Foreign Aid Movements in Nepal

Abstract

Purpose: Development needs fund and foreign aid is one of the majour source of fund for developing countries. The Paper aims to analyse the trends and composition of foreign aids with case reference to the Swiss aid.

Design/Methodology/Approach: The study is based on secondary data from 2001/02 to 2014/15.Descriptive statistics has been applied to develop the trends and compositions.

Findings/Result: In FY 2014/15, the total foreign aid commitment increased by totaling to Rs.1195.5 million as compared to Rs.2125.9 million in FY 2014/15. Of the total commitment in FY 2014/15 the contribution of bilateral aid was totaling and multilateral aid contributed. While categorizing the total foreign aid the share of grant assistance constituted and loan assistance million. In FY 2014/15 the foreign grant assistant subsequently increased by whereas foreign loan assistance decreased. The bilateral aid disbursement was out of total bilateral aid commitment. Multilateral aid disbursement was 56 percent. The amount of loan is increasing in the economy. This condition also indicates that in future debt burden in budgetary system is directly reducing the development expenditure which decreases the flow of budget in poverty reduction sectors. In amount Swiss aid is much less but is efficiency is widespread in increasing people's living standard. Due to 100% grant Swiss aid doesn't create fiscal burden in the economy.

Originality/Value: it is an empirical research to signify the urgency of increasing Swiss aid and Swiss project in Nepal for sustained and broad-based economic development.

Paper Type: Analytical Policy Research