Quiet, clean, and efficient electric vehicles are all you see on Nepal’s roads. The air is clear, with no harmful particulate or thick smog blotting out the mountain panoramas. Large irrigation works give farmers a predictable water supply and boost productivity, and watershed management systems improve soil quality while mitigating the impact of flooding and drought. Tourists from all over the world come to trek in the mountains and to raft Nepal’s scenic rivers teeming with wildlife. Powered by abundant and reliable electricity, local industry and services flourish, employment is high and incomes are rising. This is not some outlandish dream, but the vision of a prosperous Nepal that responsibly manages its most important natural resource—water. 

While Nepal is rich in water resources, for years an inability to balance and maximise the benefits of this asset has held the country’s development back. Poor planning for water management makes the effects of natural disasters worse and puts stress on the environment, making floods and landslides worse, depleting fisheries, and making access to drinkable water more difficult. Changes in climate patterns, coupled with the geopolitical reality that Nepal deeply feels the actions of its neighbours both upstream and downstream, can make the challenge of developing Nepal’s water resources seem insurmountable. Water resource management is complex and there are difficult decisions to be made, with real trade-offs. But there are constructive ways to address all these of challenges. The real issue is ensuring that Nepal can create a proper, data-driven framework for effective water resource management that can make water work for Nepal.

Given Nepal’s hydropower potential, I often hear the question: Why is hydropower development in Nepal so slow? Despite decades of work and planning, only 914 megawatts (MW) of Nepal’s estimated 40,000-plus MW potential of economically-feasible hydropower is in operation. This number will grow over the next few years, with more than 3,000 MW currently under development. Yet even with this expected increase in hydropower availability, Nepal is still a long way from its goal of reaching “10,000 MW in 10 years.” Achieving Nepal’s energy and economic goals—including becoming a middle-income nation by 2030—will require massive investments in generation, transmission, and distribution. The United States’ Millennium Challenge Corporation (MCC) has estimated that the required investment to make this dream a reality would amount to at least $3 billion a year, and the US was pleased this year to provide a $500 million grant to Nepal to move in this direction.

Addressing shortfalls

While a number of factors hinder hydropower development in Nepal, one key gap is the lack of clear, coordinated and integrated planning for water resources management. Integrated water resources management (IWRM) is a process which promotes the coordinated development and management of water, land, and related resources, in order to maximise the resultant economic and social impacts of water use in an equitable manner, without compromising the sustainability of vital ecosystems. What this looks like in practice is effective multi-sector planning to guide policy, coordinated implementation of the resulting policies, and involvement of affected people and communities throughout the process.

Nepal can also benefit from the lessons learned by other countries, including my own. In the United States, development of large hydropower facilities was a matter of intense political debate in the first half of the 20th century. Our national debates centred on the role that federal and state governments, as well as the private sector, should play in developing our water resources. The choices made in the United States more than 100 years ago led to significant development of our water resources, but each choice had its own impact on irrigation, flood control, fisheries, navigation and hydroelectricity development. The US experience also provides many examples where initial mistakes of focus and balance in developing our rivers led to negative social and environmental impacts that we later had to mitigate—often at great cost.

Closer to Nepal, the experience of Southeast Asian countries can also provide useful lessons. In 2012, Laos adopted its National Water Resources Strategy 2020 as a way to protect water resources through comprehensive planning that balances economic outcomes and ecosystems, while prioritising water allocation for basic human needs. Laos also recently amended its Water Law to strengthen IWRM mechanisms at both the national and local levels. By implementing IWRM policy and systems, Laos is looking at the totality of its water resources and how the country can meet multiple user demands, while protecting the environment for future generations. Laos’ plan to implement its water resources strategy provided a crucial foundation for accelerated hydropower development, so that over the past 25 years the country experienced a rapid growth in its hydropower capacity, bringing over 3,500 MW online.

Maximise utilisation

Although Nepal is a water-rich country, poor water management coupled with environmental stressors put these resources at risk. So, how can Nepal harness its water resources for sustainable economic development? First, better coordination can lead to smarter management and policy. A dozen different ministries are involved in water management and the lack of coordination among them leads to poor allocation of water resources and lost opportunities. The institution that could serve this coordination role—the Water Energy Commission Secretariat (WECS)—lacks the bureaucratic authority to truly coordinate across government ministries and agencies. Strategic and smart planning incorporating all the uses and benefits of water—drinking water, agriculture, hydropower, fisheries, and designating some rivers as free flowing for cultural, recreational and environmental purposes—requires this big picture perspective and ability to convene and coordinate. One key action of an IWRM strategy could include the creation of an independent National Water Resources Commission or some other single focal entity that has both the authority and the policy heft to convene and coordinate, making sure projects are developed in line with national water sector plans and policies.

A second important input is reliable hydrological data. Decision-makers need solid data if they are to make informed decisions about the costs and benefits of pursuing various projects and policies. Finally, coordination and data are meaningless if the people who use and appreciate Nepal’s water resources are left out of the discussion.

When some or all of these elements are lacking, the outcome is development that has significant negative social or environmental impacts that can impose large costs to mitigate—or cause irreparable damage. As Nepal transitions to a federal democratic model and streamlines government ministries, the new government has an opportunity to break down some of these bureaucratic barriers and lay a solid policy foundation. Effective coordination, data-driven planning, and meaningful inclusion are the way to make water work for Nepal’s future. Water is essential to life and, in Nepal, water is essential to development. Every Nepali has a stake in maximising water utilisation and should insist that national and local officials plan the use of this most vital resource strategically for the benefit of the country’s success.

Teplitz is US Ambassador to Nepal