Lack of legal framework hits Bhairahawa SEZ operation

Lack of legal framework hits Bhairahawa SEZ operation

Lack of legal framework has delayed the Special Economic Zone (SEZ), according to trade secretary. Reporting the finance minister Dr Ram Sharan Mahat here today, trade secretary Krishna Gyawali said that Bhairahawa SEZ handover and operation has been delayed due to lack of law. Though the construction works at Bhairahawa SEZ is almost complete and the contractor is all set to handover the project in a fornight, SEZ Act is still in the parliament, he said, during the budget implementation review meeting today. "There may be problems in transferring ownership of SEZ to the government and letting the private sector set up industries due to lack of SEZ Act. However, the ministry is planning to make use of build, operate, own and transfer (BOOT Act) as a temporary basis for the takeover of Bhairahawa SEZ. The government is building first SEZ on 35 hectares of land around three km south of Bhairahawa market. The SEZ – set up largely for export-oriented industries – is likely to offer various incentives including tax holidays and concessions to encourage the export-based industries.   Capital budget spending low The finance ministry’s has to spend Rs 55 billion under capital budget in the next 120 days forcing it to spend Rs 458 million a day. "The spending at the last hour in haste may result in low-quality work," said finance minister Dr Ram Sharan Mahat. The Finance Ministry has revised its capital expenditure target downwards to Rs 75.03 billion against the budgetary target of Rs 85 billion as the spending could not pick up despite timely budget in the current fiscal year. Of the total capital expenditure, the ministries have been able to spend only Rs 19.67 billion in the eighth month of the current fiscal year 2013-14. “There is a tendency of spending late, that will affect quality of work,” Mahat said, adding that development work must be completed by mid-June. Addressing secretaries from various eight ministries, he urged them not to ask for additional budget as they have failed to spend. "Better, you bring proposals to transfer the budget to better-spending projects." Joint secretary and head of Evaluation and Monitoring Department under Finance Ministry Ran Sharan Pudaisaini informed that Ministry of Industry is the lowest spender among the ministries. "In the past eight months, the ministry has spent only 12.57 per cent of its allocated budget of Rs 1.59 billion," he reported, adding that it is been able to spend Rs 200 million only. The ministry has failed to spent budget allocated for Micro Enterprises Development Project and Industrial Infrastructure Development Programme. Likewise, of the eight ministries reviewed, Agriculture Development Ministry (Rs 2.5 billion) and Federal Affairs and Local Development Ministry (Rs 3.5 billion) are the top budget receivers but they have been able to spent only 20 per cent and 25 per cent of the budget, respectively. The review meeting also discussed progress made by education, health and population, land reforms and management, industry, science, technology and environment and forest conservation. The secretaries and higher officials at the ministries complained of delay in land acquisition process and production of procurement plans that have affected the development works. Since the low spending of development budget, employment generation and preparation for the economic growth has been stalled. Finance minister, on the occasion, asked the ministries not to get involved in the smaller projects and hand over them to village development committees and district development committees. Likewise, he also asked to create a basket fund to pool resources extended by our development partners for larger projects.
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