Norway cuts bilateral aid

Norway has decided to reduce its bilateral assistance to Nepal following Kathmandu's failure to adhere to democratic principles and human rights after King Gyanendra's seized absolute power of the Himalayan kingdom earlier this year. "Formally we are the first country to take this measure," Norwegian Ambassador to Nepal, Tore Toreng, told IRIN from the capital Kathmandu on Thursday. He noted, however, that most bilateral donors had already taken preliminary steps to do the same, pending developments in the country. Under the terms of the decision, Oslo will reduce its bilateral assistance to Nepal for 2006 by 10 percent. "It will be a reduction of approximately US $2.5 million. Our annual support for Nepal is approximately $25 million and we will discuss the details of the decision with the government next week," he explained. Also included in the move was a decision to terminate Norway's involvement in a $400 million water supply project for the Kathmandu Valley, amounting to a further $35 million. "That agreement has been cancelled. We have terminated it in a formal letter to the government," the Ambassador explained, noting he had conveyed his government's decision in a meeting with the Minister of Finance on Wednesday. "Of course, it's a negative decision, but I explained that it was a decision delayed for around two months in the hope that some positive developments might occur," he added. Blaming the four-party coalition government for failing to curb the ongoing Maoist insurgency in the country, King Gyanendra seized power on 1 February and has been ruling with a hand-picked cabinet under his chairmanship since then. Nepal is one of the poorest countries in the world, a situation made worse by the Maoist rebellion against the constitutional monarchy which has resulted in more than 11,000 deaths since it began in 1996. According to the United Nations, more than 100,000 people have been displaced by the insurgency, making bilateral assistance crucial for the country. The king's action was condemned by Washington, New Delhi and London - prompting them to suspend military aid used to combat the insurgents - but the situation with regard to human rights and democracy has shown little sign of improvement. According to an embassy statement, the government of Norway considers the events of 1 February as a serious setback with regard to multiparty democracy, to the constitutional monarchy, to human rights and to finding a peaceful solution to the continuing violent conflict. "Those are the elements in which we have not seen any progress," Ambassador Toreng maintained, noting, however, that should the situation improve, the 10 percent cutback would be reviewed. Development cooperation would now focus more on efforts to promote democracy and human rights, including support to the United Nations Office of the High Commissioner for Human Rights (OHCHR) mission in Nepal, the Norwegian statement added. Norway routinely monitors democracy and human rights conditions within its partner countries and had made a similar curtailment of assistance of $4 million to Uganda earlier in July, accusing Kampala of mishandling the political process and failing to contain corruption or human rights abuses.