Announcement of Nepal Receives Eight Million Dollars for Rural Development on February 26, 1976

\A/orld 'Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 IDA NEWS RELEASE NO. 76/9 FEBRUARY 26, 1976 NEPAL RECEIVES $8 MILLION FOR RURAL DEVELOPMENT The International Development Association (IDA), an affiliate of the World Bank, is providing $8 million for a" integrated rural development project in Nepal. Nepal's agriculture accounts for about two-thirds of GDP, 80% of export earnings and 94% of employment. Foodgraln production Is the most important agricultural activity, but over the past decade, yields and per capita production have declined. Nepal seeks to arrest this decline. The project, the first operation for the Bank in the rural devel- • opment field in Nepal, proposes to support a comprehensive development of the rural Hill districts of Nuwakot and Rasuwa located north of Kathmandu, the capital •. It support~ the Government's development strat- egy which seeks to balance economic growth with improved income dis- tribution, provide for more equitable regional development and ensure productive benefits from previous road development. The project, when completed in 1981, will help to Increase agricultural and livestock production and to raise incomes and living standards in the rural areas. About 25,000 families will benefit. The direct benefit to the farmers from the Increased food production will enable farmers to meet their full yearly family subsistence requirements instead of eight to nine months at present. The Un.I ted Nations Development Progra1T111e (UNDP) wi 11 provide funds to meet the cost of technical assistance for the project. The IDA credit to Nepal is for 50 years, including 10 years of grace. It is interest-free, except for a service charge of 3/4 of 1% to t~.eet IDA's administrative costs . • Note: Money figures are expressed tn U.S. dollar equivalents. Pora No. 1121 (9-75) PROJECT: TECHNICAL Rural Development DATA • COUNTllY: Nepal TOTAL COST: $10.9 ml 11 ton IDA FINANCI?E: $8 mil I Ion, standard IDA terms OTHER FINANCING: Government of Nepal United Nations Development Progranwne (UNDP) for technical. assistance Df?I.!MENTING ORGANIZATION: Ministry of Panchayat, Government of Nepal, Rastrlya Panchayat Bhawan,. Singha Durbar, Putal I· Sodok; Kathmandu, Nepal. . PROJECT DESCRIPTION: The project will develop, over 5 years, the two Hill dis- tricts of Nwakot ~nd Rasuwa by Increasing agricultural a ~ livestock production of the 29,000 families living there and Improve communications, ~ hea 1th, water suppll es and cottage I ndustrles. Major categories: agrl cultural development, livestock, lrrlgatlcm, forestry, agricultural credit, erosion control, tracks and trails, village health services, village water supplies, cooperative development, cottage Industry Improvement, warehouse construction, Panchayat development, project administration and eval~ation, technical a,slstance, and contingencies. Procurement of equipment ($780,000) piping ($760,000) and vehicles ($520,000) lnvolvlng contracts above $50,000 will be by International competitive bidding In accordance with I DA gu I de 11 nes • CONSULTANTS: Technical assistance personnel (financed by UNDP and the IDA credit) will Include: a) an assistant to the Project Coordinator; b) an Irrigation englneer;'and c) consultants to develop satisfactory procedures for eva\uatlon of the socio-economic Impact of the project on participants and to analyze data collected throughout the project period. ECONOMIC RATE OP lt!TORH: ESTIMATED COMPLETION DATE: 1981 • -o-