5851 7006 8650 8799 34992 16.5 17.6
4.2 Urban Real Estate Tax 95 111 123 119 3 2 357 0.2 -24.4
4.3 Miscellaneous** 261 387 539 811 894 1036 3666 1.7 32.9
Total Tax Revenue 24424 25940 28753 33152 38865 40397 167107 78.7 10.7
A - 15
of Average
(%) (%)
5 Charges, Fees, Fine and 3.8 12.4
Forfeiture 1074 1246 1329 1747 1930 1868 8121
6 Government Asset, 2.7 2.9
Services and Sales of
Commodities and Service 996 1339 1036 1068 1184 1045 5672
7 Dividend 1134 1311 1783 2508 2336 2659 10597 5.0 20.0
8 Principal and Interest 1.4 35.5
Payment 448 565 202 563 950 647 2927
9 Royalty and Sales of 7.7 7.7
Government Asset 2221 2461 3928 3751 3497 2761 16398
10 Miscellaneous 76 76 103 105 131 1073 1487 0.7 157.6
Total Non-tax Revenue 5949 6998 8381 9742 10028 10053 45202 21.3 11.5
Total Revenue 30374 32938 37134 42894 48894 50450 212309 100.0 10.8
* Including Taxes on Vehicles, Interest payment and others.

** Including taxes on entertainment, hotel, civil-aviation, contracts, maintenance of roads/bridges and others.
A - 16
Table 14 : Revenue (at 1996/97 Constant price )
(Rs. in million)
of Average
(%) (%)
1 Custom Duties 8309 7851 7892 8671 9822 10373 44609 25.9 4.8
1.1 Import Tax 7093 6481 6383 7185 8131 8252 36433 21.2 3.4
1.2 Export Tax 168 200 313 347 385 731 1977 1.1 37.4
1.3 Indian Excise Refund 1009 1018 1000 1068 1139 1149 5374 3.1 2.7
1.4 Others 39 151 195 72 165 242 824 0.5 86.1
2 Tax on Consumption and 32.3 2.9
Product of Goods and
Services 10775 10388 9717 10736 12640 12161 55642
2.1 Excise Duty 2298 2665 2449 2508 2951 2880 13454 7.8 5.1
2.2 Sales Tax 7127 6577 6536 7903 9427 9042 39484 22.9 5.6
2.3 Others* 1351 1146 733 325 262 240 2705 1.6 -27.0
3 Land Revenue and 2.2 -3.0
Registration 1015 927 832 815 480 705 3759
3.1 Land Revenue 6 3 1 4 4 0 12 0.0 3. 4
3.2 Real Estate and 2.2 -2.8
Registration 1010 924 831 811 476 705 3746
4 Property, Profit and Income 18.3 11.8
Tax 4325 4786 5400 6364 7470 7480 31501
4.1 Income Tax 3969 4327 4851 5618 6768 6691 28256 16.4 11.3
4.2 Urban Real Estate Tax 95 102 102 95 2 1 303 0.2 -29.4
4.3 Miscellaneous** 261 357 447 650 699 788 2942 1.7 25.6
Total Tax Revenue 24424 23952 23842 23585 30411 30720 135510 78.7 4.9
5 Charges, Fees, Fine and 1074 1151 1102 1401 1510 1421 6585 3.8 69.9
A - 17
of Average
(%) (%)
Forfeiture
6 Government Asset, 2.7 -13.6
Services and Sales of
Commodities and Service 996 1236 859 857 927 795 4673
7 Dividend 1134 1211 1478 2011 1828 2022 8550 5.0 13.3
8 Principal and Interest 1.4 29.7
Payment 448 522 168 452 743 492 2376
9 Royalty and Sales of 7.8 1.1
Government Asset 2221 2272 3257 3008 2736 2100 13373
10 Miscellaneous 76 70 85 84 102 816 1157 0.7 146.4
Total Non-tax Revenue 5949 6462 6950 7812 7847 7645 36715 21.3 5.3
Total Revenue 30374 30414 30791 34398 38258 38365 172225 100.0 4.9
* Including Taxes on Vehicles, Interest payment and others.

** Including taxes on entertainment, hotel, civil-aviation, contracts, maintenance of roads/bridges and others.
A - 18
Table 15 : Composition of Revenue
(In percenatge)
S.No. Description of Revenue Ninth Plan Total in
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 Average
1 Custom Duties 27.4 25.8 25.6 25.2 25.6 27.0 25.9
1.1 Import Tax 23.4 21.3 20.7 20.9 21.3 21.5 21.1
1.2 Export Tax 0.6 0.7 1.0 1.0 1.0 1.9 1.1
1.3 Indian Excise Refund 3.3 3.3 3.2 3.1 3.0 3.0 3.1
1.4 Others 0.1 0.5 0.6 0.2 0.4 0.6 0.5
2 Tax on Consumption and Product of Goods and 35.5 34.2 31.6 31.2 33.0 31.7 32.3
Services
2.1 Excise Duty 7.6 8.8 8.0 7.3 7.7 7.5 7.8
2.2 Sales Tax 23.5 21.6 21.2 23.0 24.6 23.6 22.8
2.3 Others* 4.4 3.8 2.4 0.9 0.7 0.6 1.7
3 Land Revenue and Registration 3.3 3.0 2.7 2.4 1.3 1.8 2.2
3.1 Land Revenue 0.0 0.0 0.0 0.0 0.0 0.0 0.0
3.2 Real Estate and Registration 3.3 3.0 2.7 2.4 1.2 1.8 2.2
4 Property, Profit and Income Tax 14.2 15.7 17.5 18.5 19.5 19.5 18.2
4.1 Income Tax 13.1 14.2 15.8 16.3 17.7 17.4 16.3
4.2 Urban Real Estate Tax 0.9 0.3 0.3 0.3 0.0 0.0 0.2
4.3 Miscellaneous** 0.9 1.2 1.5 1.9 1.8 2.1 1.7
Total Tax Revenue 80.4 78.8 77.4 77.3 79.5 80.1 78.6
5 Charges, Fees, Fine and Forfeiture 0.9 3.8 3.6 4.1 3.9 3.7 3.8
6 Government Asset, Services and Sales of 5.9 4.1 2.8 2.5 2.4 2.1 2.8
Commodities and Service
7 Dividend 3.7 4.0 4.8 5.8 4.8 5.3 4.9
8 Principal and Interest Payment 1.5 1.7 0.5 1.3 1.9 1.3 1.4
9 Royalty and Sales of Government Asset 7.3 7.5 10.6 8.7 7.2 5.5 7.9
10 Miscellaneous 0.2 0.2 0.3 0.2 0.3 2.1 0.6
Total Non-tax Revenue 19.6 21.2 22.6 22.7 20.5 19.9 21.4
Total Revenue 100.0 100.0 100.0 100.0 100.0 100.0 100.0
* Including taxes on entertainment, hotel, civil-aviation, contracts, maintenance of roads/bridges and others
**Including Taxes on Vehicles, Interest payment and others.
A - 19
Table 16 : Position of Government Finance
(At current price)
(Rs. in million)
S.No. Description Ninth Plan
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02* Total Composition Annual
of Average
Government Growth
Finance (%) Rate (%)
1 Total Expenditure (2+2.1.1.2) 50724 56118 59579 66273 79835 81050 342854 100.0 10.0
2 Development Expenditure 46.1 4.3
(2.1+2.2) 26543 28944 28531 31749 37066 31900 158190
2.1 Internal Resources (2.1.1+2.1.2) 11511 12687 12225 14225 18269 12252 69457 20.3 3.6
2.1.1 Revenue Surplus (2.1.1.1-2.1.1.2) 6192 5764 6086 8370 6124 1301 27645 8.1 -13.9
2.1.1.1 Revenue 30374 32938 37134 42894 48894 50450 212309 61.9 10.8
2.1.1.2 Regular Expenditure 24181 27174 31048 34523 42769 49150 184664 53.9 15.3
2.1.2 Other Sources (2.1.2.1+2.1.2.2) 5318 6723 6139 5855 12144 10951 41812 12.2 22.1
2.1.2.1 Internal Loan 3000 3400 4710 5500 7000 10000 30610 8.9 27.8
2.1.2.2 Cash Balance 2318 3323 1429 355 5144 951 11202 3.3 235.9
2.2 External Resources/Foreign Aid 25.9 5.6
(2.2.1+2.2.2) 15032 16457 16306 17524 18797 19649 88733
2.2.1 Foreign Grant 5988 5403 4454 5712 6754 8702 31024 9.0 9.6
2.2.2 Foreign Loan 9044 11055 11852 11812 12044 10946 57709 16.8 4.4
3 Total Resources (2.1.1.1+2.2.1) 36362 38340 41588 48605 55647 59152 243333 71.0 10.3
4 Deficit Budget (1-3)** 14362 17778 17991 17667 24188 21897 99521 29.0 10.1
5 Deficit Budget (1-2.1.1.1)*** 20350 23180 22445 23379 30942 30600 130545 38.1 9.2
* Revised estimates
** Including Foreign Grant
*** Excluding Foreign Grant
A - 20
Table 17 : Position of Government Finance
(at 1996/97 constant price)
(Rs. in million)
S.No. Description Ninth Plan
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02* Total Composition Annual
of Average
Government Growth
Finance (%) Rate (%)
1 Total Expenditure (2+2.1.1.2) 50724 51817 49402 53146 62469 61635 278468 100.0 4.3
2 Development Expenditure 46.4 -1.1
(2.1+2.2) 26543 26726 23657 25460 29003 24259 129105
2.1 Internal Resources (2.1.1+2.1.2) 11511 11530 10137 11408 14295 9317 56686 20.4 -1.8
2.1.1 Revenue Surplus (2.1.1.1-2.1.1.2) 6192 5322 5047 6712 4792 989 22862 8.2 -18.8
2.1.1.1 Revenue 30374 30414 30791 34398 38258 38365 172225 61.8 4.9
2.1.1.2 Regular Expenditure 24181 25092 25744 27685 33466 37376 149363 53.6 9.3
2.1.2 Other Sources (2.1.2.1+2.1.2.2) 5318 6208 5090 4695 9502 8328 33824 12.1 16.2
2.1.2.1 Internal Loan 3000 3139 3905 4411 5477 7605 24537 8.8 21.0
2.1.2.2 Cash Balance 2318 3069 1185 285 4025 723 9286 3.3 225.5
2.2 External Resources/Foreign Aid 26.0 0.1
(2.2.1+2.2.2) 15032 15196 13521 14053 14708 14942 72420
2.2.1 Foreign Grant 5988 4988 3693 4580 5285 6618 25164 9.0 4.4
2.2.2 Foreign Loan 9044 10207 9828 9473 9424 8324 47256 17.0 -1.3
3 Total Resources (2. 1.1.1+2.2.1) 36362 65402 34484 38978 43542 44983 197389 70.9 4.6
4 Deficit Budget (1-3)** 14362 16415 14918 14168 18926 16652 81079 29.1 4.3
5 Deficit Budget (1-2.1.1.1)*** 20350 21404 18611 18748 24211 23270 106243 38.2 3.6
* Revised estimates
** Including Foreign Grant
*** Excluding Foreign Grant
A - 21
Table 18 : Deficit Finance#
(Rs. in Million)
Fiscal Year Deficit Finance Proportion of Deficit Finance Proportion of Deficit in Internal
Current Prices At 1996\ 97 price in GDP (%) Resources (%)
1996/97 5318 5318 1.9 46.2
1997/98 6723 6208 2.2 53.8
1998/99 6139 5090 1.8 50.2
1999/00 5855 4695 1.5 41.2
2000/01 12144 9502 3.0 66.5
2001-02* 10951 8328 2.6 89.4
Total 41812 33824 - 62.2
* Revised Estimates
# Deficit Finance = Other sources (Internal Loan and Cash Balance).
A - 22
Table 19 : Deficit Budget #
(Rs. in million)
Fiscal Year Deficit Budget** Proportion Proportion

of deficit budget in GDP (%) of deficit budget in Total
Expenditure (%)
At current prices At 1996/97 price Including Excluding Including Excluding
Including Excluding Including Excluding Grant Grant Grant Grant
Grant Grant Grant Grant
1996/97 14362 20350 20350 20350 5.1 7.3 28.3 40.1
1997/98 17778 23180 16415 21404 5.9 7.7 31.7 41.3
1998/99 17991 22445 14918 18611 5.3 6.6 30.2 37.7
1999/00 17667 23379 14168 18748 4.7 6.2 26.7 35.3
2000/01 24188 30942 18926 24211 5.9 7.5 30.3 38.8
2001-02* 21897 30600 17630 24247 5.2 7.3 26.6 37.1
Total 99521 130546 82057 107221 28.9 37.9
* Revised estimates
** Deficit Budget (Including Grant) = Total Expenditure- Total Resources (Revenue + Grant).
** Deficit (Excluding Grant) = Total Expenditure –Total Resources (Revenue).
A - 23
Table 20 : Financial Target and Achievements of the Ninth Plan
(At 1996/97 constant prices)
S.No. Description Target for Ninth Plan Achievements of Ninth Plan Achievements
Rs. in million Percentage Rs. in million Percentage against Targets
(in percent)
1 Development Expenditure (2+4) 189580 100. 0 129105 100.0 68.1
2 Internal Resources (2.1+3) 78034 41.2 56686 43.9 72.6
2.1 Revenue Surplus (2.1.1+2.1.2) 63130 33.3 22862 17.7 36.2
2.1.1 Revenue 210840 111.2 172225 133.4 81.7
2.1.2 Regular Expenditure 147710 77.9 149363 115.7 101.1
3 Other Internal Resources (3.1+3.2) 14904 7.9 33824 26.2 226.9
3.1 Internal Loan 14904 7.9 24537 19.0 164.6
3.2 Cash Balance 0 0.0 9286 7.2 -
4 Foreign Aid (4.1+4.2) 111546 58.8 72420 56.1 64. 9
4.1 Foreign Grant 32595 17.2 25164 19.5 77.2
4.2 Foreign Loan 78951 41.6 47256 36.6 59.9
A - 24
Table 21 : Share of Foreign Aid in Development Expenditure
(Percentage)
Fiscal Year Proportion of Foreign Aid in Proportion of Foreign Loan

Development Expenditure in Foreign Aid
1996/97 56.6 60.2
1997/98 56.9 67.2
1998/99 57.2 72.7
1999/00 55.2 67.4
2000/01 50.7 64.1
2001/02 61.6 55.7
Average of the Ninth Plan 56.3 65.4
A - 25
Table 22 : Monetary Survey
(Rs in million)
S. No. Sectors As of mid July Annual

1997 1998 1999 2000 2001 2002* Average
Growth rate
(%)
1 Net Foreign Assets 40191 55573 65028 80468 87798 89287 18.0
2 Total Domestic Credit 10097 115812 134833 158001 187322 205690 15.3
3 Net Claim to Government 29229 31753 34918 38243 48658 59203 15.4
4 Claims on Public Enterprises 7029 7229 9114 10311 11906 12249 12.1
a) Financial 5432 6170 7547 8503 9683 10073 13.3
b) Non-financial 1597 1059 1567 1808 2223 2176 10.1
5 Claims on Private Sector 64659 76830 9081 109448 126758 134239 15.9
6 Fixed and Saving Deposits 65260 81299 101738 125141 143877 146566 17.9
7 Unclassified Net Liability 37387 44922 47060 52348 60666 68796 13.1
8 Money Supply (M1) 38460 45164 51062 60980 70577 79616 15.7
a) Money 27334 30893 34984 42143 48295 55735 15.3
b) Current Deposit 11127 14271 16078 18837 22282 23881 16.7
9 Money Supply (M2) (M1+6) 103721 126463 152800 186121 214454 226182 17.1
10 Net-domestic Assets (M2-1) 63530 70890 87773 105653 126656 136895 16. 7
11 Percentage Change in Money Supply (M1) 5. 4 17. 4 131 194 157 128 15.7
12 Percentage Change in Money Supply (M2) 120 219 208 218 152 55 17.1
Source: Preliminary estimates, Nepal Rastra Bank.
A - 26
Table 23 : Factors Affecting on Money Supply
(Rs. in million)
S.No. Factors Annual Change as of mid July
1996/97 1997/98 1998/99 1999/00 2000/01 2001/02*
1 Net Foreign Assets 2488 15382 9455 15440 7330 1489
2 Total Domestic Credit 11651 14895 19021 23168 29321 18368
3 Net Claim to Government 1698 2524 3165 3324 10415 10545
4 Claims on Public Enterprises 819 200 1885 1197 1595 343
a) Financial 1181 739 1377 956 1180 390
b) Non-financial -361 -539 508 241 415 -47
5 Claims on Private Sector 9134 12171 13970 18647 17310 7481
6 Fixed and Saving D eposits 9106 16039 20439 23403 18736 2689
7 Unclassified Net Liability 3070 7535 2138 5288 8318 8130
8 Money Supply (M1) 1962 6704 5899 9917 9597 9039
a) Money 2287 3560 4091 7159 6152 7440
b) Current Deposit -325 3144 1808 2759 3445 1599
9 Money Supply (M2) 11068 22742 26338 33321 28333 11728
10 Net-domestic As sets 8581 7360 16883 17881 21003 10239
* Preliminary estimates, Nepal Rastra Bank.
A - 27
Table 24 : Sources and Uses of Resources of Commercial Banks
(Rs. in million)
S.No. Description 1997 1998 1999 2000 2001 2002* Annual
Average
Growth Rates
(%)
1 Total Deposits (1.1+1.2+1.3+1.4) 81542 102402 126774 154530 181203 185054 18.1
1.1 Current Deposit 12917 16409 17778 20308 24629 25615 15.0
1.2 Savings Deposit 29783 36884 50141 65704 80988 86090 24.1
1.3 Fixed Deposit 36975 47301 56844 66516 73489 70802 14.4
1.4 Margin Deposit 1867 1807 2011 2003 2098 2547 6.8
2 Borrowing form Nepal Rastra Bank 7 6 6 45 6 1044 3899.7
3 Foreign Liability 0 0 22 0 0 229 -
4 Other Liability 36370 43393 44522 52272 64320 72369 14.7
5 Total Source of Resources (1+2+3+4) 118309 145800 171323 206848 245529 258696 17.7
6 Cash and Bank Reserves 24249 31049 37710 45161 50644 45669 14.3
6.1 Cash 2837 2890 3310 3507 4117 4833 11.4
6.2 Reserve in Nepal Rastra Bank 11017 12704 13341 15427 18363 16660 9.1
6.3 Foreign Currency in Cash 628 751 693 632 666 748 4.2
6.4 Reserve in Foreign Countries 9766 14704 20366 25595 27498 23428 21.5
7 Credit and Investment 78512 93798 111969 136185 160919 172353 17.1
7.1 Claims on Government 7746 10281 12659 18177 25393 29361 31.0
7.2 Claims on Public Enterprises 5533 5607 7463 8684 10225 10594 14.4
7.3 Claims on Private Enterprises 63170 75644 89433 107343 123417 131012 15.8
7.4 Purchase Foreign Bill 2063 2266 2414 1981 1884 1386 -6.6
8 Other Assets 15549 20954 21644 25502 33965 40672 21.8
9 Total Uses of Resources (6+7+8) 118309 145800 171323 206848 245529 258694 17.1
A - 28
Table 25 : Credit Flow of Commercial Banks by Purposes
(Rs in million)
Sectors As mid of July Annual Average
Growth Rates
(%)
Ninth Plan
1997 1998 1999 2000 2001 2002
1 Agriculture (Percentage 1063 1424 1803 2136 2667 2771 21.6
Share) (1.8) (2.1) (2.2) (2.2) (2.4) (2.4) (2.3)
2 Industry 24703 29750 35796 45206 48057 51031 15.9
(Percentage Share) (42.3) (43.4) (43.8) (46.9) (44.1) (44.2) (44.5)
3. Services 2338 2732 3374 4604 6635 7043 25.4
4. Trade 21641 25659 28478 32199 37456 38677 12.4
5. Consumption 8363 8752 11877 11216 13323 15009 13.2
6. Miscellaneous 270 301 431 965 884 1039 37.5
Total 58378 68618 81759 96325 109022 115570 14.7
* Preliminary Estimates, Nepal Rastra Bank.
A - 29
Table 26 : National Urban Consumer’s Price Index
(base year 1996/97=100)
Group and Sub-group of Commodities Fiscal Year Annual Percentage Change Annual
1997/98 1998/99 1999/00 2000/01 2001/02* 1997/98 1998/99 1999/00 2000/01 2001/02 Average
Growth
Rate (%)
Food and Beverages 107.8 125.2 125.8 122.9 127.4 7.8 16.1 0.5 -2.3 3.7 5.2
Restaurant (Drink) 111.7 125.9 135.9 146.8 151.5 11.7 12.7 7.9 8.0 3.2 8.7
Grains and its product 103.1 122.4 132.9 114.7 117 3.1 18.7 8.6 -13.7 2.0 3.7
Rice 103.4 124.8 136.9 116.8 118.1 3.4 20.7 9.7 -14.7 1.1 4.0
Pulses 97.6 116.5 111.9 114.6 116.8 -2.4 19.4 -3.9 2.4 1.9 3.5
Vegetables and Fruits 117.8 141.3 117.4 122.3 130.2 17.8 19.9 -16.9 4.2 6.5 6.3
Spices 107.7 131.8 133.6 144.7 147.7 7.7 22.4 1.4 8.3 2.1 8.4
Meat, Fish and Eggs 108.6 115.7 120.6 124 129.2 8.6 6.5 4.2 2.8 4.2 5.3
Milk and Milk products 107.7 117.9 122.2 129.2 130.7 7.7 9.5 3.6 5.7 1.2 5.5
Oil and Ghee 108.3 139.7 108.2 103.1 111.7 8.3 29.0 -22.5 -4.7 8.3 3.7
Sugar and Sweets 108.3 113.2 108.8 121.3 128.4 8.3 4.5 -3.9 11.5 5.9 5.3
Beverages 114.7 124.7 129.3 131.9 138.5 14.7 8.7 3.7 2.0 5.0 6.8
Non-Food Items and Services 109.1 115.4 123.5 133.5 136.3 9.1 5.8 7.0 8.1 2.1 6.4
Cloths and Clothing 106.9 113.3 118.6 121.2 124.1 6.9 6.0 4.7 2.2 2.4 4.4
Cloths 102.6 107.2 114.6 117.6 119.6 2.6 4.5 6.9 2.6 1.7 3.7
Cloths and Tailoring 107.5 113.6 117.6 120 122.1 7.5 5.7 3.5 2.0 1.7 4.1
Shoes and Slippers 110.2 115.3 117.4 119.2 121.1 10.2 4.6 1.8 1.5 1.6 4.0
Housing Services 106.2 110.5 118.3 132.2 134 6.2 4.0 7.1 11.7 1.4 6.1
Fuel, Electricity and Water 107.6 110.5 125. 2 153.1 169.6 7.6 2.7 13.3 22.3 10.8 11.3
Transportation and Communication 111.5 116.5 131 141.7 145.3 11.5 4.5 12.4 8.2 2.5 7.8
Medicinal and Personal Care 111.5 121.9 129.7 137.1 145.6 11.5 9.3 6.4 5.7 6.2 7.8
Education and Recreation 111.9 119.8 131. 6 150 148 11.9 7.1 9.8 14.0 -1.3 8.3
Cigarettes 116.7 121.9 128.7 131 137 16.7 4.5 5.6 1.8 4.6 6.6
All Goods and Services 108.3 120.6 124.7 127.8 131.5 8.3 11.4 3.4 2.5 2.9 5.7
* Revised estimates, Nepal Rastra Bank
A - 30
Table 27 : Situation of Balance of P ayment
(Current Prices)
(Rs. in million)
S.No. Description 1996/97 1997/98 1998/99 1999/00 2000/01* 2001/02** Annual Average
Growth Rates (%)
1 Export (F.O.B) 22637 27514 35676 49823 55654 47540 17.6
1.1 India 5226 8794 12531 21221 26030 28865 42.7
1.2 Other Countries 17410 18719 23146 28602 29624 18675 4.3
2 Import (C. I. F.) 93553 89002 87525 108505 115687 106731 3.3
2.1 India 24853 27331 32120 39660 45211 45364 13.1
2.2 Other Countries 68700 61671 55406 68845 70476 61367 -1.3
3 Trade Balance -70917 -61489 -51849 -58682 -60033 -59191 -3.0
3.1 India -19627 -18537 -19589 -18439 -19181 -16499 -3.1
3.2 Other Countries -51290 -42952 -32260 -40243 -40852 -42692 -2.1
4 Total Trade 116190 116516 123202 158328 171341 154271 6.6
4.1 India 30080 36125 44650 60881 71241 74229 20.3
42 Other Countries 86110 80390 78551 97447 100100 80042 -0.4
5 Proportion in Total Trade (%) 100.0 100.0 100.0 100.0 100.0 100.0
5.1 Export 19.5 23.6 29.0 31.5 32.5 30.8
5.1.1 India 17.4 24.3 28.1 34.9 36.5 38.9
5.1.2 O ther Countries 20.2 23.3 29.5 29.4 29.6 23.3
5.2 Import 80.5 76.4 71.0 68.5 67.5 69.2
5.2.1 India 82.6 75.7 71.9 65.1 63.5 61.1
5.2.2 Other Countries 79.8 76.7 70.5 70.6 70.4 76.7
6 Ratio of Export and Import (%)
6.1 Total Export Trade 24.2 30.9 40.8 45.9 48.1 44.5
6.1.1 India 21.0 32.2 39.0 53.5 57.6 63.6
6.1.2 Other Countries 25.3 30.4 41.8 41.5 42.0 30.4
* Revised estimates, ** Preliminary Estimates Nepal Rastra Bank.
A - 31
Table 28 : Situation of Foreign Trade
(at 1996/97* constant prices)
(Rs. in million)
No. Description 1996/97 1997/98 1998/99 1999/00 2000/01** 2001/02*** Annual Average
Growth Rates
(%)
1 Export (F.O.B) 22637 25405 29582 39954 43548 36152 11.1
1.1 India 5226 8120 10390 17017 20368 21951 34.9
1.2 Other C ountries 17410 17284 19192 22937 23180 14202 -1.6
2 Import (C. I. F.) 93553 82181 72575 87013 90522 81164 -2.1
2.1 India 24853 25236 26633 31804 35376 34497 7.0
2.2 Other Countries 68700 56945 45942 55208 55146 46667 -6.4
3 Trade Balance -70917 -56776 -42993 -47059 -46974 -45012 -7.8
3.1 India -19627 -17116 -16243 -14787 -15008 -12547 -8.4
3.2 Other Countries -51290 -39660 -26750 -32272 -31966 -32465 -6.8
4 Total Trade 116190 107586 102157 126967 134070 117316 1.0
4.1 India 30080 33357 37024 48822 55744 56448 13.8
42 Other Countries 86110 74229 65134 78145 78326 60868 -5.6
5 Proportion in Total Trade (% ) 100.0 100.0 100.0 100.0 100.0 100.0
5.1 Export 19.5 23.6 29.0 31.5 32.5 30.8
5.1.1 India 17.4 24.3 28.1 34.9 36.5 38.9
5.1.2 Other Countries 20.2 23.3 29.5 29.4 29.6 23.3
5.2 Import 80.5 76.4 71.0 68.5 67.5 69.2
5.2.1 India 82.6 75.7 71.9 65.1 63.5 61.1
5.2.2 Other Countries 79.8 76.7 70.5 70.6 70.4 76.7
6 Ratio of Export and Import (%)
6.1 Total Export Trade 24.2 30.9 40.8 45.9 48.1 44.5
6.1.1 India 21.0 32.2 39.0 53.5 57.6 63.6
6.1.2 Other Countries 25.3 30.4 41.8 41.5 42.0 30.4
*National Consumer Price Index at 1996/97 used as deflator, ** Revised estimates, *** Preliminary estimate, Nepal Rastra Bank.
A - 32
Table 29 : Export of Major Commodities to India
(at Current Price)
(Rs. in million)
Description 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02* Annual Growth Rate
(%)
Maize 0 4 0 0 0 0 0.0
Mustard 35 10 19 29 38 10 7.5
Herbs 53 51 31 61 72 72 14.2
Ghee 90 167 39 38 471 13 211.9
Dried Ginger 47 42 41 60 61 68 9.4
Pulses 511 199 281 970 714 999 47.8
Live Animals 183 163 54 72 46 32 -22.3
Flour 4 8 13 0 61 37 0.0
Ginger 141 167 152 162 162 174 4.8
… 104 124 165 222 213 279 22.7
…. 55 70 117 199 150 176 31.3
Salseed oil 0 0 4 52 0 2 0.0
Raw Jute 3 5 0 0 114 8 0.0
Jute Material 565 720 872 1104 1294 1630 23.7
… 69 156 153 104 51 45 5.8
… 75 267 298 403 540 609 70.1
Rope 421 297 420 597 703 976 22.1
Total 1791 1730 1789 2968 3394 3500 16.7
Others 3435 7064 10742 18252 22637 23735 51.3
Grand Total 5226 8794 12531 21221 26030 27235 41.5
*Revised estimates
** Preliminary estimate, Nepal Rastra Bank.
A - 33
Table 30 : Export of Major Commodities to Other Countries
(at Current Price)
(Rs. in million)
Description 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02* Annual Growth
Rate (%)
Pulses 528 858 916 87 501 216 79.4
Cardamom (Large) 0 0 5 0 22 72 0.0
Medicinal Herbs 18 14 10 15 26 23 12.8
Woolen Goods - - - - - - 0.0
Nepalese Paper (Paper made goods) 66 83 122 168 197 201 25.8
Skin and Skin made Goods 289 417 271 182 658 460 41.7
Carpets (Woolen) 8880 8485 9802 9842 8592 6210 -5.8
Garments 5955 7015 9702 13942 13125 7825 10.7
Handicrafts 142 135 174 218 234 217 9.8
Total 15878 17008 21000 24455 23355 15224 1.5
Others 1532 1711 2146 4147 6269 3451 27.3
Grand Total 17410 18719 23146 28602 29624 18675 4.3
A - 34
Table 31 : Balance of Payment
(at current Price)
(Rs. in million)
No. Description 1996/97 1997/98 1998/99 1999/00 2000/01* 2001/02** Annual Average
Growth Rates (%)
1 Export (F.O.B) 22663 27540 35693 49845 55677 51298 18.9
2 Import (C.I.F.) 93662 89154 87695 108624 115797 105821 3.1
3 Trade Balance -70999 -61614 -52002 -58780 -60121 -54523 -4.6
4 Service Income (Net) 39361 29128 30201 26446 22239 9070 -22.0
5 Service Income 53181 43496 45967 43085 41615 28817 -10.6
6 Tourism 8523 9882 12168 12074 11717 8654 1.8
7 Investment 1990 2377 3510 4569 5471 4297 19.1
8 Others 42667 31237 30289 26442 24427 15866 -17.0
9 Service Payments 13820 14368 15766 16639 19376 19747 7.5
10 Transfer Income (Net) 15130 17298 22036 23368 26928 30520 15.3
11 Transfer Income 16347 19065 23168 25267 28360 32491 14.8
12 Private Remittances Transfer 5595 6988 10315 12662 15903 20951 30.5
13 Foreign Grants*** 9743 10920 11648 11286 11001 9839 0.5
14 Indian Excise Refund 1009 1158 1205 1319 1456 1701 11.1
15 Others 0 0 0 0 0 0 0.0
16 Transfer payment 1217 1767 1131 1899 1433 1971 18.0
17 Current Account Balance (+/-) (a) Grants Included -16508 -15188 235 -8966 -10954 -14933 -792.9
(b) Grants Excluded -27260 -27266 -12618 -21571 -23411 -26473 7.8
18 Foreign Capital (Net) 8390 10370 9101 8485 6977 2963 -14.1
19 Foreign Loans*** 11233 14236 13264 12548 11715 8040 -4.7
20 Interest and Principal amount Payment -2843 -3867 -4164 -4063 -4739 -5077 13.0
21 Foreign Direct Investment 0 0 0 0 0 0 0.0
22 Other Capital and Unclassified Income (Net) 11320 15785 504 14929 9199 9479 553.6
23 Balance of Payment 3202 10966 9840 14448 5221 -2491 13.5
* Revised estimates, ** Preliminary estimate, Nepal Rastra Bank, *** Related with current account payment as a result it can not be compared with annex 1 and table 16.
A - 35
Table 32 : Balance of Payment
(At 1996/97 constant price)
(Rs. in million)
No. Description 1996/97 1997/98 1998/99 1999/00 2000/01* 2001/02** Annual Average
Growth Rates (%)
1 Export (F.O.B) 22663 25430 29596 39972 43565 39010 12.4
2 Import (C.I.F.) 93662 82321 72716 87109 90608 80472 -2.2
3 Trade Balance -70999 -56892 -43120 -47137 -47043 -41462 -9.4
4 Service Income (Net) 39361 26895 25043 21207 17401 6897 -26.4
5 Service Income 53181 40162 38115 34551 32563 21914 -15.5
6 Tourism 8523 9124 10089 9682 9168 6581 -4.0
7 Investment 1990 2195 2911 3664 4281 3268 12.4
8 Others 42667 28843 25115 21204 19114 12065 -21.5
9 Service Payments 13820 13267 13073 13343 15161 15017 1.9
10 Transfer Income (Net) 15130 15972 18272 18740 21070 23209 9.0
11 Transfer Income 16347 17604 19210 20262 22191 24708 8.6
12 Private Remittances Transfer 5595 6452 8553 10154 12444 15932 23.4
13 Foreign Grants*** 9743 10083 9659 9051 8608 7482 -5.0
14 Indian Excise Refund 1009 1069 999 1058 1139 1294 5.3
15 Others 0 0 0 0 0 0 0.0
16 Transfer Balance 1217 1632 938 1523 1121 1499 12.2
17 Current Account Balance (+/-) (a) Grants Included -16508 -14024 195 -7190 -8571 -11356 -770.6
(b) Grants Excluded -27260 -25176 -10463 -17298 -18318 -20132 3.0
18 Foreign Capital (Net) 8390 9575 7546 6805 5459 2253 -19.1
19 Foreign Loan*** 11233 13145 10999 10063 9167 6114 -10.0
20 Interest and Principal amount Payment -2843 -3570 -3452 -3258 -3708 -3861 6.9
21 Foreign Direct Investment 0 0 0 0 0 0 0.0
22 Other Capital and Unclassified Income (Net) 11320 14575 418 11972 7198 7208 531.1
23 Balance of Payment 3202 10125 8159 11587 4085 -1894 5.5
* Revised estimates, ** Preliminary estimate, Nepal Rastra Bank, *** Related with current account payment, as a result it can not be compared with annex 1 and table 16.
A - 36
Table 33 : Foreign Exchange Holding of Banking System
(Rs. in million)
No. Description 1996/97 1997/98 1998/99 1999/00 2000/01* 2001/02* Annual Average
* Growth Rates (%)
1 Convertible Foreign Exchange

