Finance Minister Dr Ram Sharan Mahat today said that the next periodic plan will frame policies to facilitate graduation of the country to Developing Countries from the current status of Least Developed Countries (LDCs).
Addressing local development partners meeting, here today, he said that the 14th Periodic Plan will be prepared as a roadmap to transform the country into a developing nation from LDC.
Nepal – in the 13th three-year periodic plan launched last fiscal year – has claimed that the country will graduate from LDC to developing countries by 2022.
The country needs an average growth rate of eight per cent per annum by 2022 and massive investment in infrastructure is required to fuel the growth and achieve the target, he said, urging donor agencies to extend their support.
Lack of infrastructure for connectivity and power are key bottlenecks for economic development, Mahat addec.
Development cost in Nepal is higher compared to other countries due to difficult terrain, he said, asking development partners for massive investment in infrastructure. “Nepal has achieved some remarkable results in human and social sector – that is reflected in the millennium development goals too – and its high time, we concentrate on infrastructure.”
However, the development partners complained of low capital expenditure. Nepal was able to spend only around 75 per cent of the total capital expenditure of Rs 85.10 billion – that is 3.3 per cent of the GDP – in the last fiscal year, they said, asking the government to allocate eight per cent to 12 per cent of the GDP for capital expenditure every year till 2022 to graduate to the the developing countries grouping.
They also asked the government to create detailed design of projects, acquire land, establish project management offices and finalise and implement procurement plans on time to achieve the target. “the government must approve projects and release budget on time and enhance implementation capacity,” the donor community urged. “The country needs to drastically increase capital spending – both in quantum and quality – to address the large infrastructure deficit to set the foundation for graduation to a developing country status by 2022.”