+977-21-527173, 523915


Meghraj Marg, Goshwara Road

Biratnagar-9, Morang, Nepal


The Morang Merchant Association (MMA) has signed a Memorandum of Agreement with UNDP assisted, Ministry of Local Development executed Public-Private Partnerships for Urban Environment (PPPUE) NEP/01/007, NEP/01/G58 on 8th July 2002 for mutual collaboration, support for PPP policy guidelines, implementation and sustenance of PPPUE programme activities under the partnership arrangement. The CIM desires to work together with PPPUE under financial support of UNDP to undertake Public-Private Partnership development initiatives and activities in accordance with the PPPUE Project Document and other terms and conditions.
The MMA by joining PPP Sub-Committee of the Biratnagar Sub-metropolitan City, as part of its regular functions, are supposed to conduct following activities:
* Provide its focal point for PPP and at least one staff to conduct day-to-day works related to PPP arrangements.
* Propagate among its members the benefits of PPP as a modality for urban services delivery,
* In collaboration with the municipality and civil society, conduct awareness raising programmes among urban residents to increase public acceptability of PPP, establish and maintain a local information/reference base on PPP,
* Provide members with information on a regular basis about PPP projects, planned and on-going,
* Directly give advice on specific PPP projects or procedures, or recommend from the FNCCI roster experts who can provide the required advice, and
* Maintain regular dialogues with respective municipalities on issues of joint interest pertaining to PPP.

1. Team Building Workshop
2. Public Relation, Leadership and Negotiation Training
3. Observation Visit to Chennai
4. Identification of PPP cases
5. Studies for PPP cases
6. Orientation on Pro poor TOOLKIT and Legal Provision

1. Team Building Workshop
Local Stakeholders’ Workshop or Team Building Workshop on Public-Private Partnerships is one of the programme activities to establish effective coordination mechanism between stakeholder institutions at the national level and in selected partner municipalities and also to improve capacity to representing from CIM, Morang Merchants’ Association (MMA), municipality and civil society. The workshop was chaired by Mr. Ram Chandra Paudel, the outgoing mayor of Biratnagar Sub-metropolitan City. Mr. Toran Bahadur Karki, the Vice Chancellor, Purbanchal University was the chief guest of the workshop. Mr. Ashok Koirala was also present during the inaugural session as a special guest. The Team Building Workshop has clarified on various aspects of PPPUE including
* The development objective of PPPUE
* Strategy of PPPUE
* Different phases of the programme
* Programme activities
* Formation of PPP sub-committee
* Roles and responsibilities/functions of PPP Sub-committee

The PPP case studies of Pokhara Vegetable Market (Shree Complex) and Dhulikhel Drinking Water project were also presented during the workshop.
The PPP Sub-committee was formed during the Team Building Workshop with members and representation as follows:

* President of Chamber of Industries, Morang
* President of Morang Merchants’ Association
* Secretary of Biratnagar Sub-metropolis
* Representative of TLOs
* Focal person of Biratnagar Sub-metropolis
* Focal person of Chamber of Industries, Morang
* Focal person of Morang Merchants’ Association

The concerned stakeholders agreed the form of PPP Sub-committee. The roles and functions of PPP Sub-committee are:

* Promote, plan and engage in various PPP activities
* Assist in developing PPP policy guidelines
* PPP Sub-committee will be a common platform for PPP initiatives in local level
* Assist in reviewing existing (and proposed) local/legal policies for the facilitation of PPP
* Assist in identifying potential PPP project areas
* Suggest on pricing of PPP
* Conduct awareness raising programme among urban residents to increase public acceptability of PPP
* Provide policy and legal related feedback and lobbying to the government in relation to PPP

Participants of Team Building Workshop Group working in Team Building Workshop
There are various suggestions collected from the workshop participants on various topics regarding Benefits from PPP Arrangement to Urban Poor, Reasons for Private Sector to Participate in PPP Arrangement, Role of Civil Society in PPP, Importance and Role of Municipality in PPP, Role of Municipality. The suggestions are as follows.

