The opening remarks were followed by a technical presentation by Ms. Bushra Ferdous Khan, the Lead Consultant for Nepal’s INFF process. She walked the audience through the key elements of the strategy, highlighting how INFFs serve as nationally led mechanisms to align financing policies and institutional arrangements with sustainable development goals. She noted that Nepal’s INFF is among the first globally to place productive employment and climate resilience at the centre of its post-LDC graduation strategy.

The Financing Strategy channels public and private resources through six mutually reinforcing pillars:

Pillar 1: Fiscal Policy and Public Finance focuses on improving the efficiency and employment impact of public spending. It strengthens capital budgeting, project appraisal, and procurement to prioritize infrastructure with high job multipliers. Tax policies are reformed to incentivize formal job creation and MSME growth while phasing out inefficient exemptions. The pillar also promotes infrastructure finance through green bonds, diaspora instruments, and viability gap funding.

Pillar 2: Monetary Policy and Private Finance aims to align credit with employment outcomes. It replaces input-based lending quotas with outcome-linked incentives, expands partial credit guarantees, and supports access to finance for MSMEs through refinancing, credit scoring, and movable asset lending. The strategy also deepens capital markets by introducing new bond instruments and legal reforms to improve investor protection.

Pillar 3: Public–Private Partnerships (PPPs) enables expanded private investment in infrastructure, especially outside the energy sector. It introduces standardized contracts, sector-specific risk-sharing frameworks, and government-backed risk guarantees. The pillar supports project preparation across all levels of government and facilitates NPR-denominated project finance through refinancing and bond structures.

Pillar 4: Financial Inclusion and Digital Finance strengthens the institutional viability of MFIs and links them with digital payment systems and rural value chains. It builds shared credit infrastructure, expands access to working capital for microenterprises, and promotes bundled financial products to enhance resilience and enterprise growth in underserved areas.

Pillar 5: Climate and Risk Finance embeds climate resilience in public investment and finance systems. It enforces the 80% localisation rule for international climate funds, integrates climate priorities into budgeting, and scales blended finance instruments such as green bonds and climate insurance. Risk financing is expanded through municipal-level insurance pilots, a national catastrophe pool, and sovereign liquidity tools.

Pillar 6: Skills Development and Just Transition supports demand-driven training and aligns labour policy with climate and economic transitions. It introduces diversified financing for local skills delivery and positions agriculture within global just transition frameworks—linking emission reduction with rural job protection to access adaptation and transition finance.

The technical presentation was followed by an open discussion session, where experts, policymakers, and development partners provided substantive feedback to refine the strategy. Mr. Sharma and Ms. Khan responded to questions from the floor, clarifying the framework’s implementation pathways, coordination mechanisms, and expected results. Development partners present in the room expressed strong interest in supporting implementation of the strategy and emphasized the importance of maintaining focus through prioritization. They also underscored the need for a robust monitoring and evaluation framework, including annual progress reviews and a mid-term assessment, to ensure the strategy’s relevance, transparency, and impact over time.

Moving forward, the Ministry of Finance, with support from UNDP, will prepare a detailed action plan and results frameworks under each pillar. A high-level INFF Steering Committee, chaired by the Finance Secretary, will oversee implementation and conduct annual progress reviews to ensure results and course-correction as needed.