The government of Japan on Thursday has extended Rs 7.225 billion to Nepal for Debt Relief Measures in the form of cancellation of outstanding debts, which include the principal as of April 1, 2008 and interest accrued on or before March 31, 2008.
Mr. Tatsuo Mizuno, ambassador of Japan to Nepal, and Rameshore Prasad Khanal, secretary of the Ministry of Finance of Nepal have signed and exchanged a set of notes on behalf of their respective governments to this effect.
According to a press release issued by the Embassy of Japan, the volume of debt cancelled amounts to, approximately, twice as mush as the total ODA amount Japan has extended to Nepal during its Fiscal Year 2006. “It can be said that this cancellation of debt could provide Nepal with a significant opportunity to advance its social and economic development through utilization of the funds within the Nepalese Government, which would otherwise have had to utilize the said funds for its outstanding debt," added the the release.
The government of Japan had extended its loan assistance to Nepal for the execution of Kulekhani Hydroelectric Project, Kulekhani No. 2 Hydro-Power Station Project, and Udayapur Cement Plant Project.
Japan from 1978 to 2002, has regularly extended Debt Relief Measures to Nepal for helping implement poverty reduction and socio-economic development. Similarly in between 2003 and 2007, Japan has cancelled as much as 8.805 billion Japanese yen.
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