Provision that requires dev projects to compensate for loss of forest may be lifted

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    In a major reform initiative, a joint meeting of three parliamentary committees is directing the government to lift a provision that makes it mandatory for development projects to acquire arable land as compensation for forests destroyed in course of project development.

    Agriculture and Water Resources Committee (AWRC), Environment Committee, and Development Committee of parliament are holding a joint meeting on Sunday to lift the provision.

    Sources privy to the issue told Republica that the meeting will lift troublesome provisions which have been hindering project development. The decision is expected to benefit mega projects especially hydropower projects.

    Project developers had long been lobbying to lift this provision which was introduced in 2011 on the direction of parliamentary Natural Resources and Means Committee.

    Talking to Republica, Chairman of AWRC Gagan Thapa said that they want to address this constraint as the provision as it has been adding unnecessary burden on project developers. He, however, refused to divulge details, saying that it is under discussion.

    The committees will also hold discussion with a panel led by CEO of Investment Board Nepal Radhesh Pant which has been asked to assess problems being faced by development projects and developers.

    Gopi Nath Mainali, member of the panel, said that the panel was busy preparing its report. He also said the responsibility of compensating for the loss of forest land should be on government not the project developers.

    Likewise, the joint meeting is expected to direct the government to scrap one percent environment service fee charged by Ministry of Environment on top of 2 percent royalty that hydropower developers pay to the government.

    Satluj Jal Vidyut Nigam Ltd, which is developing Arun III, will be the first beneficiary if the provision to compensate for loss of forest land is relaxed. The project has been facing problem in finding suitable arable land to compensate for loss of forests in 85 hectares.

    A source in the panel said that the committee was likely to issue direction to the government to outsource the task of replacing forest land by forming a separate mechanism.

    At present, hydropower developers have to plant two trees for every tree felled by the project. Other developer are required to plant 25 trees for every tree cut in course of project development.

    Kumar Pandey, general secretary of Independent Power Producers’ Association, Nepal, said that relaxation will provide a huge relief to hydropower developers.

    Source : Republica