KATHMANDU: The Nepali government is considering raising the minimum threshold for receiving aid from foreign donors as it is preparing a new Development Cooperation Policy, a senior official of Nepal’s finance ministry said.
Kewal Prasad Bhandari, chief of International Economic Cooperation Coordination Division at the Finance Ministry told Xinhua on Monday that according to a draft they have drawn out, the Nepalese government would not accept foreign grants worth less than 20 million U.S. dollars from a donor. Current Development Cooperation Policy-2014 has set the minimum threshold at 5 million U.S. dollars for a grant.
You might also like
Furthermore, the Nepalese government is seeking to raise the threshold for receiving loans from bilateral and multilateral donors.
According to Bhandari, they have proposed that the government should not accept foreign concessional loans worth less than 50 million U.S. dollars per project and commercial loans worth less than 200 million U.S. dollars per project.
The current minimum threshold for concessional loan and commercial loan for a project is 10 million U.S. dollars and 20 million U.S. dollars respectively.
“This is the criteria we have proposed for receiving foreign aid in general,” said Bhandari. “But, we can accept small aids during the emergency situation or the aid that is provided as a token for strengthening bilateral relations.”
In recent years, the Nepalese government has been able to generate more revenues particularly from imports tax, which has enabled the government to finance some major infrastructure projects along with social sectors and reduce heavy dependence on foreign assistance.
Besides increasing the threshold, the Nepalese government is also seeking to tighten policy with regard to donors having offices in Nepal who provided funds to international non-governmental organizations (NGOs) in Nepal to implement the development projects.
