The Governing Board Meeting of South Asian University sets course for growth and regional cooperation

The South Asian University (SAU), a flagship initiative of the South Asian Association for Regional Cooperation (SAARC), convened its thirteenth Governing Board Meeting virtually, with participation from Governing Board representatives of Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka, alongside a representative of the SAARC Secretariat and SAU office bearers, according to a press note issued by the SAARC Secretariate.

Minister of State for Higher Education Ahmed Shafeeu from the esteemed Government of Maldives, presided over the meeting and officially called it to order. The Governing Board undertook a detailed review of the proposed budget for the upcoming year, engaging in comprehensive deliberations on resource allocation and financial planning to support the University’s growth. Members also underscored the urgency of releasing outstanding contributions from Member States to ensure the smooth functioning of SAU, it adds.

Presenting his report, President of SAU Prof Aggarwal outlined the initiatives undertaken since assuming office and shared his reform agenda for the years ahead. While acknowledging constraints that may affect implementation, he reaffirmed his commitment to strengthening the University’s academic profile, institutional resilience, and overall contribution to regional cooperation.

The Governing Board also discussed future priorities, placing particular emphasis on expanding academic programmes, and reinforcing SAU’s role as a hub for regional collaboration. It was further decided that the Chairmanship for the next Governing Board Meeting will pass on to the Government of Sri Lanka.

As SAARC’s Centre of Excellence, SAU continues to serve as a unique hub for learning, research, and creativity for the citizens of South Asia, according to the SAU. "With five faculties and seven departments, the University currently offers Master’s and PhD programmes to around 1500 students, supported by 70 distinguished faculty members from across the region and beyond."

Since its establishment, SAU has educated nearly 2300 students and research fellows, making a significant contribution to knowledge generation and people-to-people connectivity in the region.

Mobile-Phone Technology powers saving Surge in developing economies

More adults than ever in low- and middle-income countries now have bank or other financial accounts, leading to a rise in formal saving, according to the World Bank Group’s Global Findex 2025 report. This momentum in financial inclusion is creating new economic opportunities.  Mobile-phone technology played a key role in the surge, with 10 per cent of adults in developing economies using a mobile-money account to save, a 5-percentage point increase from 2021.

In 2024, some 40 per cent of adults in developing economies saved in a financial account in 2024, a 16-percentage-point increase since 2021 and the fastest rise in more than a decade. Higher personal saving, through banks or other formal institutions, fuels national financial systems, making more funds available for investment, innovation, and economic growth. In Sub-Saharan Africa, formal savings increased by 12-percentage points to 35 per cent of adults.

“Financial inclusion has the potential to improve lives and transform entire economies,” said World Bank Group President Ajay Banga. “Digital finance can convert this potential into reality, but several ingredients need to be in place. At the World Bank Group, we’re working on all of them. We’re helping countries get their people access to new or improved digital IDs. We’re constructing social protection programs with digital cash-transfer systems that deliver resources directly to those in need. We’re modernizing payment systems and helping to remove regulatory roadblocks—so that people and businesses have the financing they need to innovate and create jobs.”

Bill Gates, Chair of the Gates Foundation, one of the supporters of the Global Findex, on the occasion, said, “More people than ever have the financial tools to invest in their futures and build economic resilience, including women and others previously left behind. This is real progress. The case for investing in inclusive financial systems, digital public infrastructure, and connectivity is clear—it’s a proven path to unlocking opportunity for everyone.”

The Global Findex is the definitive source of data on global access to financial services, from payments to saving and borrowing. It highlights a major milestone in financial inclusion: nearly 80 per cent of adults worldwide now have a financial account, up from 50 per cent in 2011. But 1.3 billion adults still lack access to financial services. Mobile phones could help close this gap: about 900 million adults without financial accounts have a mobile phone, including 530 million with smartphones.

Investment in systems that enable instant money transfers, such as UPI in India or PIX in Brazil, could help expand financial usage. So could stronger consumer-protection frameworks and efforts to make phones and accounts more secure.

The Findex data also show that digital financial services are helping narrow the gender gap in account ownership: globally, 77 per cent of women have accounts compared with 81 per cent of men. In low- and middle-income countries, women’s account ownership nearly doubled, from 37 per cent in 2011 to 73 per cent in 2024.

For the first time, the report includes data on personal mobile-phone ownership and internet use.  Globally, 86 per cent of adults owned a mobile phone, including 68 per cent of adults with a smartphone, according to the Global Findex Digital Connectivity Tracker 2025 shows. The rising use of mobile phones for digital transactions, however, comes with new risks. Of the 4 billion adults in low- and middle-income economies who own a mobile phone, only around half use a password to protect their phone.

Across all developing countries, more adults are also using mobile phones or cards to pay merchants. In 2024, some 42 per cent of adults in low- and middle-income countries made an in-store or online digital merchant payment, up from 35 per cent in 2021. Three-quarters of adults, who receive government payments, and half of wage earners, receive their money into an account, a practice that helps reduce theft and ensure that money goes to the right person.

Regional Highlights

East Asia and Pacific: The region leads the world in digital connectivity and use of financial services: 86 per cent of adults have a smartphone and 83 per cent of adults have a financial account.

Europe and Central Asia: The region has the highest internet usage and social media engagement rates among developing economies. Mobile-phone ownership rates top 94  per cent.

Latin America and the Caribbean: About 70 per cent of adults have an account, and over half use their account digitally using a card or phone.

Middle East and North Africa: Account ownership rose to 53 per cent from 45 per cent in 2021. In 2024, some 17 per cent of adults save formally, up from 11 per cent in 2021.

South Asia: Nearly 80 per cent of adults own an account, although the high rate is driven by India, where 90 per cent of both men and women have an account and 65 per cent own a mobile phone.

Sub-Saharan Africa: Account ownership in Sub-Saharan Africa grew to 58 per cent of adults, up from 49 per cent in 2021. Use of mobile money accounts is at the highest levels in the world.

SAARC-ADB consultation workshop on climate change concludes

SAARC member states met in Thimphu from 10th to 11th July 2024 to review the status of the implementation of the Thimphu Statement on Climate Change 2010.

The member states discussed the national-level initiatives taken by each member state and exchanged best practices to fight climate change through regional cooperation.

The consultation workshop finalised a set of recommendations to take forward the implementation of the Thimphu Statement on Climate Change, according to a press note issued by the SAARC Secretariat in Kathmandu. "The findings and the recommendations will be adopted at the SAARC Intergovernmental Expert Group on Climate Change Meeting proposed to be held sometime later this year."

The SAARC Secretariat in Kathmandu facilitated the two-day long consultation workshop held with financial and technical support from ADB, the press note reads, adding that the chairperson of the Royal Civil Service Commission, formerly the director-general of the Department of Environment and Climate Change, Ministry of Energy and Natural Resources, graced the inaugural session of the workshop.

The 16th SAARC Summit held in Thimphu in 2010 adopted the Thimphu Statement on Climate Change towards a green and happy South Asia.

Republic of Zambia opens an Honorary Consulate in Nepal

 Republic of Zambia appointed Nepali businessman Er Desh Bandhu Basnet as Zambia’s Honorary Consul to Republic of Zambia in Nepal.