38502 52638 68987 80321 80167 80669 16.9
2 Unconvertible Foreign Exchange
10039 12520 7664 13537 25005 25592 29.9
3 Total Foreign Exchange
48541 65158 76651 93858 105172 106261 17.5
4 Capacity bearing of Import of goods and services
(in months) 5.5 7.7 9.0 9.2 9.6 10.5
* Revised estimates
** Preliminary estimates, Nepal Rastra Bank.
A - 37
Table 34 : Some Major Economic Targets and Status of Achievements of the Ninth Plan
S.N. Description Unit Targets of the Ninth Achievements of the Achievements (%)
Plan Ninth Plan
1 Gross Domestic Product (at factor cost) Annual Average Growth Rate
(At 1996/97 constant price) 6.0 3.6 60.6
1.1 Agriculture “ 4.0 3.3 81.5
1.2 Non-agriculture “ 7.3 3.9 53.5
2 Gross Domestic Production (at Producer’s price) “ 6.5 3.6 55.4
3 Production of Major Agricultural Crops “
3.1 Cereal Crops “ 5.2 2.5 48.1
3.2 Cash Crops “ 6.5 5.3 81.5
3.3 Other Crops “ 4.2 3.1 73.8
4 Major Industrial Production “ 13.0 13.2 101.5
5 Increase in Tourists “ 10.0 -0.8
6 Increase in National Urban Consumer’s Price Index “ 6.5 5.7
7 Increase in Money Supply (M1) “ 13.0 15.7
8 Annual Growth Rate of Total Import “ 8.5 3.3
9 Annual Growth Rate of Total Export “ 11.0 0.5
10 Current Account Balance Amount
(a) Grants Included “ (-)0.9 (-)762.1
(b) Grants Excluded “ 1.7 7.0
11 Revenue Rs. in Million 210840 172225 81.7
12 Revenue Surplus “ 63130 22862 36.2
13 Total Public Expenditure “ 337290 278468 82.6
13.1 Regular Expenditure “ 147710 149363 101.1
13.2 Development Expenditure “ 189580 129105 68.1
14 Foreign Aid “ 111546 72419 64.9
14.1 Foreign Grants “ 32595 25164 77.2
14.2 Foreign Loans “ 78951 47256 59.9
15 Internal Borrowings “ 14904 24537 164.6
16 Gross Domestic Savings in Comparison to GDP Percentage 14.1 11.6 82.3
17 Total Investment in Comparison to GDP “ 24.7 24.4 98.8
18 Foreign Exchange Earnings “ 20 -5.5
A - 38
Table 35 : Some Major Physical Targets and Status of Achievements of
the Ninth Plan
S.N Description Unit Ninth Plan
Targets Achievements
1 Electricity Install Capacity* MW 598 585
2 Added Irrigation and Improve farmers cannel Ha 249,400 146703
3 Road ** Km
3.1 Black Topped “ 740 517
3.2 Graveled “ 1225 843
3.3 Earthen “ 952 749
3.4 Road Improvement and Reconstruction “ 758 1087
3.5 Periodic Repairing “ 2,954 733
4 Connection to More Districts by Road Number 12 4
5 Bridge Construction “
5.1 Motorable Bridge “ 87 99
5.2 Suspension Bridge “ 400 1000
6 Telephone Lines Per 100 people 2.5 1.4
7 Post Offices Number 900 895
7.1 Ilaka Post-office “ 100 95
7.2 Extra Post-office “ 800 800
8 Literate (Above 6 years) Percentage 70 55.5
9 Literate (Above 15 years) “ 70 49.2
10 Net Students Enrollment at Primary Level “
(above 6 years) 90 80.4
11 Net Students Enrollment at Lower-secondary “
Level 55 58
12 Net Students Enrollment at Secondary Level “ 45 37
13 Net Students Enrollment at Higher Secondary “
Level 60
14 Infant Mortality Rate Per 1000 live
births 61.5 64.2
15 Child Mortality Rate “ 102.3 91
16 Crude Birth Rate “ 33.1 34
17 Crude Death Rate “ 9.6 10
18 Maternal Mortality Rate Per 100,000
live births 40.0 41.5
19 Total Fertility Rate Per Woman 4.2 4.1
20 Life Expectancy Years 59.7 61.9
21 Contraceptive Prevalence Rate Percent 36.6 39.3
22 Availability of Important Health Services “ 70.0 70
23 Drinking Water Facilities “ 100.0 71.6
23.1 Rural Area “ 100.0 71
23.2 Urban Area “ 100.0 76
24 Sanitation Facilities “ 40.0 25
24.1 Rural Area “ 36.0
24.2 Urban Area “ 60.0
* Included Alternative Energy ** Only included Progress of Second-quarterly in 2001/02 and districts of
Dolidar of the Ministry of Local. Not included other local roads.
A - 39
Annex - 2
The Basis of the Formulation of
the Tenth Plan
Background
The Tenth Plan is the poverty reduction strategy paper of the country. Attempts have
been made to prepare this document on the basis of wide discussion and public
participation in order to make the Plan more realistic and create a sense of ownership
among all stakeholders. In view of all these aspects the plan formulation process is
arranged
Institutional Framework
A Coordination Committee was formed under the Vice-Chairman of the National
Planning Commission in order to coordinate the process of the Tenth Plan
preparation. Likewise, with the intention of coordinating the planning process of each
sector, Steering Committees were formed under the concerned members of the
Commission. To assist the above- mentioned committees, technical committees were
set up and the plan formulation of the line ministries were coordinated. Under this
process, the plan formulation tasks were carried out by the concerned ministries
through the task forces headed by the secretaries and comprising the concerned
planning officers, and the heads of the Departments. Some ministers hired the
services of the outside specialists. Hence, the sectoral plans were formulated with the
active involvement of the line ministries .
The National Planning Commission created various other taskforces for other areas
related to other different sectors. In order to carry out analytical studies and
homework in some areas and prepare the necessary study reports, the donor agencies
of conc erned sectors assisted in the areas selected by His Majesty’s Government.
While preparing the study reports and formulating sectoral plans, discussions at the
ministerial and departmental levels were held with the concerned specialists and the
stakeholders.
Interactions
The formulation of the Tenth Plan is based on its approach paper. While preparing the
approach paper of the Tenth Plan, discussions were held with various representatives
related to different sectors including the Parliamentary Committees, parliamentarians,
and national level intellectuals. Similarly, various discussions were held at the
regional levels by involving the representatives of the District Development
A - 40
Committees, Village Development Committees, and municipalities. The Approach
Paper was approved by the National Development Council.
The National Development Council

The National Development Council is the supreme body representing different
sectors/areas and classes to guide the planning process. The meeting of the Council
was held on 2nd and 3rd of Magh, 2058 (third week of January 2001) to discuss on the
draft of Approach Paper. In the meeting which was chaired by Right Honourable
Prime Minster, the ministers, state ministers and assistant ministers as well as the
leader of the opposition party, Chairpersons of different Committees of the House of
Representative, representatives of major political parties, secretaries of the ministries,
Vice Chancellors of the Universities, representatives of private sectors, various
professional organizations, NGOs, intellectuals and social workers, Chairpersons of
some DDCs representing the districts, representatives of the dalits (oppressed castes)
and indigenous nationalities, representatives of labour organizations and that of
women were present. About 150 persons participated in the above meeting of the
Council. Panel reports were presented after discussing in six sectoral groups. National
Development Council approved the draft Approach Paper subject to improve the
issues surfaced in the discussion. In light of the panel reports and the issues raised in
the discussions, the draft of the Approach Paper was finalized.
In the discussion consensus was made after wide interactions on the development
policies and strategies presented for the only development objective of poverty
eradication.
The main suggestions by the National Development Council on the
draft of the Approach Paper
• Both Gross Domestic Product and Gross National Product should be
considered for economic analysis.
• An effective institutional arrangement should be made for monitoring the
policies.
• National Planning Commission should monitor the implementation of the
programmes ascertained by the Agricultural Perspective Plan.
• The task of plan formulation should be made more analytical and systematic.
• Regular expenditure should be tied up with revenues and the regular
expenditure should be limited to a specific bound.
• The economic growth rate of 6.2 %, which is lower in comparison to poverty
alleviation target, cannot be considered as ambitious.
• The roles of the government agencies, private sectors, local agencies and
non-governmental organizations should be fixed on the basis of clear and
objective analysis.
• The credit policy should be encouraging to the small industries. The policy of
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small and domestic industries should be formulated separately.
• Policies should be adopted to attract the Nepalese people residing abroad.
• The process of privatization should actively be carried forward.
• Export Processing Zones should be set-up.
• The food security stocks should be maintained specifically in remote areas in
order to ensure food security.
• Timely amendments should be made in the labour act.
• Construct the second international airport.
• The development of tourism industry should be especially encouraged.
• The decade of agriculture should be observed with the slogan “The base of
stable economic development – Agricultural development”.
• The lowest bound of defragmentation of land should be fixed.
• The dual ownership of the land should be abolished in practic e as well.
• Institutional arrangements should be made and strengthened in order to
enhance the access to rural drinking water.
• Drinking water should be supplied to 100 percent of population as far as
possible.
• The cost of hydro-electricity projects should be lowered and leakages should
be stopped.
• A “Rural Energy Development Fund” should be created in order to develop
alternative energy.
• Arrange institutional mechanism at the district level for the development of
alternative energy.
• The surface irrigation system should be constructed by giving priority to only
those areas where people are prepared to pay water tariff.
• Rural electrification should be extended rapidly.
• Priority should be given to the projects related to the development of the
backward regions .
• In order to enhance the access of any region to rural telecommunication, the
subject-matters should be in the local languages.
• Emphasis should be given to develop low-cost housing.
• Prepare necessary documentations relating to intellectual property rights and
prepare the documentation of flora in Nepal.
• Primary education should be made compulsory and it should be implemented
as a national campaign.
• Higher Secondary Education should be made the final level of school
education.
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• The higher education should gradually run on the principle of cost recovery
and grants should be continued on rational and clear-cut basis.
• Owing to the other responsibilities, Tribhuvan University and Mahendra
Sanskrit University are to be made State University.
• Subjects as population, women/gender equality, environment, child rights,
and disability should be gradually incorporated in the educational curricula.
• Use system of providing health services through information technology.
• To be set up an effective mechanism for alternative health service.
• In relation to women mainstreaming, all sectoral chapters should include and
prepare programmes accordingly.
• Develop appropriate technology that helps enhance the productivity of
women in income generation activities and unleash the areas of activities
from gender discrimination.
• Honour the rights of the persons with disabilities and children by
empowering them.
• Make institutional arrangement from centre to district levels for the persons
with disabilities.
• Strengthen the children's bench.
• Classify the local bodies.
• Implement the process of time-bound decentralization.
• Provide employment to the indigenous nationalities.
• Empower the National Foundation for Development of Indigenous
Nationalities.
• Make free education to the dalits up to higher education.
• Provide loan without collaterals and exempt taxes if the dalits want to
modernize their traditional occupations.
• Special programmes should be introduced for dalit women.
• The programmes such as 'one dalit teacher in each high school' and a Dalit
Development Fund in each district as specified in the Ninth Plan should be
carried out.
• Necessary information against the practice of untouchability should be
incorporated in curricula.
• Provide the identity cards to the poor people.
• Alternative employment arrangements should be made to the labourers who
can be displaced by the construction of physical infrastructures.
• Give emphasis to cooperatives.
• Provide loans to the unemployed educated persons on the collective security
without collaterals.
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• Considering the subsidies extended by the agricultural sector in India, Nepal
also should arrange similar provisions in order enhance competitive
capability.
• The government should contribute some money to the Poverty Alleviation
Fund and extra taxes should be levied on the luxurious commodities to
support the Fund.
• The rural infrastructures should be developed through labour intensive
technologies and relate this work with the food programmes.
• In view of its effectiveness social mobilization should be institutionalized and
its monitoring and regulation systems should be made effective.
• The national development volunteer service should be mobilized as a
movement.
The above-mentioned suggestions were further discussed in the concerned technical
and steering committees and accommodated most of the suggestions in the Approach
Paper to give the latter its final shape. Accordingly, so as to implement the
Agricultural Perspective Plan, emphasis is given to declare Decade of Agriculture,
clarify the strategies, formulate development-oriented policies of the private sector
and emphasis is given to policy reform to attract the private sector in agriculture-
oriented businesses and areas such as industry, tourism, communication and
electricity; adoption of transparent process in project prioritization; mainstream the
women-related development activities in the concerned sectors; social development
and welfare aspects of education, drinking water and health as well as special
emphasis is given to targeted programmes to develop the backward and oppressed
communities, classes and areas. Furthermore, Such aspects as carrying out of primary
education as national movement and encouragement of access of backward classes
and communities to higher education are more visibly accommodated.
Interactions at the Central, Regional and District Levels:
Before presenting the draft at the National Development Council, discussions on it
were held among the stakeholders at different levels. Among them, interactions at the
regional, district and central levels and with the parliamentarians are noteworthy.
The regional interactions were held in all five development regions in the last week of
June 2001 (11-15 Ashadh, 2058). Chairpersons of all DDCs, representatives of the
national level political parties, office heads of the regional and district,
representatives of persons with disability, the dalits, indigenous communities
participated in these programmes. About 60 to 80 persons participated in the
interactions of each programme and panel discussions were held in five sectoral
areas.
Similarly, in the process of interaction, a discussion programme involving policy-
makers at the centre, representatives of the political parties, former Vice-Chairmen
and members of National Planning Commission, heads of educational institutions,
secretaries, representatives of financial institutions, former secretaries and former
governors of Nepal Rastra Bank, representatives of private sector, intellectuals,
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persons with disabilities, indigenous communities and women was conducted.
Similar type of interaction programmes were held while preparing the interim poverty
reduction strategy paper (I-PRSP) as a preliminary document of the Tenth Plan. In
addition to regional interaction programmes involving the district level leaders and
different stakeholders in seventy-five districts two separate regional-level interaction
programmes involving only women were held. These kinds of separate programmes
for women were held in the anticipation that different views from the women would
come up and also avoid hesitation of the women in the joint gatherings. However,
while interacting in the regional level programmes, women also equally participated
and similar views were presented in the context of mainstream of development.
As the task of formulating district development plan and that of the Tenth Plan are
complementary, another interaction seminar was held in the first week of October
2001 (Ashwin 22-23, 2058) jointly with the Federation of District Development
Committees on the Approach Paper of the Tenth Plan. In the seminar, chairpersons of
all DDCs and representatives of Federation of the Village Development Committees
participated.
The suggestions received from the interactions of different levels as mentioned above
on the preliminar y draft of the Approach Paper of the Tenth Plan cantered on such
issues as harmonization of the prioritization and budget allocation; market, improved
technologies and other complimentary policies should be adopted in order to
commercialize agriculture in line with regional viability; special emphasis on the
construction of agricultural and rural roads; provision of subsidies on sallow tube
well to develop ground water irrigation; stress on tourism development; development
of transportation in Mid-Western and Far -Western Regions which are the backward
areas in consideration of development; rapid extension of basic services such as
electricity, drinking water and health and different approaches to deal with the
accessible and inaccessible areas; prioritizatio n of regional potentials in development
activities; special arrangement for the income generation of the landless peasants;
linkage of the development of forests with the possibility of income generation and
poverty reduction; special emphasis on preventio n of soil erosion; emphasis in the
development of alternative energy in rural areas; transfer of school management
responsibility to the local communities; introduction of programmes to make the
liberated bonded labourers self-dependent; special initiation should be made to
empower the women; awareness programmes against girls' trafficking; tangible
programmes should be introduced for the development and educational improvement
of the persons with disability, indigenous communities, oppressed people, dalits;
policy arrangement for local sanitation programmes; making education more job-
oriented and practical.
Along with the above-mentioned suggestions, some other suggestions like the
linguistic changes and clarification of the policy matters in the approach paper were
also made. In consideration of these suggestions the preliminary draft of the
Approach Paper with necessary revisions was presented to the National Development
Council.
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Major suggestions received on the preliminary draft of the Approach
Paper from central, regional and district level interactions
• Budget should be arranged in accordance with the priority.
• Agriculture should be commercialized and made market-oriented based on
local potentialities.
• Increase the receptive capacity of all farmers.
• Conserve soil and diversify crops.
• Coordinate among the activities of the government, non-government and
private sector.
• Make special arrangements for the landless farmers.
• Provide resource to encourage private forests.
• Protect bio-diversity through active participation of the local communities
and develop tourism.
• Give more priority to regional potentialities while formulating the Plan.
• Foreign currency exchange counter should be set up in the Far-Western
development region to facilitate tourists.
• Give more emphasis on eco-tourism.
• Emphasize on micro forest products.
• Productive forest should be operated with the partnership of the local
communities in terai and inner terai regions and activities should be carried
out to conserve ground water.
• Involve the non-governmental organizations in the activities of institutional
development and agricultural extension services.
• Develop the pastures for animal husbandry.
• Lay emphasis on control of landslides and that of soil erosion.
• Encourage alternative energy.
• Operate Alternate Energy Promotion Centre under local bodies in order to
make it effective.
• District hospitals should be established in all districts.
• Local communities should be handed over the operation of up to secondary
level education.
• Investment should be increased in public education.
• Specific standards should be adopted pertaining to the levels and tuition fees
of the schools.
• Education should be job-oriented and practical.
• Bring uniformity between the curricula of the government and private
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schools.
• Regional universities should be set up and an umbrella act.
• Give importance to the renovation of irrigation system.
• Emphasize to carry out repairs of the cannel system.
• Develop simple and easy technology to domestically manage the solid
wastes.
• Formulate the district master plans of the roads.
• Expand the rural and agricultural roads.
• Socio-economic aspects should be considered more and more while
constructing the strategic road network as per the development strategies.
• Construct additional airports to attract the air services of the private sector in
the Himalayan and hilly regions.
• Arrange communication services in the rural areas.
• Make the counselling and other treatments available to the children affected
by the violent conflicts.
• Introduce reservation system (for employment, education and other
opportunities) to enhance women participation.
• Additional priorities should be extended to the women from the marginalized
indigenous and dalit communities.
• In the context of girls trafficking, programmes of rehabilitation, counselling
and medical cure along with public awareness should be carried out.
• Arrangement of protection and proper management should be made for the
people going abroad for foreign employment.
• Relating to drinking water, practical laws should be drafted/enacted to
resolve the disputes about the sources of water.
• Coordination should be made among the drinking water projects carried out
by various organizations.
• Institutional participation and responsibility of local bodies in drinking water
should be increased.
• The sources of water should be conserved and they should be properly
utilized.
• Improve the quality of drinking water.
• Introduce an effective plan in sanitation.
• Set up sewerage treatment centres in the urban and semi-urban areas.
• Launch poverty reduction programmes to the targeted poor people with
priority.
• Integrated development programmes along with road construction should be
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initiated.
• Stop increasing encroachment in the arable land and forests.
• Continue to take advantage of herbs / medicinal plants in a scientific manner.
• Give priority to construct the link roads to connect the national highways and
the roads which join the districts.
• Air transportation should be operationalized in the remote districts
inaccessible by road service.
• Necessary actions should be taken to discourage smoking.
• Make toilets compulsorily and provide subsidies to the poor to make toilets.
• Wage rates for the women and the men should be equal.
• Regional and district-wise poverty indicators/measures should be available.
• Policies should be formulated river training.
• Provide grants to install sallow tube-well.
• Emphasize to produce wool for the woollen carpets in the western mountain
districts.
• Reduce the operational expenditures for poverty eradication programmes.
• Introduce necessary programmes to make the freed bonded labourers
(kamaiya) self-dependent.
Project Prioritization
In order to achieve the goal of poverty eradication without delay, it is necessary to
enhance the quality of projects and programmes. For this, the process of project
prioritization should be implementation from the very beginning of plan formulation.
The Public Expenditure Review Commission has also pointed the need of project
prioritization to strengthen the implementation and selection aspects of the plans. In
comparison to the previous plans, the Tenth Plan has used project prioritization as a
new instrument. The projects and the programmes have been prioritized mainly on
eight criteria: (1) Direct contribution to the national goal of poverty er adication, (2)
Contribution to the sectoral priority, (3) Regional balance (4) Necessity of
government’s involvement in the programme/project, (5) Situation of public
participation, (6) Involvement of the local bodies in line with decentralization, (7)
Contribution in enhancing private sector’s involvement/ competition, and (8)
Achievements in the past in the context of the on going programmes/projects.
As the overarching national goal of the Tenth Plan is poverty eradication, the
proposed projects and programmes in all sectors should correspond to the national
objective of poverty eradication. In this context, the national goal is taken as the
criteria of project prioritization. Like-wise, the next basis for prioritization is how
sectoral priorities have contributed to the sectoral objectives adopted by the Plan.
As development has not been balanced throughout all regions and some regions have
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especially left behind, this Plan contemplated to prioritize to carry out projects in
backward regions by analyzin g the question of regional balance in an objective
manner. Taking this into consideration, the aspect of regional balance is taken as
another criteria for prioritization.
The Tenth Plan has adopted the policy of emphasizing the involvement of the private
sector in the national development process. In this context, as the private sector has
been involved in various projects and programmes, the involvement of His Majesty’s
Government may not be necessary at all or may be less desirable. In case of the lesser
involvement of His Majesty’s Government, the reduced financial liability thereby
generates national savings which can be devoted to other important areas. In this
light, the concept of reviewing the involvement of His Majesty’s Government in
carrying out proposed projects/programmes is adopted and the necessity of the
involvement of His Majesty’s Government is taken as a criteria of prioritization.
It is obvious that projects having more public participation improve their qualities and
are more cost effective. Considering the increasing expectations of the general public,
public participation is also taken as the criteria of project prioritization as it is
necessary to develop analysis of public participation in projects objectively.
Since decentralization is the principal foundation to maintain good governance in the
country and effectively implement the projects, it is imperative that the programmes
and projects be transferred more and more to the local level. Bearing this in mind,
emphasis is given to the local participation aspect in the proposed projects and
programmes and this (local participation) is also taken as the criteria of project
prioritization.
In order to develop the private sector, the role of His Majesty’s Government should
be made as the facilitator. In this context, the programmes of enhancing the private
sector participation should be emphasized and as it is important to analyse the roles of
the proposed projects and programmes to this end, the issue of enhancing private
sector partic ipation is also taken as a principal criteria of project/programme
prioritization.
Since past performance is also important for the on going activities, progress
indicators of such projects or programmes are taken as the bases of project
prioritization.
Based on all the criteria presented above, the process of evaluating the qualities of the
projects/programmes is adopted by calculating on the basis of the categorization of
‘very good’, ‘good’, ‘general’ and ‘poor’ (3, 2, 1, 0). Among the eight criteria
mentioned above, the first four criteria are used in all sectors and the rest four are
used by modifying as per the needs of the sectors in question. The bases used by
modifying are limited to in the concerned sectors.
Based on the score derived by evaluating each project/programme on the above bases,
the projects and programmes are categorized into priorities I, II and III. If resource
does not permit, the projects falling in the second and third priorities are thought to be
curtailed.
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In consideration of the priorities of the projects and programmes, the evaluations,
priority scores and related resource allocations are presented at the chapters of the
relevant sectors. The table and the process of the use of prioritization bases are
recommended as follows.
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Calculation of the Prioritization of the Projects (Policy Action Matrix Activities)
Score: Poor = 0, Satisfactory = 1, Good = 2, Very good = 3

Activities/programmes 1. 2. 3. 4. 5. 6. 7 8. 9. 10. 11.
based on sector (in Contribution Sectoral Regiona Necessity Peoples Participation Enhance Pas t Overall Propos Amount
line with policy action to attain the prioritie l of the Participation of the local private progress evaluatio ed decreased/
matrix) overarching s Balance involveme bodies sector (for the n (%) amount increased/n
national nt of His (decentralizati participation on going (score (in ew projects
goal Majesty’s on) activities) obtained / million (%)
Governm total rupees)
ent score) x
100
Activities 2 3 3 2 3 Not applicable 2 3 (18/21) x 14.5 15
100 =
85.7
A
B
C
D
Etc.
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Suggestions for the prioritization of projects and programs:
The method to prioritize by assigning scores is suggested below. The suggestions are
based on the recommendations of the Public Expenditure Review Commission
regarding project prioritization.
1. Direct contribution to the national goal of poverty eradication
a) Much positive contribution through income and employment generation,
improvement of social condition or through targeted programs = Very good =
3.
b) The direct general contribution = Good = 2.
c) Ordinary/indirect contribution = Satisfactory = 1.
d) Zero or negative contribution = Poor = 0.
2. Contribution made to the sectoral pr iority
a) The direct contribution to sectoral priorities and much positive contribution =
Very good = 3.
b) The direct general contribution = Good = 2.
c) Ordinary/indirect contribution = Satisfactory = 1.
d) Zero or negative contribution = Poor = 0.
3. Regional Balance
a) Direct contribution to the development of the Far -Western and Mid-Western
regions = Very good = 3.
b) Contribution to the development of the Central and Western regions = Good
= 2.
c) Other general programmes = Satisfactory = 1.
d) Unnecessary and overlapping activities = Poor = 0.
4. Necessity of the government’s involvement in the program
a) Important activities in which there is no involvement of the private sector at
present, nor there seems to be any possibility of their involvement in future =
Very good = 3.
b) Important activities where the private sector has been insignificantly involved
and there is no significant attraction in the future too = Good = 2
c) Important activities where the participation of the private sector has been
between 30 % and 50 % and there is some attraction for them in future =
Satisfactory = 1.
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d) Areas of excessive attraction to the private sector = Poor = 0.
5. Status of the People Participation
a) Existence of people participation in programme formulation, implementation
and cost sharing at present and possibility of complete management by them
in the future (as per the standard specified by HMG/N) = Very Good = 3.
b) Existence of people participation in programme formulation, implementation
and cost sharing at present only (as per the standard specified by HMG/N) =
Good = 2.
c) There is people participation only in the formulation and implementation of
the program but not in cost sharing = Satisfactory = 1.
d) People participation in none = Poor = 0.
6. Involvement of the local bodies in correspon dence to decentralization
a) Project/programme with sufficient budget and authority are assigned or
proposed to do so to the local level offices = Very good = 3.
b) Project/programme with normal budget and authority are assigned or
proposed to do so to the local level offices = Good = 2.
c) Project/programme without sufficient budget and authority are assigned or
proposed to do so to the local level offices = Satisfactory = 1.
d) Project/programme suitable to operate by the local level but proposed at the
central level = Poor = 0
e) Any Project/programme transferred to the local level without resource
assurance = Poor = 0.
7. Contribution to enhance the private sector’s participation/competitiveness
a) Project/programme that enhance competitiveness or partnership of the priv ate
sector = Very Good =3.
b) Project/programme carried out jointly with the private sector = Good = 2.
c) Project/programme that is competing with the private sector = Satisfactory =
1.
d) Project/programme that contributes to monopoly or subsidy and hinders the
entry of the private sector = Poor = 0.
8. Past achievements made in case of on going programmes

