Announcement of Nepal Aid Group on February 1, 1980

, • World Bank 1818 H Street, .~.\V., \Vashington. D.C. 20433. U.S.A ... Telephone: '202) 477-1234 BANK NEWS RELEASE February 1, 1980 NEPAL /\ID GROUP The following announcement was issued on January 31 at the end of the Nepal Aid Group meeting in Paris. Governments and institutions concerned with development assistance to Nepal ;net in Paris on January 31, 1980, under the chairmanship of the \.jorld Bank. The meeting was attended by representatives of the Governments of Aus- tria, Canada, France, Germany, Japan, Switzerland, the United Kingdom, the United States and by representatives of the Asian Development Bank, the International Monetary Fund and the United Nations Development Programme. Representatives from the Development Assistance Committee of the OECD and the WFP also attended the meeting as observers. The Nepalese delegation was led by Dr. Devendra Raj Panday, Sec- • retary, Ministry of Finance, His Majesty 1 s Government of Nepal. He was accompanied by Mr. Heet Singh Shrestha, Joint Secretary, Ministry of Finance, Dr. Thakur Nath Pant, Joint Secretary, Ministry of Food and Agriculture, and Mr. Indra Bahadur Singh, Charge d'Affaires, Royal Nepalese Embassy 1 France. The Head of the Nepalese delegation noted that despite the success in imple:menting the public investment program, overall economic trends have been disappointing during the Fifth Plan period (1975/76-l979/80). The agri- culture sector, which doninates the economy, has been severely affected by unfavorable weather during most of the past five years. Efforts to boost agricultural production, through the use of improved seeds, ferti 1 izers and irrigation, ~·Ji J J need to be intensified. The head of the Nepalese ·delegution stated that the development strategy for the forthcoming Sixth Plan (1980/81- 1984/85) is to increase agricultural production, generate non-traditional employment opportunities, intensify population planning efforts, and meet the most critical basic needs. Emphasis is to be pJ3ced on increasing hill food production as ~veil as making maximum use of the existing Terai irrigation infrastructure. Social sector programs wi 1 I concentrate on the provision of basic health services, drinking water supplies, primary and vocational educa- tion, and rural transport facilities such as trails and suspension bridges. Reafforestation programs are intended to increase fuelwood supplies and check erosion. Revic\•tlng Nepal's aid requirements, the Group noted that aid com- mitments by members in recent years have been increasing significantly. Although disbursements from existing commitments during the early vears of • . .. /  - 2 - • I ' the Sixth Plan period \•.ould be substantial, additional commitments •,.;ould be required if the Government was to be able to expand its development program in line ,,.,ith Sixth Plan targets. Reaffirming its positive support for the develop~ent efforts of Nepal, the Group assured the Government that it ~ould continue to ~~rk closely in formulating a coordinated and effective response to the countr'/s requirements for s_ubstantial capital and technical assistance. Aid indications totaled in excess of $200 mill ion. The meeting also considered th~ Government's urgent request for emergency foodgrain assistance to meet the large shortfall in production due to last su~~er's poor mo~soon. The Group discussed the severity of the logistical difficulties a~d the high distribution costs of such a progran. In particular, the Grou;J noted t1ith great concern the adverse impact on 1 development efforts that would result from a diversion of the Government's resources to food distribution. While certain participants were in a position to make _ir.-:mediate cor.:mitments, others indicated their intention to con s i de r s y ~pa t he t i ca 1 1y t he Gov e rn men t I s re q ue s t f o r II em e r gen c y food - . 9 r a i"n. cl 5 S i St a nc e II - 0 - • / •