The ambassador of Zambia to India Mrs Judith KK Kan’goma Kapijimpanga announced the appointment in a special ceremony held at the Embassy in India. Basnet’s jurisdiction will be over Kathmandu Valley and he shall handle the Consular and Economics issues on behalf of the Republic of Zambia, according to a press note issued by the Embassy. The envoy handover all legal and related items to operate an office, including national flag, official seal etc to Basnet.

The appointment will help to promote and strengthen bilateral relations between Nepal and Zambia, the press note reads, adding that it will also act as a catalyst in promoting and smoothing trade, investment and tourism. "New Honorary Consul Office will help in developing strategic partnership between two countries."

Basnet is associated with various national and international associations. He is an executive committee member at Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and chairs the Bi-National NRN Coordinator (FNCCI). He is also an executive committee member of SAARC Chamber of Commerce and Industry (SAARC CCI).

India to promote sub-regional energy hub

 India is planning to promote a sub-regional energy hub.

"The sub regional energy hub comprising of Bhutan, Bangladesh, Nepal, Myanmar and India will help meet its energy needs," according to foreign secretary of India Harsh Vardhan Shringla, delivering his remarks during the inauguration of the South Asia Group on Energy at the Research and Information System for Developing Countries in New Delhi today.

India is taking the lead to promote a regional approach to meet its energy needs, the Indian foreign secretary said, adding that it is natural for India to be the epicentre for any energy initiative in the region as it is the largest producer and consumer of energy in the region. "We have to make energy affordable, accessible and clean," he said, adding that India is promoting easier movement of hydrocarbons across the region.

Shringla, on the occasion, also mentioned that the the first South Asian cross-border petroleum products pipeline from Motihari in India to Amlekhgunj in Nepal was remotely inaugurated by Indian and Nepali prime ministers in September 2019. "The pipeline has helped save Indian Rs 1 billion for Nepal Oil Corporation."

India is now expanding the project to Chitwan, and also construct a new pipeline connecting Silguri and Jhapa in Nepal," he added.

Likewise, India supplied some 700 MW of power to Nepal in 2019 through more than 25 transmission interconnections, Shringla informed, hoping that Nepal may also start exporting power in the near future. "The first high capacity cross-border power transmission line, from Dhalkebar in Nepal to Muzaffarpur in India has been completed with Government of India-assistance and was upgraded to 400 KV capacity in November 2020."

"More cross-border high-capacity connections are envisaged," he added.

In the power generation sector, Satluj Jal Vidyut Nigam Ltd (SJVNL) is developing the 900 MW Arun-III hydroelectric project in northeast Nepal, the Indian foreign secretary said, recalling the Lower Arun project of Nepal has recently been awarded to SJVNL. "A consortium led by GMR is developing the 900 MW Upper Karnali hydroelectric project in western Nepal." 

Upper Karnali is an export-oriented project, where power is to be supplied to India and Bangladesh. "Private sector participation in the hydropower sector holds enormous promise," he said, mentioning that there is a wide variation in energy resource endowments and energy demand in the region. "While India and Bangladesh account for the major natural gas and coal resources, Bhutan and Nepal have large hydropower resources, and Sri Lanka has great potential for solar and wind power production."

All the South Asian countries, in fact, have vast renewable energy potential. "By harnessing complementarities in electricity demand, load curves and resource endowments, a mutually beneficial model of cooperation in South Asia could be developed," he said.

Fourth South Asia SDG Forum calls for South Asian cooperation for sustainable and resilient recovery

 The fourth South Asia Forum on the Sustainable Development Goals (SDGs) – organised by the United Nations (UN) Economic and Social Commission for Asia and the Pacific (ESCAP) and the Maldives' government virtually on December 2-3 – brought together over 450 participants from governments, think-tanks, and civil society organizations from eight South Asian countries.

Preceded by the South Asia People’s Forum on SDGs, the Forum reviewed the status of SDG achievements and the actions taken by the South Asian governments towards resilient and sustainable recovery from the Covid-19 pandemic, including Bhutan and Pakistan that will present their second Voluntary National Reviews (VNRs) at the High-Level Political Forum (HLPF) in 2021.

United Nations under-secretary-general and executive secretary of ESCAP Armida Salsiah Alisjahbana advocated greater action on strengthened social protection and financing economic recovery through innovative financing strategies, accelerating digital transformation and greening recovery through the use of clean technology. She also reiterated the commitment of ESCAP in continuing to work closely with member States and other partners in the region.

Likewise, SAARC secretary-general Esala Ruwan Weerakoon on the occasion, highlighted cooperation initiatives such as the SAARC Emergency Fund to curb the pandemic's impact and urged member states to put SDGs at the center of all policy making and recovery planning. He also complimented ESCAP for its work on Covid-19 and for establishing the portal of the South Asia Network (SANS) on SDGs.

BIMSTEC secretary-general Tenzin Lekphell also emphasised the need for aligning plans with the 2030 Agenda and urged member states in South Asia to work together to address the impact of the pandemic and achieve the SDGs.

The forum serves as a subregional preparatory process for the 8th Asia-Pacific Forum on Sustainable Development (APFSD) to be held in March 2021, on the theme of ‘Accelerating action and delivery of the 2030 Agenda in Asia and the Pacific’. Inputs from the Forum will also feed into the HLPF to be held in July 2021. The forum was followed by a special event on Disaster and Climate Resilience in South Asia with the participation of environment ministers of five South Asian countries.

South Asia discusses impact of Covid-19 on tourism and revival strategies

 The travel industry veterans from South Asia agreed that in the new reality where there are severe barriers to long distance travel, the countries in South Asia should focus on promoting regional tourism to revive tourism.

They also suggested creating a regional body to work on the ease of travel between the countries in South Asia. Speaking during a a virtual meeting ‘Impact of Covid-19 on tourism and revival strategies of South Asian countries’ organised by South Asia Watch on Trade, Economics and Environment (SAWTEE) in association with Biruni Institute, Afghanistan; Centre for Policy Dialogue (CPD), Bangladesh; Research and Information System for Developing Countries (RIS), India; Sustainable Development Policy Institute (SDPI), Pakistan; and Institute of Policy Studies of Sri Lanka (IPS), Colombo.

Former minister of Tourism Yankila Sherpa and advisor of the Tourism Recovery Task Force (TRTF), delivering the keynote speech, noted how the first six months in 2020 have seen a 60 per cent fall in global tourist arrivals. Countries like Maldives and Nepal, the latter having faced closure of 2,600 trekking firms, are disproportionately impacted given the economic significance of the sector, she said, adding that regional collaboration, for instance, on smooth movement, destination infrastructure upgrade, testing and exploiting regional tourism potential like the Buddhist circuit, will aid in swift revitalisation of tourism in South Asia.  “The public-private mechanism is tasked with synergising efforts to revive the travel and tourism sector in Nepal.”

Sherpa, who is also part of Nepal’s Tourism Recovery Task Force (TRTF), also informed that the TRTF has come up with strategies such as Desh Darshan to promote domestic tourism in Nepal.

Likewise a widely regarded academic from the Indian Institute of Management, Bangalore (IIMB) Prof Rupa Chanda observed how each actor in the tourism value chain, from trekking firms, porters and guides, a significant proportion of which are in the informal sector, have been dealt a body blow by the pandemic. Prof Chanda suggested that while identifying and developing safe zones, including corridors, in the region, is a potential revival strategy, its effectiveness will hinge on whether Covid-19 safety rules are enforced. She added that several regulations need to be developed and credibly implemented.   

