Nepal's financial planners are scrambling as foreign donors disgusted by King Gyanendra's power grab last month cut off aid -- a vital lifeline for the impoverished Himalayan kingdom.
About 70 percent of the development budget is dependent on foreign aid, an official from Nepal's National Planning Commission said on condition of anonymity, warning that without it, "there will be no new bridges, roads, drinking water projects, schools or hospitals."
Making matters worse, the country's escalating communist insurgency has frightened off foreign tourists in recent years, depriving Nepal of one of its main sources of revenue.
PHOTO: EPA
The official said the government could make up for some of the losses out of reserve funds, but if the situation continues, the economy could plunge.
Gyanendra, a constitutional monarch, seized power on Feb. 1, imposed emergency rule and suspended civil liberties. He said he had to act because of the communist insurgency that has taken over much of the mountainous countryside.
Foreign governments, however, strongly voiced their dismay over the monarch's actions, with some recalling their ambassadors.
The UN children's agency said the crisis has blocked supplies of vital vaccines and medicines to some 3.3 million children, threatening their health. UNICEF executive director Carol Bellamy on Friday urged the government and the communist rebels to facilitate nationwide distribution of Vitamin A capsules and deworming drugs.
"It is vital that these supplies reach remote areas as soon as possible," Bellamy said. "Both sides need to put the health of Nepal's children first."
In Kathmandu, officials are still calculating the total aid that has been lost due to the crisis.
For this fiscal year, which ends in July, foreign aid makes up 32 billion rupees (US$450 million) of the 42 billion rupee (US$590 million) budget allocated for development projects. The total annual budget is 110 billion rupees (US$1.55 billion).
So far, European nations like Switzerland, Denmark and Norway have already suspended contributions for development work.
Norway has withdrawn US$8 million in aid for a project to increase drinking water in Kathmandu. The capital has severe water shortages, and its population of 1.5 million gets its drinking water for two hours every other day.
The World Bank also suspended US$70 million in aid after the royal takeover, while the Asian Development Bank (ADB) is assessing the situation.
"ADB's ongoing operations will critically depend on how the security situation evolves," said Hafeez Rahman, the bank's resident representative for Nepal.
The diminishing aid isn't just hitting development. Two of Nepal's key allies, India and Britain, have suspended military aid, which it needs in its battle with the communist rebels.
The US is considering a similar move, but has been moving more cautiously, fearing it could indirectly help the rebels. It has given US$22 million in military aid over the past four years, and is considering another US$2 million in assistance.
Analysts say it would be difficult for Nepal without the generosity of donor nations.
"If the government thinks it can sustain the economy without foreign aid, it is nothing but a mad assumption," said Bishwombar Pyakurel, an independent economist.
The collapse of the Swiss Birch glacier serves as a chilling warning of the escalating dangers faced by communities worldwide living under the shadow of fragile ice, particularly in Asia, experts said. Footage of the collapse on Wednesday showed a huge cloud of ice and rubble hurtling down the mountainside into the hamlet of Blatten. Swiss Development Cooperation disaster risk reduction adviser Ali Neumann said that while the role of climate change in the case of Blatten “still needs to be investigated,” the wider impacts were clear on the cryosphere — the part of the world covered by frozen water. “Climate change and
Poland is set to hold a presidential runoff election today between two candidates offering starkly different visions for the country’s future. The winner would succeed Polish President Andrzej Duda, a conservative who is finishing his second and final term. The outcome would determine whether Poland embraces a nationalist populist trajectory or pivots more fully toward liberal, pro-European policies. An exit poll by Ipsos would be released when polls close today at 9pm local time, with a margin of error of plus or minus 2 percentage points. Final results are expected tomorrow. Whoever wins can be expected to either help or hinder the
DENIAL: Musk said that the ‘New York Times was lying their ass off,’ after it reported he used so much drugs that he developed bladder problems Elon Musk on Saturday denied a report that he used ketamine and other drugs extensively last year on the US presidential campaign trail. The New York Times on Friday reported that the billionaire adviser to US President Donald Trump used so much ketamine, a powerful anesthetic, that he developed bladder problems. The newspaper said the world’s richest person also took ecstasy and mushrooms, and traveled with a pill box last year, adding that it was not known whether Musk also took drugs while heading the so-called US Department of Government Efficiency (DOGE) after Trump took power in January. In a
It turns out that looming collision between our Milky Way and Andromeda galaxies might not happen after all. Astronomers on Monday said that the probability of the two spiral galaxies colliding is less than previously thought, with a 50-50 chance within the next 10 billion years. That is essentially a coin flip, but still better odds than previous estimates and farther out in time. “As it stands, proclamations of the impending demise of our galaxy seem greatly exaggerated,” the Finnish-led team wrote in a study appearing in Nature Astronomy. While good news for the Milky Way galaxy, the latest forecast might be moot