Print Edition - 2015-06-18 | MONEY
Govt urged to focus on grants, not loans, at int’l donors’ meet
Jun 17, 2015-
Former finance ministers and experts on Wednesday urged the government to focus on attracting grants instead of loans at the International Donors’ Conference scheduled to be held on June 25.
At an interaction organised by the Finance Ministry, they asked the government to make sure the assistance does not come with many conditions attached.
Former Finance Minister Surendra Pandey said the government should not accept aid attached with the conditions and receiving grant should be big priority instead of loans given the country’s limited paying capacity.
Former Nepal Rastra Bank Governor Yubaraj Khatiwada said accepting more loans would affect other aspects of the economy.
Nepal’s debt burden, however, is not so high, with the debt against Gross Domestic Product (GDP) is less than 30 percent. So multilateral donors like the World Bank and Asian Development Bank have stopped giving grant for the last two years.
However, the government has insisted Nepal’s improved repayment capacity was not due to economic growth, but due to its failure to spend resources which resulted in savings.
Finance Minister Ram Saran Mahat said the government would focus on grant and long-term soft loans. He said the event has been planned in Kathmandu so that the participants would see the disaster. “We have expected high-level participation from the donors,” he said.
Former finance minister Barsaman Pun said the reconstruction body to be formed should be effective. Another former minister Shankar Koirala stressed on increasing the capacity of the government to spend resources.
Auditor General Bhanu Prasad Acharya said the country could receive foreign assistance provided transparency and accountability is ensured.
Published: 18-06-2015 08:20