u/CarrotVivid9760

So Nepal needs over Rs. 100 Kharba in infrastructure investment over the next decade. Right now only Rs. 2–3 kharba per year is actually being invested, So there is this massive funding gap that is stopping us from starting these infrastructure projects, and taking on Loans alone is not a good solution,

Matter of fact Nepal took on Rs 36.52 arba in new loans in the last 10 months, but Rs 16.776 arba of the total debt increase came solely from the weakening Nepali rupee, accounting for 55.73% of the rise in public debt this year.

So to tackle this funding Gap this new bills establishes the Alternative Development Finance Fund a new autonomous institution with legal personality (it can sign contracts, hold assets, sue and be sued). It's kind of like a development finance institution but Nepal specific as it will only invest in projects in Nepal.

The fund can raise money through bonds, equity funds, remittance funds, asset monetization, and blended finance instruments. and will invest in projects like hydropower, railways, IT parks, Airports and more infrastructure projects like that,

So why is this better you may ask?

Historically most of the infra-projects is done by government budgets or relying on aid provided by international banks or by government to government contracts/ soft loans. This bill will make it so Insurance companies, pension funds, and even international capital markets can easily invest in Nepal opening door for more foreign capital to enter Nepal.

Every 3 years independent performance evaluation will be done for this Fund, Quarterly financial disclosures will be published publicly, This is not a new concept this is done by many other countries, India also has a similar fund called National Investment & Infrastructure Fund,

Things to know-

1. It will not invest in project smaller than 1 arba, i.e Fund will only invest in big infra projects,
2. At first the government will hold 51% ownership but there are provisions where slowly government will reduce it's ownership as bigger investors come in, tho it can't go under 26%
3. A CEO will be appointed to run this fund

I want him to face the parliament and respond to questions himself but it is what it is.