World Bank announces support for $800m Nepalese road project

The World Bank has approved a $450m loan to help Nepal upgrade two roads, which the bank says will boost trade and help the Himalayan nation to set a course for economic recovery in the wake of the coronavirus pandemic.

The Nepal Strategic Road Connectivity and Trade Improvement Project will improve the H-04 highway between Nagdhunga and Mugling in central Nepal and the link between Kamala and Pathlaiya, which includes a section of the two-lane H-01 highway that helps to connect Kathmandu with the Indian state of Bihar. The total cost of these projects is estimated to be $800m.

In its press statement announcing the loan, the bank described the projects as "crucial to Nepal’s connectivity and trade with India and other countries".

Kumar Tadimalla, a senior transport specialist at the World Bank, commented: "The project will reduce the time and cost of moving goods and boost Nepal’s trade, which accounts for about 40% of the country’s economic output. Equally importantly, the project includes best practices in safety, climate resilience, road asset management, gender equality, social inclusion and citizen engagement."

The schemes also fall under the bank’s "Eastern Corridor Connectivity Programme", set up in 2013 to improve connectivity and trade between Bangladesh, Bhutan, India and Nepal.

The loan is made over a period of 38 years, with a six-year grace period.

Image: The H-01 highway runs east to west across Nepal, but also supplies a section of the road link between Kathmandu and India (Bijay Chaurasia/CC BY-SA 4.0)

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