Kathmandu, November 23

The Ministry of Finance (MoF) and the government of Germany concluded the two-day negotiations on bilateral development cooperation here today.

The German government pledged fresh funds of 36 million euros (equivalent to Rs 4.2 billion) to continue its support in Nepal. The fund pledged by the German government will be spent in the next two fiscals — 2017-18 and 2018-19 — according to Tek Bahadur Khatri, under secretary at the International Economic Cooperation Coordination Division of MoF.

The support pledged by Germany will be mobilised in three major sectors — sustainable economic development and trade; health; and energy efficiency/renewable energy as grant and technical cooperation.

The largest share of the committed fund will be allocated to the energy sector (20.5 million euros) and health sector (five million euros).

Assistance agreement for the particular projects will be signed after the projects have been designed, as per MoF officials.

In addition, German Development Cooperation (GIZ) is supporting Nepal in earthquake recovery and local governance. Out of the total commitment, 16 million euros will be provided under financial cooperation via KfW Development Bank. The remaining 20 million euros will be used for technical assistance via GIZ and the German National Metrology Institute PTB.

Prior to the beginning of the negotiation, German Ambassador to Nepal Matthias Meyer stressed that Nepal needs to build a conducive economic environment to secure the best results from the development cooperation.

Altogether, the German financial support to Nepal amounts to approximately 1.2 billion euros since 1961, according to the German ambassador.

The geographical focus of the cooperation will remain in the rural regions in Nepal’s mid- and far-west, with additional support to selected districts that were severely affected by the 2015 earthquakes.

The biggest single new project supported with this year’s commitment (16 million euros) will be a transmission line (Lekhnath–Damauli) that is key for Nepal’s grid development in cooperation with Nepal Electricity Authority (NEA). Another major commitment will allow continuation of Germany’s support for energy efficiency with the Ministry of Energy as lead partner.

Likewise, GIZ continues to support the National Health Sector Strategy and aligns its contributions to the priorities and timelines of the Ministry of Health. Key areas of support among others are improving the availability, usage and quality of health services, particularly those concerned with maternal and new-born health, as well as the establishment of the Social Health Security Programme to contribute to the country’s goal to accelerate Universal Health Coverage.

Cooperation in the field of economic development and trade aims at creating sustainable income opportunities and jobs, in particular for disadvantaged groups. To complement the ongoing activities in this sector, this year’s commitments target on strengthening the Internal Revenue Department (IRD) and Nepal’s quality infrastructure.