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The World Bank has approved a loan of USD 257 million to Nepal to strengthen electricity distribution services and enhance irrigation systems aimed at boosting agricultural productivity.
In a press release issued on May 29, the World Bank stated that its Board of Executive Directors approved funding for two major projects in Nepal: the Electricity Supply Reliability Improvement Project and the Modernization of Rani Jamara Kulariya Irrigation Project - Phase 3.
The Electricity Supply Reliability Improvement Project will receive USD 120 million to enhance power distribution infrastructure and ensure a more reliable electricity supply across Koshi, Bagmati, Karnali, and Sudurpashchim provinces. Led by the Nepal Electricity Authority (NEA), the project will focus on constructing new distribution substations, upgrading existing networks, and deploying automated systems for real-time monitoring to improve operational efficiency.
The Modernization of Rani Jamara Kulariya Irrigation Project - Phase 3, with a budget of USD 137 million, aims to improve irrigation services in Kailali district of Sudurpashchim Province. Jointly implemented by the Department of Water Resources and Irrigation and the Department of Agriculture, the project will extend year-round irrigation services to an additional 17,500 hectares, benefiting an estimated 160,000 people. It also aims to increase agricultural productivity and build climate resilience in the region.
“An uninterrupted electricity supply and adequate, year-round irrigation services are fundamental inputs for Nepal’s sustainable development,” said David Sislen, Country Director for Maldives, Nepal, and Sri Lanka at the World Bank. “These projects emphasize improved connectivity, promotion of clean hydropower-based electricity, and integrated agricultural support services to help farmers become more resilient to climate and disaster risks.”
In addition to infrastructure development, the projects will include capacity-building programs for the Nepal Electricity Authority and Water Users Associations. These initiatives aim to encourage innovative solutions and strengthen institutional systems for the effective and sustainable management of energy and irrigation infrastructure.
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