Nepal and Its Donors — Partners in Learning To Cope

Japan and the Nordic countries have emerged as major donors in Nepal over the past three decades. During this time, development co-operation, or foreign aid as it is more commonly known in Nepal, has consolidated its position as a major component of the Nepalese state’s finances and gained increasing political influence. On the surface, Nepal has become a highly aid-dependent country and its relationship with its donors appears asymmetrical. However, the partner relationships forged during this time have created spaces for different working modalities and the Nepalese have actually exercised a considerable degree of ‘ownership’ both in their basic political choices and in various aspects of aid management. This chapter suggests that this has been a long, and by no means unfinished, learning process on both sides. While the donors have gained insights into the complexities of Nepalese society and polity, the Nepalese have learned to cope with the different and continually changing approaches of different donors. Both sides have been seeking the limits of their influence. To understand this complex relationship the chapter takes a closer look at the histories of Japanese and Nordic aid relationships in Nepal.