Role of Engineering in Poverty Reduction - Nepalese

Context*
1. General
2. Lessons Learnt from Rapidly Developing Neighbouring Countries
3. Poverty in Nepal and Governments Policy and Strategy
The Millennium Development Goal and Nepal:
3.1 Engineering Human Resources in Nepal
4. Conclusion

1. General
Poverty is a deprivation of essential assets and opportunities to which every human is entitled.
Poverty is better measured in terms of basic education; health care; nutrition; water and
sanitation; as well as income, employment, and wages.
It is proven by history of human civilization, and a well accepted fact that poverty reduction is
directly linked with engineering interventions. Every measures to fight poverty and enhance
quality of life of people through building of infrastructure facility, be it access, irrigation,
hydropower, water supply, school and hospitals, tourism development etc. naturally demands
expert engineering solutions. Trade and industry can foster only when enough infrastructure
facilities are made available. Thus, none of the target development is possible without
developing basic infrastructure. For example, to develop health sector, health post or hospitals
are to be constructed. Similarly, to develop education sector, physical infrastructures like schools
and colleges are to be constructed. To develop socio-economic conditions of poor farmers,
irrigation systems, farm to market roads etc. are to be constructed. To generate electricity,
hydropower systems or nuclear power stations are to be constructed. Basic necessity for
processing and production will need industrial setup. To initiate any development infrastructure,
it has to be studied, surveyed, designed, estimated, contracted and supervised during
implementation. All these requires engineering solutions. In this context, Engineering is the
backbone of development and poverty alleviation of any country.
2. Lessons Learnt from Rapidly Developing Neighbouring Countries
The remarkable success that China has achieved in reducing poverty over the last two decades is
largely due to its massive investments on infrastructure - extending toll roads, power and water
services, and improved communications into the more remote west.
Meanwhile in India, construction projects employ at least 31 million people, of whom more than
half are extremely poor migrant workers, and many are unskilled women. The Delhi Metro Rail
Corporation, for instance, is pioneering an 8-year improvement programme in Health, Welfare
and Safety standards for its 20,000 labourers. Here engineering and reduction of social
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deprivation are at direct face with each other. The Pradhan Mantri Gram Sadak Yozana (Prime
Minister Rural Road Programme), and Gramin Rojgar Yozana (Rural Employment Programme)
are all targeting development of rural infrastructure, provide them better access to services and
facilities and aim at poverty alleviation.
Our small neighbouring country- Bhutan, has gained leaps in alleviation of poverty through
construction of hydropower projects and export of power to India. The 336 MW Chukha
Hydropower Project was constructed in 1988. At present, Tala Hydel Project of 1020 MW
capacity is under construction. After commissioning of this Hydel Project, within next few years,
it is expected that their per capita income will be much more than 1400 US $ established in the
year 2003. As a result, even now, there is Zero population below poverty line in the country.
Nepal is also very rich in hydropower potential, almost double than that of Bhutan, which yet
remains largely un-harnessed due to the lack of political commitment.
Lately, it was realised that there are series of backdrops in the prerequisites for development as
lack of policy reforms, lack of commitments, lack of innovativeness, and lack of open mind sets
value added judgement and lack of knowledge based infrastructure.
3. Poverty in Nepal and Governments Policy and Strategy
Though Nepal is one of the richest countries in natural endowment is, however, one of the
poorest countries in the world. The country has geographical and topographical diversities,
unparallel natural scenic beauties scattered across the country, enormous biological resources,
cultural heritages, religious pilgrimages, trekking and mountaineering attractions/challenges with
high prospects of tourism development, herbal plants, large hydropower potentials and other
economic potentials. One of the major reasons of Nepal falling in the poverty trap is basically
lack of infrastructure facilities. The rugged topography and fragile geology have made
infrastructure development a challenging task requiring appropriate engineering interventions.
Now, Nepal is ranked 140th out of 177 countries with Human Development Index (HDI) value
of 0.504 (UNDP, 2004). In 1996, 42 % of all Nepalese were living under absolute line of poverty.
Eight years later (in 2003/2004), this figure has dropped to 31 %. (CBS/World Bank, 2005).
During a workshop organized by the World Bank (May 11-12, 2005), economists and researchers
gave five reasons for declined tendency of poverty in Nepal, one of which was increased role of
private sector due to infrastructure development in transportation, communication and electricity,
which is the contribution of engineering science.
Poverty is greater in rural areas in the country, especially in higher-altitude and less accessible
regions and among lower castes and ethnic minorities. Measures of human poverty tend to mirror
the more traditional measures of income poverty.
The Millennium Development Goal and Nepal:
At the Millennium Summit of September 2000, the Member States of the United Nations
adopted the Millennium Declaration, which aims to bring peace, security, and development to all
people. The Millennium Development Goals, drawn from the Millennium Declaration, are a
groundbreaking international development agenda for the 21st Century to which all nations are
committed. One of the major intent of The Millennium Development Goal (MDG) is to halve
absolute poverty in the world by the deadline of 2015. Target 9 and 10 of the MDG categorically
demand to Integrate the principles of sustainable development into country policies and
programmes and reverse loss of environmental resources; reduce by half the proportion of people
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without sustainable access to safe drinking water; and achieve significant improvement in lives
of at least 100 million slum dwellers by 2020.
Nepal is one of the signatories to the Millennium Development Goad (MDG) Declaration. Since
then, Nepal has committed itself to attaining the MDGs. The Nepal Millennium Development
Goal, Progress Report, 2005, NPC, HMGN/UN states that in spite of the impressive progress
in human development, and the emphasis on good governance and social inclusion in its poverty
reduction strategy in Tenth Plan, Nepals development has been limited by a number of
constraints which include, inter alia, its rugged terrain and innumerable rivers and rivulets (about
6,000) with inadequate infrastructure, little resource endowment, high transport and investment
cost, weak governance, and high population growth.
Nepal has gone through planned development efforts since 1956. The ongoing Tenth Plan (20022007) explicitly identifies poverty reduction as the overriding objective of development efforts in
Nepal. The Plan makes a sole objective of achieving a remarkable reduction in the poverty level
from 38% (at the beginning of the Plan ) to 30% by the end of the Plan in 2007.
The Poverty Reduction Strategy Paper (PRSP) of the Tenth Plan enunciates the following four
major pillars for poverty reduction:

