Nepal owes majority debts to multilateral donors

This undated image shows the building of Public Debt Management Office in Putalisadak, Kathmandu. Photo: PDMO

KATHMANDU: Nepal’s total outstanding external debts stood at Rs 934.14 billion ($ 7.82 billion) at the end of the fiscal year 2020/21, with multilateral donors accounting for a majority share of them, according to the Public Debt Management Office (PDMO).

Nepal owes 87.89 per cent of its foreign debts to multilateral donors, including the World Bank and the Asian Development Bank, and the remaining to bilateral donors, the PDMO said in a recently released report.

The lion’s share at Rs 471.17 billion rupees ($ 3.94 billion) goes to the International Development Association, an international financial institution under the World Bank Group that offers concessional loans and grants to the poorest developing countries.

The Asian Development Bank comes second at Rs 292.91 billion ($ 2.45 billion), or 31.36 per cent of Nepal’s total foreign debts.

Among the bilateral donors, Japan is the largest creditor to Nepal with a share of 4.41 per cent, followed by China and India, according to the report.

China’s share in Nepal’s foreign debts has been growing slowly and steadily in the past five years, from 1.93 per cent in the 2016-17 fiscal year to 2.66 per cent in 2017-18 and up further to 3.10 per cent in 2018-19, 3.24 per cent in 2019-20 and 3.39 per cent in 2020-21, the report said.

“Even though a portion of the Chinese loans to Nepal has been growing in recent years, it is not a significant amount in the overall external debts of the country,” Hira Neupane, information officer with the PDMO, told Xinhua.

“The debts owed to China are basically loans from the Export-Import Bank of China for various development projects,” he added.

Source: RSS/Xinhua

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