Aid suspension may lead to crisis: Economists

March 1, 2005
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Economists Monday said the decisions of some of the major donor countries to suspend their aid to Nepal in the wake of the new political turn would seriously affect the economic and development activities here.

Expressing worries over the suspension of aid by some donor countries, speakers of a face-to-face program organised by the Reporters Club Nepal in Kathmandu today urged the government to be serious on how the donors could be convinced to resume their assistance to Nepal.

Economist Dr Bishwombhar Pyakurel said, “At a time when the country is not capable of managing administrative costs from internal sources, the recent decisions of the major donors to block assistance will lead to grave economic problem in the country.”

Even though the country needs to gradually do way with dependency on foreign aid, it should not shrug off the decisions to suspend aid at the moment, he said.

Expressing similar views, economist Prithivi Raj Legal said the country needed foreign assistance to cope with the present situation. He said the government should be proactive in wining the support of the donors while trying to build up inter-dependability.

Former finance minister Dr Badri Shrestha reasoned that the decision of some major donors to suspend assistance was not a wise move “If they want Nepal to fight terrorism they must continue their support,” said he. He was of the view that some of the donor countries were trying to go out their way to meddle into Nepal’s internal matters.