Industrial estates to lease out land through bidding

KATHMANDU:

Enterprises seeking to set up bases in state-owned industrial estates will soon have to take part in competitive bidding, as against the existing practice of hiring land or building through application-based process.

The new provision will come into effect upon introduction of the Industrial Estates Operation and Management Regulation.

The Ministry of Industry (MoI), the parent body of all the industrial estates operating in the country, has currently prepared the draft of the new regulation and forwarded it to the Ministry of Finance for further consultation.

“The regulation — the first of its kind which aims to effectively manage industrial estates — will be enforced soon after we get the inputs from the finance ministry,” MoI Under Secretary Bishnu Prasad Dhakal said.

Once the regulation is introduced, Industrial Estate Management Ltd (IEML), a state-owned enterprise that looks over the management of all

industrial estates in the country, will have to issue request for proposals to lease land or building in the industrial estates to the private sector.

“This provision has been incorporated, as land and buildings in industrial estates are currently being leased out on ad hoc basis. We hope the new regulation will create a level playing field to those who cannot wield influence to get a space there,” Dhakal said.

The new regulation, however, will not affect those who have already set up bases in the industrial estates. “But those engaged in businesses that fail to meet the requirement of the new regulation may be given time to vacate the space,” Dhakal said.

IEML will decide on whether to rent out land or buildings to enterprises based on priority of industries set by the new regulation.

Manufacturing companies, for instance, have been accorded highest priority, followed by agro-based and forestry-related industries. Similarly, companies engaged in mining business and export-oriented firms have been accorded third and fourth priority. Other priority industries include those engaged in energy and services.

Currently, 11 industrial estates are operational in Kathmandu, Lalitpur, Bhaktapur, Makwanpur, Nepalgunj, Dharan, Pokhara, Butwal, Surkhet, Dhankuta and Rajbiraj. Of these, the industrial estate located in Dhankuta has remained defunct.

These industrial estates, spread in 5,680 ropanis (289 hectares) of land, are home to 509 industries. These estates have so far drawn close to Rs 13.35 billion in private investment and have created jobs for 14,500 people, the Economic Survey 2013-14 states.

Source: THT