Bhutan has been among the least affected countries from the Covid-19 not just in the region but also globally. Yet, since its source markets have been ravaged by the pandemic, Bhutan‘s travel and tourism sector has been severely affected. Director-General at the Tourism Council of Bhutan Dorji Dhradhul, on the occasion, argued that with the pandemic, Bhutan’s low-volume high-value tourism strategy could be a model for other countries to follow. Dhradhul observed that potential revival strategies in the sector should seriously consider issues like personal safety and health and that tourists will travel only if they perceive that destinations are safe. On revival strategies, Dhradhul highlighted that the key steps in Bhutan have been development and upgrade of physical as well as digital infrastructure such as contactless payment, skilling of tourism sector workers into providing better services and promotion of domestic promotion.

Likewise, managing director at the Maldives Marketing and PR Corporation Thoyyib Mohamed emphasised that while revival of tourism is critical given its significance for the Maldivian economy, equally important is to avoid explosion of infection. Mohamed outlined how the island nation’s unique geography has enabled it to come up with strategic concepts like ‘one island, one resort’. The concept essentially means that each resort would be a self-contained facility which potentially minimizes physical contact with those outside the island.

On self-contained and isolated destinations, speakers from Bhutan and Nepal highlighted how rural mountainous areas could be a pull for tourists.

The past president of Tourist Hotels Association of Sri Lanka Srilal Miththapala discussed the Sri Lankan case, on the occasion. While the sector has been badly hit, domestic tourism remains open in Sri Lanka, he observed, suggesting that hotel certification schemes, wherein hotels are audited for adherence to Covid-19 safety protocols, have helped tourists as well as the government to minimize infection risks.

SAWTEE, in association with other prominent think-tanks in the region, has been hosting a series of webinars from September 22 to October 16 to deliberate on various socio-economic aspects of the Covid-19 pandemic, how they relate to South Asia and what should be the future course of action for South Asian countries.

Asia Pacific visitor numbers likely to reduce by 32 per cent

Under the newly updated forecasts from the Pacific Asia Travel Association (PATA), the most likely scenario for international visitor arrivals into and across Asia Pacific in 2020 is that visitor numbers are likely to reduce by 32 per cent year-on-year, also due to reduction of 31 per cent arrivals in South Asia.
Taking into account the impacts of the Covid-19 pandemic, the volume of arrivals is now expected to reduce to fewer than 500 million this year. That effectively takes visitor volume back to levels last seen in 2012. At this stage, growth is expected to resume in 2021, returning to forecast levels by 2023, the association forecasts. “Much of course, depends on how quickly and completely the Covid-19 pandemic is contained and controlled.”
A more optimistic scenario suggests arrivals still falling in 2020 but by 16 per cent year-on-year while a pessimistic narrative predicts a reduction of approximately 44 per cent, it adds.
The impacts are expected to be most severe in Asia, especially Northeast Asia, which is now predicted to lose almost 51 per cent of its visitor volume between 2019 and 2020 – most likely scenario – followed by South Asia with a reduction of 31 per cent, and then Southeast Asia with a 22 per cent drop in visitor arrivals. West Asia is projected to lose almost six percent in visitor arrivals, followed by the Pacific with a projected contraction of 18 per cent, and the Americas with a loss of a little under 12 per cent.
Recovery rates relative to 2019 are expected to occur in most destination regions, sub-regions in 2020, however, Northeast Asia is likely to take a little longer and exceed the 2019 volume of arrivals in 2022. The same is essentially true for visitor receipts as well as they are expected to drop by 27 per cent between 2019 and 2020 under the most likely scenario, reducing to $594 billion, significantly below the original 2020 forecast of $811 billion, the association press note reads, adding that Asia is expected to lose more than $170 billion (-36 per cent), with Northeast Asia predicted to lose more than $123 billion (-48 per cent) under this most likely scenario, followed by South Asia with a $13.3 billion loss (-33 per cent) and Southeast Asia with a $34.6 billion shortfall (-20 per cent). “The Americas is projected to lose more than $35 billion (-13 per cent) and the Pacific $18 billion (-18 per cent).”
The recovery at the annual level is expected to return more quickly across most regions, sub-regions, with perhaps the Pacific taking a little longer to return to 2019 levels.
“This is first and foremost an unfolding human tragedy, with a dire loss of life and for millions more, a loss of income while businesses are closed, and many remain in self-quarantine or follow social distancing guidelines,” PATA chief executive officer Dr Mario Hardy said, adding that they can only hope that this pandemic is brought under absolute control quickly and effectively, enabling the global travel and tourism industry to get back on its feet, re-employ the millions of people, who lost their positions and create even more employment opportunities both directly and for the upstream and downstream sectors that rely on it. “While there are obvious reductions in arrivals, there still remains a significant volume of visitors expected into Asia Pacific through 2020, with just under half-a-billion such travellers still generating almost $600 billion, with each visitor still requiring and expecting the attention and service that this region has become famous for delivering.”
“Nevertheless, perceptions are difficult to change so recovery might take longer in the minds of many potential travelers,” he said, adding that it however gives them time to reconsider the position they had created up to 2019, if numbers return only slowly, the obvious imperative will be to offer travellers such incentives that they remain in the destination longer and see more of what it has to offer. “The metric should therefore shift from the numbers of arrivals, to time spent in any one destination and the dispersion across it.”

World Bank predicts sharpest decline of remittances

Global remittances are projected to decline sharply by about 20 per cent in 2020 due to the economic crisis induced by the Covid-19 pandemic and shutdown.

The projected fall, which would be the sharpest decline in recent history, is largely due to a fall in the wages and employment of migrant workers, who tend to be more vulnerable to loss of employment and wages during an economic crisis in a host country. Remittances to low and middle-income countries (LMICs) are projected to fall by 19.7 per cent to $445 billion, representing a loss of a crucial financing lifeline for many vulnerable households.

Studies show that remittances alleviate poverty in lower- and middle-income countries, improve nutritional outcomes, are associated with higher spending on education, and reduce child labour in disadvantaged households. A fall in remittances affect families’ ability to spend on these areas as more of their finances will be directed to solve food shortages and immediate livelihoods needs.

“Remittances are a vital source of income for developing countries,” World Bank Group president David Malpass said, adding that the ongoing economic recession caused by Covid-19 is taking a severe toll on the ability to send money home and makes it all the more vital that we shorten the time to recovery for advanced economies. “Remittances help families afford food, healthcare, and basic needs.”

As the World Bank Group implements fast, broad action to support countries, we are working to keep remittance channels open and safeguard the poorest communities’ access to these most basic needs, he adds.

The World Bank is assisting member states in monitoring the flow of remittances through various channels, the costs and convenience of sending money, and regulations to protect financial integrity that affect remittance flows. It is working with the G20 countries and the global community to reduce remittance costs and improve financial inclusion for the poor.

Remittance flows are expected to fall across all World Bank Group regions, most notably in Europe and Central Asia (27.5 per cent), followed by Sub-Saharan Africa (23.1 per cent), South Asia (22.1 per cent), the Middle East and North Africa (19.6 per cent), Latin America and the Caribbean (19.3 per cent), and East Asia and the Pacific (13 per cent).

The large decline in remittances flows in 2020 comes after remittances to LMICs reached a record $554 billion in 2019. Even with the decline, remittance flows are expected to become even more important as a source of external financing for LMICs as the fall in foreign direct investment is expected to be larger (more than 35 per cent). In 2019, remittance flows to LMICs became larger than FDI, an important milestone for monitoring resource flows to developing countries.