Benefits from PPP Arrangement to Urban Poor

* Identification of Poor
* Mobilization of Poor
* Achieves public services at minimum cost
* Manage income generating and specific skill training
* Awareness increases
* Improves health condition

Reasons for Private Sector to Participate in PPP Arrangement

* Economic and financially viable projects can be executed
* It uses, develops and adopts new technology with respect to time
* It motivates to gain public trust by producing qualitative goods
* PPP arrangement changes the thinking and attitude of people on private sector
* It provides extra energy/support to co-work with government and foreign agencies

Role of Civil Society in PPP

* Solution of their problems with their own consultation and participation
* For mutual trust and help to solve the public problems
* Help public sector to create opportunity to private sector
* Increase common feeling for development
* Help the partnerships to give right direction
* For sustainable development
*Utilization of strong and positive features of both parties by minimizing weak features
* Maximum utilization and mobilization of economic resources
* Develop trust for PPP by developing positive thinking and feeling
* For effective operation, supervision and evaluation

Importance and Role of Municipality in PPP

* Search new investment for development and construction work
* To provide standard and sustainable services
* For new technology and strategy
* Increase new resources
* To overcome unmanaged and corruption problem
* Pinpoint the responsibility of civil society and private sector.
* To involve civil society and public sector directly in development works
* Create good and efficient environment to provide basic urban services
* Provide help to control industrial pollution
* Maximum utilization of means and resources of municipality
* Medium to mobilize organizational capacity of municipality at different sector

Role of Municipality

* Role of controller
* Role of facilitator
* Role of backstopping and guardianship
* Monitoring and evaluation

2. Public Relation, Leadership and Negotiation Training

Institutional strengthening and capacity building of the stakeholders at local level are one of the major activities and components of PPPUE. The key step in strengthening stakeholders’ capacities would be to develop human resources about the behavioral skill. In this context, PPPUE together with Development Management Institute (DMI) provided Public Relation, Leadership and Negotiation training to the key municipal staffs, Morang Chamber of Industry and Morang Merchant’s Association executives and staffs, focal persons of the municipality/CIM/MMA and Tole Lane Organizations (TLOs) on PPP.
PPPUE conducted a three-day training programme was conducted from April 4-6, 2003, at Biratnagar Sub-metropolitan City with the participation of the representatives from Biratnagar Sub-metropolitan City, Chamber of Industry, Morang, Morang Merchant’s Association and the TLOs. This training is a follow-up of activities identified by capacity needs assessment held at Biratnagar Sub-metropolitan City. The main objective of the training was to enhance the skills of CCI executives and staffs, key municipal staffs, TLO representatives and focal persons of PPPUE in the areas of leadership, negotiation and public relation. The main topics covered in the training programme were:

* Leadership and its style
* Assessment of leadership style
* Effective leadership – Group work and presentation
* Conflict management and key areas
* Conflict management – Group work and presentation
* Negotiation and its strategy
* Negotiation – Group work and presentation
* Effective public relation
* Public relation – Group work and presentation
* Time management – Tools/exercise
*Â Personal action plan

The training sessions were conducted in a participatory way. The participants were encouraged and supported by facilitators to speak, discuss and share their views and experiences. Attention was given to encourage women and shy participants to take part in the discussion. Since the participants from the municipality, CIM, MMA and TLOs differed in their level of understanding, the methodology of the training was made flexible in order to adjust level of understanding of these participants.
Photographs of Public Relation, Leadership and Negotiation Training

3. Observation Visit To Chennai

As part of activities under human resources development and capacity building of partner stakeholders, the field exposure visit to Chennai was organized by PPPUE desk, Kathmandu to orient partner stakeholders on various aspects of PPP initiatives which have been carried out as best practices. The trip was supported and co-ordinated by Chennai Metropolitan Development Authority (CMDA), India. The groups for the study tour was selected from among different stakeholders of PPPUE such as government at both central and local levels, private sector at central and local levels and community.
Chennai Mofussil Bus Park,
Chennai Koyambedu Vegetable Market, Chennai

