Kathmandu: 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.
According to National News Agency Nepal, 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.
The Ministry of Finance states that 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, with a proposed 51 per cent share investment by the Government of Nepal. “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.
The bill suggests adopting a policy of gradually reducing the government’s share once the entity becomes strong and capable through its effective use. It outlines that alternative development finance will be mobilized in projects providing high economic returns, creating more employment opportunities, or contributing to the country’s economic development. It also mentions potential sources for raising such investments.
Investment through the fund can be directed towards the construction and operation of infrastructures such as information technology parks, special tourism infrastructure, special sports infrastructure, urban infrastructure, digital infrastructure, cable cars, ropeways, and pod ways.