In 2021, the World Bank estimates that remittances to LMICs will recover and rise by 5.6 per cent to $470 billion. The outlook for remittance remains as uncertain as the impact of Covid-19 on the outlook for global growth and on the measures to restrain the spread of the disease. In the past, remittances have been counter-cyclical, where workers send more money home in times of crisis and hardship back home. This time, however, the pandemic has affected all countries, creating additional uncertainties.

“Effective social protection systems are crucial to safeguarding the poor and vulnerable during this crisis in both developing countries as well as advanced countries,” global director of the Social Protection and Jobs Global Practice at the World Bank Michal Rutkowski said. “In host countries, social protection interventions should also support migrant populations.”

The global average cost of sending $200 remains high at 6.8 per cent in the first quarter of 2020, only slightly below the previous year. Sub-Saharan Africa continued to have the highest average cost, at about 9 per cent, yet intra-regional migrants in Sub-Saharan Africa comprise over two-thirds of all international migration from the region.

“Quick actions that make it easier to send and receive remittances can provide much-needed support to the lives of migrants and their families,” lead author of the Brief and head of KNOMAD Dilip Ratha said, adding that these include treating remittance services as essential and making them more accessible to migrants.

Remittance flows to the East Asia and Pacific region grew by 2.6 per cent to $147 billion in 2019, about 4.3 percentage points lower than the growth rate in 2018. In 2020, remittance flows are expected to decline by 13 per cent. The slowdown is expected to be driven by declining inflows from the United States, the largest source of remittances to the region. Several remittance-dependent countries such as those in the Pacific Islands could see households at risk as remittance incomes decline over this period. A recovery of 7.5 per cent growth for the region is anticipated in 2021.

Likewise, the average cost of sending $200 to the East Asia and Pacific region dropped to 7.13 per cent in the first quarter of 2020, compared to the same quarter in 2019. The five lowest cost corridors in the region averaged 2.6 per cent while the five highest cost corridors averaged 15.4 per cent as of 2019 fourth quarter.

Remittances to countries in Europe and Central Asia remained strong in 2019, growing by about 6 per cent to $65 billion in 2019. Ukraine remained the largest recipient of remittances in the region, receiving a record high of nearly $16 billion in 2019. Smaller remittance-dependent economies in the region, such as Kyrgyz Republic, Tajikistan, and Uzbekistan, particularly benefited from rebound of economic activity in Russia. In 2020, remittances are estimated to fall by about 28 per cent due to the combined effect of the global coronavirus pandemic and lower oil prices.

Similarly the average cost of sending $200 to the ECA region declined modestly to 6.48 per cent in the first quarter of 2020 from 6.67 per cent a year earlier. The differences in costs across corridors in the region are substantial; the highest costs for sending remittances were from Turkey to Bulgaria, while the lowest costs for sending remittances were from Russia to Azerbaijan.

Remittances to South Asia are projected to decline by 22 per cent to $109 billion in 2020, following the growth of 6.1 per cent in 2019. The deceleration in remittances to the South Asian region in 2020 is driven by the global economic slowdown due to the coronavirus outbreak as well as oil price declines. The economic slowdown is likely to directly affect remittance outflows from the United States, the United Kingdom, and EU countries to South Asia. Falling oil prices will affect remittance outflows from GCC countries and Malaysia. Remittance costs: South Asia had the lowest average remittance costs of any region, at 4.95 per cent. Some of the lowest-cost corridors had costs below the 3 per cent SDG target. This is probably due to high volumes, competitive markets, and deployment of technology. But costs are well over 10 per cent in the highest-cost corridors due to low volumes, little competition, and regulatory concerns. Banking regulations related to AML/CFT raise the risk profile of remittance service providers and thereby increase costs for some receiving countries such as Afghanistan and sending countries such as Pakistan.

WHO calls for stronger whole of society approach in South-East Asia Region

Amidst rapid spread of Covid-19 and continuing challenges, the World Health Organisation (WHO) today emphasised on a stronger whole of society and whole of government effort in South-East Asia Region to prevent a long-haul with the pandemic and avert further loss of precious human and other resources.
“A more comprehensive approach is needed with communities at the center of our response,” regional director at the WHO South-East Asia Dr Poonam Khetrapal Singh said, adding that most importantly, communities need to be engaged and empowered to take appropriate decisions and measures. “The onus must be on each one.”
At this stage, everyone needs to contribute to minimise health as well as socio-economic impact of the pandemic,” she said.
In recent days and weeks, countries in the Region have taken difficult decisions including implementation of unprecedented physical distancing measures to arrest the virus spread.
Nearly 1.5 billion people – in Bangladesh, India, Myanmar, Nepal, Sri Lanka and Thailand together – are currently experiencing lockdowns. Supported by communities, we should start to see impact of these measures in the coming weeks, she said, adding that simultaneously, this is also an opportunity for countries to enhance capacities of their health systems. “As physical distancing measures take effect and capacities are built, whatever the transmission scenario, with the right approach the virus can be contained.”
“In areas where community transmission occurs, it can be suppressed and controlled, the regional director said.
“Every case, cluster and evidence of community transmission would need to be aggressively responded to,” according to Dr Khetrapal Singh. “Basic public health measures such as active case detection, isolation, testing, treatment and contact tracing are among our most powerful tools,” she said, adding, “A strong surveillance is needed to assess and guide evidence based measures.”
The regional director also held a virtual meeting with health ministers of the Region to review the challenges. Most countries highlighted the need for essential medical equipment, testing kits, personal protective equipment for health workers and enhancing health systems capacities, specially to respond to community transmission.
The regional director said WHO will continue to work with the Pandemic Supply Chain Network to ensure all at-risk and critically affected countries are supported. “These shortages are a global problem, and one that will have a significant impact on the response,” she said. “If we cannot protect health workers, and are unable to adequately test, we will be fighting with one arm tied.”
The regional director commended countries in the Region for participating in the WHO Solidarity Trial. India, Indonesia and Thailand have signed up for the multi-country trial, which will compare the safety and effectiveness of four different drugs or drug combinations against Covid-19.
“It is a historic undertaking that will dramatically reduce the time needed to generate robust evidence about what drugs are effective in treating Covid-19,” Dr Khetrapal Singh said, adding that the more countries that join, the faster we will have the results. “I urge all countries to sign up.”
WHO will soon be launching a second protocol for the Solidarity Trial that will help establish incidence and prevalence of infection and the future behaviour of the virus, she added.

