World Bank increasing aid to Nepal

World Bank increasing aid to Nepal

World Bank has pledged to increase its aid to Nepal. World Bank managing director Sri Mulyani Indrawati during a meeting with finance minister Dr Ram Sharan Mahat in Washington assured him that the multilateral donor is increasing its aid to Nepal under International Development Assistance (IDA) 17, a programme aimed at the poorest countries. The IDA 17 – that begins from July 17, 2014 and runs through June 2017 – aims at helping poor countries to attain millennium development goals (MDGs) and address post-MDG agendas. It also aims at maximising development impacts. Indrawati also expressed her concerns about delays in project implementation, land acquisition problems and resettlement issues. Mahat – currently in Washington to take part in the joint meeting of the World Bank and International Monetary Fund (IMF) – also met with World Bank vice-chairman for South Asia Philippe H Le Houerou, who stressed the need for policy reforms and development and assured support provided Nepal implements the reform agenda sincerely. Mahat also assured the development partner that the incumbent government is committed to introducing new reforms. "Since Nepal is heading towards political stability after successful second Constituent Assembly (CA) election, the incumbent government is mandated to promulgate a new constitution within a year." Nepal is also maintaining macro-economic stability," he said, adding that the country has also made a good progress in social development indicators including human development index, despite a decade-long conflict and prolonged transition. But the country lags behind in the economic growth due to extreme shortages of basic infrastructures like road and electricity, he said, seeking World Bank support in infrastructure development, especially in road connectivity and hydropower projects. Saying that infrastructure development is relatively costly in Nepal due to difficult geography, Mahat sought higher support from all possible windows of the bank, including International Finance Corporation (IFC) and IBRD. Likewise, IFC vice-president Karin Finkelston, during her meeting with Mahat, said that IFC’s loan to Kabeli Hydropower Project was the first step for IFC’s investment in Nepal to harness massive hydro potential in the country by leveraging private sector investment. She also stressed on the need for improving business climate in Nepal. Praising Nepal for allowing IFC to issue local currency bonds, she said, it was a step forward towards mobilising resources for development.
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