In what may be termed as a major fillip to the Nepali government's poverty reduction strategy, the World Bank (WB) plans to upscale the poverty alleviation fund PAF) from the existing 15 million U.S. dollars to a whopping 100 million dollars a year.

According to a leading newspaper, The Himalayan Times Tuesday's report, the fund was set up in 2004 for financing projects aimed at alleviating poverty in seven districts in Nepal.

While the fund now reaches nine districts, the WB is aiming at extending it to about 25 districts by the end of this year, the report said.

The crucial decision regarding the rise in PAF and the areas to be covered is likely to be approved by the board of the bank by the end of this month, according to Rajib Upadhaya, the bank spokesperson in Nepal.

The WB set up the fund two years ago after several years of deliberations, having realized the need to support the government to reach out to the poorest of the poor, particularly in rural areas, with basic services in order to establish the government's presence.

The fund, which works with local user groups and communities, takes care of their basic needs like carrying out small infrastructure work, improving sanitation, health and education.

The fund is managed by an independent board of governors with only one representative from the government.

Another big-ticket development work that the bank plans to initiate is through the renewal of its budget support operations for which it is likely to allocate another 100 million dollars annually.

"It is a unique instrument whereby the government can go on spending its money on various development projects and get reimbursed by the bank even till the last day of the fiscal year," the bank's spokesperson told the daily.

Source: Xinhua