ADB registers record disbursement

The Asian Development Bank (ADB) achieved a record disbursement of $323.7 million for development projects in Nepal in 2019. Some of the projects contributing to 2019’s record disbursement include the Earthquake Emergency Assistance Project ($38.5 million), the South Asia Subregional Economic Cooperation (SASEC) Power System Expansion Project ($28.7 million), Food Safety and Agriculture Commercialisation Programme ($25 million), Regional Urban Development Project ($22.1 million), Rural Connectivity Improvement Project ($20.2 million), and Supporting School Sector Development Programme ($20 million).
“ADB’s support to Nepal in the infrastructure sector has increased in the recent years with larger but fewer projects,” said ADB country director for Nepal Mukhtor Khamudkhanov, speaking at a country portfolio review meeting jointly organised by ADB and the Finance Ministry today. “But while disbursement has picked up pace, challenges remain and the overall performance of ADB operations in Nepal could be much better.”
“For better and quicker results on the ground, higher lending needs to be matched with improved implementation and enhanced technical capacity of implementing agencies,” he said, adding that difficult terrain and remoteness of project sites, addressing safeguards issues, and the country’s ongoing transition to federalism that takes time have also posed challenges in effective implementation of development programmes. “We appreciate the consistent efforts by the Finance Ministry to progressively address risks and constraints through regular country and tripartite portfolio review meetings, with active participation of line ministries and relevant agencies.”
At a special ceremony held in conjunction with the meeting, finance secretary Sishir Kumar Dhungana presented awards to ADB-supported projects that showed excellent results in 2019.
The Third Small Towns Water Supply and Sanitation Sector Project and Community Managed Irrigated Agriculture Sector (Additional Financing) won the outstanding project management teams awards. The Urban Water Supply and Sanitation Sector Project was awarded the best team for procurement management prize. Likewise, the SASEC Power System Expansion Project received the best team award in the categories of environmental and social safeguard monitoring; the Third Small Towns Water Supply and Sanitation Sector Project won the gender equality and social inclusion award; and the SASEC Road Connectivity Project bagged the financial management and disbursement accolade.
“These awards recognise the project teams' excellence not only in effective project management which helped save time and prevent cost overruns, but also prioritise gender equality and social inclusion, as well as environmental sustainability and social safeguards,” Khamudkhanov added.
Since the start of its operations in Nepal in 1969, ADB has provided about $6 billion in financial and technical assistance to the country. The assistance provided by ADB to date focus on the energy, transport, urban development, water supply and sanitation, agriculture and irrigation, education sectors, among others.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members, 49 from the region.

Tourist arrivals plunges in January

Tourist arrivals in the first month of the 2020 – the year Nepal is observing as Visit Nepal Year 2020 (VNY2020) – has dropped by 2 per cent compared to January 2019.
According to Nepal Tourism Board (NTB), a total of 79,686 tourists entered Nepal in January, down from 81,273 in the same month last year. “Of the total tourists, 65,983 flew into the country whereas remaining 13,703 entered the country through land routes," a press note issued by the board reads.
The government has inaugurated VNY2020 campaign amid much fanfare across the country on January 1 wishing to host 2 million tourist in the year. But January turned into an unfavourable month for the national campaign VNY2020 due to the recent incidents of tourist bus accident, avalanche in Annapurna region, death of Indian tourists and recent announcement of the Chinese government to halt outbound tourist groups, the board explained.
As China is the second largest market, the fall in the number of Chinese tourists is going to affect Nepali tourism industry, chief executive officer (CEO) of NTB Dhananjay Regmi said, adding that the board is postponing all its promotional activities in China for the short-term. “Instead, the board is preparing to add more activities for other countries.”
“Tourism is at the receiving end of coronavirus outbreak in China,” he said, adding that not only has Chinese tourists been affected, the fear of coronavirus has taken over its effect on tourists from India and Europe as well.
Though, Nepal is looking towards new another destinations including Japan, South Korea, and Sri Lanka, among others, as well as in the Middle East, the coronavirus outbreak in Hubei province of China could impact global tourism industry too making the outlook for February also not promising.
“The outlook for February is also not satisfactory, according to the tourism entrepreneurs. “The number is declining in February,” they said, adding that the drop could be even harsh in the second month. “The arrival graph is going down mainly due to drop in tourist numbers from China.”
India, China, the US, Myanmar and Thailand are the top five markets for Nepal as Nepal received 16,882 and 13,303 visitors from India and China, respectively, while it welcomed 6,386 visitors from the US, 4,447 from Myanmar and 4,010 from Thailand in January.
According to the board, some 39.1 per cent of the total tourists that visited Nepal in January were from Asian countries – except SAARC – and 26.9 per cent were from SAARC countries, whereas some 13 per cent of the total visitors were from European countries and 9.2 per cent were from the US. “Some 4.1 per cent of the total tourist, who visited Nepal in January were from Oceania region,” the board added.

Stay advanced with innovative technology at Nepal 5P

5P is the only dedicated industry specific international trade show for Plastics, Paper, Printing, Packaging and Processing Industries in Nepal. “It promises to be an excellent platform to forge business alliances, showcase innovative technologies and interact directly with the traders from across the country,” according to the organisers.
“Comprising of five industry-focused phenomenal trade fair shimmering with unprecedented export opportunities and unveiling brand-new formats and cross-industry concepts and technologies to a dynamic rapidly growing business environment,” said Media Space Solutions, Nepal and Futurex Trade Fair and Events (India), the organisers.
Nepal is one of the fastest growing markets in SAARC Countries and this exhibition would attract thousands of buyers and decision makers from all levels and segments of Plastic, Paper, Printing, Packaging & Processing Industries and aims to promote a direct business link between buyers and sellers, they said, adding that Nepal 5P Expo is supported by PHD Chamber of Commerce (India), Nepal Chamber of Commerce (NCC), Corrugated Boxes Manufacturers Association of Nepal, Screen Printing Association of India, All India Plastics Industries Association and IPAMA. “Being India the biggest supplier of machinery and raw materials in Nepal, more than 100+ Indian companies are exhibiting together with participants from China, Taiwan, Germany, Italy and more than 50+ companies are exhibiting from Nepal in this expo.”
With more than 120 global exhibitors, the expo takes great pride to have developed into an international event, targeting not just the neighboring countries but also attracting the interests of visitors from Europe, Africa and other Asian countries with the year’s theme ‘Building Nepal together for a brighter tomorrow’ leading the way.
The expo will witness all kinds of manufacturers of plastic processing machineries, screen printing, containers, bib cock, injection moldings machines and printing machines, tapes, plastic heaters office stationery machineries, printing spare parts, paper machinery, paper cup machineries, all kind of papers, and spare parts, makers of sewing machines, packaging machinery, wrap film manufacturers, label manufacturers, corrugated box manufacturers, and many more on display.
“Nepal 5P not just provides a great opportunity and a platform for suppliers, manufacturers and buyers to meet and share notes, but also claims to be a catalyst in the development drive of future Nepal and the flow of cutting-edge technology and best practices,” the organisers added. “While every segment of the Printing, Plastic, Paper, Packaging and Processing industry is represented in the expo, the participation of top brands assures a feature-packed event.” 

