Securing funds for improved sanitation management in Nepalgunj city


News

Before engaging in any business venture, proof points and a business case are needed to convince potential investors to willingly provide financing. Since gathering multiple stakeholders in a forum to discuss sanitation investments for Nepalgunj, we are seeing encouraging signs of interest that could potentially progress the city’s sanitation ambitions.

As part of the activities of the Urban Sanitation Investment Forum held last 10 August 2022, WASH focal point, Prakash DC presented – on behalf of the Nepalgunj Sub-Metropolitan City – a first version of the city’s Detailed Project Report (DPR) for the realisation of a Faecal Sludge Treatment Plant (FSTP) sanitation service. Prepared by city authorities with SNV in Nepal, discussions revolved around the financial viability of the project and its investment mechanisms, which culminated in the Town Development Fund (TDF) confirming their interest to invest in the project. See below a ten-minute video on SNV WASH SDG partner achievements in sanitation service development.

Buying into sanitation

The TDF is an autonomous financing institution established by the Government of Nepal in 1989 with a long-term institutional objective of becoming a self-sustaining and complementary part of inter-governmental fiscal transfer systems. Financing, according to Krishna Prasad Sapkota, Executive Director of TDF, will be drawn from the company’s investment portfolio, which will have a dual component comprising a grant and loan arrangement.

Beginnings of a sanitation development change movement?

A movement for change

‘We must start a nationwide movement of different stakeholders to invest in financially sustainable WASH systems’ was the challenge posed by the Honourable Minister Umakanta Chaudhary from the Ministry of Water Supply during the inaugural session of the forum.

In addition to the Town Development Fund, other stakeholders have also launched into action.

  • The Department of Water Supply and Sewerage Management (DWSSM) contracted the services of a consulting team to update the Detailed Project Report (DPR) of Nepalgunj’s Sub-Metropolitan city. The team will focus its review of the DPR’s cost and will explore the opportunity to incorporate wastewater services in the overall project plan. Through their review, the team seeks to achieve greater clarity on the costs needed to build, operate, and maintain the proposed FSTP and outline the different investment streams that may be tapped potentially for this project.
  • SNV made its research and relevant documentation available to several development partners who have indicated an interest to invest in the project.
  • There is a renewed sense of optimism within the Nepalgunj municipality that raising the much-needed finances is possible. In addition, representatives from Jumla, Birendranagar, and Khadak municipalities also gained the confidence needed to develop their own sanitation and investment plans. Their interests signify a promising development in the overall ambition for citywide sanitation services.

 

About the forum

Titled, ‘Urban Sanitation Investment Forum,’ the forum was co-organised by the city of Nepalgunj and SNV last 10 August 2022. The forum was first opened by decision-makers in government, followed by a technical session with a focus on the DPR, and concluded by a 90-minute expert panel discussion representing multiple sectors in national TV.

The 90-minute panel exchange – broadcasted in national TV – highlighted areas that require further attention – from the perspective of various stakeholders – to attract sanitation investments and fill gaps. See video below.

Among these include:

  • perspectives from private sector and financial institutions, encouraging for the exploration of the financial viability of various WASH infrastructure and services, development of several business models, establishment of a tariff policy, and introduction of tax rebates and subsidies to facilitate the investments.
  • perspectives from development partners, additionally calling for better cooperation, coordination, and capacity strengthening for local governments.

 

 


More information:
[1] Contact Abhaya Sigdel, Sanitation Financing and FSM Advisor in SNV in Nepal by email.