Foreign aid commitment up 259pc so far this fiscal
KATHMANDU:
Foreign aid commitment has jumped by 259 per cent so far this fiscal year, in an indication that development partners are optimistic about prospects of the country.
The country received foreign aid commitment of Rs 252.47 billion between July 17, 2014 — when the current financial year started — and March 17, 2015, as against Rs 70.35 billion in the same period last fiscal year, the latest data
released by the Ministry of Finance (MoF) show.Of this commitment, Rs 126.13 billion, or 49.96 per cent of the pledged amount, was in the form of loan, while Rs 126.34 billion was in the form of grant.
One of the reasons for sharp hike in foreign aid commitment this fiscal year is successful completion of Constituent Assembly election‚ which was able to install an elected government.
KATHMANDU: Foreign aid commitment has jumped by 259 per cent so far this fiscal year, in an indication that development partners are optimistic about prospects of the country.
The country received foreign aid commitment of Rs 252.47 billion between July 17, 2014 — when the current financial year started — and March 17, 2015, as against Rs 70.35 billion in the same period last fiscal year, the latest data
released by the Ministry of Finance (MoF) show.Of this commitment, Rs 126.13 billion, or 49.96 per cent of the pledged amount, was in the form of loan, while Rs 126.34 billion was in the form of grant.
One of the reasons for sharp hike in foreign aid commitment this fiscal year is successful completion of Constituent Assembly election, which was able to install an elected government. This has raised hopes for return of some sort of stability in the country, which gave a boost to the confidence of development partners.
Yet, the government fails to make timely use of funds allotted by development partners largely due to problems such as delay in land acquisition and preparation of procurement plans, presence of weak public financial management systems and practices, delays in procurement process, and weak project planning and implementation capacity.
So far this fiscal, 14 development partners of the country, including the European Union (EU), the US Agency for International Development (USAID), the World Bank (WB), the Asian Development Bank (ADB), the UK’s Department for International Development (DfID), the OPEC Fund for International Development, the International Fund for Agricultural Development (IFAD), the Saudi Fund for Development, the Japan International Cooperation Agency (JICA), and the governments of India, China, Switzerland, Norway and Finland, pledged to give away grants and soft loans of
various sizes.
Of these development partners, India topped the list with commitments to give away Rs 107.13 billion in grants and loans, show the MoF data.The amount pledged by India is 42.43 per cent of the total foreign aid commitment received by the country so far.In November, India formally extended a line of credit of $1 billion (approximately Rs 98.03 billion) to Nepal. This money, according to the government, would be invested in hydropower, irrigation and infrastructure development projects.
India has also pledged to give away Rs 8.78 billion in grant for construction of National Police Academy, Rs 256.70 million in grant to build an irrigation project and Rs 69 million in grant for goitre and other deficiency disorder control programmes.
The second biggest foreign aid commitment was made by the European Union. It has so far pledged to give away Rs 44.80 billion in grant to boost rural development and job creation, foster quality education and strengthen democratic governance. The amount would be given to the country between 2014 and 2020.
Next in the league table of aid commitment is USAID, which has pledged to give away Rs 38.60 billion in grant to strengthen democratic process, improve governance, and enhance maternal and child health and literacy, says the report.Similarly, the World Bank, a multilateral lending agency, has expressed commitment to give away Rs 18.24 billion in grants and loans to the government, which would be used for implementation of Grid Solar and Energy Efficiency Project, Kabeli Hydroelectric Project and Extended Biogas Project.
Likewise, China has also expressed commitment to extend grant assistance of Rs 12.83 billion for investment in mutually agreed development projects.
Another multilateral lending agency, the ADB, meanwhile, has pledged to give away Rs 12.10 billion so far this fiscal. The fund would be used in establishing women and children service centres, South Asia Sub-regional Economic Cooperation Project and Third Small Town Water Supply and Sanitation Project.
Likewise, the DfID, so far this fiscal, has pledged to give away Rs 5.08 billion in grant to the government. The money would be used in implementation of Integrated Programme for Strengthening Security and Justice Project.
Among others, OPEC Fund has promised to extend Rs 3.05 billion in soft loan for Community Managed Irrigated Agriculture Sector Project, while the Swiss government has expressed commitment to extend grant of Rs 2.76 billion to build bridges, conduct river protection works, improve livelihood in Chitwan and implement small irrigation programme.
Similarly, the UN’s IFAD has pledged to extend grant assistance Rs 2.51 billion to implement Adaptation for Smallholders in Hilly Area Project, the Saudi Fund has expressed commitment to give away Rs 2.41 billion for implementation of Rehabilitation and Extension of Danduwa Irrigation Project, the Norwegian government pledged to give away Rs 1.83 billion in grant for school sector reform programme, the Finnish government and JICA pledged for grant of Rs 867 million and Rs 272.70 million, respectively, for school sector reform programme.
Quick look
Development partner ------------- Pledge
India ------------------------------------107,134.70
EU ------------------------------------ --44,800.00
USAID --------------------------------- 38,600.00
World Bank ---------------------------18,235.90
China -----------------------------------12,830.60
ADB ------------------------------------ 12,097.40
DFID ------------------------------------ 5,080.00
OPEC Fund --------------------------- 3,049.20
Switzerland ----------------------------2,758.00
IFAD ------------------------------------ 2,510.00
Saudi Fund ----------------------------2,410.00
Norway ---------------------------------1,830.00
Finland ----------------------------------867.00
JICA ------------------------------------ 272.70
Total ------------------------------------ 252,475.50
Source:THT