1) Past physical progress (up to last three years) is more than 90% = Very good
= 3.
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2) Past physical progress (up to last three years) is between 75 % and 90 % =
Good = 2.
3) Past physical progress (up to last three years) is between 50 % and 75 % =
Satisfactory = 1.
4) Past physical progress (up to last three years) is less than 50 % = Poor = 0.
Some Clarifications
1. What can be the weights? Should they all be equal?
As we have started this process just recently, it is suggested to use it without any
weight. The use of weightage method may bring complications.
2. General fundamental procedures:
The bases of prioritization may be changed (increased/decreased/altered) based on the
nature of the sector. The four bases mentioned below are suggested to be used to
prioritize all activities. The other bases can be changed/altered if it is necessary to do
so.
a) Direct contribution to the national goal of poverty eradication
b) Contribution made to the sectoral priority
c) Regional Balance
d) Necessity of the government’s involvement in the program
3. The suggested order of procedure
a) Prepare the policy matrix/table
b) Determine priority according to the nature of the sector
c) Reconciliation between the prioritized programs and available budget ceiling
d) Present the results at the National Planning Commission
e) Amend the sectoral plan
Policy and programme log frame
The Tenth Plan has used the policy and programme log frame in order to strengthen
the implementation and monitoring aspects of the programmes and to link
formulation of the Plan and its programmes to the national goal. The policy and
programme log frame are prepared for all sectoral areas of the entire plan. The
sectoral log frame are formulated in two parts: (a) as a summary of at the national
level and (b) as additional explanation of the major programmes. The first category
incorporates such aspects as the overall goal, policies and major activities of the
sector whereas the category that follows presents particulars of other policies and
activities assuming the major activities incorporated in the former category as the
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results.
While preparing the policies and policy and programme log frame, the overall
sectoral goals matching the overarching national goal of the Tenth Plan are identified
and sectoral policies/operational policies are presented in line with the overall
sectoral goals so identified. Attempts have been made to provide the outcome
indicators from the implementation of those policies / operational policies and the
sources of those indicators (responsible persons/authorities/organizations).
Subsequently, major activities to support the policies and operational policies are
listed and the risk and assumption aspects are identif ied. By identifying the risk and
assumption factors, it is assumed that the implementers will be cautious to
forestall/avoid the same. Hence, six aspects are included while preparing the policy
and programme log frame: 1. Goal(s), 2. Policies / Operational policies, 3. Outcome
indicators, 4. Sources of information, 5. Major programmes, and 6. Risks and
assumptions.
The national level policy and programme log frame are attached with the sectoral
chapters and the details of the major programmes are presented in Annex III. The
format of the policy and programme log frame is as follows:
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Policy and Programme Log Frame
Sector/Name of the Ministry: …….
Overarching national goal: ………………………….
Overall goal of the sector: ……..
Goals/Objectives Strategies Indicators Source of Major Risks and

Information Programmes obstacles
Sectoral Mention the Mention the Disclose the List major Mention the risk
objectives: strategies / attainable and sources of programmes factors that can
Mention the policies measurable information in line with hinder the
sectoral goals that adopted to quantitative to monitor the goals and programme
can be attained fulfil the objectives that the strategies. implementation.
during the Plan sectoral gauge the progress
period goals. sectoral goals made in
realizing the
indicators
Results/outcomes: Policies Identify the Disclose the Present Mention the
and Action indicators sources of major risk factors that
Explain each of the Plan: reflecting the information activities can hinder the
major programmes results/outcomes in order to under each programme
listed in the fifth State the and state their monitor the major implementation.
column above. policies quantitative progress programmes.
adopted to targets. made in
accomplish indicators.
each major
programme.
Economic Growth and Investment Analysis:

While projecting the economic growth rate, investment and other major indicators for
the Tenth Plan, macroeconomic model analysis, incremental capital-output ratio
(ICOR) and input-out (IO) analysis are tak en as the key bases. Required indicators are
projected by adjusting the proportions of means of production and the production
with the macro model.
While analyzing the incremental capital-output ratio, the relations among variables of
last ten year are examined by using linear regression analysis method. Similarly,
expected investment and sectoral production growth is projected in two scenarios:
normal case scenario of 6.2 percent per year and alternative case of 4.3 percent per
year. If the internal and external socio-economic environment does not remain
favourable, the alternative production growth is expected to attain.
While analyzing the incremental capita-output ratio, impact of the cumulative
investment of the past years is used as the basis. For the agriculture, industry,
A - 56
restaurant and hotel as well as finance and real estate sectors, the impact is measured
by a one-year lag investment of the respective sectors; for the transportation and
works and communications sectors, the impact is measured by a two-year lag
cumulative investment of these sectors; and that for electricity sector three-year lag
cumulative investment. These cumulative investments are expected to explain more
than 96% the variations of the respective sectors' GDPs.
Likewise, the coefficients related with the concerned variables seem to be statistically
significant with high precision. As the figures obtained by the analysis are
satisfactory, they are used to project the incremental capital-output ratios. (For detail
see the referenc e notes.)
Altogether 51 equations and identities are used in the macro model. Among them, 8
relating to value added, 5 relating to consumption, money supply and price, 8 relating
to employment, 4 relating to import, 6 relating to taxation and 20 relating to other
definitional identities were used.
From the analyses of the aforementioned relations, the incremental capital-output
ratio, sectoral investments and final demand are projected. The projected demand is
adjusted with the input-output analysis to pro ject the realistic sectoral growth rates.
The analysis of productions and their respective factors of production are explored in
25 sub-sectors. Their projections in turn are incorporated in eight major sectors of 1.
agriculture, 1. industry and mining, 3. electricity, gas and water, 4. construction, 5.
trade, hotel and restaurant, 6. transportation and communication, 7. finance and real-
estate, and 8. social service respectively to analysis the sectoral growth rates.
The incremental capital- output ratios and likely sectoral economic growth rates
calculated by utilizing macroeconomic (macro models) and input-out analyses are
presented in the table below.
Table: Incremental capital-output ratios (ICORs) and sectoral economic growth
rates calculated through macroeconomic analysis
Sectors Incremental Capital -Output Annual Growth Rate of
Ratios Sectoral GDP
Agriculture 2.52 4.1
Industry 2.42 6.2
Electricity, Gas, and Water 15.45 10.1
Construction 0.71 7.7
Trade, Restaurant and Hotel 2.75 7.3
Transportati on and Communication 8.27 7.4
Finance and Real-estate 7.50 5.4
Social Service 7.12 8.3
Total 4.5 6.1
Fiscal year 2001/02 has been taken as the base year while formulating the Tenth Plan.
The economic growth rates have been adopted essentially the same as the findings of
the sectoral macroeconomic analyses. The projected economic growth rate of 6.1%
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based on the analysis of the production and factors of production is replaced by 6.2%
adopted by the Approach Paper with major changes in the growth rates in some
sectors. As a result, minor changes are made in some sectors. The incremental capita-
out ratio is expected to improve by only 5% during the Tenth Plan as compared to the
figure projected in the Ninth Plan based on the investment-output. In anticipation of
the upsurge of the investment of the private sector, it is likely that the ICOR can
further improve during the Plan. If it is so, higher economic growth rate compared to
the projected one can be realized. Analysis of economic structure and input-output
ratios can be found in the reference materials in detail.
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ANNEX THREE
Sectoral Policies and Policy Matrices

(Logframe)
Pages
3.1 Macroeconomic sector A-59
3.2 Agriculture and Cooperative A-72
3.3 Forest and Soil Conservation A-80
3.4 Land Reform and Management A-86
3.5 Tourism, Culture and Civil Aviation A-89
3.6 Industry, Commerce and Supplies A-96
3.7 Labour and Transportation Management A-97
3.8 Electricity Development A-105
3.9 Irrigation and Water-borne Disaster Management
3.9.1 Irrigation A-109
3.9.2 Water-borne Disaster Management A-118
3.10 Road Transportation A-122
3.11 Information and Communication A-123
3.12 Science and Technology A-127
3.13 Housing, Building and Urban Development A-132
3.14 Population and Environment Management
3.14.1 Population Management A-137
3.14.2 Environment Management A-140
3.15 Education and Sports A-142
3.16 Health A-149
3.17 Drinking Water and Sanitation A-155
3.18 Women, Children and Social Welfare A-159
3.19 Local Development A-167
3.20 Good Governance, Developed Administrations and Human Rights
3.20.1 Good Governance and Developed Administration A-172
3.20.2 Human Rights A-176
3.21 Decentralization. A-179
A-59
3.1 Policy Matrix (Logframe) : Macro Economic Sector*
Overarching National Objective: Poverty incidence of the Nepalese people (men and women) will be reduced significantly and in a sustainable manner.
Sectoral Macro Objective: Recurrence of Broad Based Economic Activities.
Sectoral • Improve financial policy. • Domestic savings/ratio to reach 16.2 • Publications 1. Interest rate will be made • Adverse effec t in
Objectives: • Improve public expenditure percent against the present ratio of of Central positive to increase Domestic investment
Consistency 11.6 percent. Bureau of Savings
management. • Financial
between 2. Revenue collection will be
• Adopt suitable monetary policy. • Budget deficit not to exceed 5.5 Statistics. increased by bringing more imbalance
economic • Create congenial environment percent of the GDP. • Economic transparency in administration. • Imbalance in
resources and that can attract foreign • Regular expenditure as a proportion survey, 3. Prudent management public application of
expenditures assistance. of GDP will be reduced to at least 9.7 Ministry of expenditure will be in place. means.
• Consistency of mone tary policy percent. Finance. 4. To maintain monetary stability • Extensive
with real sector. • Revenue surplus to cover 20 percent • Financial by controlling credit. declination in net
Report, Nepal 5. Linkage of foreign assistance
• Formulate favorable policies in of development expenditure with with plans and program. foreign asset.
relation to foreign trade and reform. Rastra Bank. 6. Make balance of payments • Policy and
external economic relation. • Revenue to be a minimum of 14 • Nepal Rastra favorable. programs of
• Adopt privatization policy to flow percent of GDP. Bank 7. Promote foreign investment donor agencies.
the facilities and infrastructure in • Interrelation existing between • Privatization 8. Privatize public enterprises. • Imbalance in
competitive environment. savings, revenue and expenditure Section, 9. Make the public debt dynamic. flow of service
• Adopt policy to encourage the management based on budget Ministry of 10. Banks and financial system will net and transfer
system established. Finance. be made second and balanced net income.
use of internal and external as well as reliable.
public debt in areas which yield • M2 to increase only by 14.5 percent. • Security • Attitude of
quick and better returns. • Annual surplus Rs. 3.7 billion in Board and Foreign
• Policies will be practically put in balance of payments. Nepal stock investors.
use such that state-owned • Inflation contained at less than 5 Exchange.
banks and financial institutions percent. • Insurance
be able to work in deregulated • A rise in the proportion of foreign committee
and competitive environment. investment in total investment and progress
witnessed. report of other
• Flow of adequate resource from Insurance
capital market companies
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• Policy will be taken to raise of • Comparative contribution made from 11. To develop and extend the • Limitations of
financial resources through contractual savings and investment capital market. ability to procure
capital market for the expansion institutions in the economy. 12. To develop and extend the national debt
of economic activities • Number of customers in Insurance contractual savings and and policy and
• Adopt policy to increase the business. investment institutions. attitude of
contribution of contractual • Growth rates of import and export. 13. To develop and strengthen foreign loan
savings/ investment necessary insurance sector. donor.
for in providing resources • Strength of
needed for the implementation management
of economic activities. side
• Pursue policy to develop • Public reliance.
insurance sector as a • Competitive
dependable instrument in potentiality of
financing economic activities. Insurance
agencies.
* Quantitative targets based on 6.2 percent of economic growth.

Outcomes/ • Policy • Increased household capacity • Economic • To launch programs which can assist in • Institutional
Results • Priority to institutional to save. survey. raising the income of agricultural as well management
1. Growth in savings • Additional savings in private • Economic Report as non-agricultural sector for the
Domestic • Reform public enterprises. and public business of Nepal Rastra • To develop interest rate relative to entrance of
savings • Effective implementation enterprises. Bank. deficiency reflecting tool of financial external
of mid- term expenditure • Increase government savings. • Report of other means. resource.
framework • PEs operated at profit. related • To mobilize financial institutions for the • Attractive and
• Privatization of public • Domestic Savings ratio institutions. extension of micro-business perpetual
enterprises reaching 16.2 percent • To formulate program s which can bring structure of
• Minimize government the remittance obtained from foreign interest rate.
subsidy. employment into banking network. • Availability of
• Strengthening of • To make participatory program based on sufficient
administration government-private sector partnership for means.
the formulation of revenue policy
• To accelerate the program that maintains
the number of employee to appropriate
level.
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2. Increase in • Broaden and expand the • Increase in number of tax • Economic • To organize programs like seminar, • Favorable
revenue tax base. payers, the number registered survey. training, to bring all the income climate for
collection • Increase in elasticity in income tax and VAT will • Economic Report generating sectors within the ambit of agriculture.
revenue reach 3,00,000 and 40,000 of Nepal Rastra income tax. • Law and
• Develop Value Added respectively. Bank. • To adjust tax rates considering foreign order
Tax(VAT) as the prime • Revenue ratio to be raised to 14 • Progress report trade structure, protection of industrial situation
basis of revenue. percent. of Internal enterprises, World Trade Organization • External
• To make tax • Manuals about the processes revenue Membership and South Asian Free sector
administration more and agencies to be contacted Department Market Management. situation.
simple, tra nsparent and for tax -payments prepared to be • To bring substantial program in order to
sound. understandable by the public. increase the proportion of VAT in
• Revenue surplus to revenue collection.
development expenditure
targeted at 20 percent.
3. Optimum use • Assurance of transparent • Effect of foreign assistance in • Economic • Implementing Foreign assistance in High • Continuation
of foreign and effectiveutilization of employment and income survey. priority programs through prioritization of of favorable
assistance foreign assistance. growth. • Economic Report development programs. policy of
• Adopt of policy to make • Share of foreign assistance in of Nepal Rastra • To formulate programs, which can assist foreign donor
grant and loan priority sector. Bank. in developing skill and technology countries and
concessional. • Access of vulnerable group and • Report of donor through available foreign assistance by multi-
• Priority to grant than loan. less developed remote area to agencies increasing the skill and competence of dimensional
resources . local people, to contribute in future as institutions.
• Increase in number of well. • Continuation
programs completed in time. • To arrange policy wise management to of the system
promptly solve any problem related with allowing
foreign assistance. reimburseme
nt of expense
expended by
Nepal.
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4. Effective • Flow of national resources • In proportion to GDP • Economic • To make plans, the major basis. • Arrangement
public into priority sector. • National savings 23.1 percent survey. • To enforce compliance of the economic of Financially
expenditure • Austerity in public and total investment 27.7 • Economic Report rules and regulations strictly. accountable
management expenditure and percent of Nepal Rastra • To flow the means on the basis of act.
improvement in • Regular expenditure 9.7 Bank. effectiveness of investment. • Availability of
expenditure management. percent and development • HMG’s white foreign
• Undertake the financial expenditure 11.5 paper means.
management process • Internal debt 1.4 percent.
based on decentralization. • Foreign debt 3.9 percent.
• Reduce the need of
Foreign assistance.
• Maintain economic
discipline.
5. Maintenance • Mobilize financial • Monetary extension M2 not to • Monthly, annual • To bring economic and monetary • Flow of
of monetary resources to support exceed above 14.5 percent and economic program that extends the credit to private foreign
stability economic activity • Adequate foreign exchange reports of Nepal sector through reduction in credit resources.
expansion. reserve supported by Rastra Bank and supplied to government • Budget deficit
• Prevent the deterioration favourable balance of other reports. • To reduce the monetary expansion situation of
of macro economic payments. possible through excessive flow of HMG.
balance while adopting • Loans to private sector not to Foreign assets, Nepal Rastra bank will
monetary and credit be less than 70 percent of total formulate program to sell government
expansion. loan. debenture and if needed will issue its
• Make balance of • Growth of credit to government own instruments.
payments fovourable. to increase by 6.3 percent
• Maintain money supply annually.
within desirable limit. • Price rise remaining less than 5
percent.
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6. Favorable • Broaden export base and • Import to cover at least 55 • Economic survey • To formulate program that helps export • National and
balance of make it sustainable. percent of export. • Economic Report by sectors and rise diversification. international
payment. • Link import with the • Current account deficit not to of Nepal Rastra • To formulate programs so that the law and order
material needed for export exceed 3 percent of GDP. Bank. Foreign-based diplomatic mission of situation.
and development • Increase in import of raw • Quartely bulletin Nepal may contribute in promoting • Lack of
• Make the service and material and capital goods than of Nepal Rastra foreign trade. demand due
transfer sector, consumable goods. Bank. • To confirm business institutional to external
transparent and attractive. • Annual surplus of 3.7 billion in • Publications of programs so that the demand of economic
• Create and extend balance of payments. Federation of Nepalese goods may reach Economic recession.
industrial investment • Foreign exchange reserve Nepal Chamber ordering unit. • Competitive
friendly environment. adequate to cover import of of Commerce, capacity.
• Make exchange rate time- goods and service for at least 6 and Industry and
regime timely. months. Nepal Chamber
• Attract official resources in of Commerce
the capital account of
BoP.
7. Promotion of • Provide additional • Increase in foreign investment • Reports of • To launch programs providing additional • National/
foreign incentives and facilities in total investment compared to Ministry of incentives and facilities and to reinforce international
investment. which can attract foreign past. Industry, legal structure. law and order
investment and to • Identification of additional areas Commerce and • To implement foreign investment situation.
formulate legal structure for foreign investment. Supplies. supportive programs after identifying • Availability of
investment policy. • Foreign investment to • Statistics of them. facilitating
• Make administrative supplement national foreign trade and • To formulate programs to provide agents and
procedures transparent, investment. balance of information to related investor. infrastructure
easy and simple. payments • To formulate investment promotion for foreign
• Institutional development secti on of Nepal friendly programs through Share Market. investment
of institutions responsible Rastra Bank. • To bring programs to encourage foreign
for investment promotion. • Economic investors through diplomatic missions of
survey. Nepal.
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8. Management • Carry the process of • Quantitative increase in number • Report of • To conduct programs related with the • Entrance and
and privatization privatization in competitive of shareholders. Privatization unit evaluation of institution to be privatized, release of
of public environment. • Privatization of 15 enterprises of Ministry of protection of employee interest, study time-relevant
enterprises • Not to support monopoly during the plan period, with at Finance. and analysis of returns etc through labour.
in any circumstances least 3 per year. • Write-ups and government investment. • Concern of
during the process of reviews on • To make arrangements to empower assistance
privatization. privatization by commission that studies the procedure of provider in
• Generate share ownership experts. privatization and work efficiency of privatization
on broad base enterprises. of institutions
• Enterprises deemed • To formulate essential programs by the constructed
necessary to be in the privatization unit for the privatization of through
public sector will be the enterprises on the basis of priority foreign
operated on commercial and to monitor them. assistance
basis.
9. Public • Maintain foreign debt at • Level of foreign debt. • Economic survey • To supply foreign loan in priority sector. • Policy and
expenditure manageable level. • Foreign debt servicing. • To formulate programs to utilize foreign program of
management • Gradually reduce internal • Internal loan to GDP not to loan assistance in economic sector that donor
made prudent loan. exceed 1.6 percent. assists in increasing productivity and countries and
exports. institutions
• To formulate program that can assist in • Condition of
making the revenue and expenditure internal debt
administration simple and transparent. mobilization.
A-64
10. Banking and • Develop balanced • Increase in contribution of • Reports of Nepal • To arrange the machinery that can assist • Stability in
financial system financial sector capital market, contractual Rastra Bank, in maintaining high level of coordination regulatory
: balanced, • Make regulations of savings/investment and life Security Board, between regulatory agencies of financial condition of
soundand financial sector effective. insurance in long-term Insurance sector. HMG, Nepal
reliable • Establish coordination investment. Committee, • To bring programs, which will help to Rastra Bank,
between financial • Reduction in financial misuse Citizen develop institution management that can Security
resources and nature of and crime. Investment Fund, regularly project the demand and supply Board,
loan/investment. • Business oriented credit of Employee of financial resources . Insurance
• Develop security-oriented banks and financial institutions. Provident Fund. • To bring programs to assist in Committee,
loan into business • Promulgation of credit situation • Reports of reinforcem ent of regulatory capacity of Nepal Stock
oriented loan/investment. of banks and financial Ministry of financial regulatory agencies. Exchange
• Develop good governance institutions. Finance, Ministry • To establish credit rating system. and Institute
in institutions involved in • Generation of production and of Industry, • To arrange security funds/ insurance of Chartered
resource mobilization and profit of organized institutions. Commerce and programs for the security of the Accountants.
utilization. • Implication of accounting Supplies, Nepal savers/investors.
• Strengthen the protection standard. Stock Exchange. • To make program that can make the
system of saver/investor’s • Regularity in project sanction • Annual reports of management, transaction of banks and
and analysis of business/assets organized financial institutions as well as activities
institutions. of regulatory agencies transparent.
• Make coordinated reforms • Management of saver’s, • To formulate and implement Accounting

in banking and financial investor’s security fund and and Book-Keeping System as per
acts and regulations insurance scheme. international standard.
• Incorporation of financial
institutions other than capital
market and insurance related
institutions in regulatory frameof
Nepal Rastra Bank.
A-65
• To establish a system that legally • Indifference
regulates the process of project of general
formulation, business/asset evaluation public
etc. towards bank
• To implement appropriate Institutional and financial
Code of Good Governance to develop system.
Good Governance System
• To study the legal, institutional and
ownership structure of government
finance dealers.
• To bring all the financial instructions
except the capital market and insurance
related institutions under the regulatory
frame of Nepal Rastra Bank.
• To implement program of coordinated
reform in company law, bankruptcy law
including financial law.
A-66
11. • Create broad share • Ownership of at least 3 percent • Publications, • To conduct program to encourage
Development ownership situation. of total population in share reports of organized institutions to issue shares as
and expansion • To develop capital market capital of organized institutions. Security Board, much as possible.
of Capital as important supplier of • Mobilization of a minimum of Nepal Stock • To make market shares available to
Market long-term capital. Rs. 5 billion from Security Exchange. public as much as possible through
• To increase the width and market. security market while privatizing public
depth of security market. • Transaction in stock exchange enterprises.
• Make the security market market to reach Rs. 10 billion. • To make necessary legal and institutional
fully transparent and • Increase in number of arrangements to encourage organized
reliable. institutional investors in security institutions of public and private sector
• Increase the liquidity of transaction. and municipality to raise capital by
security market. • At least 40 additional organized means of security.
• Make arrangements for institutions being listed. • To set an environment to invest
immediate transfer of • At least 50 percent share in resources of means of contractual
share ownership. security transaction belonged to savings/ investment institutions and
• Coordinate security contractual savings/investment insurance funds in security.
market with the institutions institutions and insurance • To make necessary arrangements to
and organizations regional companies. actualize security transactions outside
and international level. Kathmandu valley.
• Market capitalization reaching • To make legal and institutional

