ADB to provide $1.5b to Nepal under new partnership plan

The Asian Development Bank (ADB) has approved a new Country Partnership Strategy (CPS) with Nepal that will anchor its assistance over the next five years. Under the new CPS, the ADB proposes to provide funding to Nepal in the amount of under US$ 1.5 billion over the next five years. The ADB expects to raise double this amount from other partners from both the private and public sectors. The ADB, one of Nepal’s largest donors, will extend long-term public and private sector finance for capital investment in the areas of transport, energy, water and other basic public services such as education and skills development. “The government and the ADB worked very closely together to define a strategic framework that will allow the ADB and others to join up in funding the type of investments that can transform Nepal. The strategic work was done in close consultation with key public agencies and private enterprises, as well as with civil society and other development partners. What we now need is to convert this into projects that ensure value for money and deliver development effectiveness,” said Juan Miranda, director general of the ADB’s South Asia Department. The ADB’s five-year strategy will tackle critical constraints such as power shortages, poor connectivity and water supply, among others, through high-priority energy sector investments to strengthen domestic energy security and promote exports through public-private partnerships. Integrating Nepal with the regional and world economy by expanding its airports and trans-boundary road networks and modernizing customs will also be a focus of the ADB’s assistance in the next five years, said the ADB in a press statement. According to the ADB, improving urban infrastructure such as water supply and sanitation in centres such as Kathmandu is another critical activity. The ADB will also help with irrigation and watershed improvement to boost productivity and commercialization. The new CPS has set the target of completing the much-talked about Melamchi Tunnel by 2016. The new strategy also places significant focus on governance, financial management, climate change, reforms for private sector investment and sustainability, institutional development and better project implementation performance; but it will have the flexibility to respond to emerging needs in the business environment during the political transition. New Country Partnership Strategy ð. To support the Strategic Road Network in rural and urban areas and upgrade key airports. ð. To complete the Melamchi Tunnel and connecting distribution systems by 2016. ð. To support implementation of the Agriculture Development Strategy. ð. To boost private sector development by helping selected public-private partnership energy projects and improving the environment for private and foreign direct investment.