City fathers of the Kathmandu Valley have demanded that the project development agreement (PDA) planned to be signed between Investment Board Nepal (IBN) and private company Nepwaste for the management of solid waste be thoroughly reviewed.

Speaking at an interaction programme organised by IBN on Tuesday, mayors, deputy mayors and executive officers of 10 municipalities including Kathmandu Metropolitan City (KMC) asked the board to clarify key issues in the proposed pact.

Most of the local representatives were concerned about possible problems in the PDA which might surface when the project is implemented.

“IBN is the government authorized implementing agency for the solid waste project, and we appreciate its efforts in expediting it. However, we have to be accountable if any problem comes up in the future,” said Ishwor Poudel, executive officer of KMC. “Therefore, we want IBN to hold a thorough discussion with us, and clarify all the provisions in the contract before it is signed.”

However, IBN said that due attention had been given to every small detail, so local bodies and the general public would not have to face any problem in the future.

“We have agreed on major issues in the PDA, including the tariff which will be levied by the project developer on individual households as service charge,” said Maha Prasad Adhikari, CEO of IBN. “Due attention has been given to every detail and the language of the PDA.”

According to the draft PDA, the project developer will be allowed to charge Rs219 per month from each household for collecting their solid waste, and the tariff will be increased by 5 percent every year. Likewise, the developer has to pay 2 percent of the fees collected to local bodies as royalty.

Nepwaste, a Nepali-Finnish joint venture, will undertake Package 1 of the project which covers KMC and nine neighbouring municipalities—Budhanilkantha, Nagarjun, Tokha, Tarakeshwor, Gokarneshwor, Sankharapur, Dakshinkali, Kageshwori-Manohara and Chandragiri. 

Nepwaste has agreed to build a landfill site at Banchare Danda in Nuwakot and a transfer station at Teku in Kathmandu. Also, the project developer has agreed to IBN’s condition to build processing and recycling units at the landfill site.

Initially, the developer had proposed to build them in the Valley in a bid to minimise the volume of waste trucked to the landfill site and cut operation costs. IBN rejected the plan citing possibility of negative environmental impacts on the city. Likewise, Nepwaste has agreed to segregate biodegradable and non-biodegradable trash at the source. Dinesh Kumar Thapaliya, secretary of the Ministry of Federal Affairs and Local Development, urged the newly elected local representatives to cooperate with IBN and the developer to expedite the project.

“Solid waste management has been a major challenge for almost all local bodies in the Kathmandu Valley. Currently, KMC is spending around Rs550 million to handle garbage. Once the private company takes over solid waste management, this amount will be saved and it can be spent on other development projects,” said Thapaliya. “On top of that, KMC will get royalty from the company.”

After the PDA is signed with Nepwaste, IBN will start PDA negotiations with Clean Valley Company which will undertake waste management in Lalitpur Metropolitan City and neighbouring municipalities besides Kirtipur and Bhaktapur municipalities under Packages 2 and 3 of the project.