at least 15 percent of GDP. arrangements to enhance the
participation of institutional investors in
security market.
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• To conduct programs to encourage the
organized institutions in development of
different types of security based on the
nature of savings/means.
• To set an environment to collect money
for non-import local expenditure through
marketing of debenture in Nepalese
Currency, in the process of investment
by International Finance Corporation and
Asian Development Bank in Nepal.
• To establish Nepal Security Exchange
Market as Self-Regulatory institution
according to Non-community concept.
• To make arrangements to easily avail the
status of regulation, transaction of
security and economic, financial, and
managerial status of organized institution
to general public.
• To make legal, institutional arrangement
to develop Security Deposit System.
• To implement code of conduct for
security regulators, employees of
security market including board of
directors of organized institution,
advisers, security dealers
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• To conduct awareness program as well
as to make the legal action effective in
order to discourage non-transparent
transactions.
• To make arrangements to make the
security transaction possible through
power of attorney.
• To make institutional arrangement to
provide trainings to those concerned
(regulators, exchange market,
businessmen, organized institutions,
security dealers etc) related with the
Security market.
• To make necessary arrangements for the
Security Board to get membership of
IOSCO
12. Devlopment • Develop and promote the • Savings Mobilization of at least • Reports and • To make necessary legal and institutional • Change in
and expansion contractual savings and Rs. 6.69 billion by Citizen publications of arrangements to encourage domestic policy wise
of contractual investment funds as Investment Fund. Employee and foreign multinational companies to commitment
savings and sources of long-term • Investment of at least 50 Provident Fund promote gratuity funds, mutual funds and of HMG and
investment financial resources for percent of financial resources of and Citizen risk bearing capital funds. Nepal Rastra
institution. capital oriented projects. Citizen Investment Fund in Investment Fund. • To make arrangements to supply Bank.
• Contractual savings and Security. resources of employee provident fund,
investment institution • Citizen Investment Fund to and citizen investment fund in long- term
under public sector will be manage the issuance of projects like infrastructure development,
made private sector- security amounting at least information, technology, communication
oriented and market Rs.3.5 billion. and hydroelectricity.
friendly.
A-69
• To enhance the role of • Transaction of at least Rs. 1 • Reports of • To bring program necessary to make • Declination in
contractual billion of security by Citizen Security Board investment policy and legal provision of cleanliness
savings/investment Investment Fund. Nepal Stock employee provident fund, and citizen and credibility
institution as institutional Exchange, investment fund, private sector oriented of Security
investor in the security publications and market friendly. Market.
market. reports of Nepal • To create environment to flow resources • Policy wise
• To develop different types Rastra Bank, of employee provident fund, and citizen transformatio
of savings/investment Security Board. investment fund in shares of organized n of
funds. institutions. Employee
• To prepare and apply the framework of Provident
disclosure standard of Employee Fund and
Provident Fund, Citizen Investment Fund Citizen
and other funds. Investment
• To set legal arrangements to involve Fund.
Employee Provident Fund and Citizen
Investment Fund as the main institutional
investors in security trans.
• To develop manpower necessary to
enhance the project property evaluation
capacity of Employee Provident Fund
and Citizen Investment Fund
A-70
13. Expansion • Expand the area of • Increase in number of different • Economic • To create environment that encourages • Change in
and insurance business. insurance schemes. survey, reports insurance companies to start off new work-wise
strengthening of • Strengthen the insurance • Increase in number of insurers. and publications types of insurance. commitment
insurance sector. • Entrance of additional of Nepal Rastra • To perform a study concerning promotion of HMG and
sector. • Develop and expand instruments of insurance. Bank, Insurance of annuities schemes. insurance
insurance sector as • Comparative increase in bonus Committee and • To manage legal and institutional committee.
economic, and social to be received by insures in life Insurance arrangements to promote reinsurance
security provider. insurance. companies. business.
• Protect the investment of • Contribution of insurance sector • Reports and • To formulate legal system that
life insurer. in GDP(Non-agricultural sector) Publications of necessitates the insurance of domestic
• Develop insurance sector reached 2.5 percent. Security Board property within the country.
as reliable medium of • Insurance fee reached 5.5 and Nepal Stock • To reinforce institutional system to
saving and investment billion. Exchange. enhance the regulatory capacity of
• Rs. 20 billion invested from insurance committee.
insurance sector. • To prepare and apply the disclosure
• Flow of means of life insurance framework to enhance the trans parency
fund towards long-term projects of insurance companies.
and security. • To launch public awareness programs
• Insurance academy established about insurance.
under insurance committee. • To implement detail package about
• Rs. 12 billion insurance fund. surveyor.
• To make arrangement to bring about
timely changes in investment policy of life
insurance fund.
• To establish National Life Insurance
Fund or arrange other alternatives.
A-71
3.2 Policy Matrix (Logframe)-Agriculture & Cooperative*
Broader Sectoral Objective : There shall be appreciable and durable growth in the agricultural sector to contribute to the poverty alleviation by developing
economy of the country.
The entire • Widespread expansion and • The growth rate of the entire • The four monthly and 1. Development of • Fluctuati on of
productivity and utilization of the available agriculture sector will be 4.11 yearly review and programme for growing Market
income growth agricultural technology. per cent, food grains (3.70 per progress report of the cereal, fishery cash • Continuity in
rate of the • Increasing the access to credit cent), cash crop (4.4 per Ministry of crops and other high investment and
agricultural sector and agricultural inputs needed for cent), fruits and vegetables Agriculture value crops. priority to
will be witnessed Agricultural production. (4.48 per cent) Fishery (6.96 • The National 2. Development of agriculture
by high and • Diversification and per cent), Meat (5.49 per cent) Agriculture Statistical livestock services. development
sustained growth commercialisation of agriculture. Eggs (11.24 per cent) and Book published every 3. Development of agro
through the use of • Running agriculture service and milk (3.85 per cent) year. forestry.
improved support programmes even on the • Increasing the per capita • The yearly progress 4. Food technology
agriculture basis of contract and food grain production from the report to be prepared development and
technology and parternership existing 264 Kg to 286 Kg by the National quality control of food
promotion of • Making the system of monitoring • Increasing the availability of Planning stuff and animal
market. and evaluating the projects more sugar from the existing 8.7 Kg Commission products.
effective to 9.03 Kg and cooking oil • Periodic study 5. Development of
• Making agricultural development from 2.16 litres to 2.30 liters. research reports programme for the
more sustainable through the The availability of meat will be production, storage and
development of agricultural increased from the existing marketing of milk, fish
technology, agro bio-diversity and 8.5 Kg to 9.94 Kg. And the and meat products.
protection of environment availability of milk will be 6. Development and
• Providing support to the increased from the existing extension of the
consolidation of agriculture 47.05 litres to 50.85 liter. desirable technology
Increasing the availability of for small farmers’ group
market through the mobilization
vegetables from 66.74 Kg to and rural ogro
of the private and government
sectors 79.15 Kg and increasing the industries.
availability of fruits from 16.17 7. Planning, monitoring
• Encouraging cooperative and
Kg to 17.89 Kg and fish from and evaluation
contract farming
1.5 Kg to 1.87 Kg. programme.
A-72
Result (of the Policy /work policy • Productivity of food crops • National statistics • Growth of crop • Continuity of
main programs) • To speed up long term APP shall be raised from 2.20 to booklet integration by extra financial
1. Growth in implementation through 2.60, lentils from 0.794 to crop cultivation in small institutions, local
production and agricultural decade. 0.90, oil seed from 0.702 to • Rules and irrigation development cell, electricity
productivity of • Massive expansion of agricultural 0.780. Vegetable from 10.52 regulations published and new irrigation authority and
food, fish and technology and use through the to 11.31, potato from 10.00 to in the gazette. areas and diversify by irrigation
cash crops \high group mobilization. Agricultural 12.5, fruits from 9.5 to 10.36 cultivating crops like department.
value crops and Extension Services will be metric tonne per hectare • Progress and study potato, onion instead of
development of extended through contract and during the tenth plan period. reports. winter crops. • Market fluctuation.
exportable goods. partnership arrangement.
• Crop intensification and • Crop intensification and • Agriculture and • Industrial row materials
diversification. diversification, and cropped Cooperative and exportable goods.
• Provide opportunities to private area expansion of 43339 ha. Department reports.
sector by formulating commodity Industrial crop, 11865 ha. fruit,
the policies. 12691 ha. Vegetable 178171
• Promote small irrigation. ha. and mulberry 500 ha.
• To promote growth and
diversification of high value and
low volume crops.
* Quantitative targets based on 6.2% economic growth rate
A-73
• Package and outreach of • To raise production • Quality production
improved seeds, fertilizers of honey from 155 to program of vegetables,
and credit and access to 200, silk from 31 to fruits, tea, coffee, silk,
these to be raised and IPM 62 and fish to 49490 honey, and mushroom.
system will be enhanced. from present 35000
• Increasein vegetable, fruit metric tonnes per • Resource Center
crops for import substitution year. Development program
and export promotion. to supply necessary
• Operate integrated program • Participation of seeds, plants, fishling
in remote areas including w omen to be raised from the government
Karnali. from 28 to 40 and private sector.
• Encourage production of percent in the
raw materials needed for agriculture • Karnali and other
agricultural industries by extension. remote area integrated
coordinating between development program
production and industry. • Cropping intensity
• Promote use of SALT raised from 168 to • Fertilizer, seed, breed
technology. 180. supply and
• Promote bee-keeping, management program.
mushroom farming which do • Raise chemical use
not need much land. fertilizes to 66 kg
• Promote conservation and from the 31 kg of the
promotion of genetic base year per
resources of different types hectare.
of crops.
• Formulate and implement • SALT technology in
nursery Act, fish seed Act, use.
and conservation of
aquatics life.
• Development of Resource
Centres.
2. Growth in animal • Diversification and • Raise meat • Progress reports of • Program to raise • Market fluctuation.
A-74
production and commercialization of animal production from 119 DLS. income by raising in
productivity. production. thousand to 260 • Reports of private production of animal • Continuity of
• Develop improved breed thousand metric poultry/ dairy. products. cooperation of financial
and promote their extension. tonnes and egg • Report of Dairy • Program to support in institutions.
• Raise credit access for production from 54 Development Board. public health. • Recognition to animal
animal production. crore to 92 crore • Research/ study • Mobilization of industry as Agro-
• Institutional development (piece), milk reports agricultural Credit. industry.
even in private sector too in production from • Promotion of milk
controlling animal diseases. 1159 to 1400 processing industries.
• Conserve and promote thousand metric • Rearing of animal
genetic sources of animal, tones, fish from 35 calves and kids etc.
birds and grass. thousand to 49
• Development of animal and thousand metric
feed resource centres. tonn e.
• Development of heifer
raising, small milk collection • Raise production of
processing center though cheese, ghee,
farmers groups or cream, ice-cream,
cooperatives. curd, powder milk
• Expand livestock insurance. through product
• Use of Bio Technology. diversification.
• Operate animal services
delivery even on the basis of
contract and partnership
3. Growth in production of • Reform legal restrictions, • Number of nurserie. • Annual reports of DLS • Publicise extension of • Legal disparity between
Agro-forestry taxes in the Agro-forestry • Income per ha. • Timely research/study agricultural forest agricultural Forest
production, wood and non- • Covered area. reports. manag ement produce and forest
timber products with the • 25,000 poor farmers technology. product.
cooperation of the forest shall avail bare land • Promote Agro-forest. • Coordination between
sector of 25,000 ha forest • Establish agricultural agriculture ministry and
with the rate one ha forest nursery. forest and soil
per farmers in • Develop herbs grass in conservation ministry.
contract for 40 forestry areas
A-75
years. • Bee-keeping.
• Commercial livestock
rearing.
4. Growth in quality control • Standardization of quality of • Quality standard • Progress report of • Analysis program • Continuity in the
and technology meat, milk and food measurement to be food technology and • Feeding reform coordination of the
development of food and products. applied to 30 more quality control program responsible units.
animal products. • Control adulteration in food food products. department. • Food industrialization • Creation of more posts
products. • Scientific and support in poverty for food inspectors.
• Provide information about measurement to be • Site Inspection alleviation program.
nutritious value of the food used to determine • Sample collection
products through community quality standard. • lSpecial survey program
based nutrition program • Certification of reports. • Training and publicity
support enterprises that standard every year program
promote meat milk and food on the basis of 5000 • Reports of WTO.
products. to 6000 sample
• Code of conduct to be items.
implemented in food • Minimize
industries. adulteration in milk
• International standard to be and food products.
used in export/import of food • At least 30
products. technology shall be
• Establishment of laboratory developed in food
in the private sector and the industrialization.
development of manuals for • Table having
certification, training and evaluation of
analysis technique. nutritious value of
1000 food samples
shall be available.
• At least 100
entreprizes run by
small entrepreneurs
based in meat, milk
and food products
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shall be available.
• Use of modern
equipment in food
labouratory.
• WTO standard shall
be applied in
export/import of food
products.
5. Management of storage • Promote private sector and • Involve private • Progress reports of • Establishment of • Initiative of farmers in
and market of milk, fish, cooperatives in agricultural sector and cooperative slaughter house and cooperatives.
meat and food products production, production cooperatives in the department, livestock cold storage program • Market fluctuation
inputs and storage and production and sales service department, • Build wholesale m arket, • Continuity in initiative of
sales/distribution of of meat, fish, milk, food technology and collection center for local bodies.
products. egg, fruit, vegetable quality control development of market • Sufficient participation
• Promote post harvest and food products. department. infrastructure. of the private sector.
technology to develop • At least 1250 farmer • Develop hat bazaar.
suitable technology to store groups shall be • Special survey/study • Convert groups in
and transport the product converted to reports. cooperatives.
• Utilize private sector and cooperative bodies. • Help private sector in
cooperative network to • To build one market management
develop market wholesale market, and establishment of
infrastructure. 15 collection centers cold storage.
• To have exchange of ideas and 5 hat bazaar. • Manage Transport and
between the producers and • Conduct 5 processing after the
industries. researches that help production.
in export business . • Raise agriculture credit
• Decrease in loss in investment
storage and • Training of
transportation of entrepreneurship to
agricultural product meat sellers.
with the use of • Strengthen the animal
appropriate hat bazaar
technology.
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6. Development and • Emphasize adoptive • Develop one • Research oriented • Conduct research and •
publicity of useful research that solve farmers investigation center report. publicise low cost
technology needed for problems. Conserve bio- in each district to • Annual report of technology.
small farmers and small diversity and publicise bio- certify the results of National Planning
agriculture industries. technology. outreach program Commission. • Conduct research and
• Conduct technology operated in 15agri - • Released publicise promote use
research that reduces cost econogical zones as technologies. of appropriate
of production and focus on a targeted • Various study reports. technology to maintain
its expansion. agriculture plan. soil fertility.
• Conduct research and
publicise to promote soil • Production of food • Conduct realistic
fertility. and cash crops and research and promote
• Conduct technology appropriate types of cross breed.
research and extension animal shall be at
related with animal health the farmer level and • Develop and extend
and breed. used by agriculture appropriate technology
• Develop & extend industry. for rain fed area.
appropriate kind of raw
materials needed by • Developed
agriculture industry. technology shall be
• Give priority to the operation followed by majority
of Nepal Agriculture of farmers.
Research and Development
Fund with a view to help
small farmers.
• Conduct research and
extension in partnership with
private sector and non-
government organization.
7. Planning Monitoring • Projectization to be • Central and all 75 • Annual reports of • Adoption of BUP and • Sufficient creativity of
and evaluation activities to followed according to the district wise Agriculture and devolution. Training agricultural
be made effective. principle of formulating plan programs be Cooperative for capacity development
at the grass root level prepared. Ministry. development and committee at different
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(buttom up). participatory levels.
• Devolution of agriculture • Participatory • Quarterly and monitoring.
program at local level. monitoring and annual review and • Agriculture decade
Conduct training agriculture evaluation program reports of program.
workers to raise local at Service Agriculture and • Verification of regular
service providers. Centrelevel be Cooperative monitoring and review
• Setup system of operated. Ministry. and evaluation
participatory plan program at different
formulation, monitoring and • Annual program • Study reports. levels.
evaluation and ensure formulation to be • Agricultural statistics,
package of credit, effective. • Decisions of agriculture economic
agriculture inputs and agricultural analysis, Agro-
technical services. • District level development business promotions
• Activate agricultural programs to be committee meetings, program.
development committee developed in local resolution district to • Program for impact
from district to national bodies. national level and its study .
level. effectiveness. • Program formulation
• Increase women's • Central level firm and implementation in
participation and station, laboratory contract and
involvement. and training partnership basis.
• Include govt. and non- centers to be • Capacity development
governmental activities in strengthened as program by
the flow of information and the resource agriculture and
statistics and analysis. center to provide livestock manpower
technical back up training.
to the district
programs.
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3.3 Policy Matrix (Logframe)—Forest and Soil Conservation
Overarching National Objective : Poverty incidence of the Nepalese people (men and women) will be reduced significantly and in a sustainable
manner.
Broader Sectoral Objective: Provide appropriate contribution of forest sector in poverty alleviation by conservation promotion and proper use of
forest and environment
Obstacles
Intention (Sectoral • Conservation of forest, plants, • Growth in supply of • Quarterly and annual review 1. Community and • Policy, legal
Objective) insects, wildlife, bio-diversity and forest products. and reports of Forest and Soil private forest and
genetic resources. • Opportunities for Conservation Ministry. program. institutional
Conservation of • Increase local participation in soil income generation to • Program and evaluation 2. National and reforms.
forest and soil by and watershed conservation with 278,680 households reports of projects. leasehold forest • Continuity of
public participation, special emphasis on Shivalik range. through community • Reports of forest research development foreign aid and
supply of growing • Collaborative forest management to and leasehold forests. and survey. program. grant.
demand of forest be experimented for trail in suitable • Rise in local • Collection, processing and 3. Herbs and non-
products by areas by forming user groups. Avail populations sales statement of herb timber forest
promotion and timber to wood industry as a means employment. processing company.. management
management of of raw materials. • Management of program.
forest, conservation • Emphasis on development of eco- government managed 4. Soil-conservation
of bio-diversity, tourism sector by proper forests in Terai with and management
environment and management of forest, wildlife and the formation of program.
genetic resources, vegetation in the area where forests collaborative forest 5. Genetic resources
management and are given on lease to the institutions groups. With the and bio-diversity
proper use of or enterprises. formati on of conservation and
valuable non-timber • Strengthen forest and plant research, community and forest research
products and help monitoring and evaluation, collaborative forest and survey
contribute in information and data flow system. groups and their program.
poverty alleviation • Develop livelihood opportunities to management, 12130 6. Plan monitoring
by supporting in soil the deprived people living below people get and evaluation
fertility and increase poverty line by expanding leasehold employment daily. program.
in income and forest. • Growth in
employment. conservation of bio-
• Expand community, leasehold and
collaborative forest and in such diversity, non-timber
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Obstacles
forest, participation and access to forest products and
poor, women and deprived soil.
communities to be raised.
• Sustainable management and
utilization of valuable non-timber
forest product, promote investment of
private sector and promote export.
• Develop community, leasehold and
partnership forest and in such forest
participation and out reach of
deprived and women and backward
people to be raised.
• Sustainable management of valuable
non-timber forest produc e, promote
investment of private sector and
promote export
Result Policy | Work Policies • 19 Lakh households to • Quarterly and annual reports • Community and • Eagerness of
Consequences • To have effec tive management of be involved in near of forest and Soil private forest groups
forest by raising capacity of forest 2500 and old 12,000 Conservation. development as expected.
1. Raise consumer group. community forest • Reports of district forest program. • Budget
employment and • Raise participation of women, consumers committee. office and forest consumers allocation.
livelihood backward and marginalized group in • Participation of group. • Policy and
opportunities by decision taking process. women and backward • Progress reports of projects. legal reform.
increasing forest • Develop and expand forest people in forest
productivity technology by establishing related activities and
through community forest management decision making
community and exhibition venue through public process and
private. forest participation. opportunities for
dev. program. • Development, management and marginalized group
proper utilization of private plants, shall be raised.
trees and forests to be done • Involvement of
effectively. consumer in formation
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Obstacles
of community forest
exhibition site,
selection,
establishment and
implementation of
program shall be
raised.
• Growth in private
forest area.
• Give management opportunities to
marginalized groups in community
forest.
• Encourage participation of private
sector in rearing of costly wild
animals and birds.
2. Develop national • Manage wood, log to the people. • Partnership forest • Study and annual reports. • National and • Reform in
and leasehold • Manage partnership forest too in the groups to be active in • Progress reports of leasehold leasehold forest bureaucratic
forests. form of pilot project by forming forest forest management. forest development projects. development thinking.
groups around government managed • Supply of wood to be program.
forest. easily available. • Participation of
• To make effective by forming the • Management of 13000 local
leasehold forest group of the people ha.of leasehold forest communities.
below poverty line. by 3000 groups, 1500
• Make transparent and simple the to be formed of the • Policy and
process of availing leasehold forest people living below legal reforms.
for eco-tourism. povertyline.
• Rise in employment • Availability of
and income of the budget in time.
local people.
• Leasehold forest shall
be used for eco-
tourism and other
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Obstacles
forest entrepreneurs.
3. Herb, non-wood, • To include in work plans by • Rise in the • Study reports. • Non-wood forest • Participation of
vegetati on and registering herbs and non-wood management of herbs. • Quarterly and annual reports products local
forest product forest products in all types of forest. • Rise in the of Forest and Soil development communities.
management. • To help in development of small domestication of non- Conservation Ministry. program. • Availability of
enterprises of important herbs and wood forest products. • Research reports. • National herbs budget.
non-wood species. • Increase in herb • Reports of herb company. program. • Cooperation
• Expand cultivation of valuable herb collection, processing • Annual reports of national and
species. and export. herb development program. involvement of
• Raise Employment and income of • Rise in development • Progress reports of projects. project non-
poor, women and backward people of herbs due to governmental
by managing herbs, non-wood forest, establishment of five organizations
vegetation and forest products and research sites, 5 and private
developing market. herbs centers in five sectors.
• To bring effectiveness in the dev elopment regions
management of vegetation research and 10 technology
site by the participation of loc al expansion
community. development centers.
4. Management of • To effectively carry out community • Growth in productivity • Quarterly and annual reports • Integrated soil and • Provision of
soil conservation integrated watershed management at 100 sub watershed of soil and watershed watershed matching fund
and watershed. the participation of consumer group. conservation area conservation department. management for foreign aid.
• Give priority to the watershed land. • Case studies. program. • Participation of
conservation of Chure area at the • Rise in people's • Social study reports. local
participation of consumers groups participation in communities.
and local stakeholders. integrated soil
• Priority to conservation of Chure conservation and
watershed and agriculture forest watershed program.
program. • Rise in use of SALT
technology.
5. Preserve genetic • .Implement national park and • With the • Quarterly and annual reports • National park and 13.
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Obstacles
source and bio- conservation program effectively. implementation of of Forest and Soil Reserve • .Eagerness of
diversity and • .Implement buffer zone management national park and Conservation and Ministry programs. public in
conduct plan by enlisting public participation. reserve management and concerned departments. (Implementation conservation
research and • . Implementation of Terai Arc shall be plan of 13 places, • .Project reports. and management ) of bio-
forest survey. done through people participation. there will be rise in • .Published report of ngos and • Management diversity.
• Registration of bio-diversity. bio-diversity and research and study centers. program of buffer • .Policy and
• Develop and expand forest related revenue too and bio- zone. legal &
technology forest, vegetation and diversity will be • Bio-diversity reforms.
bio-diversity and research and raise registered. registration
public awareness for the • .Rise in employment program.
management of soil-conservation and income with • Forest research
and watershed effective participation and publicity
in the implementation program.
of 6 buffer zone
management plan
• Rise in bio-diversity
due to expansion of
Terai Arc.
• .Rise in the
involvement of non-
government and
private sector and
local communities in
work oriented
research.
6. Plan monitoring • Implement monitoring policy and • .All the programs of •Quarterly/annual reports of Soil • Monitoring and •Availabity of
and evaluation directives. forest sector to be and Conservation Ministry evaluation budget.
to be made • .Develop information and data flow made at local and related department. program of bottom
effective. system. participation at the •Monitoring and evaluation up planning.
• Participatory, integrated monitoring grass root level in 75 reports of implementation,
and evaluation system to be districts. process, results, involved •Information and data
implemented. • .District wise employee, expenditure and flow system
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Obstacles
• Develop system to prepare plans at evaluation of the public participation in development
the grass root level. program and as such integrated evaluation system. program.
• Effectiveness of forest sector it will be integration •Study/research reports.
programs to be evaluated from participatory •Reports of verification of
independent bodies. evaluation. regional and central level
• Verification from the offices.
ministry/ department • Policy directives regarding
whether or not monitoring.
monitoring has been • Evaluation reports conducted
done of the program. by independent body.
• quantitative and
qualitative indexes of
help in information
and data flow system
be available.
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3.4 Policy Matrix (Logframe)– Land Reform and Management
manner.
Broader Sectoral Objective: Well managed land utilization, land – information system and land management and increase in the productivity of
agriculture, forest and industry sectors.
Sectoral Objective: • Preparing land use and national land • Land use maps, survey • Four monthly and 1. The national land policy • Delay in
Making land polices. and land categorization yearly reviews and formulation & drafting and
management very and directives available. reports provided by implementation. endorsing the
effective and
• Developing the desired legal
2. Land information and
framework for contract and • The attitude on leaving the Ministry needed
increasing the ready achieves systemized. regulations
access of those who
cooperative farming with due land barren decreased • Land utilization
3. Rendering effective
consideration to maintaining the contract and maps and directives
have skill and services related to land
feeling of land ownership and land cooperative farming • Periodical study
labour directly management
use. increased. reports
linked with the land 4. Preparing land use plan.
and marginalized • The statistical system of land • Increase in the 5. Rehabilitation of freed
people. ownership, land utilization and land utilization of agriculture, Kamaiyas (bonded
resources. forest, housing and laborers) and their
• Updating topographical maps and industrial sector as per employment promotion.
developing the required manpower their categorization
for land management. • Availability of land
• Discouraging land fragmentation records in the computer
• Initiating steps to ensure efficient • Law has been passed to
management for the settlement of reduce fragmentation
Kamaiyas and working to bring about • The settlements of ex -
improvement of their lively hoods bonded laborers has
through their skills development been made systematic
program. and they have been
• Seeking to implement and manage getting skill
the new provision of land ceiling and development training
preparing the grounds for the • Guthis managed
formulation of progressive taxation through peoples’
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system in order to discourage people participation
from holding excess land.
• Mobilising peoples’ participation for
the management of Guthis.
Consequences/ Policy/ work policies • Availability of laws for • Yearly reports of • Land zoning for agriculture, • Initiation from
Results • Prepare appropriate environment for land policy, cooperative land reform and industrial, housing, and landowner.
1. Formulation and land dependent families to increase farming and contract management environmental sector based • Continuation of
implementation their income and productivity. farming. department and on classification. peace and
of national land • Discourage fragmentation. • Changes at land laws and by laws • Include land in progressive security.
policy. • Discourage land fallowing. utilization structure at published in the taxation system and
district level. gazette. encourage contract and
cooperative farming.
2. Systematic • Land – information system to be • Scanning the maps in • Reports published • Development and
management of made functioning and effective. 75 districts. from land – expansion program of land
land information • Infrastructure information and – information system for its
and records. development of land - record department functioning.
information system in and entry of data in • Program to develop and
revenue and survey computers. manage central records.
offices of Bhaktapur, • Program to develop
Kaski, Lalitpur and manpower to keep land
Kathmandu. records.
3. To provide • Prepare appropriate environment for • Availability of survey, • Annual reports of • Human Resources
effective land land dependent families to increase land management, land Land Reforms and development program
management their income and productivity. information and land Management (training of various levels
service. • Updated land – information to be record services. Ministry. related with survey).
made available. • Cadastral survey to be
more scientific. • Annual report of • Various survey maps related
• Availability of various land management program.
scale maps and data. training center.
• Increased availability of • Services provided • Program to provide all
manpower on land by offices services through one door
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management. transparent through in land administration.
notice board. • Standards for land
• Maps and reports evaluation to be
published by survey established.
department. • Abolish dual control on
• Timely Study land.
reports. • Program to make large
scale map of municipality.
• Program to print maps of
administrative and other
edition and Atlas .
4. Prepare land use • Prepare district level land map and • Availability of maps • Annual report of • Program to prepare
plan. piloting in one area. base and database districts and VDC database and land zoning
directory of 75 districts database prepared maps related with land
and land use zoning by land use project, utilization of districts.
and manual. land utilization • Piloting of land use plan
manual and and manual.
implementation
reports.
5. Rehabilitation • Empowerment of freed 'Kamaiyas'. • Land to be made • Annual report of • Program to complete land • Continuation of
and livelihood available to remaining district level land distribution to Kamaiyas. collabouration
improvement of families out of 13 reform office. • Program to provide support among forest,
freed 'Kamaiyas' thousand families and construction of houses. local
arrange settlement to • Program to provide training development
eight thousand families. for skill development. and land
• Number of freed • Program related with reform and
Kamaiyas admitted for drinking water, health, and management
primary education. education. ministries.
• Occupation followed by
freed Kamaiyas.
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3.5 Policy Matrix (Logframe) — Industry, Commerce and Supply
Overarching National Goal: Poverty incidence of Nepalese People (men and women) will be reduced significantly and in a sustainable manner.
Sectoral Goal: Substantial contribution of Industry, commerce, and supply management in the economic and social development of the country
Sectoral Goals: • Development of less risky tourism spots • 7.2 percent annual growth • Agencies under 1. Programs to create public • Economic
Rational and and promotion of tourism in in tourist arrival will bring MCTCA and awareness towards tourism fluctuation in
exemplary use of neighbouring countries. to 516 thousands. other and importance of cultural the
national • Maximum portion of the money spent by • Annual 8 percent growth • Ministry of Home heritages. international
resources, tourists will be retained in local areas. in foreign currency and immigration 2. Emphasis in the visit of the market.
upgradation of Women and people from backward earning will bring to USD department. Increase tourist travel to new • Security and
civil aviation communities will be involved w ith priority 205 million. tourist destinations. health
• Ministry of
service, standard in such activities. 3. Tourist travel to be made situation
• Contribution to GDP to Finance and
promotion and comfortable, secure and safe. within and
• The infrastructure of the newly opened reach 3 percent. Nepal Rastra
massive public 4. Ensuring quality development neighbouring
and alternative tourist destinations will • Average tourist stay day Bank.
participation for of tourism. countries.
be developed and tourism will be to 13 days. • Ministry of Land
sustainable 5. Facilitating cultural and
established as an alternative to • Per tourist per day income Reform and • Guarantee of
development of economic activities. religious tourism development foreign
tourism. of USD 60. "Guthi" through conservation of
• Eco-tourism will be given priority and Sansthan. airlines’
• Creation of 100 thousand heritage, promotion and
operation in
Nepal will be developed as one of the direct employment and • Royal Nepalese publicity to make it a
major destinations for such destinations. 125 thousand indirectly Embassy and Nepal.
supporting sector for
• Governmental, non governmental and employment annually. Consulates. development. • Diplomatic
private sector will be involved in a • Department of ties between
• Availability of 17 air 6. Re-establishing country's
coordinated manner so as to improve Wildlife and international image by Nepal and
services in the
their competitive capacity. National Parks successfully organizing foreign
international sector and
• Participatory program based on the and King destination Nepal 2002-2003 countries.
120 0 thousand air seats
principle of the decentralization will be annually. Mahendra Trust campaign.
designed in order to conserve, promote for Nature 7. Air travel to be made safe and
and manage the cultural, religious, Conservation. reliable.
archaeological, and natural heritages. • Private tourism 8. Commencement of
• Conservation, promotion and study of entrepreneurs. international flights from
literature, arts, and culture domestic airports.
• Ensuring a safe and reliable air service 9. Initiate the construction of the
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for domestic and international travel with second international airport.
the construction of airport with the 10. To avail sufficient air seats in
necessary infrastructures. international seats.
• Participation of the private sector in 11. Privatization of the Royal
construction, management and Nepal Airlines Corporation.
operation of airports and operation of 12. To generate skilled manpower
long-distance airlines. in cultural, tourism and civil
aviation sector.
13. To formulate master plan in
the area of culture, tourism
and civil aviation sectors as
well as timely amendment of
policies, acts and regulations.
14. Updating the database and
information that reflect the
current scenario in culture,
tourism and civil aviation
sector.
Consequences/ Policy and working policy • Number of locally held • Ministry and its • Organization of exhibi tions and • Level of
results • Increasing positive attitude of people programs. agencies fares with a lot fanfares at the people’s
towards tourism and culture • Local bodies local level attraction
1. Increased • Involving the local people in the services • Informing common people also towards
Awareness in the of tourism to benefit them from the returns through governmental, non- tourism
tourism and of tourism sector. governmental and educational
culture area institutes.
2. Attraction of • Contribution towards regional balance • Production of publicity and • Ministry and its • Involvement of local bodies • Development
tourists towards • Creation of employment in new areas promotion materials agencies. and communities in the of
new destinations • Removal of slackness of tourists during • Programs to promote new • Ministry of Home conservation of touristic infrastructure
rainy season. areas heritages. and the state
• Establishment of tourism centres. • Establishment of separate • In cooperation with the private of security.
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areas for eastern and sector, Nepal Tourism Board
western region will promote new tourist areas.
• • Nepal Toursim Board will
establish separate centres in
the east and west for the
tourists.
•
3. Visit of the • Making the necessary services for the • Decrease in accidents on • Home Ministry • Management of necessary • Travel
tourist will be tourists available at the local spot tourists • Local bodies and service, and facilities for the advisory
comfortable, • Making the tourist’s visit secure • Retention of majority of communities tourists at the local level by the issued for the
secure and a • Clean environment, controlled pollution money at the loc al level local communities. foreigner
happy one. and presenting a courteous behaviour • The operation of tourists visit travellers
programs will be encouraged • Negative
through the registered publicity.
agencies.
• Local bodies and security
agencies to monitor the
security of the tourists.
• Making the management of
garbage in the urban areas an
income earning opportunities
and promoting the participation
of the private sector in it.
4. Insuring quality • Encouraging quality and high spending • Foreign currency earning • Nepal Rastra • Preparation of a code of • Lack of
tourism tourists and per tourist per day Bank conduct for all involved in the cooperation
• Conservation of tourist heritages income. tourism sector and its from the
• Involvement of the local bodies and the • Categorization of the enforcement. foreign
non-governmental organizations in the organizations providing • Categorizations of all companies.
conservation and management of services and increasing institutions providing services
heritages the per package price. and strict monitoring of their
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qualities through Nepal
Tourism Board.
• Fixing the prices of services
and heritages based on its
quality transparently.
• Involvement of the local bodies
in the management of the
heritage sites.
• Environmental friendly
implementation of the
development and tourism
activities.
5. Conservation • Development of the cultural and religious • Number of tourists visiting • Manager of the • Only the activities that fit under • Level of
and promotion of tourism through the publicity and heritage sites. heritage sites the guidelines of the world cooperation
cultural heritage promotion of world heritage sites, and • Conserved heritage sites. • Private tourist heritage sites will be carried from the local
sites and its places of religious, cultural, historical and entrepreneurs out. bodies and
contribution in the archaeological importance. • Mandatory implementation of people.
religious and • the guidelines in and around
cultural tourism. the heritage sites.
• Conservation and protection of
art, literature, culture, tradition,
dance, music, rituals etc.
• Commercial use of the existing
arts and skills.
6. Successful • Re-establishing Nepal as one of the major • Number of tourist arrival. • Ministry and • Operation of programs aiming • Internal
implementation of tourist destinations through effective • Involvement of the departments to repeat the success stories of security
destination 2002- promotion and publicity. embassies and other under it. the past successful programs situation and
2003 to re- • Official use of the bodies representing international bodies in the • Immigration like Destination Nepal negative
establish the Nepal abroad. promotion activities. department. Campaign and other publicity.
international • Following the successful promotion • Embassies and successful programs. •
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image of the programs of the past. consular offices. • Use of the most latest
country • Private tourist technology in the publicity and
entrepreneurs. special emphasis in promotion
• and publicity in the
neighbouring countries.
• Embassies, consular offices,
foreign tourism entrepreneurs,
and friends of Nepal will be
used in promotion activities.
7. Air travel will be • Additional equipments will be introduced • Number of airports with the • Nepal Civil • Making the air travel safe by • Maintenance
secure and in the airport to reduce the risk of availability of modern Aviation Authority introducing the modern of the
reliable accidents. communication assisted communication assisted equipments.
facility. facility.
• Number of accidents
8. • Short distance international flights from • Number of short distance • Nepal Civil • Medium distance flights to the • Approval of
Commencement the existing airports. international flights from Aviation Authority neighbouting countries by the targeted
of the international the domestic airports. upgrading the standard of the country.
flights from domestic airports.
domestic airports.
9. • Construction of the country’s second • Commencement of the • Ministry and its • Based on feasibility study, a • International
Commencement international airport at a suitable place for construction of the second line agencies. spot will be selected in the finance.
of the construction the arrival and departure of full-capacity international airport. Terai and construction of
of the second aeroplanes. second international airport will
international begin.
airport • Construction of the
international airport at partial or
full involvement of the private
sector.
10. Availability of • Arrangement of adequate flights and • Number of airlines coming • Ministry and its • Brining four more international • Policy of
adequate air seats in the international sector. to Nepal regularly. line agencies. airlines to Nepal. international
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tickets to visit • Maximum utilization of air routs in Nepali • Availability of air seats in • Increasing the availability of air flights.
Nepal sky. the international sector. seats and air agreement. • Bilateral air
• Nepali private airlines • International operation by agreements.
companies doing Nepal’s private company.
international flights. • Simplifying the procedures to
increase the number of
chartered flights
• Maximum air flights
• in the Nepali sky.
11. Completion of • Rendering the national flag carries more • Privatization of the Royal • Royal Nepal • Privatization of the Royal • Support from
the privatization of capable and robust. Nepal Airlines Corporation Airlines Nepal Airlines Corporation all sectors.
Royal Nepal Corporation. involving the government,
Airlines employees of the corporation,
private sector, and foreign
investment.
• Corporation to improve
international services by
agreeing upon an agreement
with the foreign airlines.
12. Providing a • Production of competent manpower to • Increased opportunities in • Ministry and the • Permanent provision of training • Coordination
standard service provide a quality service. the governmental and non- related agencies. and study to create competent among the
by producing governmental sectors. • Private tourism manpower with the institutions.
capable and • entrepreneurs. participation of the private
competent sector.
manpower in the • Establishment of higher
sector. educational institution for
tourism sector.
• Establishment of regional level
mountaineering Training
Academy.
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13. Formulation of • Timely reform of policy-level, legal, and • Completion of a • Ministry • Formulation of a new master • Commitment
master plan in the institutional reform. preliminary framework for plan for tourism sector and its of all sectors
area of tourism, • A long term plan for the tourism sector a 20 year-long term implementation. according to
culture, civil and separate master plans for culture integrated projects. • New policy and act for culture the policy.
aviation and and civil aviation sector. • Formulation of new act, and separate master plans for
enactment of regulation and amendment important sites
laws, policies, in the existing acts • Amendment in tourism and air
regulations and policies, acts and regulations
their timely • Formulation and
amendment. implementation of master plan
in airlines sector.
14. Availability of • Collection and upgradation of necessary • Availability of statistics, • Ministry and its • Updating the statistics and • Credible
necessary statistics and facts to guide the future and other information. line agencies. other information related to the source of
spastics and facts programs in culture, tourism and civil contribution of the tourism information
related to culture, aviation sector. sector to the nation. and statistics.
tourism, and civil • Updating the relevant
aviation. international information.
• Research and study will be
conducted.
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3.6 Policy Matrix (Logframe)— Industry, Commerce and Supply
manner.
Sectoral Goal: Substantial contribution of Industry, commerce, and supply management in the economic and social development of the country
Sectoral • Government will play a role of a regulator, • Employment • Ministry of 1. Programs to promote export • Ups and
Objective: facilitator, information disseminator and a situation in industry Industry, oriented industries based on Downs in
Improvement in monitoring agency to create an and commerce commerce, local and foreign raw materials. international
supply system environment for the private sector to play sector supplies and its 2. Programs to promote market
along with a lead role in industry and commerce • Contribution of line agencies industries, commerce and • Policy
increased sector. industry and progress report services based on foreign consistency
competitiveness in • Intellectual property will be protected for commerce sector to and other reports. investment. of
the industry and commercial purposes. GDP 9.32%. • Central Bureau of 3. Programs to promote small and government
commerce sector. • Sustainable development of infrastructure, • Diversification of Statistics’ cottage industries based on • Law and
entrepreneurship and skills to establish exportable goods Industrial Census traditional skills and arts. order
micro and cottage industries. • Sector -wise in report 4. Programs to develop and situation
• Encourage foreign capital to enhance export. • Reports of Ministry expand micro industries in • Reform in
industrial capital base. • AIncrease in of Finance, Nepal rural areas. labour law
• Accession to World Trade Organization aailability of Rastra Bank and 5. Programs for geological survey • Foreign
membership manufactured goods NPC and exploration of minerals and Trade
• For export promotion, new products of of Nepali origin in • Ministry of development of industries Relations
comparative advantage will be identified, the international Labour’s report based on minerals.
quality of exportable goods will be market • Report of the 6. Programs to make the
improved, and new export destination will commerce and trade sector
• Absence of shortage Trade Promotion
be identified. of essential goods in Centre . liberal and competitive.
• Special Survey 7. Programs for regular,
• Monopoly will be eliminated in supply the various parts of
management and availability will be the country. reports qualitative, and accessible
increased. supply of necessary goods.
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3.7 Policy Matrix (Logframe)- Labour and Transport Management *
manner.
Sectoral objective: Creating an environment conducive to economic activities through cordial labour relations and to contribute to the larger
national policy of poverty alleviation through the elimination of child labour and consolidation of transport management.
Obstacles
• To manage labour • The rights and interests of labourers will • Ratio of more skilled • Household Survey 1 To establish a separate • Lack of enough
force and to be ensured as per the standard set by labourers in (Nepal Life Standard Department of Employment information on
guarantee the the International Labour Organisation international labour Survey) Promotion and occupational labour market.
rights of labourers through timely amendments to labour market. • Records of Department health and safety centre. • Industrial
and to raise their laws. • Fixation of minimum of Labour. 2 To increase employment instability.
productivity and • Communications between labourers and standard of opportunities through
• Records of Department
conducting vocational
• Lack of tripartite
income. management will be encouraged to occupational health of Transport coordination.
• To eliminate child promote cordial industrial relations. and safety. Management, Transport training.
3 To disseminate information
• Lack of
labour. • Employment opportunities will be • The number of Management Offices, coordination
on labour market.
• To make transport increased by conducting vocational and disputes in industrial traffic police and among
4 To formulate minimum
service affordable skill development training as per the enterprises. Department of Roads. government
standards for occupational
and qualitative by demand of the domestic and • The number of day • Reports of the Ministry agencies on
health and safety.
rendering international labour market by managing child care centres. of Labour and Transport policy.
5 To carryout programs to
transport information on labour market. • Percentage of child Management and prevent child labour.
sustainable, • Loans will be extended to low income labour. Ministry of Population
reliable, safe and 6 To consolidate the
groups in order to utilise the foreign • To end worst forms of and Environment. administrative and physical
self-reliant. employment opportunities optimally. • Department of Transport
child labour within means related to transport
• Child labour elimination programs will be next five years and to Management and management.
integrated with poverty alleviation eliminate all forms of Transport Management 7 To increase the involvement
programs. child labour within Offices. of the private sector in the
• Emphasis will be given on enhancing the next 10 years. • Traffic police, expansion of various
capacity of the officials of the concerned • Reduction in road associations of sectors of transport.
ministries, departments and offices to accidents. transporters, 8 To conduct programs to
make child labour eradication programs • Reduction in pollution passengers. reduce road accidents.
effective. in Kathmandu Valley • Emission survey.
A-97
Obstacles
• The standard, safety and quality of and other urban
vehicular transport will be enhanced and areas.
better managed.
• Vehicular pollution will be reduced.
• Means of alternative transport will be
sought and promoted.
* The quantitative targets are based on 6.2 percent economic growth (Details are on annex 3)
Consequences/res Policy and working policy • Fixing national • Report of the • Program to fix national • Impact from the
ults standard on 675 department of standard in industrial Indian market and
• Encouragement to the industries based industrial products. measurement and products WTO’s impact
1. Promotion of on local raw materials and resources. • Improvement in the standardization • Industries based on local • Willingness and
industries based on • Special promotion to the export oriented use of local labour • Progress report of the raw materials and labour management
domestic and industries. diversification of and department of industry. will be promoted. capacity of the
foreign raw increment in the • Industrial census report • Policy level and industrialists.
materials and other number of industries of the Central Bureau institutional arrangement • Policy level stability
industries. that are use more of Statistics to promote export of
than 80 percent of • Report of the Nepal industrial products.
raw material in their Rastra Bank and other • Program to mobilize
products. banks necessary domestic
• Increment in the entry • Publications of customs investment for industrial
of Nepali industrial department and the development
products to Indian trade promotion centre • Program to lower
and other markets. • Record of the NCCI industrial pollution
• Diversification in the • Report of the Ministry •
industries under of Population and
public and private Environment.
ownership. • Report of the
• Impact of industrial employment promotion
pollution in the air, commission
water, flora and soil.
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•
• • • • •
2. Promotion of the • Creation of timely and suitable • Increment in foreign • Record of the ministry • Reform in the existing • State of internal and
industries, environment to attract foreign direct investment of Industry and Finance laws, acts, policies to external security
businesses and investment • Increment in the • Industrial census of the create a conducive situation
services under number of industries, Central Bureau of environment to attract • Policy level stability
foreign investment. trade, services and Statistics foreign direct investment • Economic stability
Sectoral diveristy • Report of the • Monitoring whether the
employment promotion facilities provided by the
commission laws, acts and
regulations has been
received by the investors.
• Promoting the small scale and cottage • Employment or self- • Reports of the • Training for the • Arrangement of
3. Promotion of the industries based on traditional skills and employment department of cottage development of market
competitiveness of arts. opportunities to and small scale entrepreneurship. • Policy level stability
the small scale and 250,0000 industries. • Arrangement of loans to
cottage industries • Entrepreneurship • Report of FNCCI the small scale and
based on the local management training cottage entrepreneurs.
traditional skills and to 62,500 people
arts.
• • Industrial exhibitions • Reports of customs • Implementation of • Environment
at the district and department and trade programmes to conducive to export
central level promotion centres discourage the use of promotion
• Availability and • Reports of Nepal child labour in the small • Commitment of the
relevance of loan to Handicraft Association scale and cottage industrialists
the small and cottage • Reports of Central industries • Level of people’s
industrialists Bureau of Statistics awareness
• Impact of industrial • Reports of the Banks • Easy and
pollution in air, water, • Special survey reports concessional loan
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soil and flora.
• Decline in the number
of child labour
• • Increase in • Report of the ministry • Training for micro • Market
4. Development • Implementation of integrated package entrepreneurship of industry entrepreneurship management
and expansion of and encouragement to the civil society training • Reports of the banks • Providing market related • Policy level stability
micro industries in to participate in it. • Number of industries, • Reports of the central information to the micro • State of law and
the rural areas. diversity and spatial bureau of statistics entrepreneurs order
expansion • Reports of the related • Arrangement of loans to • Easy and
• Availability of credit to non -governmental the micro entrepreneurs concessional loan
the entrepreneurs organizations and other
projects
• Promotion of industries and • Exploration sq km • Reports of minerals • Exploration of metal, • Policy level stability
5. Geological entrepreneurship based of profitable (metals 1000, non- and geological division non -metal, coal gas etc. • Availability of local
survey and mineral mineral stocks metal 2050, coal and • Report of department of • Geochemical and and foreign
exploration and • Attracting local and foreign investors in petroleum 500, industry geophysical survey investment
development of mineral industries pylorus, mineral that • Reports of banks • Explorative drilling • Economic feasibility
industries based on • Use of latest information system. cab be used in • Report of ministry of • Geological mapping and of available mineral
it • Attracting foreign investment and constructions population and completion of reports resources
technology in exploration of necessary • Geochemical and environment • Study of geo-engineering
minerals like petroleum and gas and neo-physical survey and geo-environmental
precious minerals like uranium. 250 sq. km situation.
• Explorative drilling • Seismological study
2000 m • Implementation of
• Geological mapping programs that will
and publication of encourage the use of
maps 7800 sq. km latest information system
• Record mapping and in the geological survey
publication of maps and mineral exploration.
up to 6500 sq km. •
• • Reports of the banks • • Implementation of •

