Nepal Seeks Grants, Not Loans, for Flood Recovery After Deadly Glacier Disaster

Flood damage in Nepal following the August 2026 disaster. Representative image. Photo credit Unsplash.

 Nepal has appealed for grant-based international assistance instead of additional loans as it begins recovering from a devastating flood and landslide disaster linked to a glacier collapse.

Prime Minister Balendra Shah made the appeal during his address to the United Nations General Assembly in New York on September 24. He said Nepal needs substantial international support to rebuild communities and infrastructure damaged by the disaster.

Recovery Needs Could Reach 10% of GDP

According to Shah, Nepal’s recovery and reconstruction requirements could amount to around 10% of the country’s gross domestic product.

He argued that countries already vulnerable to climate-related disasters should not have to increase their debt burden simply to rebuild after catastrophic events.

The disaster struck mountain communities after a glacier collapse near the Nepal-China border in late August triggered landslides and a powerful flash flood. Roads, bridges, homes, schools and livelihoods were badly affected.

More Than 1,400 People Reported Dead

Recovery and reconstruction efforts in flood-affected areas of Nepal. Representative image. Photo credit: Unsplash.

Recent reports put the death toll at at least 1,450 people, while more than 6,000 people remained missing as search and recovery operations continued.

The scale of the disaster has created major humanitarian and reconstruction needs across affected areas.

The United Nations had earlier launched a $49.6 million emergency appeal aimed at helping more than 84,000 people affected by floods and landslides in northern Nepal.

World Bank Makes $170 Million Available

International financial support is already being mobilised. The World Bank has made up to $170 million in emergency financing available to help Nepal respond to the disaster and begin restoring critical infrastructure and services.

However, Nepal’s government is seeking grant-based assistance as part of a broader recovery effort, rather than relying solely on new borrowing.

Nepal Calls for Regional Climate Cooperation

Shah also called for stronger cooperation between Nepal, India and China on Himalayan climate resilience.

His proposal includes greater sharing of satellite information, improved monitoring of glacial lakes, stronger early-warning systems and better coordination during disasters that cross national borders.

The United Nations in Nepal has also reported that the August 26 flood swept through the Bhote Koshi watershed and affected communities in areas including Rasuwa, Nuwakot and Dhading. The disaster destroyed homes, farmland and livestock shelters.

Why Nepal Wants Grants

Nepal’s request comes as climate-vulnerable countries face increasing costs from extreme weather and other climate-related hazards.

The country’s latest appeal focuses on securing resources for recovery, reconstruction and stronger disaster resilience, while avoiding an excessive increase in public debt.

Source basis: Reuters, United Nations in Nepal and World Bank.