Mr. Kishore Pradhan, the President of CIM and Chairperson of PPPUE Sub Committee in Biratnagar, Mr. Shankar Lal Agrawal, President of MMA, Krishna P. Ojha, executive secretary of Biratnagar Sub-metropolitan City represented the visiting group. A five day observation visit to Chennai has been very useful to the stakeholders and visit members. It can be listed below the outcomes of the visit as;
* The roles of various sectors (public, private, community) have become comparatively clear for the visit members as they have actually seen what the different sectors have performed their tasks effectively in their respective projects.
* The interaction and discussions have shown that local stakeholders including both public and private sectors have been convinced with the concepts and various modalities of PPPs.
* By observing the actual cases and its operation, their level of confidence have increased which means that they have now become able to select pilot PPP cases for their respective cities in Nepal.
* The visit was also fruitful in a way that both the visit groups had representatives from public, private sectors and civil society who spent five days together and they interacted with each other informally to share ideas on various potential PPP cases in their respective municipalities that would benefit all stakeholders.
Interaction in CMDA,
Chennai Exposure Visit Alandur Sewerage Treatment Plant, Chennai

4. Identification of PPP cases

The PPP sub-committee of Hetauda has identified a list of PPP pilot cases as to be undertaken as follows.
1. Improvement and Management of Existing Bus Park on BOT basis
2. Construction and Management of Budhahaat Market (Vegetable Market)
3. Construction and Management of Gudri Shopping Complex

5. Studies for PPP Cases

In order to technically support Biratnagar Sub-metropolitan City, local private sectors and civil society in their PPP ventures, the PPPUE has initiated the study on feasibility of Biratnagar Bus Park Improvement, Operation and Management on BOT basis. The consultants have been provided with the TOR and their proposals (technical and financial) have been awaited.

6. Orientation on Pro-poor PPP TOOLKIT and Legal Provisions

The PPPUE programme has prepared a Pro-Poor toolkit, as a PPP procedural handbook, which covers a number of topics ranging from creating, formulating, implementing, running, monitoring a PPP scheme. Hence, the programme felt a need of disseminating knowledge on Pro-Poor PPP Toolkit and existing legal provisions on PPP in Nepal. In this regard, the programme conducted an orientation on Pro-Poor PPP toolkit and legal provisions on PPP to the stakeholders at local level. The orientation programme basically highlighted the academic and practical aspects of PPP citing PPP cases and briefed that existing legal provisions have rooms for PPP at present.
The main objective of the two-day orientation programme on Pro-Poor PPP Toolkit and legal provisions on PPP was to provide knowledge on Pro-Poor PPP toolkit and the prevailing legal provisions on PPP at the national and local level to the executive officers/legal officers of municipalities and presidents/legal advisors of Chamber of Commerce and Industries (CCIs). The orientation is also believed to seek feedbacks and suggestions on the said topics both at the policy level and for the toolkit respectively.
Participants of Orientation Programme
Mr. Khem Raj Nepal Inaugurating the Programme
The orientation programme was inaugurated by Mr. Khem Raj Nepal, The Secretary of Ministry of Local Development. In the Inaugural session, the UNDP Programme Officer, Mr. Jacob Huagaard, the National Programme Director of PPPUE, Mr. Surya Pd. Silwal were also present and gave their remarks. The main orientation was conducted in four sessions, presentations, interactions, presentation of local case studies and discussions. The programme oriented the participants in details the followings on the legal provisions:
* Contract Act – Privatization Act – BOT Policy
* Company Act / Private Firm Registration Act and Partnership Act
* Arbitration Act
* Slaughter House and Meat Inspection Act
* Electricity Act 2049
* Water Resources Act 2049
* Environmental Protection Act and Regulation (IEE & EIA)
*Â Labor Act/ Rules 1991
* Trade Union Act 1992

