NPC mulling seven-year 14th plan

National Planning Commission (NPC) is mulling to make 14th 'five-year' plan seven year long.
During discussions on the Approach Paper for the 14th periodic plan today, some planning commission members proposed that the plan – that creates a structure, picks priority areas and sets targets for the country's economic development – be made a seven-year-long one for this time, according to planning commission vice chair Dr Govind Raj Pokharel.
"We have started discussions on the approach paper for the 14th plan from today," he said, adding that different members had put forward varied opinions.
The 14th periodic plan will start from the next fiscal year 2016-17.
Since, Nepal will have seven years to graduate to developing country from current Least Developed Country (LDC) status, some members proposed that we take this into account and align the periodic plan accordingly, Pokharel added.
Nepal is planning to graduate from its current LDC status to a developing country status by 2022.
Earlier, the planning commission had prepared Three-Year Interim Plans thrice due to prolonged political transition. The planning commission had brought three-year interim plans to align with constitution making process from the Constituent Assembly (CA). But historically, planning commission has been bringing five-year plan since almost six decades. But the planning commission has brought three year interim plans thrice since the second political movement of 2008.
The third Three-Year Interim plan (2013-14 to 2015-16) – also the 13th plan – aimed at preparing groundwork for Nepal to graduate to developing country status in the next 10 years from 2013 to 2022.
Though Nepal will technically graduate to developing country before 2022 – as it has already met two of the three criterion set for graduation – its sustainability has been under question, especially after the devastating earthquake of April 25, May 12  and series of aftershocks.
The earthquake floored many buildings – including world heritage sites, public buildings, schools, police posts and important infrastructure in addition to private buildings – pushing as many as a million people into poverty, according to the Post Disaster Needs Assessment (PDNA) report.
Out of the three criterion set by the United Nations Committee for Development Policy, Nepal has already met two – Economic Vulnerability Index (EVI) and Human Assets Index (HAI) – graduate to developing country. But it cannot meet per capita GNI threshold.

Budget to come to implementation from the first day of the fiscal year: Finance Ministeru

Finance Minister Shankar Prasad Koirala today claimed that the budget will come into an implementation from tomorrow, the first day of the new fiscal year.

The budget for the current fiscal year 2013-14 brought yesterday will also be acceptable to the elected government as it has been prepared on the basis of approach paper for the third Three-Year Interim Plan (TYIP), he said, adding that the government has also held series of discussions with the stakeholders and political parties before bringing the budget.

The government has recently approved the third Three Year Interim Plan (2013-16) that has envisioned a next three years’ development plans. “The budget has been based on the third Three-Year Interim Plan with focus on key sectors and necessary resources,” he explained. “The fiscal policy has no new programmes, which could be not acceptable for the new government that will be formed after the second Constituent Assembly (CA) election scheduled for November 4," Koirala added.

However, the government reviewed some tax rates after two years of gap to arrange for more resources and also to abide by commitments made to global trade regime, he clarified, adding that the timely budget will, but help get satisfactory results in development projects. “The government is also planning to take some measures to manage budget accountability and ensure implementation to boost economic growth," the finance minister added.

The concentrated approach of the government has cut down the number of projects to 452 in the fiscal year 2013-14 from last fiscal year 459 a fiscal year ago. “The drop in the number of projects is also due to more concentrated approach to implementation of the budget,” he said adding that budget has also mandated not to make any amendment in programmes after the third trimester of the fiscal year.

The Rs 517.82 billion budget has however, is going to fuel inflation in the market. But Koirala assured that the government will take all necessary measures, including improved supplies channels, effective market monitoring and increase in domestic production to contain price hike at eight per cent as envisioned by the budget.

Identification of poor households starts

The Ministry of Cooperatives and Poverty Alleviation has started collecting data of poor households in 25 districts.

The coordination committee will distribute poor identification cards — that will help the government categorise the poor into three categories and provide them preferential treatment — after the data collection in the first phase that includes 25 selected districts.

Data collection has started in four districts — Bajhang, Bajura, Achham and Kailali — in far western; 10 districts — Kalikot, Mugu, Humla, Jumla, Dolpa, Rolpa, Pyuthan, Rukum, Jajarkot and Bardiya — of mid-western; five districts — Gorkha, Tanahun, Kapilbastu, Baglung and Argakhanchhi — of western; three districts — Sindhuli, Ramechhap and Rautahat — of central; and three districts — Bhojpur, Khotang and Siraha — of eastern regions.

