Despite criticism by parliamentarians, the Ministry of Environment agreed for a loan of $36 million from the Climate Investment Funds — a multi-donor trust, on Monday.
The meeting between the World Bank officials and a team led by the Joint Secretary of the Ministry of Environment, Meena Khanal, in Cape Town, decided to go ahead with the Pilot Project Climate Resilience through loan and grant.
The parliamentarians and civil society have been criticising the loan stating that climate change is a problem entirely created by the developed countries and the support to fight it should be unconditional.
However, the ministry has defended its move saying that the country needs the money to fight climate change. “We need the money and in our experience, the loan is more effective than grant. So, we need to focus on its effectiveness rather discussing whether it is loan or grant,” said Krishna Gyawali, Secretary, Ministry of Environment.
Initially, total fund was $ 110 million ($ 50 million grant and $ 60 million loan), but after the developed countries, especially the US, failed to provide the fund, the loan was reduced from $60 million to $36 million.