Green, Resilient, and Inclusive Development (GRID) in Nepal

Nepal is shifting to a green, resilient, and inclusive development (GRID) path.

Economic development in Nepal faces a set of complex inter-related challenges, including a jobless and slow-paced economic recovery from COVID-19, a changing climate, environmental degradation, and persistent poverty and social exclusion. Addressing these challenges simultaneously and systematically is necessary to build a better-performing economy. This approach is embedded in the GRID partnership platform.

Given the urgency and magnitude of these crises, good investments and policy implementation need to be accelerated, while creating inclusive opportunities and green jobs – especially for the poor and vulnerable who are disproportionately impacted by climate change and unsustainable use of natural capital.

The endorsement of the Kathmandu Declaration on GRID in September 2021 by the Government of Nepal and 16 Development Partners marked the moment that Nepal adopted the GRID approach. It identified an indicative US$7.4 billion of on-going and future support. Since then, Nepal and its partners established a long-term GRID platform to scale up and align investments, enhance the policy environment, and convene institutions and information.

The GRID platform has advanced several tools to support Nepal’s ambitions. For example, Nepal’s draft GRID Strategic Action Plan was presented in June 2022 by the Ministry of Finance at a high-level roundtable and is currently being revised.

The World Bank and the Government of Nepal developed the GRID programmatic series of policy financing operations; the first of three operations was disbursed in September 2023 and the second operation is being prepared, with partners joining the effort.

A collection of 19 GRID Policy Notes have been formulated. Communication products are being rolled out. And finally, the government has adjusted two consecutive annual budgets and development partners have adjusted their pipelines to deliver on GRID outcomes based on five criteria:

• Simultaneous Impact: Green, resilience, and inclusion impacts can all be achieved simultaneously.
• Build on Nepali Success: Enhance and scale up on-going successes.
• Positive Tipping Point: Investments and policies that trigger transformative impact at scale, and as needed, enable private capital mobilization.
• Implementation Realism: Investments and policies can be implemented in Nepal.
• Ready Financing: Investments are aligned and available, to avoid a wish list approach found in other plans.

G, R, and I in GRID

	Both public and private sector investments need to be driven by sustainability to help secure current and future growth and jobs. Growth can be limited by risks such as climate change, natural disasters, health effects of pollution, land degradation, unsustainable land use change, and biodiversity loss.
	For people to be economically resilient, the systems that they depend on must be able to bounce back from a variety of shocks. There is a need to better prepare for reducing, adapting to, and recovering from a wide range of risks and uncertainties, including slow growth, persistent unemployment, financial shocks, conflict, natural hazards, natural resource degradation, climate change, pollution impacts on health, and pandemic risk driven by zoonotic diseases.
	Rising inequality and exclusion impede development. Recovery efforts should therefore leave no one behind, reduce disparities in opportunities and outcomes, and help excluded groups realize a fair share of benefits. Unlocking the potential of the diversity of human capital helps drive resilient green growth.