Earlier, the first board meeting of the coordination committee on September 6, had planned to start data collection from September 17, 2012, from the selected districts which had the maximum number of poor households to distribute the poverty identification cards in the first phase but the plan did not materialise.

Poverty Alleviation Fund (PAF) had identified 25 districts for the first phase of distribution of identity cards for poor households on the basis of the number of poor households, Small Area Estimation prepared by Central Bureau of Statistics (CBS) and some 12 analysis of the third Nepal Living Standards Survey (NLSS).

The remaining districts will be targetted in the second and third phases, respectively.

According to PAF, the poor identification card will be distributed in three phases with 25 districts in each phase. Each phase is expected to last for two months.

PAF has planned to distribute three colour identity cards — for those who do not have enough to eat for three months, six months and nine months — and the government will provide subsidies and relief packages accordingly.

According to the plan, a Centralised Household Information System will look after the whole process of the card distribution after the testing of Proxy Means scoring before identifying the poor households, though the district coordination committee led by District Development Committee (DDC) — that will also include local development officers and assistant chief district officers besides chiefs of various government agencies in the district — will distribute the cards.

The database of the poor households will be kept at the district level committee and the committee will also listen to the grievances of the public.

The Village Development Committee (VDC) will collect the data of poor households and publish it.

The current three-year Interim Plan — that will come to an end on July 15 — has envisioned the identification of poor households and distribution of poor identification cards.

According to CBS, around 25.16 per cent of the total population of 26.6 million live below the poverty line as they earn less than Rs 54 a day. The national poverty line has been calculated on the basis of consumption which states that a person needs 2,220 calories per day.

Country plans to graduate from LDC by 2022

The National Planning Commission (NPC) has revised its targetted time frame of the country's planned graduation to a developed country from the current status of Least Developed Country (LDC) by eight years to 2022.
"Though the current Three Year Interim Plan (2010-13) has envisioned to graduate Nepal to a developed country in the next two decades, we could graduate by 2022," according to the chairman of the Election Council Khil Raj Regmi, who is also the chair of the planning commission.
A country falls under a Least Developed Country (LDC), if it has less than $905 three-year average GNI per capita (poverty) — as a country will graduate, if it exceeds $1,086 — lowest indicators of socioeconomic indicators including nutrition, health, education and adult literacy along with the lowest Human Development Index ratings, and economic vulnerability based on instability of agricultural production, exports of goods and services, economic importance of non-traditional activities, merchandise export concentration and handicap of economic smallness, according to the Committee for Development Policy of the UN Economic and Social Council that reviews the LDC criteria every three years.
According to Central Bureau of Statistics, the GNI per capital is projected at $721 — some $ 365 less to graduate — for the current fiscal year, whereas Nepal has also been improving in some of the human development indicators under the Millennium Development Goals (MDGs) in recent years.
Since the LDC category was started, only three countries have graduated to developing country status. The first country to graduate from LDC status was Botswana in 1994 followed by Cape Verde in 2007. Maldives became the third country to graduate to developing country status on January 1, 2011.
Currently, there are 14 countries from Asia and Pacific, apart from 34 from Africa, under the LDC group that Nepal is leading in the UN.
Apart from Nepal, Afghanistan, Bhutan and Bangladesh are other LDCs in SAARC.
As the planning commission is vacant currently, only the officiating members — finance minister, chief secretary, finance secretary and the secretary of NPC including chairman — were present in today's meeting that also decided to complete the homework for the third Three Year Interim Plan (2013-16) that will come into effect after mid-July as the current second Three Year Interim Plan will come to an end by mid-July.
The planning commission has remained vacant since April 22, after vice chair Deependra Bahadur Kshetry and three members resigned following the High Level Political Committee's decision to call back the appointees of the then Dr Baburam Bhattarai-led government.
In the absence of the vice chair and other members, it will be a Herculean task for NPC to prepare the strategy let alone finalise the draft of the third Three Year Interim Plan (2013-16), though the meeting also decided to work on it.
The planning commission has to call the meeting of Nepal Development Council to finalise the draft, which, if not finalised by the end of this month, could lead to a plan holiday.
Development partners have been waiting for the final draft of the third Three Year Interim Plan to align their programmes, according to the government's advice, as without the alignment, the donors' assistance — that have helped imporve human development indicators — will be derailed. However, the government itself is delaying the appointment pushing the country towards a plan holiday.
Earlier, finance minister Shankar Koirala had — after pressure from development partners — promised to appoint vice chair and members in the commission soon to expedite the preparation of strategies and finalise the draft to avoid a plan holiday.

