Nepal will get over US$3 billion more from other countries to help reconstruction after the 7.9-magnitude earthquake of April 25 that killed an estimated 10,000 people. The amount, pledged at a donors’ meeting with the government in Kathmandu last week, is less than half of what will be needed, according to official estimates.
About half the money will be grants and the rest loans. India and China have overtaken developed countries as the big donors, with India pledging over $1 billion and China over $700 million. Then came Asian Development Bank and the World Bank, followed by Japan, US and the European Union.
China and India both sent their foreign ministers to the donors’ meeting. Sushma Swaraj, India’s foreign minister, said, “We are ready to put our shoulders to Nepal’s efforts and no stone would be left unturned to help.” Chinese Foreign Minister Wang Yi said, “We should take this as an opportunity, and China being a good neighbour will help Nepal to rebuild.”
Before last week’s meeting, donors had already pledged around $1.4 billion to help reconstruction. “The level of participation and pledges encouraged us and raise our hopes,” said Narhari Acharya, Nepal’s Law Minister.
The donors’ meeting was preceded by altercations between aid agencies and Nepal’s government.
Directly addressing the concerns of aid agencies, Prime Minister Sushil Koirala said at the conference, “We will rebuild Nepal together and Nepal is friend of all. We assure you that no funds will be misused.”
After the conference, there are two areas of debate in Kathmandu. First, when will the pledges be kept? In this regard, the experience of Nepal – or any other developing country, for that matter – does not provide grounds for optimism.
Second, should so much of the money come as loans? This has evoked mixed reactions, especially in social media. Many observers feel Nepal has no choice but to take these loans. However, it should ask lenders to exempt the government from repayment of loans taken in the past. “Supposed not to look a gift horse in the mouth but 50% loans not gifts, surely not good enough – so demand debt forgiveness,” tweeted David Seddon, Nepal expert in the faculty of University of East Anglia in Britain.