This report analyzes five critical public investment bottlenecks cutting across the project cycle. The selection of these bottlenecks was informed by these previous assessments and discussions with government counterparts. At the upstream level, this report reviews recent developments in Nepal’s project appraisal, selection and monitoring system (i.e., the National Project Bank - NPB) and its implications on budget planning. Furthermore, the report includes two deep dives of project readiness bottlenecks: the tree cutting clearance process and the land acquisition process. At the downstream level, the report provides an updated analysis of implementation challenges emerging from inefficiencies in cash management and the budget reallocation process (i.e., virements). The report concludes with an examination of key drivers of public procurement inefficiencies including gaps in the procurement regulatory framework. The analysis is focused on bottlenecks in the planning and implementation of federal infrastructure projects. Project implementation is affected by other critical issues that fall outside the scope of this chapter and warrant further analysis. These include, inter alia, challenges associated with the transition to federalism, high turnover of project-level staff, the absence of a performance assessment system for public employees, the role and effectiveness of oversight agencies, and bureaucratic constraints to the payment and repatriation of profits for international contractors