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• Geological and geo- program so as to
engineering and geo- promote necessary
environmental study investment and
up to 1500 km technology in the
• Geological section exploration of petroleum,
study and gas and uranium.
publications of map • Programs to attract local
800 sq. km and foreign investment in
• Use of RS/GIS in the the mineral resources
geological survey and based industry
mineral exploration
• Seismological study
500 sq. km
• Operation of
earthquake
measurement centre
( 38325 days from 21
stations)
• Gravity survey 3,000
line k.m.; geological
section measurement
750 and
petrogeochemical
sampling 750 km;
statigraphy and
structure study 5000
sq km; recognisance
seismic survey 300
km; source and
analysis 750, and
drilling 15, 000 m
• Diversity in industries
based on mineral
A-101
resources
• Local and foreign
investment in the
development of
mineral-based
industries.
6. Commerce and • Government’s role will be that of a • Reports of the banks • Reports of the banks • Formulation of 20 years • Conducive
trade sector will be facilitator • Use of information • Ministry of industry, long and up to date environment of law
made liberal and technology in commerce and policies in the commerce and order.
competitive commerce sector supplies. sector.
• Government will assist the initiative of • Use of backward and • Resources related to • Obtaining the • Conducive
the private sector forward linkages in long term and periodic membership of the international
• To obtain the membership of the the export oriented plans. regional and international market.
regional and World Trade Organization trade. • Progress report of the trade organizations and • Policy level stability.
and work accordingly • Activeness of department of amendment in the laws • Government
• embassies and commerce and field accordingly. commitment
consulate offices report • Obtaining the memberhip
abroad in trade • Report of the Trade of SAPTA, SAFTA, WTO
promotion Promotion Centre and amendment in the
• Effectiveness due to • Progress report of the laws to suit the
networking between various embassies and provisions of these
the commerce and consulate offices regional and world trade
revenue department, abroad bodies.
FNCCI, Nepal • Membership of SAPTA, •
Chamber of SAFTA, and WTO and
Commerce and other their progress report
organizations • Legal base paper on
• Increase in the network and its
industrial and progress report
agricultural
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production and export
and diversity
7. To make the • Ending monopoly in the import and • Availability of goods • Progress report of • Arrangements will be • Timely policy level
supply of necessary transportation of necessary goods. and services to the ministry of industry, mad for regular and changes
goods qualitative, • Legal provisioning for ending monopoly. consumers commerce and supplies adequate availability of
regular and adequately, timely • Field level inspection necessary goods and
accessible. and at a reasonable reports services.
pricing. • Arrangement for food
security
• Assistance to the institutions providing • Increase in the level • Special survey results • Necessary institutional • Promotion of
necessary services and monitoring of of food stock. • Reports of the arrangement will be consumer’s
their efficiency. • Price Index trends consumer groups made to increase the awareness
• Control and monitoring mechanism will • Reaction of the • SAARC report effectiveness of the • Positive
be further strengthened with the consumer groups • Structure of the supply system. cooperation from
participation of the private sector to Supplies Department • Regular monitoring will the industrialists
check monopolistic tendency in the • Reports of the be done to discourage and businessmen.
market, artificial shortage and rent concerned institutions artificial shortage and
seeking. rent seeking.
• Special attention will be given to the • Necessary arrangement
food deficient areas and to meet the will be made for smooth
food need of the economically and open import and
challenged people. Food deficient mobility of necessity
districts will be given subsidy for goods.
transportation of food. • SAARC level
• To meet the shortage during the natural participation will be
calamities and other similar situations mobilized to establish
adequate buffer stock will be maintained five food reserve centres
for foods, petroleum and other daily at the regional level and
necessity necessary Timely policy level one at the national level.
changes commodities. • Pricing information
A-103
system will be developed
regarding the production,
import, export, and sales
to regularize the flow of
goods and services.
• Development of low -
priced retail outlets
through the consumer
cooperatives.
A-104
3.8 Policy Matrix (Logframe)- Electricity development*
manner.
Larger Sectoral goal: Increasing the contribution of electricity in the national development significantly
Sectoral Goals: • Development of hydropower • To exchange 150 • Ministry of Water Resources, 1. Increasing the • Fluctuation of
Sustainable development sector through private, public mega watt of Nepal Electricity Authority, electricity generation electricity market.
of economic structure of and partnership of the both. electricity between annual and quarterly reports capacity. • Expansion of
hydropower. • The watershed area of the Nepal and India of Electricity Development 2. Expansion of electricity electricity market
rivers to be made major base 132 KV line will be Department. service and its with India and its
of development of established in three • Special Survey Reports. reliability. management.
hydropower and its places. 3. Studying the potential
management. • Generation of 214 of various
• The private or public sector mega watt of hydroelectricity
whichever can bear the electricity by private projects.
unexpected risks at low cost sector. 4. Policy level and
will be given the responsibility. • Household with institutional reforms.
• All small, medium and large electricity access.
projects yielding high returns
and low environmental
impacts will be implemented.
• Nepal Electricity Authority will
be made more commercial
and will be move towards
unbundling.
• Hydropower services will be
extended to rural economy
level to promote social justice.
• Policy to develop hydropower
through bilateral and
multilateral level will be
adopted.
• To promote the participation of
A-105
the private sector
• investment friendly, simple
and transparent pr ocedure will
be adopted.
• To promote the exchange of
electricity between India and
Nepal, a grid connecting the
electricity system of Nepal and
India will be established.
* The quantitative targets are based on the economic growth rate of 6.2 percent
A-106
Consequences/ results Policy/working policy • Generation of total 315 mg • Annual and quarterly • Electricity generation from the • Availability of
1. Increasing the electricity • Promoting the watt electricity during the report of the ministry private sector market fro export
development capacity participation of private plan period, including 101 of Water Resources, • Electricity generation and of electricity
sector mg watt from public sector NEA’s and Electricity distribution with the • Availability of
• Encouraging the and 214 mg watt from the Development participation of the private capital
dev elopment of the private sector Department. sector and users communities • Consumer’s
reservoir projects • Commencement of • National strategy • Electricity generation through capacity to
• Developing the micro, construction for generation report of the participation of the private consume
small medium, and large of 1938 mg watt electricity hydroelectricity and public sector electricity
projects • Additional customers’ • Feasibility study and
• Exclusion of the cost of number 705,600 construction of the reservoir
road development and • Number of VDCs with projects
distribution lines in the electricity 26,000 • Arrangement to let the
project cost to reduce producer use the national
the cost of projects electricity distribution system
2. Electricity service will be • Expansion of rural • Electricity services to 43 • Annual and quarterly • Expansion of rural • Consumers’
made more reliable and electrification percent of the population report of the ministry electrification with the capacity and
qualitative and expanded • Encouragement to the through the national grid. of Water Resources participation of the local bodies willingness to
use of electricity in • Extension line expansion to • NEA’s annual and and consumers consume
agriculture, industry and 430 km and distribution line quarterly progress • Program to handover electricity.
social services. expansion to 15,782 km. reports distribution and operation • Dues of electricity
• Responsibility will be • Substation capacity • National strategy maintenance of the electricity tariffs
given to the local bodies development to 426 MVA report of services to the local bodies
and consumers in the and distribution substation hydroelectricity and private sector in the
distribution of the to 149.5 MVA • Documents of the municipality areas.
electricity • Electricity leakage to below National Planning
18 percent Commission
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3. Conducting feasibility • To develop • Annual feasibility study of • Quarterly and annual • Annual feasibility study of the • Lack of adequate
study of various hydroelectricity from the the large, medium and small development reports projects those have passed budget.
hydroelectricity projects private sector, study will scale reservoir and run-off- of Electricity screening and ranking process.
be done about the river hydroelectricity Development Centre • Screeni ng and ranking at the
hydro-projects from the projects. • Quarterly and annual interval of few years
public sectors reports of the Nepal • Systematic study of the river
• Feasibility study of the • Feasibility study of various Electricity Authority basins to develop electricity
projects from the public projects with 13, 376 mega and feasibility study of the
and private sectors watt capacity. identified projects.
• Regional balance in • Identification of the
project selection multipurpose and reservoir
• Encouragement to the projects and their feasibility
reservoir projects study.
4. Completion of policy • Institutional reform • Availability of adequate • Institutional structure • Periodic evaluation and reform • Continuity of the
level and other institutional according to Hydropower manpower related to of the Ministry of of the institutional structure of participation of the
reforms Development Policy hydropower development Water Resources. the organizations working in concerned bodies.
2000. • Quantitative and qualitative • Quarterly and annual the area of electricity • Continuity in the
growth of the hydropower reports of the Ministry development and Lack of participation of
projects constructed with of Water Resources adequate budget. local communities.
the participation of the local and its line agencies. • Development of the suitable
bodies and the local • Annual development human resources to promote
communities. report of the local the use of up-to-date
• Increase internal and bodies technology in the development
foreign investment to of hydropower.
hydropower development. • Increasing the involvement of
the government, private sector
and local bodies in the
development of
hydroelectricity.
Mobilization of internal and
external resources in the
development of the
hydroelectricity sector.
A-108
3.9.1 Policy Matrix (Logframe)- Irrigation*
manner.
Sectoral Objective: Significant contribution of irrigation in the National development.
Information
Sectoral • Intensive irrigation programs will be • Farmer canals reforms in • Four-monthly 1. Sustainable management of the • Commitment of
objective: lunched in areas where year-round 64,000 ha. and annual ongoing projects. external
Extending year- irrigation facility is available. • New irrigation facility progress report 2. Complete irrigation management loans/assistance.
round irrigation • Irrigation management will be extension to additional of the and hand-over projects. • Commitment of
facilities to strengthened by enhancing 1,77,600 ha. Department of 3. Renewal and extension of Matching Fund.
irrigable land. capacity of water users • Participation of users in Irrigation farmers' canal. • Commitment of
associations. Proper co-ordination canal management, its • Annual report of 4. Renewal and improvement of policies and
will be established with Agriculture strengthening and project NGOs. government projects. programs.
related agencies at project, regional hand over in 37,000 ha. • Special survey 5. Development of groundwater • Political
and national levels. • Renewal and improvement report. projects in new areas. commitment.
• Project formulation and of government project in • Four-monthly 6. Development of surface irrigation • Continuity in the
construction procedures will be 33,780 ha. and annual projects in new areas. participation of
improved by taking technical, • Maintenance, renewal, progress report 7. Producing high-value crops by Department of
social, economical and management improvement of the using non-conventional irrigation Agriculture and
environmental aspects. of traditional irrigation Department of technologies. Department of Soil-
• Massive irrigation projects will be system in 280,710 ha. Agriculture. 8. Conducting irrigation program conservation and
developed on basis of bilateral and • Producing high-value • Four-monthly from Agriculture Development watershed.
multilateral co-operation. crops in 10,000 ha by and annul Bank, • Continuity in
• Ground-water irrigation projects will developing irrigation progress report 9. Conducte irrigation program from participation and
be developed in Terai, while, in hills through the adaptation of of local bodies. the Ministry of Agriculture and co- local bodies and
drip and sprinklers projects will be modern technology. operatives. people.
formulated. • Diversification in 10. Conducting feasibility study of
• Capacity of local bodies (DDCs, agriculture. different projects.
VDCs and water users groups) and • Participation of local
NGOs will be developed in bodies and people in canal
formulation, construction and construction, its
management of small and medium- maintenance and
A-109
Information
scale projects. management.
• Farmer will be encouraged to
integrate irrigable lands having
single ownership and to adopt
contract farming and co-operative
farming.
• Private sector participation in the
irrigation sector will be encouraged.
Objectives Strategy Indicators Sources of information Major programs Risk and obstacles
1. Sustainable Improving management a. The average effective utilisation of • Four-monthly and annual 1. Annual maintenance • Govt. commitment
management of through repair and 280,710 ha of land through progress report of the of irrigation projects on budget.
ongoing irrigation maintenance of ongoing maintenance, repair and enhancement Department of Irrigation run by govt. • Commitment on
projects irrigation projects. of traditional irrigation system will be • Special survey report. 2. Full operation of policies and
increased to 60% from 50%. • Four-monthly and annual barrage, bear and programs.
b. The crop intensity of year-round progress report of the pumping station • Continuity in
irrigation will be increased from 185% Department of Agriculture. through repair and participation of
to 200% and crop intensity of monsoon • Four-monthly and annul maintenance. Department of
irrigation will increase from 120% to progress report of local 3. Repair and Agriculture.
140%. bodies. maintenance of the • Commitment on
c. The current 30% efficiency of irrigation govt. built projects collecting Irrigation
system will increase to 35%. that have low Service Fees by
d. Local bodies will collect 30% of cost of capacity utilisation. granting water
maintenance through Irrigation Service users groups and
Charge. irrigation
authorities legal
power.
A-110
2.Complete Management reform of a. Joint management of irrigation system • Four-monthly and annual 1. Management of hand- • Commitment of
irrigation ongoing projects. in the command areas of over 500 ha in progress report of the over of irrigation foreign loans
management hills and 2,000 ha in Terai. The Department of Irrigation system. • Commitment of
and hand-over of management of irrigation system below • Special survey report. matching fund.
projects. that will be handed over to water users • Four-monthly and annual • Commitment of
association. progress reports of the joint management
b. The crop intensity of year-round Department of Agriculture. in collecting
irrigation will be 185% to 200% and • Four-monthly and annul irrigation service
crop intensity of monsoon irrigation will progress reports of local fees.
increase from 120% to 140%. bodies.
c. The current 30% efficiency of irrigation
system will increase to 35%.
d. Local bodies will collect 30% of cost of
maintenance through Irrigation Service
Charge.
3. Renew and Management a. The crop intensity of year-round • Four-monthly and annual Farmers' canal reform • Commitment of
expand farmers' improvement of ongoing irrigation will be 185% to 200% and progress report of the • Pragana Farmers' Canal foreign loans
canal agriculture irrigation crop intensity of monsoon irrigation will Department of Irrigation Reform Projects. • Commitment of
projects. Integrating increase from 120% to 140%. • Special survey report. • Community Irrigation matching fund.
agriculture package b. The current 30% efficiency of irrigation • Four-monthly and annual Sector Projects. • Commitment on
programs run by district system will increase to 35%. progress reports of the • Nepal Irrigation Sector policies and
authority with local Department of Agriculture. Projects. programs.
irrigation projects. • Four-monthly and annul • Ranijamara Farmers' • Continuity in
progress reports of local Canal Reform Projects. participation of
bodies. • Second Irrigation Sector Department of
Project. Agriculture.
• The water of Eastern • Continuity of
main canal of Babai river people's
will be divided to participation.
Western farmers' canal
by constructing Siphon
on Babai River.
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4. Renew and Maintenance and a. The average effective utilisation of Renew and reform of govt.
reform of management reform of large-scale projects covering 33,780 ha projects
government running large-scale will be increased to 60% from 50% by • Narayani Irrigation
projects projects. improving, renewing and strengthening Project.
management and the projects. • Pokhara Water
b. The crop intensity of year-round Conservancy Project
irrigation areas will be 185% to 200% • Koshi Pump Canal
and crop intensity of monsoon irrigation Project.
will increase from 120% to 140%. • Gandaki Western Canal
c. The current 30% efficiency of irrigation Project.
system will increase to 35%.
d. Local bodies will collect 30% of cost of
maintenance through Irrigation Service
Charge.
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5. Development a. Extension of fully a. Expansion of irrigation to addition • Four-monthly and annual 1. Developing year-round • Commitment of
of ground controlled year- 49,000 ha of area. progress report of the irrigation system govt. budget
irrigation in new round irrigation b. Expansion of irrigation to additional Department of Irrigation through community • Commitment of
areas. facilities for crops areas through shallow tube-well (10,000 • Special survey report. ground-irrigation foreign loans.
intensity and ha) and deep tube-well (18,000). • Four-monthly and annual project. • Commitment of
diversification. c. The crop intensity of year-round progress reports of the 2. Development of matching fund.
b. Development and irrigation areas will be 185% to 200%. Department of Agriculture. irrigation through • Commitment on
management reform d. The efficiency of irrigation system would • Four-monthly and annul shallow tube-well. policies and
of ground-water be increased to 60 per cent. progress reports of local 3. Development of programs.
irrigation. bodies. irrigation through deep • Continuity in
3. Water exploration in tube-well. participation of
new areas and 4. Implementation of PTP Department of
monitor water level programs of Bhairawa- Agriculture.
in Terai region. Lumbini Ground water. • Continuity of
5. Exploration programs people's
of ground water. participation.
6. Integration with
agriculture package
programs run by district
authority.
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6. Development Complete remaining a. The crop intensity of year-round • Four-monthly and annual 1. Completing unfinished Commitment of govt.
of surface works of ongoing irrigation in command areas will be progress report of the task by irrigating 5,000 budget
irrigation in new surface irrigation increased from 185% to 200% and crop Department of Irrigation ha of land from Babia Commitment of
areas projects and develop intensity of monsoon irrigation will • Special survey report. irrigation project. foreign loans.
some possible large or increase from 120% to 140%. • Four-monthly and annual 2. Complete second Commitment of
medium scales surface b. The current 30% efficiency of irrigation progress reports of the phase works of matching fund.
irrigation projects system will increase to 35%. Department of Agriculture. Mahakali Irrigation Commitment on
c. Concerned bodies will collect 30% of • Four-monthly and annul Project. policies and
cost of maintenance of joint progress reports of local 3. Developing new programs.
management projects through Irrigation bodies. surface irrigation from Continuity in
Service Charge. medium-scale irrigation participation of
d. The command areas effective utilisation proj ects additional Department of
of ongoing projects will be increased to 4. Irrigate 1,200 ha by Agriculture.
70% from existing 60%. supplying water to Continuity of
Khagari irrigation people's
project from Bagmara participation.
lift project.
5. Other Irrigation Project
a) Completing Chandu
Dam
b) Completing Mallaz
Irrigation Project.
c) Initiating Charunga
Charan Lift Project.
6. Completing Chanda
Mohana project.
7. Organising the
management of Rajpur
Irrigation project.
8. Extending irrigation to
3,000 ha from Sikta
Irrigation Project.
9. Extending irrigation to
25,00 ha from third
phase of Mahakali
A-114 irrigation project.
10. Manage irrigation to
16,000 ha of areas
under Bagmati
Command Area
Development Project.
11. Manage 20,100 ha of
area under command
area of first phase of
Bagmati Irrigation
Project
12. Manage irrigation
facilities to 10,000 ha of
land under the
command area of
Sunsari -Morang (third
phase)
13. Complete and manage
irrigation facilities to
15,100 ha of land under
the command area of
Sunsari -Morang (third
phase running)
14. Development of new
irrigation to cover 3,100
ha of land.
15. Extension of irrigation
to 500 ha of land
through Trishuli
Irrigation Project.
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7. Development Extension of fully a. Irrigation to additional 10,000 ha of land • Four-monthly and annual Extending irrigation to • commitment of
of high-value controlled year-round b. The crop intensity in areas with year- progress report of the vegetable and fruits farms foreign loans
crops through irrigation facilities for round irrigation will be increased from Department of Irrigation by constructing water • Commitment of
non -conventional crops intensity and 185% to 200%. • Special survey report. reservoir and developing matching fund.
technology. diversification c. Affiliation with agriculture package • Four-monthly and annual sprinkler, drip technology • Continuity in
programs conducted by district progress reports of the and cycle pump. participation of
agriculture authority. Department of Agriculture. department of
• Four-monthly and annul agriculture.
progress reports of local
bodies.
8. Conducting Expanding facilities to With the loan assistance received from the Progress report of Developing irrigation • Commitment of
irrigation project farmers by extending bank, irrigation will be extended to 30,000 Agriculture Development through shallow tube-well, government
through the loan loans from Agriculture ha from shallow and duck tube-wells, 6,000 Bank. duck well, small surface budget.
assistance from Development Bank. from reform of farmers' canal, and 2,000 irrigation project, farmers'
Agriculture from drip and sprinkler technology. canal reform, drip and
Development sprinkler technologies in
Bank. loan assistance form
Agriculture Development
Bank.
9. Conducting Extending irrigation Extension of irrigation facilities to additional • Four-monthly and annual Developing irrigation • Commitment of
irrigation project facilities by constructing 10,000 ha in the plan period by conducting progress report of the through shallow tube-well, government
through ministry small irrigation projects small irrigation projects through drip and Department of Irrigation duck well, small surface budget.
of Agriculture and reforming farmers' sprinkler technologies, and reforming and • Special survey report. irrigation project, farmers'
and co- canal on the basis of expanding farmers' canal. • Four-monthly and annual canal reform, and drip and
operatives. farmers' group. progress reports of the sprinkler technologies
Department of Agriculture. through ministry of
• Four-monthly and annul Agriculture and co-
progress reports of local operatives.
bodies.
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10. Conduct Conducting feasibility Number of feasibility study of the large- • Four-monthly and annual Implementation • Commitment of
feasibility study study for large-scale scale irrigation projects. progress report of the procedures of large-scale government
irrigation projects. Department of Irrigation projects like Bheri Babai budget.
• Special survey report. diversion and Sunkoshi
• Four-monthly and annual diversion will be initiated
progress reports of the after conducting detailed
Department of Agriculture. feasibility study.
• Four-monthly and annul
progress reports of local
bodies.
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3.9.2 Policy Matrix (Logframe)- Water Induced Disaster Control*
manner.
Sectoral objectives: Effective management of water-induced disasters.
Sectoral • Enhancing present institutional • Policy and law for water- • Department of 1. Formulating policy related with Water- • Continuity in co-
objective: capacity of the concerned induced disaster Water -induced induced Disaster management. operation and
Effective bodies by formulating polices management. Disaster control 2. Mapping and marking risk areas from the co-ordination
management of and acti on plans. • Number of targeted and department of point of view of water-induced disaster. among related
water-induced • Promoting public participation programs for raising Land and 3. Development of expansion of proper institutions.
disasters. and raising public awareness public awareness. watershed technology through sample construction. • Availability of
for precautionary steps to • Damages and relief Conservation. 4. Preparation and implementation of necessary
minimise damages and programs created by pogroms for Flood land management of financial
promoting system of re- Water-induced disasters. sensitive rivers and preventive measures resources.
establishment at local and • Projects/ programs of sensitive cliffs.
community level. related with watershed 5. Pre-informing people about the possible
• Stressing to conduct watershed management must be damages from flood and landslide
management and river control initiated. through pre-information system.
programs in an integrated way • Mapping of risks areas 6. Timely extension of relief to the people
by using locally available skill of 20 districts must be affected by the water -induced disasters
and resource through public completed. and reestablishment of demanded
participation. infrastructures.
7. Coordination among the institutions
related with water-induced disaster
management.
8. Enhancing effectiveness of the bilateral
committee related with Nepal-India
border area immersion problems.
*Quantitative targets are based on assumption of 6.2 per cent economic growth rate.
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Information
Results Policy and Programs • Management policy of • Four -monthly and • Formulating policy of management • Continuity of co-
1. Formulating • Institutionalised management of water-induced disaster annual reports of of water-induced disaster control ordination among
policy related water-induced disasters as regular approved by the Ministry of Water • Preparing rules, regulations and concerned
with the programs. government. Resources and manuals related with water-induced institutions.
management of • Rules, regulation and Department of disaster management.
water-induced manual. Water Induced
disaster disaster
management.
2.Mapping and • Mapping and classification of risk • Risk areas of 20 district • Department of • Mapping and marking of areas • Continuity of co-
marking of risk areas. will be completed. Water Induced prone to flood, landslide, flow of ordination among
areas from disaster gravel and explosion of glacier. concerned
water-induced management • Preparation of lists and statistics of institutions.
disasters risk areas.
3. Extending • Development of proper technology • Number of sample • Four -monthly and • Developing technology through • Continuity of co-
training to suitable to local environment. construction works (15). annual report of sample construction works to ordination among
concerned • Extending training to technicians of • Extending training to 150 Department of control flood, landslide and flow of concerned
government concerned institution. technicians. Water Induced gravel institutions.
technicians • Enhancing capacity of local people • Conducting public disaster • Extending training to technicians of • Continuity of public
through sample to adopt security measures. awareness programs (25 management and concerned institutions of the participation.
construction districts) other concerned government on technology.
works to • Number of participants institutions. • Enhancing awareness on
develop and (1,250) minimising water-induced disasters
expend proper to local people, schools and users
technology. groups through seminar, workshop
and training.
4.Initiate action • Proper management of watershed • Number of managed • Four -monthly and • Updati ng some of already • Co-ordination
plan to manage and sensitive rivers. rivers and watershed annual report of completed detail feasibility study of between
and control • -river control Departments of some of the sensitive rivers. departments of
flood land of management ( 31 initial Water Induced • Implementing some economically Water -induced
sensitive rivers stage) disaster and technically viable river and management and
and sensitive • - Land conservation and management and landslide control programs in co- watershed
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Information
cliffs landslide control (10 in Watershed ordination with department of management.
initial stage) management. watershed management after
completing studies
5. Informing • Protecting life and property from • Number of established • Progress report of • Establishment of earlier warning • Co-ordination
people over the water induced disaster through pre- pre-information departments of technology in sensitive rivers and between
possible information technology. technology Water Induced glaciers. departments of
damages from • rivers and glaciers 2 Disaster • Establishment of earlier warning Meteorological and
flood and • Land erosion and Management, technology in sensitive landslide Water Induced
landslide landslides 2 Water and areas. Disaster
through pre- Meteorological, Management
information land and
technology. watershed
management and
road.
6.Extending- • Extending relief to the people • Extent of damage. • Four -monthly and • Storing relief materials in all five- • Continuity of co-
rescue affected by water-induced disaster. • Progress report of relief annual reports of development regions. ordination with
operation to the • Extending co-operation to establish efforts. concerned • Extending co-operation in Ministry of Home
affected areas a regular system of adopting • Description of re- institutions. distributing emergency relief in co- and concerned
by water emergency security measures of the established projects. • Four -monthly and ordination with District Natural district offices.
induced damaged infrastructures and re- annual progress Calamities Management
disasters and establish them. reports of Committee.
co- operate to concerned district • Extending technical co-operation to
reconstruct offices. concerned district-level institutions.
damaged • Conducting necessary
infrastructures. reestablishment projects.
7. Co- • Making the water-induced disaster • Gradually strengthening • Four -monthly and • Conducting meeting of Joint Co- • Continuity of co-
ordinating management effective by co- co-ordinating annual progress ordination Committee as per ordination among
among the ordinating with various institutions. mechanism through joint reports of requirement. various institutions
institutions co-ordinating committee Department of • Conduction seminars and related with Water-
related with meetings, seminars and Water-induced workshops. ind uced Disaster
controlling workshops. Disaster • Organising necessary interaction Management.
water-induced Management. among the concerned institutions.
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Information
disaster • Co-ordinating with Land and
Watershed Department about
watershed areas of the upper part
of river while conducting river
control programs
8. Enhancing • Sorting out the immersion problems • Joint Committee will be • Ministries of • Conducting regular or necessary • Relation with friendly
effectiveness of of the people living in the border made effective. Foreign Affairs meetings of joint committees or neighbouring
the bilateral areas. • Minimising the number and Water sub-committee related with country.
committee of immersion problems. resources. immersion problems.
related with
Nepal- India
border area
immersion
problems.
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3.10 Policy Matrix (Logframe)- Road transport*
Sectoral Objective: Remarkable contribution of the road sector in national development.
Information
Sectoral objectives: • Construction, development • Road Construction • Four - • Development, • Budget should be released on time as
Given the need to and expansion of strategic (new) 1025 km. monthly and construction and per the program.
promote sectoral roads. • Quality annual expansion of strategic • Reform and effective implementation
unification and • Construction of roads so as upgradeing1764 km. programs roads (including of policy and programs.
balance, and to contribute for the • Improvement, reports. connecting district • Commitments made on foreign
contribute for socio- development of rehabilitation and • Report of headquarters and Asian loans/grants and other aid should be
economic infrastructures and other reconstruction of concerned highway). maintained.
development of least economic activities. roads 596 km. seminars. • Construction and • Political commitment and
developed areas, the • Promotion of private sector • Bridges construction • Special expansion of roads to understanding should be continued.
Tenth Plan aims in construction and 200. survey contribute for economic • Inter-sectoral co-operation and co-
contribute to support maintenance of road • Periodic report. activities, tourism, ordination should be developed and
in achieving the network. maintenance 1216 • Annual hydropower and other continued.
national goal of • Arrangement of proper km. economic sectors • Monitoring of programs should be
poverty by study, technology, • Recurrent survey of • Encouragement to private effective in various levels.
constructing, environmental management maintenance 5000 ministry of sector in the development • Public awareness and participation
repairing and along with security km. finance. of road sector. should be raised.
maintaining road arrangement while • Additional road link • Reports of • Adaptation of proper • Capacity of local institutions should
network. constructing and expanding to 10 district various local technology, arrangement be enhanced.
roads. headquarters and for environmental • Maximum utilisation of local resource
• Implementation of planned • Expansion of roads. international management and road and means.
system in construction, • Good condition of organisation security. • Road fund should be operated.
expansion and maintenance roads. s. • Implementation of • Proper amount of budget according to
of roads and bridges. • *Institutional • Observation planned system for total estimated budget should be
• Promote institutional enhancement. and maintenance, expansion, annually allocated and released.
development and capacity • Decline in supervision. and quality upgrading of • Conducive environment for the point
building as per the policy of transportation cost. roads. of view of security should be created
liberal economic policy and • Adoption of capacity for smooth operation of projects and
decentralisation. decentralised system. programs.
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3.11 Policy Matrix (Logframe)- Information and Communication Sector
manner.
Sectoral Objective: Remarkable contribution of Information and Communication in socio-economic development of the country.
Information
To ensure easy • Enhancing Participation of private • Availability of • Four-monthly and 1. Expand television • Continuous threat to
availability of news sector. television services annual progress services to all people in peace and security.
and information • Clearing liabilities and responsibilities in all parts of report of Ministry an effective way. • Continuity of the
based on facts and of private and government broadcasting country. of Information and 2. Expand radio services importance of
truth to the general services to develop, expand and • Increase in communication. to all people in an information and
people on time. operate their broadcasting services in a availability of radio • Special survey effective way. communication in the
competitive and co-ordinated manner. services. report. 3. Extension of security development process of
• Increase capability and effectiveness of • Increase in • Field inspection press services. the country.
postal service as an autonomous body. availability and report. 4. Extension of telephone,
• Developing a security printing press by quality papers. e-mail and internet
creating a favourable environment • Increase in services in an effective
within the country for all kings of availability of way.
printing activities related with security postal service. 5. Ex tension of quick and
printing, except printing paper notes. • Increase in effective postal
• With an aim to develop healthy availability of E- services.
competition in the journalism sector and mail and internet. 6. *Various activities of
to bring effectiveness in flow of • * Availability of the development of film
information, Department of Information security press. sector.
would be developed as a centre of
releasing information for general public
in the country and abroad.
• Encourage private sector in production
of Nepalese films and develop Nepal as
a centre for international film related
activities.
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Information
Quantity/results Policy/program • Receive of • Four-monthly and • Broadcasting television • Initiation of private
1. Extending • Extending television service nation-wide. television services annual reports of programs through transmitter sector.
television services to • Broadcasting television programs to nation-wide. NTV and Ministry of with low capacity. • Continuity of peace
all people and promote education, health, • Receive of Information and • Establishment and operation and security.
nation-wide entertainment, tourism and environment television services Communication. of metro channel.
effectively. conservation through a separate through metro • Special survey • Operation of TV program
channel. channel nation- reports. producing centre in Pokhara
• Making the country self-sustain by wide. • Field inspection and Itahari.
promoting participation of private sector. • Establishment and reports. • Promoting private sector in
operation of at least broadcasting TV programs.
two regional • Raising revenue through
programs producing business-oriented programs.
centres. • Establishment and operation
of earth station in Kathmandu.
• Operation of programs to
enhance efficiency of NTV.
2. Extending radio • Reform and expansion of radio • Reliable radio • Four-monthly and • Reforming Short wave and • Initiation of
services to all people broadcasting services. services will reach annual reports of medium wave radio services. communities and
and nation-wide • Expansion of community FM radio all parts of the Radio Nepal and • Expansion of FM services. private sector.
effectively. services in participation of private sector. country. Ministry of • Continuity of peace
Information and and security.
Communication.
3. Initiating security • Press of Department of Printing would • Availability of • Four-monthly and • Developing press of the • Continuity on
press services be made autonomous. security press annual reports of Department of Printing as receiving national
• Arrangement would be made for security services inside the Department of commercial institution by priority by security
printing inside the country. country. printing and making it autonomous. press program.
Ministry of • Arranging training for the
Information and development and
Communication. maintenance of printing
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Information
services.
• Establishing security press
building.
• Supplying and assembling of
modern machines like
multicolour and dry upset
press and perfecting
machines.
4. Extension of • Developing healthy, independent • Preserving papers • Four-monthly and • Establishing a CD Rom • Initiation of
effective press accountable journalism. through CD Rome annual reports of library. individuals and
services technology. Ministry of • Enhancing efficiency of institutions related
• Effective operation Information and pressmen. with journalism.
of communication Communication, • Enhancing interactions
village Press Council, between pressmen and
Department of various classes of the
Information and community.
RSS. • Publishing books and
educational materials related
with the development of
journalism sector.
5. Extending • Expansion of competitive • Extending • Four-monthly and • Expansion of basic telephone. • Active role of
telecommunication telecommunication services. telephone services annual reports of • Expansion of mobile phone private sector
services like • Enhancing participation of private sector. to 40 lines in every Ministry of services. • Continuity of peace
telephone, email and thousand people. Information and • Expansion of additional and security
internet services in • Expansion of Communication telecommunication services
an effective and telephone services and Nepal like email and internet
easily accessible to all VDCs. Telecommunication
manner • Number of mobile Corporation.
telephone
subscribers will
reach 170,000.
• Extension of email
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Information
and internet
services in al least
31 district
headquarters.
• Availability of pay
phone services in all
municipalities.
6 Extension of • Expansion of competitive postal services • Expansion of money • Four-monthly and • Institutional reform and • Active role of
quality, reliable and • Expanding the participation of private order services to annual reports of manpower development of private sector
quick postal sector. tem countries. Ministry of postal service. • Continuity of peace
services. • Expansion of Information and • Arrangement of physical and security.
domestic express Department of equipment for enhancing • Continuity of co-
mail services to ten Postal Service. postal services and operation from
10 areas and expanding express mail international postal
international services. associations.
express mail • Expansion and strengthening
services to 20 of money order services.
countries • Promotion of Phelatelical
programs and Postal Saving
Bank Services.
• Expansion of services like e-
post.
7. Development of • Development of films to promote • Number of films • • Manpower development of • Active role of
film sector. nationality, discipline, and social norms film sector. private sector.
and values. • Code of conduct in producing • Continuity of peace
• Ensuring massive participation of private films. and security.
sector. • Promotional services for film
industries.
•
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3.12 Policy Matrix (Logframe)- science and technology*
manner.
Sectoral Objective: Enhancing the use of Science, technology and Information Technology in increasing production and productivity and
accelerating -economic development of the country.
Information
Vision (sector- • Establishment of a mechanism to • Effectiveness of • Four-monthly and 1. Development and • Availability of timely
wise objective): conduct research and development technologies used in annual reports of promotion of technologies for the use in
There would activities agriculture and industries. ministries of traditional and agriculture, industry,
be massive Agriculture, industry, proper technology. education and health
use of science and science and services.
and technology technology.
in socio- • Contribute in raising socio-economic • Effectiveness of • Special survey 2. Ensuring the easy • Availability of market
economic condition of people through the technologies used in reports availability of management for the
development sustainable use of natural resource education and health renewable energy. agricultural and industrial
activities. and means. services. products produced by
using timely technologies.
• Producing high-quality scientists • Access of consumers of 3. Massive use and • Availability of programs to
manpower different group to the development of IT. increase the excess of
technologies used people towards timely
agriculture Industries, technologies.
education and health
services and their
proportionate growth
• Development and expansion of 4. Publicise and
meteorological services. ensuring availability
of information
related with weather
and floods.
• Creating conducive environment for 5. Expanding science
attracting private sector investment education and
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Information
in IT sectors. researches.
• Establishing access of general
people to IT through Community
Informati on Centres.
• Expansion of training required using
IT.
• Expansion and promotion of micro-
hydel, solar power, wind power,
improved ovens in rural areas.
• Creating environment to attract
community and private sector in
development and promoti on of
alternative energy and its expansion
to rural areas.
• Establishment of a separate Rural
Energy Fund to ensure a
sustainable development of rural
energy.

