Bill to establish alternative development finance funds registered in parliament

Kathmandu, April 22: A bill to establish the Alternative Development Finance Mobilization Fund-2025, with an authorized capital of Rs 100 billion and a paid-up capital of Rs 25 billion, has been registered in Parliament. The Fund will focus on infrastructure development investments.

The bill aims to create a legal framework for exploring both domestic and international sources of funding, identifying and prioritizing investment projects, and facilitating investments in those projects.

Registered in Parliament last Friday, the bill seeks to establish legal provisions for alternative development by ensuring the proper use of fiscal instruments, including domestic and foreign investments, and addressing institutional structures to support these efforts. It also emphasizes the incorporation of monitoring and evaluation mechanisms.

According to the Ministry of Finance, the introduction of the bill is intended to effectively manage resources for overall economic development through alternative financing methods, such as bonds, equity funds, and other financial instruments. 

The Alternative Development Finance Mobilization Fund will be an autonomous body. It is proposed that the Government of Nepal will have 51 per cent share investment in it. "The government has to invest Rs 12.75 billion, which is 51 per cent of the paid-up capital of Rs 25 billion of the Fund," the bill states.

It is appropriate to adopt a policy of gradually reducing the ratio of the share of the government once the entity becomes strong and capable through its effective use, according to the bill.

It is stated in the bill that alternative development finance will be mobilized in projects that provide high economic returns, create more employment opportunities or help in the economic development of the country. The bill also mentions possible sources for raising such investments.

Investment can also be made through this alternative development finance fund for the construction and operation of infrastructures such as information technology parks, special tourism infrastructure, special sports infrastructure, urban infrastructure, digital infrastructure, cable car, ropeway, pod way. (RSS)