Himal Press 
KATHMANDU: The Ministry of Finance and the Asian Development Bank have signed a $100 million concessional loan agreement to advance public financial management reforms in Nepal for improved public expenditure and debt management at the national level and enhanced resource planning, financial management, and devolved service delivery at the subnational level.
Finance Secretary Ghanashyam Upahdyay and ADB’s Country Director for Nepal, Arnaud Cauchois, signed the agreement amid a ceremony at the ministry on Wednesday
The loan has a repayment period of 24 years, including an eight-year grace period. The interest rate during the grace period will be 1%, while it will be 1.5% for the remaining period.
The ADB had approved the assistance on November 2.
Key reforms at the national level include operationalizing Nepal’s first fiscal risk and strategy report; assessing contingent liabilities of state-owned enterprises; institutionalizing annual borrowing plans in line with medium-term debt strategy; implementing management and governance policy, and loan and share investment policy for public enterprises; upgrading the Public Enterprises Management Information System for real-time monitoring and oversight; and operationalizing the Public Financial Management (PFM) reform strategy and integrated PFM System. These reforms will contribute to improved expenditure planning and management and reduced fiscal risks.
The program will also help establish an Alternative Development Financing Fund to mobilize domestic and international capital—including bonds, equity investments, and remittance pools—for resilient infrastructure development to bridge Nepal’s development financing gap.
