Tuesday, October 18, 2011

World Bank commits $400m in next two years

The World Bank Group reaffirmed its support to Nepal’s efforts at achieving durable peace with investments in development and poverty reduction.
Launched its new assistance strategy for Nepal for the next two years here today, World Bank country director Ellen Goldstein said that Nepal can potentially benefit from an allocation of about $400 million from International Development Association (IDA), subject to good performance and prudent economic management, over the next two years.
"The funds could finance four to five new operations per year and International Finance Corporation (IFC) can potentially commit $25-30 million on average annually, depending on the availability of viable investments and improvements in the business climate," she said, adding that the assistance programme will help improve food security, reduce malnutrition, improve immunisation coverage and enhance the access to and the quality of education apart from accelerating the economic growth and generate employment.
"It will also support efforts at strengthening governance and accountability, fostering gender equality and social inclusion, and removing key bottlenecks to higher economic growth and more jobs through investments in rural finance, transport and the energy sector,” Goldstein added.
The government is committeed to strengthening governance, replied Finance Minister Barsha Man Pun launching the Interim Strategy Notgdpe for Nepal (1012-2013).
He also urged for the support from international community — both public and private sector to help utilise resources. "Total FDI inflow to Nepal comes to a mere 0.1 per cent of gross domestic production (GDP), much lesser than in other Low Income Countries (LICs), where FDI's contribution comes to around 1.9 per cent," he said, adding that the international community can contribute to economic growth and job creation.
"The bank hopes to create a positive impact on private sector growth through investments in infrastructure, clean growth, and by providing advice which will enhance trade and support a better business environment for the private sector, including small and medium enterprises," said IFC Resident Representative in Nepal Rajeev Gopal.
Given the political transitional – with a new constitution being written and elections to follow – the World Bank Group has prepared an Interim Strategy after discussing in the bank’s Board of Executive Directors in Washington DC last month.
Supporting Nepal’s overarching goal to build a peaceful, prosperous and just Nepal, the strategy is organised around three ‘pillars’ that emerged during consultations within the World Bank Group and with Nepal, donor partners and key stakeholders.
The first pillar intends to enhance connectivity and productivity for growth, whereas the second focuses on reducing vulnerabilities and improving resilience and the third pillar concentrates on promoting access to better quality services.
Governance, accountability, gender equality and social inclusion are themes that run across all three pillars. "Within each of the pillars, the strategy identifies specific areas where the World Bank Group can make a difference," Goldstein said.
The new strategy sets out the basic parameters of the World Bank Group programme but remains flexible to respond to the challenges of implementing the proposed federal structure, once it is formally adopted. It proposes development programmes that are consistent with the government's Three Year Interim Plan and reflects considerable continuity, largely building on programmes with successful track records that are adapted to local conditions.
It also emphasised greater selectivity, focusing on areas considered vital to development and complementing programmes supported by other development partners during the transitional phase.
The World Bank Group in Nepal includes the IDA, the concessionary financing arm and IFC, the private sector arm. Two more World Bank Group organisations — the Multilateral Investment Guarantee Agency (MIGA) and the World Bank Institute (WBI) — offer investment insurance and capacity building services.
For IDA, these include roads, food security and livelihood vulnerability, education, health, urban services, and disaster management. For IFC, these include improving access to finance and investment climate, trade facilitation, lending to Small and Medium Enterprises and trade finance facilities for local commercial banks. IDA and IFC expect to work together on power development, agriculture and climate change.

Modernisation of Rani Jamara Kulariya Irrigation Scheme
KATHMANDU: World Bank country director Ellen Goldstein and Finance Secretary Krishnahari Baskota on Tuesday signed an assistance package of $43 million for the implementation of Phase 1 of the Modernisation of Rani Jamara Kulariya Irrigation Scheme. Located in Kailali district in the far western Tarai region of Nepal, Rani Jamara Kulariya is one of the most prominent Farmer Managed Irrigation Schemes, with a total command area of 14,300 hectares. It constitutes three independent, traditional irrigation systems constructed, operated and managed by generations of farmers, mainly from the indigenous Tharu community. The Rani system dates back to 1896. Nepal has a long tradition of farmer managed irrigation systems with a strong sense of ownership and farmer organisations are typically strong and dedicated to rural development. “About 25,000 farming households comprising close to 160,000 people are expected to benefit directly from the project,” Goldstein said. In the first phase, it will support the modernisation of the irrigation system by substantially rehabilitating and upgrading the main and secondary irrigation and drainage systems and flood management infrastructure, and by training Water Users Associations to improve their ability to manage the water and maintain the infrastructure. It will also carry out a series of agriculture production support activities in the project area through demonstrations, farmers’ field schools, and other adaptive processes.

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