The Nation · Public debt · Bilateral
Japan (JICA)
जापान (जेआईसीए)
Lowest-interest external debt Nepal carries. JPY exposure is the trade-off.
Outstanding
USD 800M
as of FY 2024/25
Share of ext. debt
8%
cited
Currency
JPY
FX exposure
Major loans
4
cited
How it works
JICA's ODA loans to Nepal carry the lowest interest in the country's external portfolio (often below 0.30%) with 40-year maturities. The catch is JPY denomination: JPY moves against NPR can change the repayment burden materially over a 40-year horizon. The 2022-2024 JPY weakness reduced Nepal's effective debt-service cost on this stock — the reverse can happen.
The short version
Japan's loans to Nepal cost almost nothing in interest — but they are in Japanese yen. So if the yen gets stronger, Nepal owes more in rupees.
Typical loan terms
0.01-0.30% interest · 40-year maturity · 10-year grace
Headline terms — individual loans may vary. Per-loan detail follows.
Major loans
Sindhuli Road (BP Highway)
1995–2015
JPY 53B
Trans-hill highway
Nagdhunga Tunnel
ongoing
JPY 16.6B
Kathmandu access tunnel
Kathmandu Water Supply Improvement
ongoing
JPY 4.5B
Treatment & distribution
Earthquake recovery (housing, schools)
2015–2020
JPY-denominated grants & loans
2015 Gorkha recovery
What to watch
- ·JPY/NPR exchange rate over 40-year horizon — biggest single FX risk on Nepal's external debt book.
- ·JICA pipeline post-Nagdhunga — currently no announced loan exceeding USD 200M equivalent.
Sources · cited verbatim
Ministry of Finance Nepal — PDMO — Public Debt Bulletin — bilateral creditors
Open release checked 2025-01-15JICA — Nepal — ODA loan portfolio
Open release checked 2025-01-31