WB-funded projects will not face budget crunch: Government

KATHMANDU, MAR 29 -

The government on Thursday assured the World Bank (WB) that the projects aided by the global lender would not face budget shortage. The development lender had complained about the shortage of resources to projects it has funded due to the government’s failure to release budget timely.

The government told the bank that it has authorised an additional Rs 9 million to the projects to ensure speedy project completion. “This amount is meant for foreign-aided projects that were demanding additional funds after resources under the ceiling of the budget for this year were not sufficient,” said a Finance Ministry official.

During a joint trimester portfolio review of WB-funded projects on Thursday, Finance Secretary Shanta Raj Subedi assured that efforts were being made to expedite development projects, while informing about the additional fund release.

The World Bank has said implementation the projects it has financed slowed down this fiscal year due to delays in full-budget presentation and inadequate budget releases, weaknesses in procurement and financial management as well as frequent turnover of project staff. As a result, over 50 percent of the $1.3 billion project commitments is at risk of not yielding its intended results.

According to the WB, five of the 17 projects in its portfolio have received disbursements so far this fiscal year. “Delays in submission of audit reports have affected preparations for new projects,” stated a WB statement.

According to the Finance Ministry, 43 percent of WB-funded projects have completed audits so far. “Almost all projects will complete the audit within a month,” said the ministry official.

Project audit means the status report of the projects that includes information on how much work has been completed and how resources have been spent.

According to Madhu Marashini, chief at the ministry’s International Cooperation Department, said the ministry has formed a four-member “follow-up team” led by Joint Secretary Krishna Prasad Devkota to help the projects complete audits. He said the ministry also directed the chiefs of the projects to submit action plans for timely completion.

The WB statement said during the review meeting, the Finance Ministry agreed to develop an action plan to ensure that required budget is released, procurement and financial management are strengthened and implementation issues are resolved.

The meeting, attended by the secretaries of various other ministries, also reviewed the status of 12 projects and discussed resolution of issues affecting implementation.

“Early resolution of the implementation issues will allow Nepal to continue to demonstrate development results building on its past performance,” said Tahseen Sayed, World Bank Country Manager for Nepal. “Progress is especially critical as this year’s budget shortfalls have further weakened portfolio performance,” she said.

The World Bank is currently preparing its next country assistance strategy for Nepal.  

Meanwhile, the International Development Agency (IDA), the World Bank Group’s concessional window that provides grants and interest-free credits to its poorest member states, recently began global consultations on the 17th IDA cycle.

Source: The Kathmandu Post