Output/Result Policy/program • Qualitative change in the • Progress report of • Identifying various • Realization and
1. Development • Enhancing the production and existing traditional Ministry of Science technologies being adopted in initiation of
and expansion of productivity of agricultural industries by technologies being and Technology agriculture and industrial technology
traditional and improving traditional technologies and adopting in Terai, hills • Documents of sector and taking measures to development
proper adopting proper modern technologies. and Himal. Nepal Agricultural develop and reform them. among the argo-
technologies • Increase in the use of Research Center • Encouraging Agro-based based
new and proper and Royal Nepal industries in using improved entrepreneurs.
technologies. Academy for and proper technologies.
Science and • Encouraging research and
Technology. tests of new technologies and
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encouraging their uses.
2. Easy • Increase in the use of bio-gas, solar • Number of houses with • Progress report of • Conducting programs to • Realization and
availability of power, wind power and hydropower. bio-gas will be increased Ministry of Science produce energy from bio-gas, initiation in using
renewable • Replacing petrol and diesel vehicles by to 200,000. and Technology. solar power, micro alternative and
energy. electric-powered vehicles. • Increase of household • Progress report of hydropower, wind power and renewable energy.
solar energy system to bio-gas promotion other organic sources. • Availability of
• 52,000. program. • Distributi ng subsidies and subsidies and loan
• Use of at least 2,700 • Progress report of loans. assistance.
solar dryers. Alternative Energy • Conducting community
• Electricity production from promotion Center. mobilization programs.
micro-hydels will reach • Establishing Rural Energy
100,000 kw. Fund.
• Operation of 4,000
improved water mills.
• Establishment of Rural
Energy Fund.
3.Massive • Legalizing the use of science and • Incorporation of science • Progress report of • Formulation of proper laws • Upheavals in the
development and technology on priority basis. and technology courses Ministries of and rules for the development international
use of • Introducing computer education in all from school to university Science and of science and technology. maker.
information levels of school education. level. Production of Technology and • Incorporating information • Availability of
technology. • Promoting private sector in the 50,000 information Law. technology education in power and
development of information technology manpower in • Course of Study of schools and university levels. telephone services.
technology. first three years. school to university • Conducting 'computer • Continuity in
• Encouraging the use of information • Establishment of a levels. education to all by 2010' realization about
technology in areas like trade, national level information • Progress report of program. the importance of
education, health and rural technology park in ministries and • Expansion and development information
development. Banepa and completion departments. of information technology technology among
• Development and expansion of of feasibility studies at • Reports of parks. local bodies and
information technology park. various other parts. ministries of • Connecting ministries and other ministries.
• Encouraging international trade of • Use of E-commerce, E- Science and departments through electric • Participation of
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information technology. governance, E-post, E- Technology, network. private sector.
health in all municipalities Industry and • Expanding use of information
and selected DDCs and Commerce, and technology in local
VDCs. chambers of development, trade, health
• Operation of at least commerce and services and postal services.
1,500-community industry. • Promoting national and
information centers at • Reports of National international private sector in
VDCs level. Planning the development and
• Total export amount of Commission. expansion of information
hardware and software to technology.
reach Rs 10 billion. • Extending co-operation to
information technology
products produced in Nepal to
enhance its competitiveness
in the international trading.
• Conduction awareness
programs among the general
public about the advantages
of using information
technologies.
4. Increase in • Qualitative improvement in collection • Operation of 120 sub • Daily, monthly, • Improving the mechanism of • Initiation of
availability and of information related with meteorology stations fitted with the four-monthly and measuring information on neighboring
publicize of and floods. equipment standardized annual reports of climate and flood and countries in sharing
information • Exchange of information related with by World Meteorological Department of publicizing. information related
related with meteorology and floods at international Organization under Hydro and • Operating all the Hydro with climate and
meteorology and level. Department of Hydro and meteorological. Meteorological Stations under floods.
floods • Availability of information related with meteorological. Department of Hydro and
meteorology and floods to general • Establishment and meteorological by fitting all
public. operation of a center to necessary equipment.
study climate change in • Collecting and broadcasting
the Himalayan range. satellite based information
related with climate.
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• Initiating negotiations and
signing agreement with the
neighboring countries for
exchange of information on
climate and floods.
5. Increment and • Inclusion of science education in every • Improvement in the • Progress reports of • Extending co-operation in • Initiatives of
expansion of levels of school and university. course of study and Ministry of improving science education concerned
research and • Promoting research for the educational materials and Education and at schools and universities authorities in
science development and expansion of science methods. universities. level. improving science
education. and technology. • Establishment and • Progress reports of • Establishing and improving education.
• Publicizing the importance of science operational improvement Ministry of Science planetarium, science • Continuity of
and technology in enhancing of planetarium, science and Technology. museum, laboratories and initiation of agro-
production and productivity of museum, laboratories and • Progress reports of information collection centres. based enterprises
agriculture and industry, and ensuring information collection Ministries of Forest, • Improving information in improving
its easy excess. centres. Agriculture and collection methodologies and technology.
• Use of and their Industry their use.
improvement. • Region-wise • Conducting awareness
• Increase in awareness inspection reports programs to enhance the
and participation of productivity of agro-based
general public in adopting enterprises by adopting and
science and technology improving technology and
for enhancing production ensuring the availability of
and productivity of agro- necessary equipment.
based industries.
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3.13 Policy Matrix (Logframe) – Housing, Building and Urban Development *
manner.
Sectoral Objective: Productivity of the human resource will be increased sustainably.
Purpose • Guide urban development through the protection of historical • Availability of the • Ministry of 1. Enhance well- • Continuation of
(sectoral and cultural heritages and the support of urban infrastructure digital maps of the Physical managed the priority of His
objective): in a sustainable manner. m unicipalities. Planning and urbanization. Majesty’s
Condition of • Develop Kathmandu Valley as the capital city and touristic • Increase the Works 2. Develop Government on
human and cultural centre of the kingdom of Nepal, and develop the compliance of the • Department of interdependenc housing, urban
settl ement will satellite towns around Kathmandu Valley. norms of Urban e of rural and development
be improved • Mobilize the means and resources of private sector and municipalities. Development urban regions. and building
sustainably. local elected bodies for the construction, operation and • Availability of market and Building 3. Develop rural construction.
management of urban infrastructure. centres that are Construction and urban
• Carry out the necessary regulating functions to systematize sy stematic as per the • Sectoral housing.
urban development. national standards. supervision 4. Manage
• Promote village-town partnership programme. • Execute sample reports building
• Develop urban housing with the participation and programmes of construction
involvement of private sector. densely populated and
• Update and implement the building construction codes and settl ements. maint enance.
standards. • Increase in the 5. Develop the
completion of areas of special
construction of importance.
government
buildings.
* The quantitative goals are based on the economic growth of 6.2 percent
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Results/Outcomes Policies and working • Availability of 1:2000-scale • Four-monthly and • Put the unplanned urbanization • Timely
1. Increase in planned policies digital maps of all annual progress in order. amendment
urbaniz ation. • Obtain the participation of municipalities. reports of the • Develop physical infrastructure. s of
His Majesty’s Government, • Increase in the compliance of Ministry of Physical • Develop Kathmandu Vall ey as conflicting
local elected bo dies, private municipality norms. Planning and a centre of tourism and culture acts, laws
sector and the beneficiaries • Availability of capable human Works and and capital city. and by laws.
for the development and resource in the area of concerned • Conduct the programmes of • Coordination
improvement of urban management. divisions, urban and environmental among
areas based on the Plan. • Investment of private sector, departments and improv ements. various
• The role of His Majesty’s consumers, local elected programmes. • Make well-developed housing institutions.
Government will be bodies and His Majesty’s plots available.
supporting and facilitating. Government in the • Conduct sample programmes
development of urban of densely populated
hous ing. settl ements.
• Development of Harisiddhi • Develop well-planned market
sub-municipality. centres.
• Effectiveness of land • Conduct housing improvement
development programmes in programme.
five municipalities. • Develop safe and economical
• Availability of 20,000 housing technologies.
plots in 500 ha. in • Make available the digital maps
Kathmandu Valley. of municipalities.
• Effectiveness of UEIP • Increase in the compliance of
programmes in nine municipality norms.
municipalities.
• Planned settlements in at
least five squatters’
settl ements of Kathmandu
Valley.
2. Develop • Encourage the scattered • Availability of planned market • Four-monthly and • Planned physical development • Coordination
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interdependence settlements to concentrate centres in at least 20 places annual progress of small towns and market among
between rural and urban in the places having according to national reports of Min. of centres. various
areas. physical infrastructures. sta ndards. Physical Planning • Encourage area development institutions.
• Systematize the small • Availability of physical plans and Works. according to economic growth • Readiness
towns created by the of at least 25 urbanizing corridor. to change
changing rural economic VDCs. • Construct and improve among the
conditions. • Availability of infrastructures infrastructures that link villages residents of
• Encourage the of e-commerce in market and towns. settl ements.
development of economic centres. • Develop small towns and
development centres. • Settlements developed markets in close vicinities to the
according to the area highways.
development plans in • Create employ ment and self-
different areas. employment opportunities.
3. Rural and urban • Develop appropriate • Conduct sample densely • Department of • Conduct densely populated • Lack of
hous ing development tec hnologies to construct pop ulated programmes of Urban settlement programmes in im provemen
safe, economical and 10-15 households in two Development and different areas of the kingdom. t in the
environment-friendly areas. Building • Carry out land development capabilities
houses in rural and urban • Provide concessional loans Construc tion. programmes with the joint of planning
areas. and technologies to 2000 • Nepal Housing investment of HM Government and
• Conduct programmes to low -income families. Finance Company. and private sec tor. im plementati
develop group and jointly • Conduct programmes in 58 • Private housing • Develop cooperative housing. on of local
owned houses envisaged municipalities. sector. • Follow partnership scheme elected
by the national housing • Collectiveand jointly owned • Reports of the between government and bodies.
policy with the partnership housing programmes in four Personnel private sector to make urban • Absence of
of private sector. cities with private sector’s Prov ident Fund. services available effec tively. public
• Go on creating employment involvement. • Conduct studies and research awareness.
opportunities by activities about housing • Non-
maintaining a persistent technologies appropriate to existence of
relationship between different ge ographical areas. coordination
housing and employ ment. • Conduct residential building among
reform programme. various
institutions.
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• Timely
amendment
s in
conflicting
acts, laws
and by laws.
4. Arrangement of • Use local materials, skills, • Publish the up -to-date • Department of • Update the documentation of • Lack of
building construction and and im proved technologies document ation of the Urban the government buildings. planning and
maintenance. in building construction to government buildings. Development and • Complete the buildings of im plementin
support domestic indus tries • Complete the construction of Building Ministries of Finance, Land g
and businesses. parliament building. Construc tion. Reform and Management, capabiliti es
• Systematize the existing • Construction of offices, • Nepal Housing Communication, General of local
tasks of building employee residential Finance Company. Administration, Local elected
construction, management buildings in 10 dis tricts. • Rural Housing Development under bodies.
and repair/renovation • Train 500 artisans and 500 Com pany. construc tion. • Want of
through National Building other related technicians. • Private housing • Commence the construction of public
Codes. • Construct 100 sampl e sector. Parliam ent building after awareness.
buildings by selec ting • The Personnel completing its design. • Absence of
appropriate materials and Prov ident Fund. • Make the processes of repair coordination
technologies for emergency and building construction among
building construction. uniform and bring homogeneity different
in spaces required for the concerned
government offices. institutions.
• Implement Building Codes in • Timely
the government buildings and amendment
construct some office buildings of the
as samples. conflicting
• Building Codes Act, 1998 will acts, laws
be amended by incorporating and by laws.
the international • Lack of
standards/norms of natural availability of
disasters including fire, flood, skilled
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landslide, and earthquake. domestic
• Make provision of the transfer artisans in
of high technology by required
increasing the involvement of number.
domestic consultants and
construction entrepreneurs in
the construction of large
buildings.
• Arrange emergency buildings
for homeless people as a result
of natural disasters to relieve
them immediately.
5. Develop areas of • Complete implementation of • Department of • Prepare ten master plans • Lack of
special importance. 10 areas as per the master Urban based on priority. coordination
plans. Development and • Prepare inventories of tem ples, among
• Completed maintenance Building monasteries, stone spouts, different
tasks on inventories. Construction. religious places of refuge, etc. institutions.
• Special Physical • Lack of
Area Infrastructure awareness.
Development
Project.
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3.14.1 Policy Matrix (Logframe)- Population Management*
manner.
Overall Sectoral Objectives: the development programs that are based on the balanced of population will be sustainable.
Intention • Reproductive health services will be made available and the late • Reduce the total fertility • National 1. To tie up population
(sectoral marriage and breast-feeding will be encouraged. rate to 3.5 census with development
objective) • Emphasis will be given to raise public awareness for population • Increase the users of • Surveys activities
Development of management. family planning services • Gazette 2. Management of
small and • The policy to operate special programs focused on adolescents to 47.0 percent • Research migration
qualitative and the youths (10-24) will be undertaken. • Reduce the infant • International 3. To take population
family. • Population management will be made effective by reviewing mortality rate to 45 publications management to the
population related laws and making policy reforms. person (per 1000 live • Progress local level by
• Special emphasis will be given to raise the social and family birth) reports participatory and
status of women and skill development & growth of employment • Reduce child mortality decentralized
opportunities, women’s literacy, and girls’ education. to 72 (per 1000 live manner
• The role of educational institutions in the formulation and birth)
implementation of population education programs will be • Human Resource
increased. Development Index
• The role of local bodies in the operation of population • Gender Index
manag ement programs according to the concept of • Percentage of Literacy
decentralization will be increased.
• The policy of participatory partnership of private and non-
governmental sectors for the operation of population
manag ement tasks will be adopted.
• The internal and international migration will be regulated.
Output/Result • Policy / action plans • Projection of population • Ministry of • Reform of policy
1. Tie up • Prepare policy and legal system, • Population index Population and legal system
population with • Carry out research and to flow information, and related to
development Environmen population
activities t • Formulation and
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implementation of
longtorm action
plans related to
population
• Population and
information,
education and
communication and
advocacy
programs
• Various researches
and studies on
population
• Special programs
on adolescents
• Coordination
between education
and population
• Preparation of
Population
Pressure Index
2. Management Carry out study on trend of migration and coordinate the • Rate of migration • Record keeping
of migration developmental efforts to minimize the negative impact of migration. • Change of population of Nepali at the
in different areas point of departure
from Nepal and
record keeping of
foreigners at the
point of arrival to
Nepal
• Regulate
migration
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• Considering the
nature of
migration carry
out programs that
relates rural and
urban
development
3. Take the • Number of programs • Operation of
management of population
population to management
the local level programs with
by participatory the involvement
and of local
decentralized authorities and
manner non -
governmental
organization
* The quantitative goals are based on the economic growth of 6.2 percent.
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3.14.2 Policy Matrix (Logframe): Environment*
manner.
Sectoral broad objectives: The development programs that are based on the balance of population and environment will be sustainable.
Intention (sectoral • To internalize the environmental • Implementation • Population and 1. Protection of Bio-diversity, land • Provision of
objectives management with development of international Env ironment resources, and cultural law and order
• To achieve sustain able programs, treaties/conventi Ministry resources, • Promptness of
development through • To mobilize the non- ons, • Gazette 2. Control of pollution vehicles
the interrelationship governmental and private • Pollution control • Local bodies 3. Appraisal of development ow ners
between environment sector, local authorities, and and prevention, (municipalities) programs from environmental • Timely
and development people for the environmental • The number of and various perspectives amendment of
awareness raising campaign. programs that means of laws, acts, and
• To make a work plan by setting are appraised for communication regulations
priorities to implement the the • Ministry of Health which are
treaties and proposals environmental contradictory to
sanctioned at the international impact each other.
level, assessment.
• To set a national standard for
air, water and noise pollution,
• To ban the mixing of drain
directly to the rivers for
controlling the river pollution.
Output/Result Policy / action plan • There should be • Ministry of • Study possible outbursts of • The continuous
1. Protection of bio- • Give emphasis on integrated a central Popul ation and glaziers cooperation
diversity, land resources development based on the inter- coordination Environment • Make arrangement to implement and support of
and cultural resources environmental relationship system in the • Ministry of Forest the international treaties various
between the upper-land and m inistry and Soil • Establish Environment Protec tion authorities is
*
The quantitative goals are based on the economic growth of 6.2 percent
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lower-land, • Bio-diversity plan Conservation, Trust and charge pollution control necessary
• Implement the policy of will have come • Department of fee
poluter/user pay the fee, into being Archeology • Carry out programs that
• Preparation of • Local bodies emphasize on environment
manuals • NGOs education
• Carry out programs that protect
land use and heritage protec tion
• Increase the involvement of local
people in the plan formulation
2. Control of pollution • Prepare standard for the users • Implementation • Ministry of • Preparation of national standards • The pro-
of natural resources and of standards Popul ation and of air, w ater and noise pollution activeness of
Implement it. • Formulation of Environment, • The provision of land use and various vehicle
• Ban the mixing of sewerage laws • Municipalities, waste dis posal activities will be owners
directly to rivers. • Preparation of • Means of made mandatory for • Coordination
manuals communications municipalities among various
• Municipalities will be made authorities
compel to prepare sewerage
strengthening system before
developing settlement plans.
• The measurement of pollution
emitted by the motor vehicles will
be extended and this task will be
provided to local bodies
3. Evaluate development • Evaluate development • Environmental • Developmental • Establish strategic environment •
programs based on the strategies and policies from the management activities related assessment system and
environmental aspects environmental aspects. programs of ministries implement it.
• Evaluate the Environmental ministries related • Ministry of • The environment impact
aspects of development to development Popul ation and assessment system will be
programs and projects. Environment strengthen and made simple
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3.15 Policy Matrix (Logframe)- Education and Sports*
Overarching Nationa l Objective : Poverty incidence of the Nepalese people (men and women) will be reduced significantly and in a sustainable
manner.
Comprehensive Sectoral objective: Increase human resource development and its productivity sustainably.
Purpose • Increase literacy by expanding non-formal educational • Percent of • School 1. Encourage pre- • Lack of
(Sectoral programmes and make non-formal education useful. children of 6-14 enrolment and primary education. awareness of
objective): • Emphasize on public participation of local level for the years who do attendance 2. Universalise the importance and
Make overall management of school education for which the not go to school register quality of primary readiness about
sustainable government plays a strong role to facilitate, promote quality, • Literacy percent • Trimester and education. education among
growth in regulate and provide service and support in line with the of women and annual 3. Provide programmes local
access to, concept of decentralisation. men 70 % (6 yrs progress of functional literacy communities and
and quality • By calling attention to pre-primary education, emphasize on +) reports of and alternative, non- guardians.
and expansion and development of quality primary education to - Female District formal education to • Lack of
management fulfil the national commitment of ‘Education for All’. literacy (6 Education the adults and awareness and
capacity of • Increase the opportunities by making the progr ammes of yrs+) 67% Office and Min children deprived of readiness
education. technical education and vocational training effective for the - Adult above of Education primary school. towards
production of skilled human resource. 15 years – & Sports 4. Raise the quality of, education among
• Increase the access for the transition of rising number of 63 % • Reports of and access to, the the adults.
students passed from primary level to the secondary - Female special secondary education. • Absence of
education and develop the secondary education to make the literacy (15 surveys and 5. Provide vocational continuity of
higher secondary level as the last destination of the school yrs+) – 55% evaluation training and technical priority to
level education. - Gender • Field educ ation. education sector
parity index supervision 6. Increase the quality under the
• By adopting the principle of cost recovery in higher
education, em phasise on its opportunity, quality and – 0.8% of, and access to, national social
diversification. • School higher secondary service.
• Enhance the quality of education at all levels and make enrolment ratio education.
appropriate arrangement for teachers’ training. of girls and boys 7. Raise the quality and
and dropout rate diversification of, and
• In view of the conditions of women, people from the lowest
• Qualitative and access to, higher
caste (dalits) and backward communities, conduct additional
objective bases educ ation.
educational programmes to increase their access to quality
of the teachers’ 8. Mobilize the youth
education.
promotion and raise the
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• To carry out the concept of ‘Education for All’, develop • Number of diversification, quality
inclusive and integrated education system in line with the school managed of, and access to,
concept of special needs education for the groups requiring by the sports.
it including the persons with dis ability. communities.
• Mobilize the youth in community development programmes
by em phasizing on the sports development programmes
from the local level.
* The quantitative targets are based on the economic growth rate of 6.2 percent

