India committed to Nepal's development, no aid cut: MEA

New Delhi: Notwithstanding the current chill in bilateral ties, India on Thursday said it was fully committed to Nepal's socio-economic development and there was no reduction in aid extended by it to the Himalayan nation.

The statement came in the backdrop of reports that China has overtaken India as the top donor country to Nepal.

"I think this comparison is completely wrong. I have also seen these reports which say that Indias aid to Nepal is USD 22.227 million. This is a misleading figure which totally distorts the picture. Actual funds released to assist Nepal from MEAs 'Aid-to-Nepal budget' are in the range of Rs 300 to 400 crore annually, or over USD 50 to 70 million," External Affairs Ministry Spokesperson Vikas Swarup said here.

The discrepancy could be because a good part of our aid is not necessarily routed through the Nepalese treasury.

Giving details of the assistance provided to Nepal in various sectors, he said major payments include about 3000 scholarships to Nepalese students annually and training for over 700 Nepalese citizens from security, economic and other organizations accounting for about Rs 75 crore.

In addition, we have approximately 20 Small Development Projects, he said, and noted that "Four Lines of Credit totalling USD 1.65 billion are available for utilization, of which only USD 150 million has been disbursed since 2010. Its interest equalization is borne by MEA. We look forward to their speedy utilization."

India also pays pension to ex-Gorkha soldiers, which is about Rs 1800 crore per year, or USD 300 million, he said, adding assistance under Operation Maitri after the earthquake in Nepal last year was to the tune of Rs 400 crore, or USD 70 million.

"India is fully committed to Nepals socio-economic development. There is no aid cut in the case of Nepal," Swarup said.

Initial allocations of aid to Nepal and other neighbouring countries are based on actual expenditure levels in the preceding years and take into account absorption capacity of our valued partners, he said.

"If there is sufficient expenditure and more is required, funds are sought by MEA at Revised Estimate stage in the financial year. So more can and will be provided if and when required," he added.

Nepal had last week cancelled the visit of its President Bhidya Devi Bhandari to India and recalled its envoy to New Delhi Deep Kumar Upadhyay amidst reports that it suspected New Delhi of attempting to topple the K P Oli government. However, Indian officials had denied the charge.

When asked about India's representation at an International Buddhist conference in Nepal next week, Swarup said it will be represented at an "approriate level".

There were media reports that Prime Minister Narendra Modi and Bihar Chief Minister Nitish Kumar were likely to attend the conference.