After 35 years, SAARC is a non starter

The South Asian Association for Regional Cooperation (SAARC) turned 35 years today but is still a non starter.
After three-and-a-half decades of existence, the platform has largely failed to advance its own central tenet, the regional cooperation. Marking the 35th anniversary, the heads of governments in SAARC expressed their commitment to regional cooperation but their commitment to regional cooperationhas failed to ever translate into action. The regional association has failed to hold its 19th summit, ever since 2016 when India suddenly decided to pull out of a planned meeting in Islamabad, accusing Pakistan of failing to control cross-border terrorism. The regional platform – of eight South Asian countries – has largely been held hostage to the India-Pakistan rivalry.
But the regional platform prohibits discussion on bilateral issues and the Indo-Pak historical baggage always has been a major blockade in the path of the SAARC not it seems to have any immediate progress in holding the summit due to the Indian government’s recent decision on Jammu and Kashmir to strip the special status.
The decision of the Indian Prime Minister Narendra Modi to change Kashmir’s status and tighten the Indian government’s grip over the region in August has stoked anger and resentment while a three-decade armed revolt rages.
But Nepal – as the current chair of SAARC – could take steps to reach out to both India and Pakistan and hold the summit. Nepal itself has its own boundary dispute with India and the government has not able to talk to the Indian leadership on the border dispute, though Nepali Communists have been making it a political agenda to win the election time and again.
Some blame the Indian Prime Minister Narendra Modi – since his rise in India in 2014 – that he has attempted to eschew SAARC  to circumvent Pakistan and pushing the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), a sub-regional grouping that does not include Pakistan.
On the occasion, Prime Minister KP Sharma Oli said that Nepal, as the current chair, is firmly committed to the SAARC Charter, its principles and its objectives. “As a founding member and current chair of SAARC, Nepal pledges to continue to constructively engage with fellow members to collectively realise the hope of the people of this region,” Oli said in his message. But Nepal has also not done anything constructive to make the platform more dynamic.
As SAARC chair, Nepal should have atleast convene a foreign secretary-level meeting or a meeting on eliminating terrorism, though no other country in the region can force India as they are not comparable to India in terms of geography, economy, military strength and influence in the global arena.
Due to failure of the multilateralism including SAARC like regional forums – across the world – the countries have been slowly turning into stronger bilateral relations. The SAARC conferences – in the past – had signed various agreements in the last 35 years though most of them are yet to be implemented.
On the occasion of 35th SAARC Charter Day that falls on December 8, Indian Prime Minister Narendra Modi and Pakistan Prime Minister Imran Khan also issued their statements. Modi called for greater collaboration among the SAARC member states to act against the scourge of terrorism, according to Indian media reports. “SAARC has made progress but more needs to be done. Our efforts for greater collaboration have repeatedly been challenged with threats and act of terrorism.”
Modi said that the regional organisation was set up ‘to build a connected and integrated South Asia’ and aims to promote ‘development and progress of all countries in the region’ and New Delhi will continue to ‘support various initiatives to achieve closer cooperation in diverse areas’.
Likewise, Prime Minister Khan – in his statement – said that Pakistan believes the effective and result-oriented regional cooperation can only be achieved by adhering to the cardinal principles of sovereign equality and mutual respect as enshrined in the SAARC Charter.
“December 8 marks the day when leaders with vision and foresight adopted the SAARC Charter and pledged to work together for the progress and prosperity of South Asia," Khan said, in the statement posted on the official website of the Ministry of Foreign Affairs of Pakistan.
On December 8, 1985, at the first SAARC Summit in Dhaka, the leaders of the seven South Asian states –the Maldives, India, Bhutan, Pakistan, Nepal, Bangladesh and Sri Lanka – signed a charter to establish the South Asian Association for Regional Cooperation (SAARC). Afghanistan joined as the youngest SAARC member in 2007. SAARC Charter Day is commemorated every year to mark the signing of this Charter, and lately it has just become only a 'ritual'.

Nepal hails Japan’s support to post-quake reconstruction

Nepal lauded Japan’s support in post-earthquake reconstruction.
Inaugurating the 46th annual function of JICA Alumni Association Nepal (JAAN) and International Seminar on ‘Natural Disaster in South Asia: Interventions, Best Practices and Challenges’ in the capital today, foreign minister Pradeep Kumar Gyawali lauded Japan for supporting Nepal in its reconstruction process by providing financial and technical assistance.
Gyawali said Nepal and Japan had enjoyed excellent cordial bilateral relations ever since the establishment of formal diplomatic ties between the two countries in 1956. “JICA has been helping in reconstruction and recovery especially of schools and health posts,” he said, thanking the people and government of Japan.
While recalling his visit to Japan in November, Gyawali said that Japan has been a longstanding development partner of Nepal.
On the occasion, he also launched JAAN's annual publication ‘MILAN’, which contains scholarly articles from experts from Nepal, JICA, JAAN and other countries in South Asia.
Speaking on the occasion, Japanese ambassador to Nepal Masamichi Saigo said that with high level exchanges between the two countries ‘Japan-Nepal relations have been more solid than in the past’. The envoy also thanked JAAN and JICA Alumni Associations' Forum of SAARC Countries (JAAFSC) for contributing to strengthening the relations between the two countries.
JICA Nepal's chief representative Yumiko Asakuma, on the occasion, highlighted Japan's contribution to Nepal's reconstruction process after the 2015 earthquakes and various other cooperation projects launched with Japanese assistance. She also expressed the hope that JAAN and JAAFSC will contribute to further strengthening the relations between Nepal and Japan.
Likewise, chief executive officer (CEO) of National Reconstruction Authority (NRA) Sushil Gyewali shared the progress of Nepal's reconstruction process with the audience. “The reconstruction process is expected to be completed within the next two years,” he informed.
During the programme, various scholars and representatives from South Asia presented papers on the theme of Japan-Nepal relationships and natural disasters, which they said, are the common problems for all countries in South Asia.
According to president of JAAN and general secretary of JAAFSC Ram Chandra Bhusal, the international seminar has been organised to share lessons and best practices of South Asian countries in matters of disaster management so as to enable each country in the region to be better-equipped to overcome the challenges facing the region in disaster risk management.