Similarly, the participants were also oriented on the use of Pro-poor Toolkit and its contents covering concepts and forms of PPP, current PPP environment, procedures of creating PPPs, procedures of formulating PPPs, procedures of implementing PPPs, and procedures of monitoring, regulating, adjusting PPPs.
The Executive Officer, Mr. Tilak Ram Sharma, and Legal Officer, Mr. Binod Koirala of Biratnagar Sub-metropolitan City and the President of Morang Chamber of Industries, Mr. Kishore Pradhan participated in the two day orientation. The participants at the end of the programme have made several suggestions for forging PPPs at local contexts. They are:
* Separate acts and rules on PPP should be made.
* Incorporate PPPUE Unit in organizational structure of municipality
* Contract period should be mentioned in the regulations with respect to nature of PPP project.
* Rules on PPP should be included in local self-governance regulation in separate heads. Flexibility should be there for negotiation to undertake PPP rather than through competitive bidding only.
* Approval from HMG while doing contract should be amended. (Section 134)
* BOT and BOOT should be clearly addressed and mentioned in financial regulations.
* Provision should be made flexible such that PPP can be done in Public land (Aeilani)
* PPP contract (agreement) should be registered and this provision should be made
* Reserved fund should be mobilized and PPP projects should be given priority for it.
* PPP cases to be observed and promoted by a common cell comprising of Ministry, FNCCI and MuAN, which also functions as a solution of problem.
* The local self-governance act and regulations should be amended in such a manner that new board incorporates CCI representative/president as a member.
* Sector/area of PPPUE to be identified from extensive discussion with the stakeholders.
* HMG should make provision of matching funds through municipalities for PPP projects.
* While bringing PPP acts and regulations, the other overlapping acts for PPP should be removed.
* The proposal brought by private sector for PPP should be confidential till disqualification.
* PPPUE should focus on result oriented rather than procedure.
* MLD should make guidelines (process) on PPP, which should be provided in coming fiscal year.
* Checklist to be made by incorporating important points of toolkit.
* Guidelines to be provided mentioning the duration of contract, which should be based on the nature of the project.
* The road of municipality should be build in PPP modality and develop BOT concept
* Sample contract for PPP arrangements to be provided.
* The coming budget should make provision of providing incentive package for urban infrastructure development under PPP arrangement and promote the PPP concept.
*Â New process or best practices should be incorporated in the website of PPPUE.
*Â The concern ministry should commit for developing policy document/directives in this coming fiscal year budget for the projects under PPP concept.
* Government should develop enabling environment for public sector and private sector for better implementation of PPP projects.
* Provision of minimizing political risk (Investment safeguard)
* Government should give priority to private investors for loan facilities under PPP projects through financial institutions. The loan should be ‘priority loan’ and the interest rate should be fixed in that manner.
* Capacity of local bodies should be enhanced to develop a feasibility report.
* PPP related policy level decisions should be incorporated in annual programme
* PPPUE should create social awareness in an extensive manner
* PPP focal persons of CCI and municipality should be equipped by knowledge through study visit of PPP cases
* Conduct study of existing PPP cases and organize meeting to share experiences.
* The investment safeguards of private sectors under PPP should be made clear in legal provisions.
*Â One pilot project in each municipality should be started from this fiscal year (060/61 B.S).
*Â Interaction with political leaders for the usefulness of PPP should be done.
*Â Video exhibition of best PPP experiences of neighboring countries to be done.
* Seminars to be conducted time to time for mind set
* PPPUE should make policy/strategy of such programmes which improves management of municipality
* Investment scenarios/attitude of private sector should be changed
* LSGA has given the right to make by laws/guidelines for municipalities so model by laws/guidelines based on LSGA should be developed which will focus on PPP and its procedure.
* Tools or measuring rods for private sector to examine the potential investor’s capacity, ability and experiences to qualify private sector should be developed. Some mechanism is needed to know the good investors.
* Each municipality needs to prepare a model under the guidance of PPP toolkit for upcoming PPP activities and review in the workshop
* The meaning of leasing public assets should not reflect the meaning of selling the public assets.
* Need to fix criteria consisting procedures and legal formalities while doing agreement/contract.
* Need to discuss on the possibilities of resource mobilization (tax, revenue collection) of municipality can be exercised under PPP.
* Legal provisions needed so that the proposals submitted by private sector can be decided in time.
* Public sector should have provision to monitor and give direction for tax and revenue contract for public welfare.
* Municipality collects tax from public and provides services from it. It may be double for users because fees are collected for PPP again.
* Municipality needs to publish a list of fixed assets for government and public notice.
Resource Person Presenting Legal Provisions