Results/outcomes Policies/action plans • Among those enrolled in class 1, at • Records of class • Awareness enhancement • Decrease in
1. Encourage the pre- • The government least 40% will have received the 1. programmes of pre-primary education concern
primary education. supports the lead pre-primary educ ation. • Record of VDC/ among the office bearers of local among the
role of the local • In every VDC and every ward of the Municipalities. bodies and guardians. local bodies
bodies and municipalities, at least two Child • Four-monthly • Provide physical assistance or block and
communities. Development Centres will be and annual grants to the initiation of the local communitie
established and run with active progress reports bodies to impart pre-primary s.
participation of the local of District education.
communities. Education • Provide training of pre-primary
Offices (DEOs) education to local teachers.
and Ministry of • Make teaching materials available for
Education and pre-primary education.
Sports (MOES).
2. Enhancement of • His Majesty’s • Net enrolment of primary level 90%, • School • Construct/repair additional primary • Decrease in
quality and Government (HMG) female teacher 30, ratio of teachers enrolment schools. educ ational
universalization of will bear all and students. records. • Encourage the appointment of female awareness
primary education expenditures of • Nutritious food to 450,000 students • Records of teachers for primary education. and
public schools on and special education to 30,000 to school students • Impart pre-service, in-service and readiness
primary education. disables. (boys and girls) refres her training to the teachers of among the
• Orient towards • Number of students receiving and teachers. primary educ ation. local bodies
making primary scholarship. • Four-monthly • Improve courses of study of primary and
education universal • Provide the ten-day teachers’ and annual education. communitie
and com pulsory. training: pre-service to 25,000, in- progress • Make the teaching materials of s.
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• Encourage the service to 45,000, to all each year; records of DEOs primary education avail able. • In case
women and the provide 80,000 teaching licences. and MOES. • Train concerned party of primary teac hers
backward classes in • Management training to 26,000 education in management and are not
special way. headmasters and School administration; and transfer school made
Management Committees, 4000 management. aware of
Education Committees of • Make provision of nutrition to the their
municipalities/VDCs; adminis trative students of primary schools. professiona
training: long-term to 100 and short - • Integrate special education in primary l
term to 2400 persons. education. responsibilit
ies.
3. Provide the adults • Conduct movement • Women’s involvement in non-formal • Class records of • Make appropriate teaching materials • In case the
and children barred of adult education education. non -formal available to literacy and work-oriented targeted
from going schools with the • Availability of post-literacy practical education. non-formal education of adult and groups do
with literacy and involvement of the education to at least 50% of the • Four-monthly children. not
non-formal job- com munities. newly literate persons. and annual • Prepare human resource for literacy understand
oriented education. • Provide appropriate • Availability of skill-oriented training progress and work-oriented non-formal the
educational to at least 20% of post-literate records of education. importance
opportunities to the persons. MOES. • Conduct separate literacy of literacy.
children out of the • At least 200,000 children of the age • Reports of programmes for the adults and
schools. group of 6-10 and 1-0-14 not going special surveys. children barred from going schools.
to school receive separate basic • Carry out non-formal education and
non-formal education. community development activities in a
• coordinated way by setting up of
community study centres.
4. Increase the • Implement the • General enrolment rate: classes 6-8 • School • Construct and repair additional • In case
quality of, and concepts of 65% and 9-10 45%. enrolment secondary schools; extend block institutions
access to, secondary community, • Ratio of teachers and students. records grants to conductlaboratories and are not
education. institutional schools. • No. of schools conducting special • Records of libraries. strengthene
• Encourage women education – 200; no. of laboratories school students • Provide training on school d to
and bac kward and libraries – 2000; nutritious food (boys and girls), management and administration of enhance
class/communities every year to 110,000 students; male and female public secondary schools to the access to,
to education. scholarship to 5000 girls stu dents teachers. concerned people and transfer and quality
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• Institutional every year. • Four-monthly management. of
strengthening of • Teacher’s training: pre-service to and annual • Impart pre-service, in-service and secondary
secondary 25,000; in -service to all and progress refresher training on secondary educ ation.
educ ation for its refresher to 1005 teac hers. records of DEOs education to the teachers.
easy access and • Increase SEDU to 45. and MOES. • Spell out the qualification and
qua lity education. • Management training (all • Reports of distribute teac hing licenses to the
headmasters and School special surveys. teachers of secondary education.
Management Committees); • Make timely improvements in the
inspector's training to all. curriculum of secondary education.
• Make provision of nutrition and
scholarship to the women and
backward classes/communities.
• Integrate special education in
secondary level education.
• Extend SEDU.
5. Provide vocational • Reduce the gap • Impart long-term • Students' • Arrange short-term • In case
training and between skill vocational/technical training to 7100 records and vocational/technical training in targeted
technical educ ation. development and persons and short-term to 23555 four-monthly consideration of labour market. classes
labour market. persons. and annual • Provide/arrange for the long-term could not
• Incorporate • Add two technical colleges and two progress reports technical education based on the be made
occupational skill tec hnical schools. of needs of the country and labour aware of
development in • The ratio of teachers and students voc ational/techni market. the
school education. will be 1:30. cal educational • Set up additional technical educational importance
• Conduct Annex Programme as institutions. institutions and colleges. of
sample and on trial in one general • Four-monthly • Encourage institutional and private v ocational
secondary school in each district. and annual technical/vocational academies. and
• Availability of 7100 trainers trained progress reports • Conduct Annex Programmes in technical
in various vocational/technical of DEOs and general secondary schools as sample skills.
subjects. MOES. and experiment.
• Management training (to all • Four-monthly
managers of the government and and annual
non-government, vocational and progress reports
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technical educational institutions). of CTEVT.
• Increase in the involvement of the • Vocational
persons having vocational skills in training and
employ ment and self- employment. technical
educ ation; and
special
evaluation report
of labour
market.
6. increase the • Integrate the • Raise general enrolment to 23%. • School • Provide block grants to • In case 205
quality of, and management of • Bring up community higher schools enrolment construct/establish additional HSSs, HSSs could
access to, higher school education by to 205. records. repair them, and conduct laboratories not be set
secondary implementing a • Implement the education of • Records of and l ibraries. up.
education. unified course in vocational subject in at least one students (boys • Train on management and • In case
school education of com munity higher secondary school and girls) and administration of community HSSs proficiency
classes 1 to 12. (HSS) of each district. teachers (male and transfer management to the certificate
• Ratio of teachers and students; and female). concerned people. level cold
teachers’ training: 1000 pre-service • Four-monthly • Provide pre-service, in-service and not be
and 500 in-service. and annual refresher training to the higher displaced
• Management training (205 progress reports secondary teachers. by HSSs.
headmasters/principals). of DEOs and • Timely improvement of courses of
• Availability of block grants to 205 MOES. higher secondary education.
community HSSs based on school • Special survey • Arrange scholarship to women and
reform programme. reports. backward classes/communities.
• Formulate/enact unified education • Prepare unified education act.
bill/act. • Formulate integrated curriculum.
• Prepare integrated course of study. • Merge proficiency certificate level (of
TU) into higher secondary educ ation.
7. Raise the quality • Increase • Availability of higher education to • Enrolment • Establish universities in mid and far- • In case
and diversification decentralization and 6% (of 18-22 age group) youths. records of western development re gions. proficiency
of, and access to, autonomy of higher • Availability of scholarship (10% of universities. • Make provision of decentralization, certificate
higher education. education. enrolled students) to targeted group • Four-monthly institutional adjustment and autonomy level could
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• Encourage higher (lowest caste or dalits, ethnic and annual of the Tribhuvan University. not be
educ ation to com munities, the poor and women; progress reports • Arrangement of grants for tuition displaced.
become competitive • Ratio of teachers and students. of the University programmes based on the country’s • In case cost
at national and • Enhance educational, economic and Grants need. recovery
international lev els. occupational autonomy of all Commission and • Establish open universities. principle
• Encourage private institutions involved in higher MOES. • Carry out studies or get the studies could not
sector in higher education. • Special done on employment/self-employment be
educ ation. • Adjust posts and structure of tuition evaluation conditions of the graduates. implemente
• Follow cost fees. reports on • Maintain quality in tuition by arranging d.
recovery principle. • Establish and conduct at least one employment and departmental investigation.
• Displace proficiency university, one Open University in self-employment • Displace proficiency certificate level
certificate level. each development region; and that on the and merge it into higher secondary
establishment and operation of need of labour education.
universities under deemed market. • Review the posts of teachers in the
university concept. Tribhuvan University (TU) by
• Condition of employment and self- specify ing the teacher-student ratio.
employment of the graduates. • Review the structure of tuition fees of
• Need of labour market and TU based on social justice.
capability of the graduates.
• Displacement of proficiency
certificate level.
8. Youth mobilization • Involve the youths • Improvement of 3000 youths in • Records and • Conduct youth volunteer pr ogrammes. • In case the
and increase in (both males and volunteer programme with 50% progress reports • Establish youth mobilization youths do
diversification and females) in national participation of women. of youth and organisation and sports development not show
quality of, and development. • Establish and operationa lise one sports centres at constituency level. any
access to, sports. • Keep developing sports and youth mobilization programmes. • Train the teachers and train ers on enth usiasm
sports as the institution in each constituency. • Four-monthly sports and youth mobilization. s to sports.
inalienable part of • Number of teachers trained in and annual • Provide training on sports
educ ation. sports. progress reports management and strengthen
• Encourage the • Prepare 1000 skilled trai ners. of DEOs and institutions.
youths (both males • Government grants to 100 sports MOES. • Encourage to participate in sports
and females) to be organizations. • Special survey competitions of national, SAARC,
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competitive at • Various prizes by participating in reports. Asian and international levels.
national and national, SAARC, Asian and World • Four-monthly • Set up and run the Hi gh Altitude
international levels. level sports competi tions. and annual Sports Training Centre.
• Number of managers trained in progress reports • After incorporating sports as
sports management. of the Youth and extracurricular activities in each level
• Establish and operate at least one Sports Council. of formal education, train 26,000
High Altitude Sports Training • Field teachers to conduct the same.
Centre. superv ision.
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3.16 Policy Matrix (Logframe) - Health *
Sectoral objective: Ensure the health and productivity of the Nepalese people.
Objective Str ategies Indicators Sources of Major Programs Risks and
Purpose • Investment to provide essential health service to the poor and the • Life expectancy at birth will rise • Reports of 1. Child health programme. • In case the local
(sectoral backward communities will be increased gradually. (from 61.9 to 65 years). household 2. Family health programme. elected bodies
objective): • Ayurved, naturopathy services and traditional healing systems (like • Among those receiving survey. 3. Programme for the control and the
Availability homeopathy, Unani) will be developed as the suppleme ntary curative, preventive, • Four-monthly of parasites and endemic communities do
of capable health service. In order to protect and promote these se rvices, promotional health services, all and annual diseases. not show any
and these remedial systems will be developed by the use and 100% will be satisfied. reports of 4. Programme for the control interest,
effective development of local medicinal herbs and by enhancing skills and • The number of health workers MOH. of non-communicable • In case of lack
health expertise. will be adjusted as per the size • Nepal Health diseases. of confidence in
services • Health services will be gradually decentralized a ccording to the of population. and 5. Partnership and peace and
(curative, Local Self-governance Act, 1998 and the office -bearers of Local • Decrease in time to reach the Demography participation programme of security,
preventive, Health Administration and Management Committees will be nearest health centre from the Survey the government, non- • In case the
promotional involved in orientation programmes to enhance their working households (distance less than Report. government and private users do not
and capability. one hour’s walk). sectors. show any
rehabilative • So as to raise the availability of and access to the essential health • Increase in assistance in 6. Programme to operate with interest in
services) on services of such main contributors of the health problems as safe management and operation of the coordination of such receiving health
equality motherhood, reproductive health, child health, nutrition, local level service units of programmes as service,
basis, and tuberculosis, kala-azar (typhus), malaria, Japanese encephalitis health service from the local decentralization • In case the
effective and other communicable diseases, the health service will be level. programme, qualitative health se rvice
reproductive enhanced in rural and remote areas through special se rvices. • At all levels of health service, management of hu man, programme
health and • All government, non-government and private health institutions the participants will have financial and physical does not get
family from the local level health institutions providing basic health enhanced capability to follow resources, population and priority and
planning services to the central level institutions providing specialist services plan and management system. environment. continuity,
services to will be effectively managed and strengthened by means of two- way • The process of ensuring the 7. Programme for the • In case of lack
bring down communication system. quality of service in the development of alternative of availability of
the rising • With the aim of improving the quality of health services provided by government, non-government curative service system. rated human
people as the collaboration of the govern ment, private and non-government and private sectors will be 8. Programme to enhance the and physical
well. sectors, the human, financial and physical resources will be systematized. effectiveness of health resources,
managed effectively. • Human, financial and physical service through qualitative • In case the
• By making reproductive health programme having imperative role in resources will be effectively management of resources. financial sources
population management more effective, the family planning service arranged. dwindles.
will be made more extensive and effective based on the public
choice and, hence, will help reduce maternal and child mortality.
* The quantitative goals base on general (expected) growth rate of 6.2
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Outcomes/Purposes • Policies and Action Plans • Ninety percent of the children • Four-monthly • Vaccine, nutrition, and • In case
1. Make effective • Make child health services under five will be vaccinated. and annual prevention of respirat ory confidence
programmes available via child health • Bring down acute pneumonia progress problems and diarrhoea. among
relating to the programmes, district hospitals, caught by the children under five report of the consumers,
children available. primary health service centres, from current 5.3 to 3.5%. Ministry of guardians, local
Municipality Boards and health • Lessen acute problem of Health. elected bodies
posts and sub -health posts in dehydration pro blem prevalent • Reports of and people in
VDCs. among the children under five from special survey general seems
• Increase access of health services 5.4 to 3.5. (multiple to be low.
in order to improve the health of • The ratio of malnutrition among the survey) • In case there is
the children at risk. children below three will be • Nepal Health lack of
• Arrange quality medicines, brought down from 20.9 to 15.5%. and availability or
machines and equipments for all • Reduce infant mortality from 64 Demography lack of
the year round. per 1000 live birth to 45. Survey. continuity in
• Bring down child mortality from 91 distribution
per 1000 to 72 per 1000. sy stem of
medicines,
equipments and
vaccinati on
m aterials in the
v accine stores
and other
stores.
2. Effective • Family health services will be • Use of the means of family • Four-monthly • Safe motherhood and • In case the local
operation of the made available through district planning will increase from 39 to and annual adolescence services. communities
programmes hospitals, primary health centres, 47%. progress • Family planning and guardians
related to fam ily health posts and sub-health posts • Obstetric services from trained reports of services. do not show any
health. in each VDCs and each ward of persons will increase form 13 to MOH. • Female community interest on the
municipalities. 18%. • Nepal Health health volunteers importance of
• Provide services related to safe • The women receiving pre-natal and programmes. family health.
motherhood through the services for four times will increase Dem ographic • Information,
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partnership network of the form 16 to 25 percent. Survey communication and
gov ernment, non-government and • Number of women (15-44 yrs age (NHDS) education.
private sectors; and the district group) receiving TT vaccines will reports. • Provide special services
hospital will be strengthened for increase form 15 to 50 percent. to the people at risks
emergency obstetric care. • At least 30% adolescents will be (Emergency Obstetric
• Carry out special services with informed about reproductive Care, National Intensive
priority aimed at the women under health. Care, etc.).
high-risk pregnancy. • Maternal mortality rate will reduce
• Arrange supply of qualitative from 415 per 100 thousand to 300
medicines, equipments and per 100 thousand obstetric cases.
apparatus for all the year round. • Total fertility rate will reduce from
4.1 to 3.5.
3. Control of • The services related to • Epidemic of malaria will decline • Annual and • Prevention and curative • In case the
communicable communicable diseases and from 0.56 to 0.10 and that of four-monthly services, and patients,
diseases will be emergency life saving will be made ty phus from 0.29 to 0.10. progress rehabilitation and guardians, local
effec tive. accessible to the people in general • Effectiveness of diagnosis of reports of dissemination of the bodies and
up to the districts, municipalities tubercul osis will be raised from MOH. vector-borne diseases. people in
and the village development 67% to 90% and population and • Nepal • Control of tuberculosis general do not
committees. patients receiving DOT service and Demography and leprosy. show
its effectiveness will reach to 90%. and Health • Management and preparedness.
• Population affected by leprosy will Survey. preparation for • Persistent lack
reduce from 3.88 to 0.80%. • Surveillance emergency and disaster of peace and
• Awareness about HIV/AIDS will reports. services. security.
reach from 52.5 to 70%. • Early Warning • HIV/AIDS, sexually • Lack of
• Emergency services as per the Response transmitted diseases, continuous
protocol will be made available in (EWR). eradication of drug availability of
75 districts. • Report of addiction, environmental workforce and
Ministry of and professional health, resources.
Home Affairs urban health.
about
pandem ics.
4. Prevention of • Extension of preventive and • Provide specialist services by the • Four-monthly • Explore the conditions of • In case the
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non- promotional rehabilitation service. concerned hospitals to 60% of and annual con-communicable patients,
communicable • Follow the results of the cases referred from the local level progress diseases and strengthen guardians,
diseases will be management studies of non- health institutions. reports of curative service at stakeholders,
effec tive. communicable diseases. • Provide cost-free specialist MOH, related various levels to conduct local bodies and
services by the zonal and higher departments, dissemination system in people in
level hospitals to 70% people divisions, concerned hospitals. general do not
identified as the poor and helpless. sections and • Services to other than show readiness.
• Ninety percent people will be national general diseases and • In case
having services against common programmes. essential health; health resources are
diseases. • Special survey problems of eye, nose, not available in
• Provide 80% people with the reports. ear, throat, mouth; time.
treatment related to eye and ear. • Reports of health of mental and
• Reduce the number of drug MOH. senior citizens, mobile
addiction by 25 percent. team, safety net
• Reduce cases of mental problems programmes aimed at
and mouth health by 20%. excessively poor and
• Preventive and promotional health helpless communities,
services will reach at school health laboratories,
environment and business levels. diagnostic x-ray, other
auxiliary services and
blood transfusion
services.
5. Cooperation • Increase the role of the • Active participation of this sector. • Monitoring and • Maintain cooperation to • Decrease in
and participation government, non-government and • Partnership programmes will be evaluation provide health services, readiness of
programmes of private sectors. operated to provide 25% of reports of and set up dissemination local elected
private and non- • Increase the joint investment of the essential services. MOH. system network of the bodies and
government government, non-government and • Partnership will be enhanced to • Four-monthly local to specialised communities.
sectors. private sectors to provide health conduct 50% of special services. and annual services with the • In case health
services. • Contributory non-government reports of involvement of the workers do not
• Arrange the process of ensuring investment in health sector will be MOH. government, non- feel the sense of
the service quality in government, increased by 75% from the present • Four-monthly government and private responsibility.
non-government and private level. and annual sectors. • If the women
• Systematize the quality
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sectors. • In addition to the partnership of reports of the proc ess of services in and backward
• Update the systems of review, government and private sectors, M&E government, non- communities are
supervision and resource dissemination system network will Div ision. government and private not encouraged
mobilization with the formation of be set up. sectors. towards health
target group of skilled human • Partnership will be enhanced to services.
resource. provide 50% of non-essential • Promote
services. decrease in
labour market.
• Lack of
preparedness
among people
in ge neral and
guardians.
• Decrease in the
commitment of
HMG.
6. Effective • To increase the availability of • The number of decentralized • Reports of • Establish partnership • In case local
decentralization health services and to improve the programmes being implemented HMIS. proc ess. comm unities,
will be ensured in health condition of the backward by the communities with their own • Annual and • Partnership plan and consumers and
all levels of health communities, mobilize the decisions will increase. four-monthly management system. guardians do
services. available services at the local level progress not realize
by form ing volunteer groups. statements of importance of
• Provide health services aimed at the MOH, decentralization
the poor and the backward people departments in health sec tor.
by conducting special information, and divisions. • In case the
communication tec hnologies and • Reports of targeted
distant education. local elected communities do
• Strengthen the system of bodies. not realize the
participatory planning and importance of
management. health.
• Make the roles of the Health
Management and Operation
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Committees effective.
• Enhance the participatory plan
formulation and management
capabilities at all levels by
maintaining gender balance.
7. Develop • Ayurveda, homeopathy, unani and • Effective decentralization will be • • •
alternative naturo-therapic medical systems ensured at all levels of health
medical services will be continued as the services through participatory
system. complementary medical systems sy stem.
of health services.
8. Effectiveness • Develop effective and capable • Use of health information will • Reports of • Development of physical • In case the
of health sec tor health management system. increase by 80% while preparing HMIS, HLMIS, infrastructure/structure patients,
will be enhanced • Develop appropriate human plans and pr ogrammes. HEIS. and their reconstruction. guardians, local
with quality resource and employ it in health • Availability of essential health • Four-monthly • Workforce development. elected bodies
management of service. services will increase from 70 to 90 and annual • Information, personal and
resources. • Increase availability of required percent. reports. statements, logistic communities do
resources and establish policy • All 100% of workforce involved in management information not show
mechanism to utilize it health service will be trained. system (HMIS, HLMIS, willingness.
appropriately. • At least 80% of health institu tions HEIS)
• Systematize year-round supply will have regular service of 100% • Medicines, equipments,
process of designated medicines qualified, skilled and expert com munity medicines
and approved medical materials. workforce. and health insurance
• Availability of 80 to 90 percent of management.
essential medicines in the
desi gnated health institutions.
• At least 80% of health institu tions
will maintain 100% accepted
standards of health materials.
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3.17 Policy Matrix (Logframe)- Drinking Water and Sanitation*
Overarching National Objective: Poverty incidence of the Nepalese people (men and women) will be reduced signi ficantly and in a sustainable manner.
Sectoral Objective: Improve public health and increase productivity by providing drinking water and sanitation service
Sector Objective: • Drinking water project(s) will be operated on • 85% of population will • District drinking 1. Provide basic • Continuity of
Improve public the basis of cost recovery principle. benefit from basic water and sanitation drinking water peoples and
health and • Drinking water project(s) will be constructed drinking water services. documentaries. facility local bodies
increase and operated with the involv ement and • Additional 5% • Trimester and 2. Provide participation
productivity by participation of Users' Community and local population will be annual programs of appropriate and
supplying drinking resources will be mobilized to the maximum. benefited from high level the Ministry of sanitation facility contribution
water and • Emphasis will be laid down to increase skill service Physical Planning 3. Up-gradation of • Local level
sanitation services and capacity of the users' • Additional 10% and Works. drinking water capacity
in a sustainable community/committees and NGOs who will population will be • District health service level building
manner. involved in the mobilization of rural drinking benefit from medium statistics 4. Increase capability
water schemes / projects level service. • Special survey of local
• Priority will be given to appropriate, simple • Reduction of illness reports bodies/institutions
technology based projects / schemes, which from water borne and consumers'
could be afforded by the consumers' diseases (children community
committees. In those places where there are below 5 years of age)
no permanent sources of water and enough • Save in water fetching
water quantity, drinking water will be supplied time.
by adopting rainwater harvesting, solar PV • Increase in school
pump, high dam (hydro ram), etc. enrolment of girl
• Priority will be accorded to rural drinking water students in rural areas.
projects to be reconstructed and uncompleted • Reduction in per capita
/ongoing projects expenditure in health
• Adopt policy for proper protection and treatment.
development of water storages by protecting
the watershed and manage integrated use of
its surface and underground water sources.
• Sanitation will be made as an integral
component of drinking water program. In
urban areas where population density is high,
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sewage drainage will be constructed with
peoples' participation, while in other areas
toilets construction will be emphasized.
• National code of conduct/ norms for quality
water will be developed to provide safe
drinking water. Quality monitoring and
controlling process will be strengthened. Also,
national water reg ulatory authority will be set
up.
• In urban areas, private sector involvement will
be encouraged. Also, drinking water facility
will be developed and ex tended by giving
responsibility to District Development
Committee (DDC), Village Development
Committee (VDC) and municipality in line with
the decentralization policy.
Quantity/Outputs • Policy and Implementation Strategy: • Benefited population • Statistics of • Program of district • Continuation of
• Construction of drinking water projects on the from basic drinking Depar tment of w ater supply community and
1. Provide basic leadership and management of consumers w ater:85% Drinking Water poster upda ting local
drinking water • Renovation and repair maintenance of old • Benefited urban • Reports of DDCs • Rural drinking institutions'
drinking water projects population from basic • Reports of all the w ater program participation.
• Maximum mobilization of people's participation drinking water: 85% agencies involved in • Rehabilitation of • Local institution
including cash contribution. • Number of projects in drinking water old projects capability
• Apportion of rainwater harvesting tec hnique operation after supply. program. development.
where permanent water sources are not construc tion • Rain water • Dispute over
available. • Quantity of people's harvesting program sources of
• Increase participation for women's active role participation • Skill and capability water.
and effectiveness. • Participation of women increase o non- • Pollution of
• Give full responsibility of repair and in consumers groups governmental natural w ater
maint enance to consumers' groups and local • Service to poor and organizations/ sources
institutions. neglected/oppressed community based
• Non-governmental organizations, community communities. organizations
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based organizations/ private sec tor's role will program
be the supportive and facilitator.
2. Provide • Implement sanitation program as an • Number of households • District sanitation • Sanitation program • Priority on
appropriate integrated part of drinking water. with private toilets. pos ters. as an integral part sanita tion by
sanitation service. • Mobilize non-governmental organizations and • Number of households • Reports of of drinking water communities
community based organizations as supporter using public toilets. agencies/institutions program.
and facilitator. • Benefited population involved in • Urban sector
• Encourage to construct sulav toilets based with in the area of sanitation. sew erage drainage
upon appropriate technology on the basis of influence zone of • Special surveys and construction
geographical condition in rural areas. sew erage drainage and evaluation report program.
• In dense urban areas, the emphasis will be to length of drainage. • Field inspection • Health educ ation
construct sewerage drainage with treatment and public
plant. awareness
• Mobilize local resources at the maximum. increase program.
• Rural sanitation
program
3. Up gradation of • Contribution by consumers required for more • Number of • Number of private • Kathmandu Valley • Implementa tion
level of drinking expenditure for upgrading service level than hous eholds/population tabs users. drinking water of cost
w ater service. the basic service level. using high level service • Number of good im provement recovery based
• Encourage private sector involvement in the of drinking w ater. and better service program ( urban drinking
urban drinking water management. • Number of providing systems. Melamchi drinking w ater supply.
• Operate drinking water service on the basis of hous eholds/population • Reports of agencies water project). • Interest of
cost recovery principle. using medium level involved drinking • Kathmandu Valley private sector
• Make strong monitoring and control proc ess drinking water service. water sector. Drinking Water in urban
by developing national drinking water quality • Time saving in drinking • Special surveys and Authority and drinking water
standard. w ater fetching. evaluation reports involvement of sector.
• Increase of private private sector in
sector involvement the management of
Execution of national drinking water
drinking water standard service.
in the management of
urban drinking w ater
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supply.
• National
norm/standard for
drinking water
quality
development
program.
• Monitoring of
urban and semi-
urban drinking
water by
autonomous
regulatory body.
4. Capacity building • Consumers' group/committee play • Completion of projects • Reports of agencies • Continuation in
of l ocal institutions implementer's role. within the time frame. involved drinking participation and
and consumers' • Provide training to consumers' groups/ local • Permanent systems water and sanitation contribution of
groups institutions on drinking water manag ement operated and sector. communities and
and health education. maintained by • Special surveys and local institutions.
• Local institutions play the role of facilitators consumers. evaluation reports
• Trained consumers and
repair –maintenance
workers
* Quantitative targets are based upon 6.2% economic growth rate.
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3.18 Policy Matrix (Logframe)- Women, Children and Social Welfare*
manner.
Sectoral Macro Objectives: Standard of living of women, children, disables and senior ( male and female old people) citizens will be raised
Sectoral objectives: • Make the process of formulation, • Amendment in acts • Human 1. Capacity developm ent for • Social
Emerge contribution of coordination, evaluation and and regulations. Development increase in women discriminatio
women, children, disables, monitoring of policy and targeted • Gender Development Report of Nepal participation, increase n continued.
senior citizens and non- programs related to women Index. Gender • Central Bureau of women's access to • Availability of
governmental organizations participation sector effective. Empowerment Statistics resources and abolition of resources for
(NGO) into mainstream of • Increase women participation in all Measure and • Annual reports of all types of discrimination implementati
national development phases of cycles of all types of participation rate of line ministries. against women. on of welfare
programs including poverty women in policy • Social Welfare 2. Prepare national work plan policy.
alleviation and income generation formation. Council and district related to children's right. • Political
programs implemented at local level. • Child mortality rate, administrative 3. Prevention of disables, instability
• Amend legal discriminatory provisions school enrolment rate, offices. provide opportunity to
against women on the basis of birth regis tration rate, disables to lead a dignified
equality and international rates like child mirage, life.
commitment. child labor, nutrition, 4. Develop capability of senior
• Bring children's rights on the basis of etc. citizens, social security and
rights oriented concept in the • Average age of senior provide opportunity to lead
mainstream of national development. citizens. respectable life
• Extension of disables' access to • participation of disables 5. Creation of institutional
economic, social and all types of and service to them. – structure and
opportunities, development Increase in institutional strengthening of existing
amendment to suit the time demand structure. structures.
of laws, policy formation for ensuring • Coordination among 6. Arrangement of co-
protection of economic and social NGOs. –Indicators of working, coordination,
security. population, social and monitoring and evaluation
• Launch programs oriented towards economic. with NGO/ civil societies.
social security and rights related to
senior citizens
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Quanti ty/Outputs • Policy and Implementation • Participation ratio in • National • Preparation of national • acceptance
1. Capacity building, Strategy: political, popul ation census plan of actions and of existing
increase of women access • Amendment in the existing acts administrative, • Repots of development of laws patriarchal
to resources and relating to discrimination against employment sector. Election based upon equity sy stem and
abolition/elimination of all w omen. • Gender sensitive Commission, principle by amending values
types of discrimination • Increase in public awareness curriculum. Public Service discriminatory acts. • Vagueness
against women for related to women rights and gender • Number of Commission, and • Condut of regular in respect of
increasing their equity. complains against Nyaya Parisad gender awareness equality
participation. • Special measures to introduce for crimes. (Council of training oriented concept
increasing women participation in • Assessment of Justice). program at local level among
the returns of opportunity and women domestic • Annal Crime and provide training on concerned
development. work. statis tics of Police leadership, skill and agencies.
• Control of crime against women. Headquater. capacity building for • Realization of
• Increase of skill training and flow of • Human women empow erment. importance
credit Development • Make aware against ill- social
• Include domestic labor in the Report of Nepal. system and tradition obligation
national accounting system. • Central law related to act of killing among
• Increase of women access to service (boksi, jhuma, deuki, employ ers.
resources and control. committee/ Nepal badi, etc.) including • Lack of
• Development of existing institutions Bar Association. women rights and importance of
for work related to women rights gender equality gender
and gender equity. • Arrangement and sensitivity at
coordination of decision level
compensation,
consultation, health
treatment, legal support,
reintegration pac k age
program for women
affected by crimes.
• Women groups
formation and market
arrangement for
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increase of their access
to economic resource,
income generation and
employment.
• Development of
monitoring and
evaluation system of
treaties and conventions
related to all types of
discrimination against
women.
• Development of
institution for
empowerment of
national women
commission, women
rights and gender
equality related works.
• Gender analysis of
policy, program and
budget as well as
assessment of domestic
work of women.
• Establishment of
national gender
resource centre.
2. Protection of children' • Reform in the existing laws to • Amended acts and • Annual report of • Reform of acts related • Terrorist
rights and ensure strengthen children's right and regulation. Ministry of Home to child rights and activities
development development • Increase in • Central children development of national • Increase in
• Abolition of children's exploitation rehabilitation of welfare plan of action. HIV/AIDS
like ill-treatment (sex exploitation children like labor, committee. • Increase of children problem and
and misbehave, labor exploitation, street , drug abuse. • Report of Ministry access to education and increase in
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use in terrorist activities, etc. • Number of sexually of Labor health and its girl trafficking
• Increase of children education and ill-treated children, • Annual report of continuation. • Conti nuality
health facility. • Establishment of Ministry of • Program of child labor of availability
• Increase in birth registration, child reform centre women, children elimination of resources
control of child mirage and and residence. and social • Rehabilitation of
monitoring of adopted children, • Dicrease in child welfare. sexually exploited, ill-
male and female situation. mortality, growth in behaved, traded and
• Awareness raising on protection of educ ation, increase used in mean labor
children' rights and reform of in birth registration, including the children in
institutional system reductin of child hardship in 5
m irage. development regional
• Number of adopted centres and their
children and list of v ocational training
their monitoring. program
• Birth registration,child
labor, child marriage
control including
awareness children
rights program.
• Institutional reform of
central and district child
w elfare committee.
• Establishment of
national resource
centre.
• Other works related to
children rights.
• Financial support and
grant to the Nepal
Children Organization
including NGOs working
in the areas of children
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rights for their
protection and
development related
program.
3. Reduce disability and • Undertake reform legal reform to • Literacy of disables, • Reports of line • Amendment in the acts • - Availabi lity
make them normal for protect rights of disables and school enrolment. ministries. to suit demand of time of fund and
dignified liv ing. prepare national plan of action. • Increase in self – • Annual report of and formulation of resources
• Make living condition of disables employed or Ministry of national plan of action,
comfortable. employed disables. Educ ation. • Implement or make
• Develop capability of disables. • Rehabilitation of • Reports of im plement programs of
• Increase disables' participation in disables related to national disables preventive, curative and
the [programs related to them. increase in human association and supportive service.
resources disables • Implement or make
concerned im plement education
institutions. and skill oriented
training program
• Implement or make
im plement community
based rehabilitation
programs
•
• Rebate on transport,
entertainment and
health service,
• Launch awareness
programs to develop
positive attitude toward
disables in the society,
• Strengthen the
feder ation of disables
and institutions,
• Distribution of disables'
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identity cards and
updating of disables
record.
4. Capability development • Amendment in acts and reform • Number of senior • Financial act/ • Continuation of on- • Availability of
of senior citizens and legal sy stem. citizens and widows budget red book. going social security fund and
guarantee of social security • Increase of social security of senior receiving • Annual report of programs of senior resources.
and dignified liv ing. citizens and special arrangement allowances. Ministry of citizens and helpless • Realization of
for their respect and awareness • Operation of old-age women, children, w idows. importance of
increase. homes in 5 and s ocial welfare • Arrange geriatric ward birth, death
• Utilize the ability, experience and development • Report of Ministry and consultation for and
knowledge of senior citizens in regions. of Health treatment. registration of
development work. • Number of geriatric • Operate old-age homes individual
• Construction of old-age home and ward in hospitals. and establish day -care events.
ex tend it. centre and develop it for
• Keep in mind ageing population lecturing, entertaining
while preparing. and med itation study.
• Publicity of print
materials related to
respect creating of
senior citizens.
• Establishment of senior
citizens Fund.
5. Establishment of • Development of strengthened • Statistics on gender • Secretariat of • Empowerment of • Effectiveness
institutional framework and institutional framework to guarantee discrimination parliament/ national women in
strengthening of existing rights of women, children, disables • Computer data base Gazette. commission and centre coordination
institutions. and senior citizens. of statistics. • Annual report of and district welfare • Other
• Development of monitoring and Ministry of committee and other ministries'
evaluation system. Women. committees with fund response to
• Annual report of and resources. their role and
Supreme Court • Establishment of responsibility.
resource centre • Continuation
(gender, children, senior of fund and
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citizen, disables). resources
• Establishment and
strengthening of women
branch/unit in all line
m inistries.
• Make effective role of
ministry of women,
children and social
w elfare in keeping
contact with other
ministries to adjust,
coordinate, monitoring
and evaluation of
programs related to
children, disables and
senior citizens.
• Equipped child hearing
cases units (child
courts) with physical
facility and resources.
6. Encourage and motivate • Increase direct involvement of local • Increase of NGOs • Social We lfare • Amendment in acts and • Continuation
NGOs and civil societies to institutions, NGOs and civil society (qualitative and Council / District regulation coordinating of fund and
contribute in the in different programs of social and quantitative) Administrative with social welfare resources.
development of women, economic development as well as • Code of conduct of Office. council and district • Active
children, disables and gender equality. NGOs • Association of administrative office for cooperation
senior citizens. • Motivate NGOs to work in remote NGOs. increasing rights and of institutions
and backward areas. • Report of Ministry duties of NGOs and civil and agencies
• Make NGOs responsible and of Information and societies. to rectify
transparent their activities. Communication • Undertake joint working code of
with NGOs in the fields conduct.
of education, health, • Continuation
law, crime, children, of objective
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senior citizens, disables, evaluation.
community
development, public
awareness along with
the programs related to
agriculture, forestry,
electricity drinking w ater
and income generation.
• Increase transpa rency,
uniformity and self
dependence of national
and international NGOs,
• Arrange award, prizes,
etc. to NGOs
contributing in creating
environment for quality
service and competition.
* Quantitative targets are based upon 6.2% economic growth rate.
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3.19 Policy Matrix (Logframe)Local Development*
Overarching National Objective: Poverty incidence of the Nepalese people (men and women) will be reduced significantly and in a sustainable
manner.
Comprehensive sector objective: Reduction in poverty due to the easy access of local people particularly of the economically and socially
backward area, caste, nationalities and class to the services made locally available.
Sector objective • Make stakeholders directly • Creation of 300,000 self- • Report of 1. Organizational strengthening of Donor
Reduction in poverty participants in every phase of employments Local local bodies agencies will
due to the access of development plan preparation, • Creation of 40 million Development 2. Increase in the resource keep up their
local people implementation, monitoring and (400,000x100) man-days of Ministry and mobilization ability of local committed
particularly of the evaluation at the local level. employments due to Department; bodies. assistance.
economically and • Focus the local development construction work including Studies and 3. Improvement in the quality of
socially backward programs on the people of neglected the construction of reports made delivering services by local
area, caste, and oppressed caste and nationality, infrastructures. by local bodies.
nationalities and backward group and backward • Increase in internal bodies; 4. Durability of, maintenance of and
class to the services geological area based on resources of local bodies by Report of use of physical infrastructures
made locally development index and resources at least 50%. target group constructed/ repaired at the local
available. available at the local level. • Beneficiaries of programs and level.
• Continuously increase coordination will be at least 30% people nationalities' 5. Implementation of income
and cooperation among the programs of the backward caste, academy; generating programs at the local
to be implemented at the local level. nationalities and class. Report on level.
• Implement development programs at • Women's participation in regional and 6. Social and economical capital
the local level using environment programs will be 40% infrastructure formation and social
friendly and labor-intensive work program transformation due to social
technology. mobilization at the community
level.
Outcome/Results Policy/action policy • All Districts and • Reports of the • Strengthen the linkage of a local --
1. Institutional • Make District Development municipalities will prepare Ministry of planning system with the center.
strengthening of Committees more capable and periodic plans. Local • Prepare district development
*
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local bodies. responsible. Further strengthening • All DDC & municipalities will Development indicators, and then prepare
the coordination of District set up and strengthen the and development index.
Development Committees with information system (GIS). department. • Set the sectors that donors will
Regional Offices of National Planning • All VDCs will gradually set assist in local development
Commission for making plan up and operate an programs (review and prepare
preparation, and monitoring and information system. donor assistance policy).
evaluation tasks effective. • All assistant staffs of second • Systematize the information
• Make provision for integrating grade working at local system.
population management, bodies will have training. • Implement program on technical
environmental conservation and • 12,000 DDC office holders, assistance to the local bodies.
development in the plans prepared by 50,000 VDC office holders • Make pre-budget estimation and
local bodies through spatial planning. and 1,500 municipal office guidance effective.
• Make an appropriate institutional holders (including women) • Let local bodies prepare and
setup for redefining the remote area, will have training. implement local level programs;
and for preparing and implementing the ministry will provide them with
strategy and program on remote area guidance, assistance and
development accordingly. effective monitoring system or
assistance in effective monitoring
system .
• Make improvement in the
monitoring system.
• Prepare local development policy
and provide feedback:
- Identify the area and the
class based on the GIS
Poverty Mapping for
preparing the development
index of the very poor
community, neglected,
suppressed caste,
nationalities and backward
group and area.
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- Implement the local body -
strengthening program.
2 Increase in the • Mobilize local resources with the • Local Developm ent Fund • Reports of the • Implement program on --
capacity of local direct involvement of local people. will be set up at the local Ministry of strengthening a local body tax
bodies for mobilizing bodies (including DDCs, Local revenue system.
resources. VDCs, & municipalities). Development
• Internal resources of the and
local bodies will increase by department
50%
3 Improvement in • Implement the target programs at the • Issue Civic Charters for • Reports of the • Implement program on --
the quality of local level through the Poverty ensuring services (in 75 Ministry of strengthening the local body.
delivering services Alleviation Fund" in an integrated DDCs, 58 municipalities, Local • Implement program on solid waste
by the local body. manner. 1,500 VDCs). Development management and environmental
• Implement program on poverty • Make use of the program and protection at the local level.
alleviation through social mobilization budget more than 50%. department • Implement the personal event
in every VDC, and diversify the areas • Complete 50% projects out registration program
of investing the savings and loans of the total approved
created by community institutions. programs.
• Make the personal event registration
program effective.
4 Physical • Turn over the responsibility for • All districts will havea • Reports of the Local infrastructure development --
infrastructures at the preparing and implementing programs transport master plan Ministry of program
local level will be on building rural infrastructures to the • At the end of the plan, the Local Rough and gravel road
long lasting, will be local bodies. country will complete Development construction
used and • Make the "fund" set up for repairing constructing 1,200 km rural and
maintained. department • Constructing 1,200 km rural and
and maintaining rural infrastructures and agricultural rough
agricultural rough roads, 600 km
effective. roads, 600 km gravel;
gravel (RIDP); 500 km (RIP), 400
• Have the concept of systematic rehabilitating 250 km roads
km (DRSP), 400 km (RAP), 500
settlement in the geographically every year; regularly
km (RCIW); rehabilitating 250 km
appropriate rural areas. repairing 5,000 km roads
roads every year; regularly
• Categorize the programs on rural and periodically repairing
repairing 5,000 roads; periodically
infrastructure building, prioritize the 600 km roads every year
repairing 600 km every year.
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ongoing programs, and mobilize making total 20,000 km Suspension bridges: new construction
necessary resources for them. operational roads. 500; comprehensive repair 1,200;
• Set the tradition of implementing • New 500 suspension general repair 2,000.
small-scale programs pursuant to the bridges will be constructed; • Setting up a labor-intensive
local master plan. comprehensive repair of technical training center.
1,200 suspension bridges, • Small-scale irrigation.
general repair of 2,000 • Rural drinking water & sanitation
suspension bridges will be program - rural & sanitation
done. project.
• One regional level • Settlement area development and
laboratory will be set up at land pooling.
each development region
for the quality control of
construction work.
• Irrigation facilities for
additional 200 ha will be
available.
• Additional 100,000 people
will have drinking water
facilities.
• Land pooling and settlement
development will be done in
20 locations.
5 Income-generating • Encourage in using the knowledge & • Number of people affected • Reports of the • Neglected, oppressed and Dalit --
programs will be skills of retired army, police, civil by the programs. Ministry of people development program.
implemented at the servants, teachers and so on. Local • Social mobilization & self-
local level. • Identify the poor & implement the Development employment program (in all
income-generating programs that will and VDCs, in all municipalities, in 75%
directly benefit them. department wards of sub-metropolitan, & in
50% wards of metropolitan)
• Local Development Fund (LDF).
• Rural Development Program
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(RDP)
• Western hill poverty alleviation
program.
• Western Terai poverty alleviation
program
• Preparation of norms for
categorizing various areas.
6 Social and • Focus the local development ------ • Reports of the • Neglected, oppressed and Dalit --
economical capital programs on the poorer community, Ministry of people development program.
formation & soc ial neglected, oppressed caste, Local • Set up a Nationalities
transformation nationalities and backward community Development Development National Academy .
through the social and backward geographical areas and • Praja Development Program.
mobilization at the based on the locally available department • Gompa Management &
community level. resources & region wise development Preservation Program.
index. • Rural community infrastructures
development program
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3.20.1 Policy Matrix (Logframe)- Good Governance and Development Administration*
manner.
Sector objective • Improve quantity & quality of the • Increase in the • Auditor General's 1. Leadership and capacity Political
Provide support for services and materials to be percentage of the report development program commitment to
achieving the poverty delivered by the government. progresses of • Various 2. Civil servants' performance the reform
alleviation & • Increase the performance capability development projects. parliamentary capacity & motivation building efforts will not
sustainable of the entire civil service. • Number of economical committees' program. have continuity.
economical & social • Encourage the involvement of and administrative reports 3. Setting up good conduct,
development by w omen in the civil service. irregularities. • National Human corruption control and
creating the sense of • Make the civil service of an • Cost and time required Right transparency expansion program
good governance in appropriate size for clean & prompt for delivering services Commission's 4. Performance improvement of the
the minds of people services, & increase the financial to the people. report government agencies program.
making the public efficiency of the civil service. • Monitoring and • Public Service 5. Monitoring and evaluation
management • Increase the institutional capacity of evaluation indicators at Commission's strengthening program
/administration the institutions involved in control on various levels. report
competitive, cost- corruption and abuse of authority. • Provision for linking the • Annual report
effective, • Strengthen the system of monitoring budget release with the on staff
transparent, service- and evaluation of development progress of project. vacancy
oriented, result- policies, programs and projects. • Number of women in positions.
oriented, responsible the civil service.
& gender equality
oriented.
Outcome/Results Policy/action policy • Various policy ------- • Develop experts and committed • Possibility of
2. Leadership and • Make political and high level decisions. managers required for the having
capacity managerial leadership committed to government agencies, and make tendency of
development the reform process. sustainable transfer of them being unable
*
A-172
• Develop the sense of civic • Gradually increase the to involve
awareness in different stakeholders; involvement of civic society and the civic
and increase their involvement in stakeholders in the reform society.
project implementation. process.
2 Increase in • Involve the civic society in evaluation • Number of civic -- • Introduce the process of civic • Non-
performance ability of the performances of the agencies charters. society evaluating the services uniformity of
and motivation of that deliver public services. • Handover of feasible and materials to be delivered to definition of
civil servants. • Prepare civic charters of the tasks from the center the people. merits &
administrative units at the central to the local bodies. • Prepare & implement the program probability of
and local levels. on making the training job- accepting
• Adopt the policy on contracting out oriented & on improving the academic
non-core jobs of the central level curriculum and examination qualifications
government agencies. technique. as merits.
• Promote the accountability of and • Adopt action plans on increasing • Difficulty in
transparency in the performances of w omen's participation in the civil making the
the government agencies. service. promotion
• Adopt the policy on recruiting and • Adopt a new long-term salary system
promoting staffs on merits in policy. transparent
addition to making the training job - • Strengthen Nepal Administrative • Possibility of
oriented for making the civil service Training Academy & gradually unable to
more effective; and introduce integrate other training centers. pay the
transparent policy on making the • Make provision for contracting out salary
employee transferring system non-core jobs of the government pursuant to
effective. agencies. the salary
• Increase women's participation in the • Right sizing the civil service for policy.
civil service. making it clean & prompt by
• Make structural changes in the policy studying the number of
on salary. employees required & gradually
• Keep the number of employees in a reducing the unproductive staff
right size for making the civil service positions
clean and prompt.
A-173
3. Establishment of • Develop a mechanism for watching --- --- • Developing the capacity of --
good conduct, the assets and conduct of political Commission on Investigation into
corruption control leadership and high-level managers. Abuse of Authority & the
and increase in • Implement activities such as anti- Watchdog Center.
transparency. corruption investigation & pleading • Creating favorable environment
skill development. for anti-corruption investigation by
• Increase the capacity of the agency providing the investigating officers
involved in controlling corruption. & staffs with professional training
& with physical resources.
• Every ministry and every central
level administrative unit will
prepare action plans on
implementing the national anti-
corruption strategy.
• Making additional legal provision
for preventing money laundering
& for taking actions against
amassing wealth through illegal
means & from various illegal
sources.
• Making necessary legal provision
for protecting a staff or an
individual who gives information
on irregularity or on corruption
from within the concerned
agency.
4. Improvement in • Implement the provisions for • Development of norms. -- • Setting up and operating a --
the performances of improving the institutional job • Setting up of a "Performance Incentive Fund " for
the government performance standard of the "Performance Incentive improving the performance
institutions. government institutions. Fund". standard of ministries.
• Preparing and implementing
annual action plans of the
A-174
ministries on delivering services
and on setting the quality norms
of services.
• Providing training on managerial
and onsite problem analysis, and
on developing skills in designing
feasible professional resolutions.
• Making provision for regularly
publishing the information on cost
and quantity of services and
materials delivered by the
government agencies.
5. Strengthening the • Strengthen the monitoring & • Monitoring/evaluation --- • Activating National Development --
monitoring and evaluation system for getting report. Action Committee & Ministerial
evaluation system. anticipated achievement in specified • Provision for linking the Development Action Committee &
quantity, in appropriate quality at the budget release with the making them effective.
estimated cost & time from the progress. • Linking the budget release with
implementation of development the progress.
policies, programs and projects.
A-175
3.20.2 Policy Matrix (Logframe)- Human Rights *
manner.
Sector objective: • Develop the culture of respecting • Improvement in the human --- 1. Promotion of human rights. ---
Support the poverty human rights by effectively rights situation. 2. Institutional improvement in
alleviation task by protecting, promoting and honoring the judiciary.
ensuring the the fundamental human rights
fundamental human enshrined in the Constitution of
rights of Nepalese Nepal of 2047 (1990) and in the
people, and by international conventions ratified by
linking the human Nepal.
rights development • Make the job of preparing and
task with the national amending l aws modern, transparent
development and qualitative.
program • Place emphasis on institutional
improvement in the judiciary.
Outcome/Results Policy/action policy • Make human rights ------- • Preparing a national action ---
3. Protection and • Effectively protect and promote the organizations able to play plan on human rights.
promotion of fundamental human rights provided an effective role in human • Implementing children,
human rights. by the Constitution of Nepal of 2047 rights protection & women, nationality, minority
(1990) and by the international promotion because of their and Dalit, labor, education
conventions ratified by Nepal. institutional strengthening. and culture, environment &
• Gradually link the human rights • Improvement in human development, health, jail,
program with the national rights situation. judicial administration, law
development program to implement • Increase in the inclusion of and legislation, & conflict
the international commitment to subject matters concerning management & so on
human rights as much as possible human rights in preparation programs concerning the
based on the available resources. and implementation of human rights in a
development program. coordinated manner.
*
A-176
• Timely amendment to the • Implementing human rights
existing laws based on the programs for effectively
international ideals of putting into practice various
human rights. international conventions, &
implementing various
awareness programs on
increasing the people's
concern about the
implementation of national
action plan.
• Institutional strengthening of
National Human rights
Commission, Women's
Commission, Dalis't
Commission, Nationality
Academy and other
institutions concerning
human rights.
• Gradually include the
human rights education in
the curriculum of
educational institutions,
governmental training
centers and training
institutions for developing
the culture of honoring the
human rights.
2 Institutional • Place emphasis on necessary basic --- -- • Making timely amendment ---
improvements in the services, institutional and manpower to the prevailing laws
judiciary. development for making prevailing concerning human rights
laws concerning human rights based on the international
A-177
pursuant to the principles of ideals of human rights.
international human rights & making • Preparing and implementing
the tasks of preparing & improving programs on the
the laws qualitative. institutional development of
• Develop physical facilities of the law Law, Justice and
courts; make institutional Parliamentary Affairs
improvement in the law courts, & Ministry, & its manpower for
develop human power for the law making the preparation of
courts. laws and amendment to
them qualitative.
• Making improv ement in
physical facilities of the law
courts, and developing their
human power, & using the
modern information
technology for making the
record system more
systematic for delivering
justice in a prompt, fair,
easy and transparent
manner. Making
institut ional improvement in
the Judicial Academy to
increase the skills of
manpower involved in the
Law and Justice sector.
A-178
3.21 Policy Matrix (Logframe)- Decentralization *
Sector objective: Local bodies will have increased ability to deliver services and benefits effectively at the local level
Decentralization • Give autonomy to the local bodies for • The Local Self- • Annual report of 1. Program on local body • Commitment of
practice will be in performing duties pursuant to the Local governance Act of Decentralization strengthening. stak eholders
place at the local Self-governance Act of 2055 (1998). 2055 (1998) will be Implementation and 2. Program on strengthening the will continue.
level. • Increase the institutional capacity of fully implemented. Monitoring planning procedure of the
local bodies. Committee. local body.
• Increase the people's participation in • Annual report of the 3. Program on financial resource
the local development process Ministry of Local management.
considerably. Development & 4. Program on manpower
• Make the local bodies capable of Report on the final development.
mobilizing internal and external evaluation of the 5. Program on policy and
resources. Ten th Plan. institutional improvement.
Outcome/Results Policy/action policy • All local bodies will • Annual report of • Program on reviewing the • Political
4. Local bodies will • Implement the Local Self-governance be reorganized as Decentralization number, structure, boundary commitment
be strengthened. Act of 2055 (1998) in a timely manner. viable units from the Implementation and of local bodies, and of will be
Categorize the responsibility and the development & Monitoring functions, duties and authority implemented.
programs to be implemented at the administrative points Committee. of the local body and office • Foreign
central and local levels then turn over of view after the • Report on the final holders. assistance will
the responsibility and the programs to review of their evaluation of the • Program on making continue.
be implemented at the local level to number & structure. Tenth Plan. & amendments to the Local
local bodies. • Prepare five new Annual report of the Self- governance Act based on
• Effectively amend the Local Self- work procedures, & Ministry of Local the review results.
governance Act of 2055 (1998) and review 10 current Development • Program on setting up a Local
Rules as required. Amend other Acts procedures; prepare Service Commission.
conflicting with this Act. Prepare & handbooks of • Program on preparing a Local
implement action plans on operating Poverty Service Commission Act in
decentralizing the tasks and resources Alleviation Fund, the first year.
*
A-179
that various agencies of His Majesty's Social Mobilization, • Program on simplifying the
Government of Nepal are going to turn Environmental procedures of local bodies.
over to the local bodies. Management, & • Program on categorizing the
• Set up a Local Service Commission for Local Development local bodies.
recruiting & supplying skilled manpower Fund. • Program on making
to the local bodies. institutional improvement in
• Review the structure & number of the the local bodies.
local bodies including the number of • Program on implementing the
elected office holders as required. judicial authority of the local
• Categorize all local bodies; & increase bodies.
their internal management capacity for
financial management, plan preparation
& monitoring.
2 Local bodies will • Complete the preparati on of the • All local bodies will • Annual reports of • Program on setting up GIS, • Political
have a strengthened periodic plan of all District Development have prepared a DDCs; a National MIS Information networking. commitment
planning system. Committees, municipalities and VDCs periodic plan. Planning • Program on preparing annual will be
within the plan period. Prioritize & • Local bodies will Commission's plans pursuant to the periodic implemented.
effectively implement these plans in achieve 80% targets booklet; an annual plan. • Foreign
partnership with non-governmental of their plans in report of the Local • Program on monitoring review assistance will
organizations, civic society, & the coordination with Development & evaluation of annual plans. continue
private sector. the national plan Ministry. • Linkage with local & central.
3 The financial • Implement the recommendations made • Resource • Annual reports & • Grant program (improving • Political
management by the Local Body Financial mobilization the audit report of revenue & revenue allocation; commitment
capability of local Commission for Decentralization as capability of local DDCs, & the annual formulating the basis of will be
bodies will increase. scheduled. bodies will increase; report of the Local revenue allocation, & implemented
• Increase the resources to be provided & their internal Development improving it every year.) • Foreign
by the center to the local bodies based resources will Ministry. • Grant distribution (making assistance will
on their absorption capacity. increase by 50% of available a lump sum grant continue
• Increase the internal resources based the current according to the category of
on the feasibility of mobilizing the resources. local bodies as set by the
internal resources at the local level, & • They will use 80% of Financial Commission).
systematize the spending process. the available • Financial source transfer
A-180
resources. (identifying the revenue
• They will reduce the sources (taxes) that can be
irregularities in their transferred to local bodies, &
accounts to 10% of transferring the revenue
the total sources & collection
expenditures; they responsibility to them).
will regularly take
actions on settling
the irregularities.
• Prepare and implement action plans on • Strengthening the local body
decentralizing the tasks of His tax system.
Majesty's Government of Nepal & of • Increasing the capability of
various central agencies to be turned local bodies for collecting
over to the local bodies. taxes, & for conducting a tax
• Formulate local condition-specific policy feasibility study.
on allocating the use of the locally • Setting up an Auditing Board.
available natural resources, & • Preparing a computerized
formulate other polices appropriate to accounting system, &
the local area in coordination with the introducing it in DDCs,
local bod ies rather than making a municipalities & 25 VDCs of
single universal policy. the kingdom.
• Making institutional provision
for settling irregularities in the
accounts (setting up an unit
for regularly monitoring by the
Local Development Ministry).
4. Local bodies will • Review the role of the Local • Setting up of a Local • Annual report of • Developing & improving the • Political
have required Development Training Academy & the Service Decentraliz ation organization of the Local commitment
manpower, & training centers under it; train local Commission. Implementation and Development Ministry. will be
increased capability. level officeholders, staffs & other • Number of Monitoring • Organizing orientation, implemented.
manpower required at the local level. personnel receiving Committee; Annual training, study tour, exchange • Foreign
• Link Nepal Agricultural Research training. report of the of views & study research for assistance will
A-181
Council (NARC) and Council of Ministry of Local office holders & staffs of the continue
Technical Education & Vocational Development & local bodies.
Training (CTEVT) with the local bodies Report on the • Setting up a Local Service
for increasing their capability. evaluation of the Commission.
Tenth Plan. • Capability building of local
bodies for taking over the
transferred authority, duties &
functions.
5 Policy • Improve the organizational structure of --- --- • Categorizing district, town & • Political
improvement & the Local Development Ministry; make village level programs in commitment
institutional explicit its role as a coordinator, and its coordination with local bodies. will be
improvement will be. responsibility for it. • Developing leadership of implemented.
• Strengthen the regional offices for women. • Foreign
coordinating the neighboring districts • Coordinating with ministries. assistance will
with each other for local development • Setting up a separate desk at continue
activities; make explicit the authority & the ministry for coordinating
the responsibility of the regional with ministries to set up line
administrators & regional level agency sections at DDCs.
agencies, their institutional • Making provision for setting up
development for preparing & a Commission on Controlling
implementing development plans Abuse of Authority of Local
pursuant to decentralization, for Body/ombudsman; for
periodic monitoring & evaluation of preparing & implementing
these plans, & for making the service code of conduct for it.
delivery process effective. • Monitoring the program of the
• Give priority to the existing users' local bodies.
groups while organizing users' groups • Implementing E-governance.
for implementing local level programs.
• Make special provision for women
leadership training.
A-182

