Indian Grant Assistance for Implementation of Small Development Projects (SDP)

Project TitleSmall Development Projects (SDP)
Project TimelineAugust 6, 2008 to August 5, 2023
Total Budget of Project Each project with maximum budget of:
NPR 5,00,00,000
Local GovernmentGrant
20% of the project budget80% of the project budget
Development PartnerGovernment of India
Brief introduction of projectThe small Development Project was launched on August 6, 2008 through the bilateral agreement between Government of Nepal Ministry of Finance and Embassy of India in Nepal. During the time the projects were implemented through the then District Development Committees. With the change in governance system of the country, the provisional responsibility for the project implementation was handed over to the respective District Coordination Committees. As the Constitution of Nepal, 2015 barred direct donation of funds to local level, there was a hiatus in project implementation for a long time. The cabinet decision of December 23, 2019 approved the new implementation modality and appointed the implementing agencies paving way for the resumption of the project implementation.
As per this modality, Ministry of Federal Affairs and General Administration (MoFAGA) acts as the coordinating agency between the Local Governments (LGs) and the Embassy of India in Nepal. The project proposals that the Ministry receives from LGs are sent to Ministry of Finance which forwards them to the Indian Embassy for implementation. The tripartite agreement has to be signed among MOFAGA, Indian Embassy and the Implementing Local Level for the project implementation. This modality has the provision that the LGs should bear 20 percent of the total project cost. So far MoU has been signed for the implementation of four projects under this implementation modality.
Major areas of the projectCommunity school buildings, Child development center, Library Hospitals, Health centers, Yoga center, Blood transfusion center, Birthing center Garbage management Drinking water projects Agriculture infrastructures
Project AreaAll the local governments of country
Approved ProjectsThe construction of school building of Shree MalikarjunModel Secondary School, Dhap, Darchula, The construction of school building of BaidyanathDevnarayan Public Higher Secondary School, Tulsiyahi, Dhanusha, The Construction of sanitation facility at the Pashupatinath Temple, and The construction of school building of Shree Mahadev Higher Secondary School in Humla
Major issues/challengesThe Ministry receives a large number of project proposals from LGs under this project. Compared to the high demand, only a few numbers of projects are implemented by Indian Embassy leading to the failure in addressing the demands of LGs. The LGs have to spend their internal resources for the preparation of DPR and Soil Test Report required for project proposal while the chances of selection are very minimal