NPC vice chair, three members put in papers

National Planning Commission (NPC) vice chair Deependra Bahadur Kshetry and three members today resigned to pave the way for new appointment in the commission, according to the new government's wish.
"I quit the job that I was entrusted to following the shift in the leadership of the government,” Kshetry said at the press meet today.
A former governor of the Nepal Rastra Bank, Kshetry was appointed as the vice chair of the planning commission by the Baburam Bhattarai-led government on September 8, 2011, as he is believed to be close to the UCPN-Maoist.
The three members — Janak Raj Shah, Shiva Kumar Rai and Abdur Karim Mikarani — have also quit as they were also appointed by the Bhattarai-led government.
The tradition has it that with the prime minister, who acts as the chair of the national think tank, gone, the vice chair of the planning commission also follows him. But since the incumbent government was formed on March 14 to hold election, the change in guard in the government was expected not to impact the planning commission.
However, after the decision of yesterday's meeting of four parties’ High-Level Political Committee, to make fresh political appointments including in in the planning commission, Kshetry put in the paper today to make it easier for the government appoint new vice chair.
The new government must appoint new chair immediately as in the absence of vice chair, it will be difficult for the planning commission to form National Development Council to finalise draft approach paper of the third Three Year Interim plan (2013-16).
Kshetry has been apparently not happy with the interim government's non cooperation in calling National Development Council meeting, apart from government's plan to bypass the planning commission while approving the development projects, though the finance minister Shankar Koirala has clarified that there was no misunderstanding among them.

Is Nepal heading towards plan holiday?

It may not have been in the plan, but the country is likely to be visited by plan holiday, an event that could cost country dear.
The National Planning Commission (NPC) is on the horns of a dilemma regarding preparation of the third Three-Year Interim Plan (2013-16) in the wake of a face-off between the national think-tank and the government.
The planning commission has, though already approved the draft of the approach paper for the Third Three-Year Interim Plan, ‘the delay in the formation of National Development Council has ruined its plan to finalise the draft approach paper’, said NPC vice-chairman Deependra Bahadur Kshetry.
The National Development Council is 300-member body that comprises representatives of all the political parties, reputed institutions working in the field of social and cultural sectors and academicians.
Tradition has it that the prime minister, as the chairman of planning commission, calls a meeting of the National Development Council. “But the chairman of the interim election government is busy in state affairs, and does not have time on his hands for the planning commission,” Kshetry said, adding that the commission is already late for the formation of National Development Council that will finalise the approach paper of the third Three Year Interim Plan.
Even the development partners, especially the World Bank and the Asian Development Bank, are waiting for the planning commission to finalise the draft approach paper so that they could put the finishing touches on their own strategy papers.
The Development Cooperation Report (DCR) 2011-12 published this week has also pointed out at stark differences between the priorities set by the second Three-Year Interim Plan (2010-2013) and the development partners. According to the report, the second Three-Year Interim Plan focused on infrastructure development, whereas the development partners’ support was aimed at social sectors. The longer the planning commission or National Development Council for that matter, takes to finalise the approach paper of the third Three-Year Interim Plan, the tougher it will be for development partners to align their programmes with the government priorities.
However, the draft approach paper of the third Three-Year Interim Plan — that has estimated expenditures of around Rs 1,900 billion over the three fiscal years — has focused on infrastructure and hydropower development, aiming at bringing poverty down to 17 per cent from current 25.4 per cent.
The planning commission had promised that it would send the finalised approach paper of the third Three-Year Interim Plan to the development partners by the first week of May so that they could match their projects and programmes with those of the government.
The second Three-Year Interim Plan, which will end on July 15, is the second such plan in a row that has estimated expenditure of Rs 1,023.7 billion over the three years till the end of the current fiscal year 2012-13.
As the delay in budget for the current fiscal year had hit the economic growth, pulling it down to six-year low of 3.56 per cent, the  failure in finalising the approach paper by the end of this fiscal year would hit the country much more.
“Failure in finalising the draft approach paper on our part will further befuddle our development partners,” Kshetry said, asking “How are they going to support a country which is struggling to finalise its own programmes and projects.

The three year interim plan was brought after the Constituent Assembly (CA) election was held in 2006 -- 2007-10 -- till the transition period. However, the political transition lengthened after the CA died on Mar 28, 2012 without finalising the Constitution during the second three year interim plan (2010-13).
Earlier, in 1962 also, a three-year interim plan was implemented, after the demise of democracy and introduction of the party-less Panchayat system.