Bilateral Nepal-German Government Negotiations on Development Cooperation Successfully Concluded

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The Government of Nepal and the Government of the Federal Republic of Germany have successfully conducted government negotiations on bilateral development cooperation on 22 and 23 November 2016 in Kathmandu. The German side has pledged fresh funds of EUR 36 m. (more than NPR 4.2 bn) for the continuation of German support.


German Development cooperation is focusing on three thematic areas:


  1. Sustainable Economic Development and Trade
  2. Health and
  3. Energy Efficiency/Renewable Energy


In addition, German Development Cooperation is supporting Nepal in the field of earthquake recovery and local governance. Out of the total commitment, EUR 16 m. will be provided under financial cooperation via KfW Development Bank. The remaining EUR 20 m. will be used for Technical Assistance via GIZ and the German National Metrology Institute PTB.


The lion’s share of the committed funds will be allocated to the sectors of energy (EUR 20.5 m.) and health (EUR 5 m.). Altogether, the German financial support to Nepal amounts to approximately EUR 1.2 bn since 1961.


The geographical focus of the cooperation will remain on the rural regions in Nepal’s Mid and Far West, with additional support to selected districts that were severely affected by the 2015 earthquakes.


The biggest single new project supported with this year’s commitment (EUR 16 m.) will be a transmission line (Leknath – Damauli) that is key for Nepal’s grid development in cooperation with Nepal Electricity Authority (NEA). Another major commitment will allow the continuation of Germany’s support for energy efficiency with the Ministry of Energy as lead partner.


In the priority area of health, German Development Cooperation continues to support the National Health Sector Strategy and aligns its contributions to the priorities and timelines of the Government of Nepal, Ministry of Health. Key areas of support (among others) are improving the availability, usage and quality of health services, particularly those concerned with maternal and new-born health, as well as the establishment of the Social health Security Programme to contribute to Nepal’s goal to accelerate Universal Health Coverage.


Cooperation in the field of economic development and trade aims at creating sustainable income opportunities and jobs, in particular for disadvantaged groups. To complement the ongoing activities in this sector, this year’s commitments target on strengthening the Internal Revenue Department (IRD) and Nepal’s Quality Infrastructure.


All new commitments will be implemented fully in line with Nepal’s Development Cooperation Policy, either via Technical Assistance or direct implementation.


The Government of Germany expressed its hope that after a challenging 2015 the new Government of Nepal will accelerate the support for the earthquake victims, successfully expedite the new constitutional set-up and held long overdue local elections at the earliest.

  Following the negotiations, the German delegation plans to visit a number of bilateral cooperation projects, e.g. earthquake relief and reconstruction activities in Bhaktapur, Dhading and Nuwakot as well as the Middle Marsyangdi Hydropower Plant.