The two-day Chief Ministers’ Meeting organized by the Gandaki Province Government was focused on listing out common agendas for the Inter-state Council meeting to be held in Kathmandu on September 09, 2018.

The meeting saw discussions on the current status of governance across local bodies, issues and ways to resolve them.

Speaking on the sidelines of the meeting, Gandaki Province Chief Minister (CM) Prithvi Subba Gurung said that the meeting is in line with the constitutional provision for federal structure that marks the significance of CM’s role in development after Prime Minister.

In the meeting, majority of the CMs said the federal government failed in timely devolution of powers to provincial governments, leading to discrepancies in key areas like defining laws, human resources and required budgets.

Because of this, provincial governments failed to deliver the required support to local bodies, they added.

“This has led to a situation, wherein we’ve not been able to send the message to the people that provincial government is at work despite being six months in power,” said CMs.

They claimed that provinces will not able to deliver the expected unless local administration, civil servants and police are under their jurisdiction.

Raising serious concerns over implementation of budget, policy and programs even six months after the formation of provincial bodies, CMs urged the Center to handover all the physical infrastructure and other properties to the provinces.

They urged for the formation of the ‘National Natural Resources and Financial Commission’ at the earliest possible.

Let’s take a glance at what Chief Ministers of various Provincial Governments said in the Summit:

It’s obvious that questions would be raised against the federal government as the constitution has allocated all the rights to it including that of transition period, civil servants, managing resources, formation of police organization and right to draft laws regarding the list of common rights. Since the provincial governments would be responsible for the failure of federal system, we have taken the initiative to organize the gathering and play constructive role. – Prithvi Subba Gurung, Chief Minister of Gandaki Province

Provinces have brought the budget, but there is no mechanism to implement. Old structures have been removed. The presence of provincial government cannot be felt at all the districts. – Dormani Poudel, Chief Minister of Province 3

Though province’s law & order comes under state government’s jurisdiction, we’ve not been able to form the provincial police  – Lal Babu Raut, Chief Minister of Province 2

“It’s a serious issue. What shall we do if the central government refused to accept when we begin the process after seeking foreign investment?  – Shankar Pokhrel, Chief Minister of Province 5

Let’s see what the Center says now!

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The Board of Executive Directors of #WBG on August 07, 2018 enacted a new five-year Country Partnership Framework (CPF) for Nepal with an aim to support the country in its path of development driven by federalism.

CPF for Nepal also includes WB’s commitment to offering needed support to all Nepali institutions that are key to successful implementation of federalism and fast-paced development of the country.

According to the Chief of the International Economic Cooperation Coordination Division of the Finance Ministry, Shri Krishna Nepal, WBG also promised enhancement of its financial support to the Himalayan nation significantly over the next five years period.

Nepal’s transition to federalism unlocks opportunities for all citizens to participate in its development. This represents a window of opportunity for the country to further reduce poverty, increase the income of the bottom 40 percent, and pursue its ambitious agenda of inclusive growth and accountable service delivery.
– Qimiao Fan, World Bank Country Director for Bangladesh, Bhutan and Nepal

What CPF Envisages for Nepal?
CPF noted that #NepalFederalAgenda comes as a boost to WBG’s programmes at the operational and policy levels, while also cautioning the nation with supposed societal challenges that can arise in the federalism implementation process.

“Transitional vulnerabilities could heighten in the early days of federalism as development roles are adjusted and the new structures take root,” notes CPF.

According to an official release, CPF’s key areas of focus for Nepal include:

• Strengthening public institutions for economic management, service delivery and public investment
• Promoting private sector-led jobs and growth
• Enhancing inclusion for the poor, vulnerable, and marginalized groups, with greater resilience against climate change, natural disasters, and other exogenous shocks 

The new partnership strategy with the World Bank Group is focused on supporting our transition to federalism, fits squarely within our vision and underpins a Nepali-owned model, says Yuba Raj Khatiwada, Nepal Finance Minister.

Khatiwada feels that this partnership strategy with the World Bank is in line with Nepal’s goal of giving every Nepali equal access to security, justice, good governance, basic services and an opportunity to participate in the developmental process.

Need of the Hour!
According to World Bank, Nepal will need significant financing beyond currently-available public and development aid resources in order to achieve fast-paced growth and fight poverty in its transition to federalism.

In this regard, CPF states that the government’s growth strategy pitching for higher investment and productivity and effective participation by public institutions will need carefully-calibrated policies to draw required private investment in parallel with the federal process.

We will expand our investments — both debt as well as equity — and advisory services for private investment in Nepal. Our efforts will encourage high-quality private investors to support the government’s strategy of inclusive development – Wendy Werner, International Finance Corporation’s Country Head for Nepal, Bangladesh and Bhutan.

Behind CPF
CPF priorities under its developmental agenda for Nepal were formed after a wide range of consultations with the federal, state and local governments.

The results also included recommendations and opinions of Nepal’s related stakeholders and development partners including private sector, civil society, academia, community groups and media.

This includes hearing from over 200,000 citizens across Nepal through SMS and online surveys. The framework aligns with the government’s development priorities and Nepal’s goal to graduate to middle income country status by 2030, said the World Bank in its official release.

WBG Support to Nepal
The World Bank Group has been actively supporting Nepal through its three main arms:

• International Development Association (IDA): Under this concessionary lending arm, WB is currently supporting 21 active Nepali projects at a USD 2.5 billion investment promised under IDA. Under IDA18, WB has indicative resources worth USD 300 million for Nepal for FY 2018-2020 through the IDA Risk Mitigation Regime.
• International Finance Corporation (IFC): This is WBG’s private sector arm in Nepal, which is committed to infuse about USD 800 million-USD 1.2 billion investment in Nepal over the coming five-year period.
• Multilateral Investment Guarantee Agency (MIGA): This is WBG’s investment risk insurance arm in Nepal, which is actively finding opportunities to pump in foreign private investment into Nepal. IFC and MIGA use IDA IFC/MIGA Private Sector Window (PSW) and the MIGA Guarantee Facility to underwrite eligible projects.

WBG’s first economic mission to Nepal arrived in 1963 to assess the country’s development prospects and challenges. Following this, the country received its first WB credit in 1969 for a telecommunications project.

Since then, the World Bank continued its support to Nepal and provided USD 4.75 billion in assistance (USD 3.48 billion in credits and USD 1.27 billion in grants), so far.

Hope the World Bank’s country-wise development strategy will offer more benefits to the development of Nepal in the years to come!

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