Chairman of the Committee Malcolm Bruce said: "In the long run UK aid in Nepal will be judged by its success in helping to reduce poverty, averting the risk of reverting to conflict, and paving the way to sustained development. In the right political circumstances, the country has significant economic potential." [break]
The UK is the largest bilateral donor in Nepal and will be providing £172 million over the three years to 2012. The report says that the Department for International Development (DFID/UKAid) must ensure that its assistance is targeted toward the poorest people and those least capable of accessing services.
The chairman said: "One in three people in Nepal lives in poverty. The 10-year conflict there was caused at least in part by poverty and exclusion, based on ethnicity, gender, caste and religion. These inequalities persist and those who are least vocal or least able to understand the system suffer the most. Failure to assist the millions of people living in the most dire conditions will result in the Millennium Development Goals being missed, both in Nepal and globally."
He said DFID Nepal has implemented some very effective programs and it now needs to ensure it has more carefully tailored projects which meet the needs of the most vulnerable people, whom other aid interventions have failed to reach.
The Report highlights the risk of post-conflict states falling back into conflict within five years of a peace agreement. The Comprehensive Peace Agreement was signed in 2006 but the political situation in Nepal remains fraught.
Bruce said: "The parties in Nepal are yet to reach agreement on a new constitution, a new federal structure and the future of the 20,000 Maoist ex-combatants. It is for the people and Government of Nepal to resolve these issues. The role of the international community must be to support the mechanisms set up under CPA to facilitate a long-term solution, ensuring that the voices of the many and varied communities in Nepal are heard."
The report said climate change threatens Nepal´s development. The predicted impact includes more rain during the monsoon and less during the already dry winter.
Although the precise timescales have been disputed recently, melting of the Himalayan glaciers will increase flood risks in Nepal and the wider region in the short term. In the longer term the loss of ice cover, combined with changing rainfall patterns, could lead to increased strain on water resources.
Bruce added: "In developing countries, tackling climate change diverts resources which could be used for poverty reduction and development. DFID has supported Nepal in drawing up its National Adaptation Program of Action. It must now help Nepal to access international funding to implement adaptation measures and encourage the Government of Nepal to make tackling climate change a policy priority."
Nepal will also provide an interesting test of the effectiveness of the new UKAid brand, as it is one of the countries in which the new logo is being trialled, the report said
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