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Unofficial Translation

His Majesty’s Government

Prime Minister March, 2003

Lokendra Bahadur Chand

March, 2003 National Planning Commission

We are sincerely thankful to the Parliamentary Committees of the Ministries

National Planning Commission

Rt.Hon’ble Prime Minister Mr. Lokendra Bahadur Chanda Chairman

Dr. Shankar Prasad Sharma Vice-chairman

Dr. Yub Raj Khatiwada Member

Chief Secretary Dr. Bimal Prasad Koirala Ex-officio Member

Finance Secretary Mr. Bhanu Prasad Acharya Ex-officio Member

Mr. Bhoj Raj Ghimere Member Secretary

High, sustainable and broad based economic growth

Targeted Programmes and Local Development

1. Wider public discussion :

2. Direct participation of ministries and departments:

4. Log-frame of policies and programs:

5. Growth rate and investment analysis:

6. Clarity in the role of different agencies:

2.2 Progress in poverty alleviation

2.3 Progress on main physical infrastructures:

2.4 Macro Economic Indicators

Heading Target Progress

2.5 Government Expenditure:

2.5.1 Regular Expenditure:

2.5.2 Development Outlay

2.6 Sources of Development outlay

2.6.1 The revenue

2.6.2 Budget deficit and financing deficit.

2.6.3 Foreign Aid

2.7 Monetary and price situation and internal debt.

2.7.2 Price situation

2.7.3 The credit and d eposit situation

3.1 Various aspects of poverty

3.2 Income based poverty

The state of poverty incidence is explained by limited access of poverty group to

3.3 Human Development Indicators

3.4 Social Exclusion , Backward Groups and Areas

Table: 3.6 Human Development Indicators by caste and ethnicity 1996

3.6 Backward Areas

3.7 Consultation with civil society and people

3.8 Causes of poverty

4.1. Perspective development strategy

Table 4.1 Major Long-term Perspective Targets -in- Chief

Macro Economic Targets Target up to Twelfth Plan (2016-17)

4.2 Tenth Plan: objective, target, strategy

Table 4.4 Major targets of physical infrastructure

4.2.3 Macro strategies

a) High, sustainable and broader economic growth

b) Social sectors and rural infrastructures development

4.2.4: Areas with Special Thrust

a. Agriculture development, sustainable management of natural resources and

b. Rural infrastructure development and rural energy

c. Population management, social service and basic social securities.

d. Under the role of private sector, development of tourism, water resources,

e. Human resource development and women empowerment

g. Strengthening of local bodies, Non-government and community based

h. Thrust on Areawise development and remote areas

§ Agriculture § Human Resource § Targeted § Promotion and