The government of Japan has agreed to extend grant assistance of over NRs.1.2 billion (approximately US$17m) to the government of Nepal for the execution of Non-Project Grant Aid and the increase of Food Production (2KR) in Nepal, Japanese embassy said.

Japan has decided to continue grant-assistance to the people of Nepal, with a view to addressing issues at the core of the Maoist insurgency such as poverty alleviation and redressing social inequity so as to significantly help reduce poverty and cultivate an atmosphere conducive towards attaining peace which would lead to the development of a stable democracy in Nepal, a press communiqué issued by the Japanese embassy said Monday afternoon. The statement, moreover, urged the Maoists to achieve peace through dialogue.

Saying Japan believes that the strengthening of the democratization process under a system of democracy and a constitutional monarchy will facilitate to achieve sustainable development in Nepal, the press statement added, “As stated in the Ministry of Foreign Affairs Press Secretary Statement issued on February 2, Japan has been strongly urging that the political leaders be released and that the freedom guaranteed by the constitution be restored promptly.”

“Japan hopes that Nepal will recover its peace and stability as soon as possible on the basis of democracy and constitutional monarchy. Considering the aspirations of the people of Nepal, the Japanese government has been responding to Nepal’s requests in achieving sustainable socio-economic development for poverty alleviation in line with PRSP, which will ultimately facilitate ensuring peace building and human security, ” the statement read.

The Government of Japan expresses its firm belief that the assistance extended today will directly benefit the people of Nepal through the implementation of development activities such as the improvement of agricultural productivity through the supply and use of fertilizer, the advancement of transportation and human communication, the effective implementation of disaster prevention and rehabilitation activities as well as the improvement of health and education in the rural areas of Nepal, it said.

The Government of Japan has been extending Grant Assistance for the Increase of Food Production (2KR) to Nepal since JFY 1977.

Japan decision to provide aid to Nepal follows suspension of assistance to Nepal from major donor communities.

The government of Nepal will have to deposit a specified amount of money separately, in Nepalese currency, in a bank as a counterpart-fund of NPGA and 2KR after the utilization of the aforementioned Grants. The currency thus deposited under the NPGA counterpart fund is to be effectively utilized in health, education, local development, reconstruction, rehabilitation and development of rural areas, disaster management and, drinking water and sanitation with prior consultation between the two governments, the statement added.

Ambassador of Japan to Nepal Tsutomu HIRAOKA and Secretary of the Ministry of Finance Bhanu Prasad Acharya signed and exchanged two different notes on behalf of their respective governments amid a function Monday.

On the occasion, envoy HIRAOKA expressed his sincere hope that the continued support of the Government of Japan to His Majesty’s Government of Nepal in its development efforts will help in increasing the socio-economic development of Nepal as well as enhancing the well-being of the Nepalese people. He also expressed his belief that this support will also help strengthen the existing friendly and cooperative relationship between Japan and the Kingdom of Nepal, according to the statement.