Nepal gets $20 mn in UN aid after $2.7 bn flood losses: Is climate finance failing vulnerable nations?

Nepal will receive $20 million from the UN’s loss and damage fund after August floods killed around 1,500 people and caused $2.7 billion in infrastructure losses. With reconstruction costs topping $4.7 billion, the aid highlights the gap between climate finance and vulnerable nations’ needs.

Nepal is set to receive $20 million from the United Nations’ climate loss and damage fund following devastating August floods that killed around 1,500 people and left more than 5,000 missing.

But the allocation covers less than 1% of the country’s estimated reconstruction costs, raising questions about whether global climate finance is reaching vulnerable nations at the scale they need.

The Fund for Responding to Loss and Damage (FRLD) agreed to set aside the money through an emergency procedure at a meeting on Thursday, October 22, the Nepalese government said.

The assistance is intended to “help address the severe damage caused by climate-related disaster”, the Ministry of Agriculture, Forests and Environment said in a statement, as per Reuters.

The allocation marks a significant step for the fund, established to help developing countries cope with climate-related destruction.

However, the money has not yet been disbursed. Nepal must submit a detailed proposal for approval by the fund’s board before payment can be made.

The disaster began on August 26, when an avalanche of ice and rock near Nepal’s border with China’s Tibet region triggered destructive flooding downstream.

According to official data cited by Reuters, the floods affected around 60,000 people across 15,000 families and damaged critical infrastructure, including roads, bridges, schools and 13 hydropower plants. Nepal estimates infrastructure losses at approximately $2.7 billion, while the overall cost of recovery and reconstruction could exceed $4.7 billion.

Nepal sought assistance from the FRLD in a letter sent in August, less than a week after the floods. Prime Minister Balendra Shah, in his maiden address to the United Nations in September, described the disaster as a warning to the world and linked it to climate change, despite Nepal’s negligible contribution to global emissions.

Nepal had also called for international recognition of the damage caused by climate change.

Foreign Minister Shisir Khanal clarified later in September that the government had not formally sought compensation from India, China or the United States.

Test for global loss and damage fund

The FRLD emerged after years of demands from developing countries, which argue that they face disproportionate climate risks despite contributing relatively little to global greenhouse gas emissions.

The fund is intended to help countries address climate-related losses that cannot be avoided through mitigation or adaptation alone.

With reconstruction needs estimated at more than $4.7 billion, the proposed $20 million contribution is unlikely to make a substantial difference to the overall recovery bill on its own.

The decision comes ahead of COP31, the UN climate conference scheduled to take place in Antalya, Türkiye, from November 9 to 20.

About the Author

Bhanu Pratap is a journalist who reports and writes on foreign affairs, India’s foreign policy, geopolitics and strategic affairs. He closely follows diplomatic developments in New Delhi and has a keen interest in defence and national security.<br> <br> Bhanu also focuses on in-depth, interview-based reports and regularly speaking with experts and policymakers to bring perspectives and context to major developments around the world.<br> <br> He is also interested in stories with strong humanitarian angles.<br><br> One such report examined the cases of Indian nationals who were allegedly recruited and forced into Russia’s war against Ukraine. While reporting the story, Bhanu spoke to the families of those affected and documented their experiences. The report was later taken into account by the United Nations in its findings on human rights violations linked to the war in Ukraine.<br> <br> For Bhanu, the zeal to produce meaningful and impactful journalism remains at the heart of his work.<br> <br>He has previously worked with Firstpost, NDTV, Newslaundry and Republic.<br><br> Bhanu studied at the Delhi School of Journalism, University of Delhi. He initially chose science with plans to pursue engineering, influenced by conventional expectations, but fate had other plans and eventually led him to journalism.<br><br> Beyond the newsroom, Bhanu enjoys exploring culture and history and often spends his days off on heritage walks. He is also passionate about travelling, biking and listening to folk music.<br> <br>For tips, reviews and suggestions, you can reach him at bhanu.pratap@htdigital.in.