Broad based Economic Growth

Social Development

Targeted Programmes

Good Governance

The first pillar of PRSP, i.e. Broad Based Economic Growth highlights on the needs of policy,
regulatory and implementation level interventions in agriculture development, improved
irrigation facilities, rural electrification, sustainable forest and environment management,
industrialization in priority sector, opening up more tourism destinations and improving tourism
infrastructure, expansion of road density, communication infrastructure and information
technology and foreign investment. All these can only be achieved through application of
appropriate engineering technology.
Living between the two rapidly developing economic giants, who are accounted as the future
superpower of the World in next two decades, and living at neighborhood of Bhutan, Nepal is
still searching and endeavoring to find lasting solution to reduce poverty. Time is rich to learn
lessons from the neighbouring countries and march ahead for real achievements, which will
largely depend upon development projects through engineering interventions.
3.1 Engineering Human Resources in Nepal
Till a decade back, there were very few engineers produced in the country through assistance of
friendly countries, particularly India and the then USSR. It is believed to some extent that the
development efforts of Nepal was adversely affected due to lack of adequate numbers of
engineering professionals in the country. However, at present, the country has more than 22
engineering colleges producing about 3000 engineers yearly in the country. In addition, some
1,000 engineers get graduated every year from abroad. At present, the total Engineering Human
Resources in Nepal exceeds 12,000 in number.
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In the above background, laxity observed in the past hindering development of infrastructure
facility due to lack of enough engineers and technical resources is expected to change
dramatically in future. The encouraging quantity and quality of engineers being produced within
country is expected to fill in the gap of technical manpower and contribute in the construction of
development infrastructure utilizing the skilled manpower within the country itself. This will
definitely have a long-term positive impact in the poverty alleviation efforts of the nation.
4. Conclusion
Indicators of development of any country is a strong infrastructure base, be it roads, irrigation,
hydropower, water supply, buildings etc. Without basic infrastructure facilities, the country
cannot make available basic social services to the poor. Existing socio-economic condition
cannot be changed and poverty remains prevailing. Engineering plays a primary and pivotal role
in building infrastructures and achieve the Millennium Development Goal. But, traditional
engineering approaches have not always reduced poverty, for example where externally
conceived projects have been imposed without appreciation to local needs and conditions. To
address this, the engineering needs to be designed and delivered in sensitive relation to its
context, and to be focused on outcomes not artifacts.
In country like Nepal, there is huge task of construction of infrastructure facilities, both basic as
well as developmental. Committed and efficient engineering solutions are needed to accomplish
this.
Lessons from the past should be learnt, and mistakes should be rectified. We all must try to know
how the fast growing economic giants like China, India, South-East Asian countries could make
such rapid economic progress, and analyse what sort of policies did they follow to attain this.
Such lessons learnt must be practically applied with full commitment of the government.
One of the strong means to achieve intended development with positive and future looking
approach is by placing the right person in the right place. Only politicians, economists and
bureaucrats should not be given priority to make in-charge of national development planning and
policy-making process. Here too, we must learn lessons from China, India, and South East Asian
countries, where technocrats and engineers have been at central play of national development
planning. Technocrats have become president and prime minister. Indeed they have been very
successful, and we can see what they have done in their country. Thus, we also must adopt this
trend, as technocrats are also people, who are the cream of intellectuals, they are better educated,
have respectful position in the society are oriented to ground level planning, and are trained for
long-term vision.
At the end, we all agree that alleviation of poverty, enhancement of quality of life of people and
an overall sustainable development of the country is only possible through dynamic and broadbased economic development for which adequate and efficient infrastructure facilities are must.
Only adequacy of infrastructure facilities attracts development activities in the country like
agriculture, trade, commerce, industry, tourism etc. Development of infrastructure can be done
only through engineering inputs. This indicates the vital importance and mandatory linkage
between infrastructure development, engineering and its contribution in poverty alleviation.
From the above, one can conclude the important role of engineering and demand of technical
human resources in addressing poverty in any country
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Case Studies
Case Study No. 1:
Social and Environmental Implication in Melamchi Water Supply Project funded by Asian Development
Bank
(1) Resettlement Policy
The resettlement policy is too liberal. Compensation for any house to be acquired includes full cost of
the building at present rate, no depreciation applied, the owner keep all material after demolition of house,
displacement allowance equivalent to 270 days of the minimum wage labour rate of the district comes
about Rs 38,000. Moreover, these people get priority in training. The house owner constructs new house
few feet away from demolished house, using construction material from demolished house with labour
cost covered by displacement allowance. As such, the house owner could pocket all the compensation
money for almost free.
Additionally, some of the beneficiaries, who built their houses within the right of way in case of existing
road, are illegal squatters. As a result, people tend to build some huts etc. when they come to know that
there is going to be development activities of some form. Hence the present resettlement policy has
encouraged the people to unnecessarily look for compensation.
Such provision has benefited house owners near the road corridor, whereas others felt that the affected
families are unnecessarily provided more facilities. As a consequence, nearby families are pressing the
Project to acquire their houses as well so that they also could benefit. Most of these house owners are
relatively better off, so the ADB provision has benefited the rich people as compared to poorer ones who
live away from the road corridor. The disadvantaged people are thus encouraged to create problem to the
Project as road blockade etc. so as to benefit from the project.
The communities have firm belief that all their demand would be fulfilled by the Project if they obstruct
the project activities. They are demanding for:

