Japan offers additional Rs. 5.5 billion for Nagdhunga tunnel

Kathmandu, June 4: The government of Japan has decided to provide an additional loan of 5.7 billion Japanese yen (approximately Rs. 5.5 billion) for the construction of the Nagdhunga Tunnel Project.

Ghanshyam Upadhyaya, Secretary of the Ministry of Finance, and Maeda Toru, Ambassador of Japan to Nepal, signed the exchange of notes for the additional loan on Wednesday.

Similarly, the loan agreement was signed by Dhani Ram Sharma, Joint Secretary, Foreign Aid Coordination Division (FACD), Ministry of Finance and Matsuzaki Mizuki, Chief Representative of JICA Nepal Office on behalf of their respective institutions.

In December 2016, the loan assistance of up to 16.636 billion yen was signed by the government of Japan for the implementation of the project.

However, due to a shortage of funds caused by rising prices and other factors, the additional loan of 5.7 billion yen has been made, bringing the total amount of the loan to 22.336 billion yen.

The Nagdhunga Tunnel is the first mountainous traffic road tunnel in Nepal.

The Nagdhunga Tunnel Construction Project is designed to enhance transportation around the Nagdhunga pass, improving connectivity between Kathmandu and other important areas in Nepal.

The construction of the Nagdhunga tunnel way has reached the final phase. With about 99 per cent of the physical progress being made, the tunnel way is expected to be open to the public from July 2026.

The 2.68 km tunnel will significantly change travel in the region and set the stage for future infrastructure projects, supporting Nepal’s growth and development.

This initiative will leverage modern tunneling technology to promote economic resilience and sustainable development beyond the tunnel itself.

The construction of the tunnel commenced in 2019.

The inside of the tunnels was repeatedly hit by unexpected floods and collapses during the extremely difficult excavation work.

Japanese project team has been working together with Nepali team to take on technical challenges in the site.

This project provides a unique opportunity to transfer advanced Japanese skills to young Nepali engineers. It would surely benefit the Nepali people in the future.

Nepal’s collaboration with Japan, particularly through JICA, has led to significant advancements in road construction and infrastructure development in Nepal.

Some notable achievements include the 160 km BP Highway-Sindhuli Road and Kathmandu-Bhaktapur Road Spanning 9.1 km., and numerous bridges in Kathmandu valley as well as in the rural areas. Hence, it is assured that Nagdhunga tunnel will also be a world class construction in the history of Nepal’s infrastructure

This year marks the 70th anniversary of the establishment of diplomatic relations between Japan and Nepal.

The Embassy of Japan believes that this project will be instrumental for Nepal in achieving sustainable economic development, and serves as a symbol of the enduring

friendship and cooperation that has defined the relationship between our two countries over the past seven decades.