The government and European Investment Bank (EIB), the European Union’s long-term financing institution on Monday signed a Framework Agreement under which the Bank may start financing capital investments in Nepal.

The agreement was signed between Finance Secretary Krishna Hari Baskota and EIB Vice-President with special responsibility for the Bank’s activities in Asia, Magdalena Álvarez Arza, according to the press statement issued by the bank.

"I am confident that this first milestone in the cooperation between Nepal and the EIB will soon result into the implementation of projects, especially in the area of renewable energy and energy infrastructure. These will help Nepal develop further its huge hydropower potential and improve economic prosperity and quality of life for the Nepalis people." said Arza at the signing ceremony.

Alexander Spachis, Ambassador, Head of the European Union Delegation to Nepal also  expressed the optimism that this agreement would open up additional avenues for Nepal to acquire funds for further pursuing development initiatives on important social, economic and development sectors.

“The agreement was in line with the European Union’s recent initiatives designed to assist developing countries in achieving inclusive economic growth, including providing access to sustainable energy to their populations, said the statement received from EU quoted Spachis as saying.

Similarly, Finance Secretary Baskota also expressed that this agreement would provide Nepal a basis for sufficient financing at low cost and create conducive environment for foreign investment in different projects like infrastructure development, energy, sustainable environment and so on.

"We are confident that this venture will support Nepal to achieve sustainable and inclusive economic development. Let’s hope this collaboration will grow further in the days to come." Baskota added.

The EIB finances projects in countries which have concluded cooperation agreements with the European Union. In Asia, the Bank has so far signed Framework Agreements with Bangladesh, China, India, Indonesia, Laos, Maldives, Mongolia, Pakistan, the Philippines, Sri Lanka, Thailand, Vietnam and Yemen.

Following the signing, the EIB Vice-President called on Prime Minister Baburam Bhattarai at his office in Singha Durbar where the two discussed the future role of the EIB in supporting Nepal’s sustainable development. nepalnews.com