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DOCKING NEPAL’S ECONOMIC ANALYSIS
FOREIGN AID AGRICULTURE FOREIGN AID
The review period highlights a reduction in foreign aid as the COVID-19 pandemic ravages countries worldwide and stems from the supply of money from most developed countries. Since foreign aid is a major source of funding for Nepal’s development efforts, the government has been making efforts to gather and mobilize resources from sources such as ADB, IMF, World Bank, EU, and many others. The budget for the FY 2020/21 also entails an encouraging target of foreign revenue collection. However, the planning has to be followed with effective implementation. Plunge in the foreign aid to Nepal and seeking additional funding:
According to the Development Cooperation Report 2018/19 published by the Ministry of Finance, Nepal had received NPR 1.79 billion (USD 15.25 million) worth of foreign aid from multilateral and bilateral donors and international nongovernmental organizations (INGOs) in the FY 2018/19.178 Bilateral donors accounted for 60 percent of the foreign aid of Nepal while INGOs accounted for the rest. However, with the coronavirus pandemic hovering over the global economy and pushing it into a severe recession, it is expected that the aid from developed economies of the US and Europe (mostly bilateral givers) could go down, and individual contributions to charities could also plunge. Given the potential of a major shrink in the aid receipts, infrastructure and capacity development efforts to strengthen the provincial and local governments of the country are expected to be negatively affected.179 In early April, when only 16 COVID-19 cases had been reported in Nepal, the government had already started feeling resource gaps. Thus,
Nepal had sought additional funding ranging from NPR 69 billion to NPR 104 billion (i.e. USD 588.03 million to USD 886.31 million), equivalent to 2 to 3 percent of the nation’s GDP, from international multilateral donors for the current and upcoming fiscal year so that the health system could be better equipped to fight the COVID-19.180 Up until midApril, the government had already written to all multilateral donors and many of them had assured of providing additional support as well. On March 29, the Cabinet formed by the government had decided to accept NPR 3.4 billion (USD 29 million) from the World Bank for pandemic preparedness, rapid credit of NPR 12.52 billion (SDR 78.5 million (wherein 1 SDR equals to USD 1.36) from the International Monetary Fund (IMF) and NPR 7.04 billion (USD 60 million) from the Asian Development Bank (ADB) under its Initial Response to COVID-19 fund.181 Ministry of Health and Population receives medical assistance package: In coordination with
the Ministry of Women, Children and Senior Citizen and Social
Welfare Council, the Association of International NGOs (AIN) in Nepal handed over medical assistance package worth NPR 45.3 million (USD 0.38 million) to the Ministry of Health and Population in response to its fight against the COVID-19 pandemic. The package includes personal protective equipment (PPEs), safe delivery kits, infrared thermometers, water and airproof aprons, surgical sterile gloves and utility gloves, KN95 masks, surgical masks, surgical goggles, sanitization and disinfectant items for the medical workers who have been untiringly working in the fight against the pandemic. This assistance is part of a joint procurement initiative led by AIN which has the participation of 16 organizations such as Action Aid, ADRA Nepal, CARE Nepal, FAIRMED, Good Neighbors International Nepal, INF Nepal, Ipas Nepal, Lutheran World Federation, Mountain-Child, One World Health, Oxfam, Plan International, Practical Action, UMN, Water Aid and NGO Nyaya Health Nepal.182 23 tonnes of essential medicines to Nepal from India: To fight
the
coronavirus
pandemic,
the
