Loss and Damage Fund Board Approves $20 Million Grant for Nepal's Flood Recovery
The Fund for Responding to Loss and Damage (FRLD) has approved a $20 million grant to support Nepal's recovery from devastating floods in the Bhote Koshi region. The decision, made at the Fund's first special virtual Board meeting, marks a significant step in mobilizing international climate finance for vulnerable countries.
KATHMANDU, Oct 22 — The Board of the Fund for Responding to Loss and Damage (FRLD) has approved a $20 million grant for Nepal to support recovery and reconstruction following devastating floods in the Bhote Koshi region.
The decision was made at the Fund's first special virtual Board meeting on Thursday, convened after Nepal formally requested emergency financial assistance in the wake of the disaster. Nearly all Board members, alternate members and representatives attending the meeting expressed support for providing assistance to Nepal.
The approval marks a significant step towards securing international support for Nepal as it confronts the growing impacts of climate change and seeks to address the losses and damage caused by climate-related disasters.
Of the total $21.6 million earmarked for Nepal, $20 million will be directed towards flood-affected areas, while the remaining $1.6 million will cover management costs.
Dr Maheshwor Dhakal, spokesperson for the Ministry of Agriculture, Forests and Environment, said Nepal would prepare project proposals under the Fund's existing Barbados Implementation Modalities (BIM) process.
"Based on the guidelines and procedures provided by the Loss and Damage Fund Secretariat, Nepal will prepare and submit a programme proposal to address losses and damage caused by climate-related disasters," Dhakal said.
He said Nepal had formally sought assistance from the Board, prompting several rounds of formal and informal discussions among representatives of developed and developing countries before the decision was taken.
According to government figures, the Bhote Koshi–Trishuli floods directly affected more than 60,000 people from approximately 15,000 households. The disaster reportedly claimed around 1,500 lives, injured hundreds and left more than 5,000 people missing.
The economic damage caused by the floods is estimated at approximately $2.7 billion, while preliminary assessments indicate that around $4.7 billion will be needed for reconstruction. The ministry is conducting further assessments to establish the full extent of the disaster's economic and non-economic losses and damage.
The government has appealed to the international community, development partners, the private sector, non-governmental organisations and the media to support immediate relief efforts for affected families and communities, as well as longer-term recovery, rehabilitation and reconstruction.
The ministry has described the Fund's approval as a significant achievement in mobilising international assistance for developing countries that are particularly vulnerable to climate change and face substantial losses and damage from climate-related disasters.
The Fund's 11th Board meeting is scheduled to take place in Kathmandu from March 9 to 19, 2027.