Feedback on draft constitution by IPPAN

Independent Power Producers' Association, Nepal (IPPAN) has submitted the feedback on "Preliminary Draft of New Constitution, 2015" to Subash Chandra Nembang, chairman of Nepalese Constituent Assembly. Here are the feedback.

Schedule 4 

List of Federal Powers/Jurisdiction

Serial Number 9. Mega projects for electricity, irrigation and other government and donor- funded projects. 

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Schedule 5
List of Provincial Powers/Jurisdiction 

Serial Number 8. Provincial level electricity, irrigation projects and other projects.

In short "mega electricity projects belongs to federal whereas small electricity project belongs to provincial"

IPPAN has made references of other countries including India where disputes among the provinces regarding the usage of water and the construction of dam have become a common problem. The concerned authorities have to be aware of such likely consequences. 

IPPAN has suggested that the central government should directly intervene hydropower development planning, basin study, transmission line development planning and inter-country energy trading. 

Also, the approving authority for hydropower project should be the central government in a situation where project lies in two or more than two provinces.

The projects lying solely in a single province can be approved by the province provided that the impact of such projects in upper and lower riparian is none. 

But in the case of transmission line construction, the central government should be the approving authority. 

55 g. Policies related to protection, promotion and utilization of natural resources. 

1) Sustainably utilizing the available means and resources by protecting and promoting in environment-friendly way and equitably distributing the achievements by prioritizing and providing preferential rights to local community taking into consideration the national interest and values of intergenerational coordination. 

IPPAN has suggested not to use the term “preferential right”. It says preferential right clearly violates the International Labor Organization (ILO) 169 definition. Instead, IPPAN suggests distributing the achievements by prioritizing the local community participation in a lawful manner.

55 g. Policies related to protection, promotion and utilization of natural resources.

6) Maintaining forest area in at least forty percent of the total area of the country for environmental balance.

IPPAN has showed dissatisfaction. 40 percent rule will directly affect the projects. It says that there will be space for government to impose additional environmental taxes.

227 (2) Local unit can impose taxes not inconsistent with national economic policy, transportation of goods, services, capital and labor and neighboring state or local units.

IPPAN has demanded to change this clause. Unnecessary tax burden imposed by the local unit will hamper the hydropower industry.