As a first step toward climate justice, the Fund for Responding to Loss and Damage (FRLD) has set aside $20 million for Nepal. However, the amount is significantly less than what the country needs to recover from the August 26 flash flood in Bhotekoshi. According to official estimates, the disaster resulted in at least 1,455 deaths, around 7,000 injuries, and 5,285 people reported missing. Families were uprooted and livelihoods destroyed as the flood washed away villages, highways, bridges, and hydropower infrastructure. Nepal estimates that $4.78 billion will be needed for rehabilitation and reconstruction. The proposed allocation covers less than 0.5 percent of that amount. The decision marks the first time the fund's board has set aside resources for a country seeking assistance for climate change-related loss and damage. However, Nepal has yet to receive the money. There is no fixed timeline for disbursement, and the government must first submit a plan for approval. The announcement offers little immediate relief to communities cut off from essential services, farmers whose land has been devastated, and families who have lost their homes. The speed with which the funds are disbursed to those affected is now critical. Nepal has a strong case for international assistance. Despite contributing less than 0.1 percent of global greenhouse gas emissions, its mountain communities are increasingly at risk from climate change. Wealthy nations that have contributed the most to global warming bear a greater responsibility to help vulnerable countries cope with its consequences.
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After years of negotiations at UN climate summits in 2022 and 2023, the loss and damage fund was established. Developing countries argued that emissions reduction and climate adaptation measures would not prevent every disaster or compensate for every loss. The fund was intended to fill that gap. However, wealthy nations have committed only about $822 million, and no funds had been disbursed before the decision on Nepal. That amount is far from sufficient to meet the needs of countries facing disasters that cause damage worth billions of dollars. Further concerns arise from the reluctance of some wealthy countries to create a precedent through Nepal's allocation. The fund will fail the people it was designed to assist if countries must secure extraordinary political support after every major disaster. Access to assistance should instead be based on fair and transparent criteria, rather than diplomatic pressure. Nepal's experience should help shape a system that enables vulnerable countries to receive support in a timely and reliable manner. The nature of aid is just as important as its amount. Finance Minister Dr Swarnim Wagle has questioned why Nepal should have to borrow money to rebuild infrastructure damaged by natural disasters beyond its control. Prime Minister Balen Shah expressed a similar concern at the UN General Assembly. They have good reason to question the use of loans for this purpose.
International organisations, development banks, and humanitarian agencies must also step up support for flood victims. Families need food, shelter, and medical care, while farmers and other affected workers require assistance to restore their livelihoods. Roads, bridges, and essential services must be rebuilt. At the same time, Nepal must present a credible financing plan backed by verified damage assessments, clear spending targets, and transparent oversight. At COP31 in Turkey, it should push for greater contributions to the fund, more grant-based financing, and a faster disbursement mechanism. The government must also strengthen early warning systems, disaster preparedness, and climate-resilient infrastructure. Nepal cannot compensate for the failure of wealthy nations to provide adequate funding, but international assistance cannot replace domestic effort. The $20 million allocation is a beginning, not an end. Its value will depend on how quickly Nepal receives the funds, how effectively they reach affected communities, and whether the fund can mobilise sufficient resources to support other vulnerable countries. Climate justice cannot be built on occasional compromises after disasters. Nepal needs timely assistance backed by predictable financing.