Nepal Kathmandu Valley Urban Policy Dialogue Advisory Notes on Metropolitan Planning and Management and Urban

Report No: ACS5812 . Nepal Kathmandu Valley Urban Policy Dialogue Advisory Notes on Metropolitan Planning and Management and Urban Public Disclosure Authorized Regeneration .U June 2013 SASDU SOUTH ASIA . Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Document of the World Bank . Standard Disclaimer: . This volume is a product of the staff of the International Bank for Reconstruction and Development/ The World Bank. The findings, interpretations, and conclusions expressed in this paper do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Copyright Statement: . 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Nepal Kathmandu Valley Urban Policy Dialogue Metropolitan Planning & Management in the Kathmandu Valley Advisory Note & Action Plan Urban Regeneration of the Historic City Cores of the Kathmandu Valley Advisory Note & Action Plan Summary of Focus Group Discussions in Prayag Pokhari and Jhyapato Initial Documentation & Description of Two Heritage Routes in Lalitput June 2013 KATHMANDU VALLEY URBAN POLICY DIALOGUE TECHNICAL ASSISTANCE METROPOLTIAN PLANNING AND MANAGEMENT IN THE KATHAMANDU VALLEY ADVISORY NOTE AND ACTION PLAN June 2013 South Asia Urban Unit METROPOLTIAN PLANNING AND MANAGEMENT IN THE KATHAMANDU VALLEY ADVISORY NOTE AND ACTION PLAN Due to haphazard and unplanned urbanization, the Kathmandu Valley faces critical threats that deserve immediate policy attention. The Kathmandu Valley metropolitan region faces an imminent crisis in infrastructure and services, has the highest earthquake risk and among the worst air quality in the world. The recently formed Ministry of Urban Development (MoUD) and Kathmandu Valley Development Authority (KVDA) provide an opportunity to move to action to address these critical threats. These recent institutional changes show that a crisis often provides an opportunity for dialogue and change out of necessity. Together, these institutions can move forward to address the valley’s critical threats. But the challenges for improved metropolitan planning and management are complex, encompassing a spatially fragmented and asymmetric local governance structure, with no elected local governments; institutional fragmentation, inadequate coordination and limited local capacity; outdated plans and planning techniques, and inadequate enforcement; and inadequate financing and financial instruments for infrastructure and service delivery. The policy directions proposed in the advisory note, and discussed with the stakeholders over the course of the technical assistance, take into account the imperative of moving to action, and the agreed incremental approach to improved metropolitan planning and management. The following immediate, medium-term and long-term strategies have been discussed and agreed with stakeholders: (i) The immediate strategy: start the dialogue on metropolitan planning and management with the local authorities; (ii) The medium-term transitional strategy: take incremental steps to improve metropolitan planning and management; (iii) The long-term strategy: initiate a process of institutional change for improved metropolitan planning and management. 1 ACKNOWLEDGEMENTS This note has been prepared by a team comprising Elisa Muzzini, Senior Economist in the South Asia Urban and Water Unit of the World Bank/Task Team Leader), Silva Shrestha (Water & Sanitation Specialist), Pawan Lohani (Consultant/Municipal finance), Anil Pokhrel (Disaster Risk Management Specialist), Sonam Velani (Disaster Risk Management Analyst), Tara Lonnberg (Consultant/Institutions) and a team of experts including David Dowall (International Development Advisor and Professor Emeritus of Planning, University of Berkeley), Edward Leman (Consultant/urban planning), and Rajivan Krishnaswamy (Consultant/municipal finance). The advisory note benefited from the Global Lab Knowledge exchange on metropolitan planning organized by the World Bank Institute (WBI) and the World Bank Urban Anchor in collaboration with the South Asia Urban & Water Unit. The Technical Assistance benefited from support from the World Bank – AusAID Infrastructure for Growth Trust Fund. The advisory note builds on consultations with a broad range of central agencies and local governments, service delivery agencies, NGOs, private sector, the academia and professionals conducted in January and April, 2013; a sector study on the competitiveness of the Kathmandu Valley Metropolitan Region conducted by the World Bank in 2012; and the World Bank’s ‘Urban Growth and Spatial Transition in Nepal’ study completed in 2012. The team would like to extend special thanks to the Ministry of Urban Development (MoUD), the Ministry of Federal Affairs and Local Development (MoFALD), the Ministry of Physical Infrastructure and Transport, the Ministry of Home Affairs, the Kathmandu Valley Development Authority (KVDA), the Kathmandu Valley Water and Sewerage Board (KVWSB), and the High-Powered Commission for the Bagmati Civilization for their collaborative efforts to support the note. 2 TABLE OF CONTENTS EXECUTIVE SUMMARY ................................................................................................................................. 4 I. INTRODUCTION ..................................................................................................................................... 9 II. THE CRITICAL THREATS POSED BY RAPID, HAPAZHARD URBAN GROWTH IN THE KATHMANDU VALLEY ..................................................................................................................... 10 III. OPPORTUNITIES AND CHALLENGES FOR METROPOLITAN PLANNING AND MANAGEMENT ................................................................................................................................................. 12 III.I The Opportunities ................................................................................................................................... 12 III.II The Challenges ........................................................................................................................................ 14 IV. POLICY DIRECTIONS ........................................................................................................................... 23 A. The Immediate Strategy – Start the Dialogue on Metropolitan Management and Planning with the Local Authorities ................................................................................................................................. 24 B. The Medium-term Transitional Strategy – Take Incremental Steps to Improve Metropolitan Planning and Management ...................................................................................................... 28 C. The Long-term Strategy – Initiate a Process of Institutional Change for Improved Metropolitan Planning and Management ...................................................................................................... 32 V. IMPLEMENTATION ROADMAP FOR IMPROVED METROPOLITAN PLANNING AND MANAGEMENT ..................................................................................................................................... 34 Annexes Annex 1: Models of Metropolitan Management – The International Experience ............................ 37 Tables Table 1: Summary of Examples, Criteria and Models .............................................................................. 42 Boxes Box 1: The Functions and Governance Structure of the KVDA............................................................ 13 Box 2: The 2020 Kathmandu Valley Long-term Development Plan ................................................... 20 Box 3: Metropolitan Partnerships – The International Experience ....................................................... 28 Box 4: Geospatial Data and Open Source Tools for Planning: An International Perspective....... 30 Box 5: Metropolitan Initiative for the Regeneration of the Kathmandu Valley ................................ 31 Maps Map 1: Kathmandu Valley, Population Growth 1991-2001 ................................................................... 16 Map 2: Kathmandu Valley, Population Growth 2001-2011 ................................................................... 17 3 EXECUTIVE SUMMARY The Kathmandu Valley has not been able to seize the benefits of agglomeration forces due to haphazard

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