compensation for damages to the houses, which are mostly existing cracks in walls, along the
road corridor. They claim that these crack were induced due to passage of heavy vehicle on the
road.

compensation for land where road was constructed by Department of Roads some 10-15 years
back.

compensation for irrigation canals which is not in operation since long time back due to wash out
of intake and canal by flood. They argue that the road construction activity has triggered the flood
and subsequent wash out, etc.

compensation for water mills, which are slowly being replaced with electricity driven rice mills

construction of facilities like water supply, canals,

There is provision of employing at least 30% of labour from the local community. It is being applied
irrespective of the skill level of those people.
(2) Environment Plan
The Environmental Plan has restricted any side casting of excavated material along the road. The
contractor is forced to carry all the excavated material to 2-3 km to the spoil tip, adequately compact the
dumped material at the spoil tip, undertake soil erosion protective measure at the spoil tip, etc. All these
additional activities have escalated the unit cost of excavation and per km cost of Melamchi Adit Access
Road is highest in the country, Japanese Dhulikhel-Sindhuli Road could be an exception.
Provision for health facilities, water quality and sanitation facilities to be supplied to the labour,
restriction on use of fire wood by the labour, etc are not easy to be complied.
Case Study No. 2:
Government of Nepal (GON)s Contract with FAO for Technical Assistance to Community Livestock
Development Project, CLDP.
Government of Nepal has requested to submit EOI from International Consulting Firms in association
with National Consulting Firm for Community Livestock Development Project financed by Asian
Development Bank (ADB). Several International Consulting firms in association with domestic firms
have submitted EOI. To every ones dismay and surprise, the Government of Nepal through a notice
published in the local paper The Himalayan, invited The Food and Agriculture Organization of
United Nation (FAO) to provide Technical Assistance to GON/Asian Development Bank (ADB)
supported Community Livestock Development Project (CLDP). In the same paper, FAO has published
notices inviting application from suitably qualified Individuals for 7 International positions including
Team Leader and for 18 national experts including Deputy Team Leader.
It is matter of concern that without following any of ADB Norms and Guidelines for the procurement of
the Consultants, GON has awarded FAO the Contract, when the domestic consulting industry is very
much suffering from the lack of job in the market.
The other important concerns are:

What guarantee is there that FAO will be able to recruit qualified experts ?. What will be the fate
of the project, if recruitment of the qualified expert are delayed and the implementation of the
project then, who is to blame ?

