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Nepal Investment Summit 2017

Road & Transport

  • Sector Overview

  • Opportunities

Sector Overview

Nepal is a landlocked country in which road transport is the primary form of transport used for cargo and passengers. The road network in Nepal consists of the Strategic Road Network (SRN), which is managed at the central level, and the Local Road Network (LRN), which is managed at the local level. The SRN consists of national highways (NH) and feeder roads (FR). All roads within municipal boundaries that do not belong to the SRN are considered urban roads (UR), while the remaining roads are classified as either district roads (DR) or village roads (VR).

According to the Department of Local Infrastructure Development and Agricultural Roads (DoLIDAR), Nepal has 6,683 rural roads, the combined length of which is 50,943 km. Of these, 1,575 km are blacktop, 14,601 km are gravel and 34,766 km are earthen fair-weather roads. At present, 73 districts headquarters out of 75 have access to roads. The country has a road density of about 34.41 per 100 sq km, whereas effective population kilometres per 1,000 is 1.91. The national road network in Nepal (excluding all local roads) is worth about NPR 90 billion (USD 900 million), which represents almost 20% of the country’s GNP. These roads comprise a substantial investment, underscoring the need to maintain these roads.

There is a backlog of maintenance on more than 50,943 km of rural roads under the Local Road Network. As a result, a large proportion of the roads are in ‘poor’ condition and beyond routine maintenance. These roads require reconstruction/rehabilitation.

Nepal Road Standards 1971 (Second Revision in 2014) is applicable to all strategic roads in rural areas being constructed within Nepal. For non-strategic (local roads) and urban roads, separate standards are applicable.

Opportunities

Development opportunities

  • Only 19% of roads in Nepal are all weather roads.
  • Only 11% of total roads in Nepal are blacktopped.
  • 2 out of the 75 districts in Nepal are still not connected by roads. 
  • There are several proposed road projects in Nepal.
  • Some highways require expansion to accommodate the increase in traffic.

 
Transportation financing mechanisms – A shift from government financing to PPPs

  • Almost all of the roads in Nepal have been financed by the Government of Nepal, however, the government is now seeking to collaborate with the private sector.