Nepal and European Union discuss investment

The 11th meeting of the Joint Commission between Nepal and the European Union (EU) – held today in Kathmandu – discussed a gamut of issues including mutual interest.
Both delegations also underlined the importance of further strengthening the political partnership, development cooperation and promoting global and regional engagement on matters of common concern like climate change, human rights, connectivity and multilateralism, according to a press note issued by the EU Office in Kathmandu.
“Nepal and the EU have taken firm steps to reinforce their partnership, including through the decision of upgrading the Joint Commission to annual meetings from biennial ones from 2019 onwards,” the press note reads, adding that both the party underlined the importance of high-level visits in further consolidating bilateral relations and cooperation, and agreed to plan such exchanges in the near future. “The Nepali side, on the occasion, highlighted the efforts being made by the government in institutionalising peace and stability through a number of policies and programmes under the overarching national aspiration of ‘Prosperous Nepal, Happy Nepali’.”
The meeting also underlined the long-term vision of the government, including the implementation ofthe Sustainable Development Goals (SDGs), and the strategies for graduation from Least Developed Country (LDC) status and becoming a middle-income country.
The EU appreciated the achievements made by Nepal in a peaceful political transition, stressing that steps like the promulgation of the new Constitution and the 2017 elections were instrumental in consolidating democracy and institutionalising federalism. The EU, on the occasion, welcomed the statement of commitment to transitional justice made by foreign minister Pradeep Kumar Gyawaliat the 74th Session of UN General Assembly.
The EU also informed the Nepali side about the May elections to the European Parliament, the incoming EU leadership and its priorities, and the Multiannual Financial Framework 2021-2027, which is the forthcoming framework for EU development assistance. “The Nepali side expressed hope that Nepal-EU relations will be further strengthened under the new EU leadership and the new framework,” the press note reads, adding that the EU side explained its Connecting Europe and Asia Strategy and emphasised the importance of economic, fiscal, financial, social and environmental sustainability. “The development and financing of sustainable transport, energy and digital networks, as well as of people-to-people connectivity are at the heart of this strategy.”
The Joint Commission noted that the European Investment Bank (EIB) will focus its lending activities in the field of climate change mitigation and adaptation and infrastructure development in the forthcoming years. Moreover, both sides attached high importance to the investment and blending opportunities under EU's Asia Investment Facility.
The Nepali side briefed about the various policies, legal instruments and adaptation measures to create an enabling environment for investment.
As important trading partners, Nepal and the EU exchanged views on bilateral trade, focusing on the challenges, prospects and way forward. Nepal, with the support of the EU, will continue to enhance its export capacity to the European market, particularly in the context of the Everything But Arms (EBA) scheme, the most preferential EU trade regime. The EU undertook to assist Nepal further in gaining access to and benefits from the EU market.
In terms of people-to-people connectivity, Nepal and the EU discussed ongoing collaboration in the higher education sector, given the growing number of Nepali students choosing to study in European universities. The EU provides scholarships to students to study in European universities under ERASMUS+ and would like to further enhance participation by teachers and academic institutions in this programmme. The EU welcomed the announcement of Visit Nepal 2020 Year (VNY2020), and looks forward to supporting this initiative.
The EU side also acknowledged the substantive efforts made towards improving air safety, while reiterating that progress hinges on sufficient advances being made on the regulatory level and technically on the ground. Both sides agreed to work together, with the EU reiterating its offer for technical support to increase Nepal's institutional capacity in this area.
Likewise, in the Sub-Commission on Development Cooperation, Nepal and the EU took stock of the progress achieved and lessons learned in the implementation of ongoing cooperation, particularly in nutrition, education, governance, agriculture and rural development. The Joint Commission concurred that cooperation should continue to be guided by the government’s priorities and the use of country systems, including budgetary systems.
The EU and Nepal welcomed the recent signature of the €8 million Trade and Investment Financing Agreement (TIFA) which will develop further the coffee and pashmina value chains, and build capacity in the Nepali trade sector; the adoption of the European Commission's Financing Decision in favour of Nepal's Multi-sector Nutrition Action Plan (€22 million); and Provincial and Local Government Support Programme (€33 million), to be implemented through budget support and complementary technical assistance.
“Nepal and the EU will continue working jointly towards the implementation of the SDGs, which should including cooperation with other key international partners, the private sector and civil society organizations,” the press note reads, adding that Nepal and the EU also focused on jointly identifying opportunities for supporting investment and blending opportunities in the future. “Both delegations reiterated their commitment to democratic values, rule of law, good governance, human rights and fundamental freedoms.”
Nepal – the current chair of the South Asian Association for Regional Cooperation (SAARC) – spoke of the regional cooperation priorities. Both sides, on the occasion, acknowledged the importance of regional integration, including the SAARC and Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) processes.
Nepal and the EU look forward to working closely in the United Nations (UN), World Trade Organisation (WTO) and other international fora supporting multilateralism and a rules-based world order, and working towards achieving landmark global goals, such as the Paris Agreement. Similarly, the Nepali side underscored the importance of Sagarmatha Sambaad (Sagarmatha Dialogue), a permanent platform created by the Government to discuss pressing global issues. The Sambaad will be launched in Kathmandu in April 2020 and will address climate change. The EU saluted the initiative and looked forward to engaging in this forum.
The next Nepal-EU Joint Commission will take place in Brussels in 2020, the press note adds.
The Joint Commission was co-chaired by foreign secretary Shanker Das Bairagi and deputy managing director for Asia and the Pacific of the European External Action Service for the EU Paola Pampaloni.
Earlier yesterday, the third meeting of the Sub-Commission on Development Cooperation between Nepal and the EU was held in the ministry, where they exchanged views on the whole spectrum of the ongoing development cooperation between Nepal and the EU, apart from future course of action for enhanced level of partnership and increasing the effectiveness of the development cooperation.

October sees 10 per cent growth in tourist arrival

Fuelled with strong Chinese arrivals, a total tourist arrivals increased by 10 per cent in October compared to the same month last year.
“A total of 143,870 tourists arrived in the country in October, whereas the number stood at 130,745 last year,” according to Nepal Tourism Board (NTB). “A total of 975,557 visitors arrived in Nepal in the first ten months of 2019,” it informed, adding that of which, some 123,267 visitors entered the country by air and 155,058 came overland.
Likewise, Chinese tourists have the biggest share occupying 10.45 per cent of the total arrival followed by Indian with 8.83 per cent share. The tourist arrival from India increased by 9.1 per cent and reached 12,707 compared to the figures of last October. But the number of tourists from South Korea decreased by 20.1 per cent during the review month as only 3,032 South Koreans visited Nepal compared to a total 3,793 last October.
Likewise, some 2,786 tourists from Bangladesh visited Nepal in October, which is 58.6 per cent more than the arrivals last year. The overall arrivals from SAARC countries recorded a growth of 7 per cent in October in comparison to last October. “A total of 169,952 Indians and 19,279 Bangladeshi nationals visited Nepal in the first ten months of 2019,” the board press note reads, adding that the total arrival of Chinese tourists stood at 134,281 in the first ten months. “Some 122,986 Chinese visited Nepal in the 10 months of last year.”
A total of 21,720 visitors from SAARC countries and 28,789 from Asia visited in the 10 months of the 2019. “Likewise, the European arrivals also surged with sustained growths from the key markets with 42,297 total arrivals in October,” it informed, adding that arrivals from the United Kingdom, Germany and France in October 2019 were 8,672, 7,308, and 6,777 respectively. “Total European visitors in first ten months of 2019 reached 199,003.”
Similarly, the total number of American visitors to Nepal in October stood at 12,109, whereas a total US arrival reached 77,798 – an increase by 5 per cent compared to the figures of last year – in first ten months from January to October of 2019. “The numbers of Australian and Canadian visitors to Nepal in October were 5,625 and 2,624, respectively.”
Nepal has been carrying out promotional activities for the Visit Nepal Year 2020 campaign aiming at hosting 2 million guests. But the two-day state visit of Chinese President Xi Jinping to Kathmandu in October has lifted the hopes of the tourism industry which expect a surge of Chinese tourist arrivals to Nepal in the days ahead. Foreign tourist arrivals in Nepal crossed the 1 million mark in 2018 for the first time with 1.17 million tourists streaming into the country.

