The Government of Nepal and the Government of Finland have signed a framework agreement under Finland’s Public Investment Facility Scheme to mobilize concessional financing for socio-economic infrastructure projects, with a strong emphasis on energy and sustainable development.

The agreement was formalized during a meeting between Nepal’s Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel and Finland’s Foreign Trade and Development Minister Ville Tavio. The signing ceremony, held at the Ministry of Finance, was attended by Dhani Ram Sharma, Head of Nepal’s International Economic Cooperation Coordination Division, and Riina-Riikka Heikka, Ambassador of Finland to Nepal.

According to Nepal’s Ministry of Finance, the agreement aims to promote sustainable development by supporting infrastructure projects in sectors such as renewable energy, electricity, and digitalization. Other focus areas include drinking water, waste management, healthcare technology, disaster management, and meteorology.

Through the grant-supported initiative, Nepal plans to advance its renewable energy sector by increasing access to clean and reliable electricity, addressing energy poverty, and supporting the nation’s transition toward sustainable energy systems. These efforts align with Nepal’s commitment to achieving its green energy goals and strengthening its socio-economic infrastructure.

The financial support will adhere to the Organisation for Economic Cooperation and Development (OECD) framework and Finland’s Public Sector Investment Facility Guidelines. Notably, as Nepal is classified as a Least Developed Country (LDC), 50% of the funding will be provided as grants.

Deputy Prime Minister and Finance Minister Paudel hailed the agreement as a significant milestone for Nepal’s infrastructure development, emphasizing its potential to accelerate energy sector progress. Finnish Development Minister Tavio highlighted the importance of such partnerships in fostering deeper economic cooperation between the two nations.

The agreement sets the stage for Nepal to leverage concessional finance and grant funding to bolster its energy sector and other critical infrastructure, driving sustainable development and enhancing the quality of life for its citizens.