International donors pledge $4 billion in aid to quake-hit Nepal

KATHMANDU - International donors led by India and China pledged around US$3 billion (S$4 billion) to rebuild quake-devastated Nepal on Thursday, as the country's premier vowed "zero tolerance" of corruption and said all aid money would go to victims.

Nepal says it needs around $6.7 billion to recover from the April disaster, which killed more than 8,800 people, destroyed nearly half a million houses and left thousands in need of food, clean water and shelter.

At a meeting of foreign donors on Thursday, India's Foreign Minister Sushma Swaraj pledged $1 billion to finance reconstruction, while regional rival China promised 3 billion yuan ($483 million) in grant assistance.

Nepal's two giant neighbours have historically vied for influence in the Himalayan nation, and both were heavily involved in post-quake rescue and relief efforts.

Additional pledges of $600 million from the Asian Development Bank, $260 million from Japan, $130 million from the US, $100 million from the EU as well as an earlier announcement of up to $500 million from the World Bank have now taken total assistance pledged to around $3 billion.

The government wants all aid to be channelled through a new state body, raising concerns among some international donors that bureaucracy and poor planning will hamper reconstruction.

Prime Minister Sushil Koirala urged delegates to "work with us, the government of Nepal" and vowed "zero tolerance toward corruption".

"I assure you that we will (leave) no stone unturned in ensuring that the support reaches the intended beneficiaries," he said as he opened the one-day meeting in Kathmandu.

Nepal -- one of the world's poorest countries even before the disaster -- desperately needs assistance to rebuild homes, schools and hospitals destroyed or damaged by the April 25 earthquake and a strong aftershock on May 12.

- One in 10 homeless -

One in 10 people are homeless and the Himalayan nation's already weak economy has been hit hard, with annual growth forecast to fall to just three per cent, the lowest in eight years.

But critics say Kathmandu is struggling to lay out a roadmap to recovery.

"What is lacking right now is a clear strategy... the government needs to come up with a credible plan to implement reconstruction projects within a stipulated time," Chandan Sapkota, economist at the Asian Development Bank's Nepal office, told AFP ahead of the meeting.

As pledges rolled in, participants said it was crucial to ensure the money was spent well.

"Money will be important for building back a more resilient Nepal... but it's not just about money," said World Bank president Jim Yong Kim in a video message to delegates.

"Just as important is how these funds are spent."

The international community pledged several billion dollars in aid to Haiti after a catastrophic earthquake struck the Caribbean nation in January 2010.

But the pledges yielded little tangible progress as donors delayed implementing projects due to concerns over corruption and political instability, leaving thousands living in temporary shelters five years on.

"Follow-up is extremely important -- when pledges are made, the government formulates its plans accordingly and if the money doesn't come, it throws everything out of gear," said Poonam Khetrapal Singh, WHO's regional director for South-East Asia.

"We have seen that happen in previous cases with devastating results so I think we will lose our credibility as members of the donor community if we don't act on our promises," Singh told AFP on the sidelines of the conference.

Dev Ratna Dhakhwa, secretary general of the Nepal Red Cross Society, said earlier he feared Kathmandu's "one-window policy" for reconstruction would obstruct relief efforts, with political parties already trying to manipulate the system to siphon off funds.

"People are using political influence to pressure officials and access funds meant for quake victims, by getting their names added to government-managed records," Dhakhwa told AFP.