India has always been committed to the process of socio-economic development in Nepal. The aid flow to Nepal is routed through many channels and is in many forms. The actual fund flow to Nepal from MEA’s Aid-to-Nepal budget in 2014-15 was INR 300 crores, or over USD 50 million. While a good part of this Aid is routed through the Nepalese Finance Ministry, a lot of such Aid is given directly to the beneficiary. Such assistance includes granting of scholarships, creating medical infrastructure, etc.
Our aid in 2014-15, and in other years, normally includes nearly 3000 scholarships to Nepalese students annually at a cost of INR 50 crores; bilaterally committed free electricity supply and trainings for over 400 Nepalese persons from security, economic and other organizations accounting for INR 50 crores; about 20 SDPs, gifting of buses/ambulances (over 600 have been gifted so far), over 1000 shallow tube wells and supply of iodized salt for INR 50 crores; construction of river training embankments for INR 40 crores; with payments for ongoing projects such as ICPs, Terai Roads (of which 90 kms have been built) and Rail links, depending upon project progress, accounting for the rest. Every year, Government of India spends approx. NRs. 700 Million for construction, maintenance and repair of embankments.
Four Lines of Credit totalling USD 1.65 billion are available for utilization, of which only USD 150 million has been disbursed since 2010. Its interest equalization is borne by MEA. Apart from this, pension is paidto ex-Gorkha soldiers totaling to about INR 1800 crores per year, or USD 300 million. In addition, our ‘Operation Maitri’ after the Nepalese earthquake last year, cost INR 400 crores, or USD 70 million.
Such financial support translates into on-ground socio-economic transformations in the form of spread of educational facilities, building health infrastructure, providing livelihood support and enhanced transport linkages leading to an overall improvement in the standard of living.
It may further be reiterated that there is NO aid cut in the case of Nepal. Our initial allocations for foreign aid, including to Nepal and other neighbouring countries, are based on actual expenditure levels in the preceding years, and take into account absorption capacity of our valued partners. If there is sufficient expenditure and more is required, funds are sought by MEA at subsequent stages of the Budget Allocation Process. Possibility of channeling more funds, if required, is always open.
These figures indicate that, at the very minimum, Indian Government is spending USD 50-60 million towards Nepal’s assistance. Being fully committed to Nepal’s socio-economic development, India has continuously endeavoured to partake in the development process in Nepal. Any misrepresentation of figures undermines the quantum, scope and extant of the nature of socio-economic engagement between the two nations.
(Press Release from the Indian Embassy in Nepal, May 13, 2016)