The ADB Board of Directors approved a grant of $12 million from its concessional Asian Development Fund for the Nepal Transport Project Preparatory Facility. The facility will ensure that important road and air transport projects are prepared in advance, and implemented quickly and efficiently.
"Making remote communities accessible by road or air is crucial to the growth of trade and tourism, and critical for the delivery of essential social services that so many of these poor communities lack," said Dong-Kyu Lee, senior transport specialist in ADB's South Asia Department.
Nepal is highly reliant on road and air links to transport people and goods around its diverse terrain, which includes steep mountains in the north, hills in the centre and lowland plains in the south. However, the road network in remote, upland areas is in poor condition, while many of its 47 airports urgently need upgrading to improve safety and capacity, with the volume of air traffic expected to double by 2019 as tourism grows.
Providing quality road links to distant areas and improving capacity and safety of airports to handle more passengers are central to the government's development plans and it has a range of transport projects earmarked for ADB assistance on the drawing board.
To help move them forward quickly and efficiently, the ADB facility will fund feasibility studies, and other key preparatory measures to reduce the time between the concept stage and the start of physical works. "We expect the facility will substantially reduce the implementation gap for ADB-funded projects," Lee said.
At least, two road transport projects and one air transport project will be prepared under the facility, with priority given to roads that link to subregional transport corridor routes. Capacity support will also be given to improve regulatory environment that clears the way for public-private-partnerships in the road and air transport sectors, which the government is keen to foster. This will also include identifying and preparing a small-scale public-private-partnership pilot project.
ADB is funding 87 per cent of the total project cost of $13.8 million, with the government providing the balance of $1.8 million. The executing agencies are the Ministry of Physical Planning and Works for the road component and the Civil Aviation Authority of Nepal for the air transport component. The facility is due for completion in December 2015.
Talk on stimulus
MANILA: The steps taken by Asia to rebound from the global economic crisis, including financial stimulus packages, exit strategies, and the role of central banks in promoting long-term financial stability, will be discussed this week at a forum organised by ADB. Central bank governors, finance ministers, and government officials from more than 15 countries around the region are taking part in the Impact of the Global Crisis on Asia - Lessons Learned, Policy Insights and Outlook on November 4. It is the third and last in a series of regional forums hosted by ADB to bring together policy makers to find lasting solutions to the worst economic crisis since the Great Depression. ADB President Haruhiko Kuroda will open the forum
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