Pokhara-Muglin highway to be widened to four lanes

The Asian Development Bank (ADB) has approved a loan of $195 million to improve the highway section between Pokhara and Mugling, which links Pokhara to Kathmandu and to subregional corridors connecting Nepal with India and Bangladesh.
“The project will boost the traffic capacity, reliability, and safety of the main road link from Pokhara,” said ADB transport specialist Johan Georget. “The highway will be widened to four lanes, and this will reduce travel times, lower transport costs, and improve access to domestic markets, jobs, and social services,” he said, adding that the upgraded highway will also open a wider gateway for Nepal to international markets, especially in India, and facilitate the arrivals of tourists to the region of Pokhara and its hinterland.
The project is part of a major trade corridor and feeder roads of the South Asian Association for Regional Cooperation (SAARC) and the South Asia Subregional Economic Cooperation (SASEC), linking Kathmandu with Dhaka and Chittagong through India.
As a landlocked country, Nepal relies heavily on direct neighbours for international trade, mainly India, which traded 65 per cent of Nepal’s imports and exports. But while roads are the predominant mode of transport in Nepal for more than 90 per cent of goods and passengers, the density and capacity of the road network remains low. This infrastructure deficiency hampers the economy, resulting in high operating costs and travel times, and impeding the development of competitive supply chains, tourism, and regional integration and trade.
Nepal’s economic growth improved to 7.3 per cent a year on average between fiscal years 2017 and 2019, compared with about 3.3 per cent in the previous three fiscal years. The
The 200-kilometer (km) journey from Pokhara – a prime tourist destination at the foot of the Himalayas – to the capital Kathmandu takes more than 5 hours by road. It is currently a two-lane highway that handles about 7,400 vehicles a day. As the number of vehicle registrations has been rising and total vehicles are expected to quadruple by 2029, upgrading national highways is a priority to support economic development.
Under the project, 81-km of the road will be widened to four lanes from Pokhara to Abukhaireni to meet increasing demand. Improvements will be made to the surfacing, structure, and drainage, with safety features like crash barriers, and traffic and other warning light systems installed. A second 8-km section between Mugling and Abukhaireni will be considered for a subsequent project.
The road will be divided by a median, while service lanes in urban areas will improve safety, especially for pedestrians, bicycles, and motorcycle users. This is especially important since the country suffers a high rate of almost 16 deaths per 100,000 people due to traffic. Performance-based maintenance contracts of 5 years will strengthen road management and maintenance. The project will also install a landslide monitoring and management system to strengthen disaster resilience, according to a press note issued by the Asian Development Bank (ADB).
The total cost of the project is $254 million, of which the government will provide $59 million, it reads, adding that the project is due for completion at the end of 2025. “Accompanying the loan is an ADB technical assistance grant of $500,000 to strengthen disaster risk reduction, landslide management, road safety, and procurement in the Ministry of Physical Infrastructure and Transport and Department of Roads.”
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion. Established in 1966, it is owned by 68 members, 49 from the region.

Nepal third competitive economy in South Asia

Nepal climbs one position to become the third competitive economy – out of the eight economies in South Asia behind first-placed India and Bhutan – from the fourth last year, whereas the country has jumped to 94th position – with 63.2 score – out of 190 economies in the World Bank’s ease of doing business rankings due to improved credit information availability, easier cross-border trade, and enforcement of contracts.
Nepal was in the 110th position – with a score of 59.7 points – in the doing business ranking in 2019 World Bank report. The leap of 16 places is also attributed to Nepal’s dissatisfaction over the last year’s ranking. Nepal was ranked 105th in 2018 and slipped five positions to 110 in 2019.
In the Doing Business Report 2020, Nepal scored highest on access to credit information – 37th out of 190 economies – among the 10 indicators used by the World Bank to calculate the ranking as the country has improved access by expanding the coverage of the credit bureau.
Likewise, Nepal also ranked relatively high on cross-border trade – 60th out of 190 economies – as the country has reduced export costs and improved import times by opening the Birgunj Integrated Check Post (ICP), according to the annual report.
However, Nepal has spiralled down in starting a business indicator from 107th to 135th, which reflects all the procedural delays and time-consuming processes that have always deterred investors in Nepal. “Nepal is still poorly ranked in starting a business ranking as the country is in 135th position among the 190 economies as the country has made things more difficult – according to the World Bank – by
Nepal made notable improvements with four reforms, the report reads, adding that the country improved an online e-submission platform for construction permits and enhanced the quality of land administration by publishing official service standards for delivering updated cadastral maps. “Authorities improved the commercial judicial system by introducing time standards for key court events.”
However, Nepal made the process of registering new employees with social security more cumbersome by requiring in-person follow-ups. The country also raised property transfer registration fees, it adds.
Overall, of the 10 indicators that the World Bank evaluates to rank countries, Nepal has improved in five indicators, slipped in three and remained constant in two indicators compared to the previous year, according to the report.
The report measures procedural changes but not the quality and efficiency of the implementation of structural reforms in tax regimens and in starting a business, apart from changes in regulation. Hoever, the report does not account for the level of corruption and the existing level of investor confidence, which are major factors affecting the investment climate.
The index draws data from a questionnaire administered to professionals who oversee or advise on legal and regulatory requirements for doing business. According to the World Bank, most respondents are legal professionals such as lawyers, judges or notaries. In addition, officials of the credit bureau or registry complete the credit information questionnaire. Accountants, architects, engineers, freight forwarders and other professionals answer the questionnaires related to paying taxes, dealing with construction permits, trading across borders and getting electricity. This profile of respondents to the questionnaire perhaps accounts for the report’s focus on regulatory measures over their implementation.
Many South Asian economies kept up a solid pace of business regulatory reforms as India and Pakistan both earned spots among the world’s top ten most improved economies, the World Bank Doing Business 2020 study revealed, adding that it is encouraging to see the steady implementation of reforms in South Asia. According to senior manager of the World Bank’s Global Indicators Group, which produces the study, Rita Ramalho, “Continued and sustained progress is key to improving the domestic business climate and enabling private enterprise.”
Economies in the South Asia region carried out 17 reforms to improve the business climate for domestic small and medium-size enterprises.

South Asian ranking
Afghanistan  – 173
Bangladesh – 168
Bhutan  – 89
India  – 63
Maldives  – 147
Nepal  – 94
Pakistan  – 108
Sri Lanka  – 99
Source: World Bank

Nepal, Bangladesh talk hydropower development, trade facilitation

Bangladesh has expressed willingness to invest in 20 hydropower projects in Nepal.
During the fourth meeting of the Nepal-Bangladesh Technical Committee for promotion of trade – held in Kathmandu today – both the countries are also positive on simplifying existing issues related to tariff and non-tariff barriers (NTB). Likewise, Nepal has asked Bangladesh to allow the export of local cardamom, yarn and broom grass (amriso) without facing any hurdles to be sold in Bangladesh. “Likewise, Nepal also put forth providing easy access to Nepali agricultural products including fruits to trade in the Bangladeshi market,” according to an official, who took part in the meeting.
“Apart from the trade issues, Bangladeshi officials also shown keen interest in investing in hydropower projects in Nepal,” according to the official.
The power-hungry Bangladesh has been consistently showing interest to invest in Nepal’s energy projects but Nepal has not been able to provide a project despite rounds of talks. However, both the countries agreed to trade power through India's transmission network, in a recently held secretary-level meeting between energy officials in Dhaka. Four months after the secretary-level meeting between Nepali and Bangladeshi energy officials, who agreed to trade power through India's transmission network, the three countries – Nepal, India and Bangladesh – are also holding talks on using the Indian grid to transfer electricity from Nepal to Bangladesh.
The seventh Joint Steering Committee meeting on Nepal-India Cooperation, which concluded last week has decided to hold a tripartite meeting within three months to move forward.
The two countries – during the meeting that is led by joint secretary at the Navaraj Dhakal and joint secretary at the Bangladeshi Ministry of Commerce Sharifa Khan – also discussed easing the movement of passenger vehicles across the borders, operation of direct bus service from Kathmandu to Dhaka as well as cargo supplies between the two SAARC nations. Bangladesh is also positive on providing easy access to Nepali cargo vehicles in the seaport of Bangladesh for third-country trade.
They also discussed ‘air route’ in order to operate air service to Bangladesh from the eastern part of Nepal, though the bilateral trade talks mainly focused on materialising the five memorandam of understanding (MoU) – including the trading of farm products and food items – signed between the two countries earlier, apart from extensive discuss on ways to reduce Nepal’s trade deficit with Bangladesh.
Moreover, trilateral transit agreement between Nepal, Bangladesh and India, harmonisation of sanitary and phytosanitary measures and technical barriers to trade measures between competent authorities of Nepal and Bangladesh were also on the agenda.