It has been observed that during the selection of FAO, no competition has taken place. It is against GON
rules and ADB guidelines for selection of Consultant.
Such bad practices should be stopped totally in future and consultant must be procured following the
Guidelines of ADB in a healthy and competitive manner.

Case Study No. 3:

Decentralised Rural Infrastructure and Livelihood Project (DRILP)
In Decentralised Rural Infrastructure and Livelihood Project (DIRLP) proposed to be funded by ADB
also, consultants were invited to submit their EOI for Project Management Services. It was combination
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of International (Lead) and Domestic Consultants. The EOIs were submitted, but without any notice to
consultants, the project was awarded to DRSP Consultants through SDC as, during the process of
shortlist, Government of Nepal requested Swiss Government to provide Technical Assistance (TA) grant
for Project Management Services. And the Swiss Government agreed to provide the grant but with the
grant they directly appointed SDC to provide the requisite services. No local consulting organisation was
required to be affiliated to such an assignment where considerable local inputs of different local
professionals were required besides international inputs. The consultants who participated in the EOI
were not even informed on this new modalities.
Agencies like FAO and SDC are supposed to strengthen the domestic consulting industry by taking them
as partners in the development works and not compete with them and take away jobs in the local market.
The concerns are like in Case Study No. 2 above and it is hoped that such practices are not repeated in
future
(1) Absence of Technical / Social/ Administration Support Staff in the Project
In ADB funded Community Water Supply Project, Consultant is performing as a Management Consultant
for the implementation of rural water supply and sanitation project in western/far western region in about
20 districts. But during the project preparation, for such kind of scattered job, not a single support staff
was foreseen in TOR. Hand-full of professional staffs require technical/social/administrative support staff
to collect data from field / secondary sources and to liasion with communities and provide assistance to
them. Administrative/secretarial support at management consultants office is also required. The
consultant can not fully depend on Clients secretarial staff, as even an office helper from clients side
think that he is the employer.
Conclusion:
Small amount of money spent in the input of support staff would greatly enhance in the overall
performance of the Consultant vis-a-vis the Project.
(2) Inadequate input of Professional Staff.
In Small Town Water Supply and Sanitation Sector Project, in the team of Engineering Design
Consultant, one Resident Engineer and one Overseer has to take responsibilities of the whole construction
work including Quality Control, which means, in the absence of Engineer due to any reason (sickness,
leave etc.), the Overseer will be incharge of the whole water supply and sanitation project. Input of few
man-month of an Assistant Resident Engineer would have greatly improve the overall performance of the
construction work. Team Leader has negligible input from home office 10 days per project during 18
months period
Conclusion:
It is advised that the Client and donor also should consult with other stakeholders, such as SCAEF
member before finalizing the inputs. Larger consultations can result in better project design ultimately
resulting in the successful implementation of the Project.
(3) Variation Order and Approval
Variations during implementations are essential to refine project benefit as estimated inputs/quantities can
never be 100% accurate. But the government officials do not understand it that way. Moreover, FAR has
put severe restrictions and is generally understood as punishable act.
Restrictions on variation may result in incomplete project outputs as even the critical items which
make the project relatively more sustainable may have to be left incomplete there by shortening the
life of the infrastructure.
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ADB guideline on variation is silent. Hence, the executing agencies tend to follow GON regulation which
limits variation. Variation in the Project must be looked in terms of its justified need and should be tied up
with the availability of funds rather than percentage increase in cost. At present, the following provisions
are made in FAR of GoN.

15% in department level with approval from the committee in Ministry Level

25% in the ministerial level

On New Items and Design Specification changes too, GON regulation requires project authority
(the Project Manager) to get it same approval from the ministerial level.

Though FIDIC allows the Engineer to issue variation order only with the limitation on availability of total
funds, the authority of Engineer is restricted by FAR as mentioned above. Therefore, responsibility of
approving variation should lie with the project management which is the best judge of need for variation.
Restrictive clause related to 15% to 25% variation should totally be deleted to get the best from the
investment in infrastructure or sufficient time and input should be given during detailed design phase.
It should be understood that Variation Orders are required to be issued because of the very short time
given for the design phase, implementing project based on feasibility/project preparation study level; no
detailed engineering survey and design were carried out before tendering.
For example in RMDP Project time allocated for survey and design of 400 km of new and upgrading
roads was only 3 months and the tenders were floated based project preparation study that has resulted
remarkable variation in quantity during construction.
(4) Change of Personnel
Change of project personnel is inevitable particularly

When the contract award decisions are delayed.

Where the input is intermittent.

Where the duration of a particular specialist is for a very long period.

When there is a wide time gap between the completion of design phase and the start of
construction, it is very difficult to maintain the original nominee for the assignments, particularly
when he/she is a resource person.

Hence change of personnel should be taken as a routine phenomenon and should be facilitated, if the case
is genuine.