Support sought to bridge resource gap in infrastructure sector

Kathmandu, June 18

Nepal has sought financing from the Asian Infrastructure Investment Bank (AIIB) to bridge the resource gap in infrastructure sector.

Addressing the concluding session of second board of governors meeting of AIIB held in Jeju province of South Korea today, Finance Minister Gyanendra Bahadur Karki said the country requires robust infrastructure to keep momentum of high economic growth.

Stating that the country needs to raise investment from current level of around four per cent of the gross domestic product (GDP) to at least nine to 10 per cent of the GDP, Minister urged the China-backed multilateral bank to raise its investment in Nepal.

“As the government has approved the proposal of Asian Development Bank (ADB) and International Finance Corporation (IFC) — wing of the World Bank Group that looks over private sector development — to issue local currency bonds, the multilateral development agencies can raise the capital from the local market to invest in the needs of the country,” the statement issued by the Ministry of Finance quoted Karki as saying in his address to board of governors meeting. He also urged AIIB to finance private sector-led infrastructure projects as well.

Minister Karki also said that the country has been gradually moving towards stability through implementation of new Constitution. He sought support from the AIIB on transportation, electricity generation, urban development and drinking water facility, aviation and information technology-related infrastructure.

Minister Karki also met AIIB President Jin Liqun on the sidelines of the meeting and urged early conclusion of the loan agreement for six projects proposed by Nepal. Liqun said that the AIIB is mulling over financing two projects out of six proposed and a decision in this regard would be taken shortly.

During the meeting, AIIB President Liqun also showed interest to work together with other multilateral development partners in Nepal, as per the statement.

AIIB’s second board of governors meeting, held in South Korea from June 16 to 18, approved the membership proposal of three other nations, taking the total number of member countries to 80. Nepal is the founding member of the bank.