Kathmandu, May 11, 2018: An agreement was signed between the country director of The World Bank and the secretary at the Ministry of Finance, Nepal,for a $200 million concessional loan which has been extended by the International Development Association of the World Bank Group. The loan is being provided under the First Programmatic Fiscal and Public Financial Management Policy Credit(DPC) in budgetary support and $66 million for Rani Jamara Kulariya Irrigation Project.
The agreement for the loan was signed between Rajan Khanal ,secretary at the Ministry of finance and Qimiao Fan, country director of World Bank,at the Ministry of finance on behalf of the government for Nepal and the World Bank,respectively.
The loan amount received under ‘Development Policy Credit’ will be utilized in the sectors of government’s priority through national budgetary system. This policy credit is tailored with prior actions of reform in fiscal and public financial management sector, according to the Finance Ministry.
The second agreement for Rani Jamara Kularuya Irrigation scheme will be utililized in modernization of the irrigation system and strengthening the water user’s association committees and agricultural production support. The second phase of the modernization of the project will be completed with the remaining part of $66 million received in loan from the World Bank.
This agreement for the concessional loan under DPC remains effective till February-end next year while the loan agreement for the irrigation scheme remains effective until the end of 2023. The World Bank has been extending DPC following the Nepal government’s reform initiative for the macro-economic and financial sectors.