Kathmandu. The World Bank has increased the interest rate on loans given to Nepal with effect from July. Dhaniram Sharma, chief of the Foreign Assistance Coordination Division, said this at an orientation programme on foreign aid mobilization system jointly organized by the Association of Economic Journalists of Nepal and the Ministry of Finance on Monday.
According to him, Nepal has so far increased the interest rate on development assistance from the World Bank from 0.75 percent to 1.5 percent. He said, “The World Bank has increased the interest rate since July this year. We used to pay it within 40 years. At present, the maturity period has also increased from 24 to 30 years. Earlier, there were two types of such periods of 40 and 38 years. Now it has been built in 30 years. ’
According to him, the interest rate on loans has increased naturally as Nepal has been upgraded from the list of poor countries. He said, “Why have we grown now, we have become rich. We have grown because we are rich, because there is nothing else. Nepal was at the lowest level in the list of poor countries. We have come up a bit from that category below. ’
The World Bank and the Asian Development Bank (ADB) have recently come out with their own strategies, he said, adding that the development assistance would be carried forward in a way that is consistent with those strategies. He said, “ADB has brought the Country Partners Strategy by the World Bank as Country Partner Fembark. These two documents were also made in collaboration with us. Development assistance will proceed on the basis of what is mentioned in those documents as priority. They contribute 80 percent of Nepal’s development assistance. ’
He informed that project readiness filter has been issued to make all the development assistance received by Nepal selective. He said that the filter was brought only by focusing on the quality and yield of the project. He said, “If some ministry tried to apply projects as easily as yesterday, it may not happen now. The desire to take more projects is going to be broken.
He said Nepal could not get foreign aid on priority basis as it would not be implemented without consensus on both sides of receiving and giving foreign aid. He said, “There seems to be some criticism of foreign aid. There are complaints that we have to be our priority and we have to put it in place. ’
He said it was not possible to get development assistance only as stated by Nepal as the agreement would be decided through negotiations. “It’s based on negotiation. Our effort is to put it on our priority. ’
On the occasion, Under-Secretary Dolendra Sharma made a presentation on the practice of mobilizing foreign aid in Nepal. In some cases, it is not possible for foreign aid to come as per the commitment, he said. He said, “We talked about MCC, this year also we have kept about seven billion rupees for MCC. If MCC had not continued, it would not have been able to implement foreign aid. ’
Ministry representatives Prem Upadhyay and Vishesh Pradhan briefed about the development finance information management system.
