KATHMANDU: The Government of Japan has extended an additional Official Development Assistance (ODA) loan of 5.7 billion Japanese yen for the Nagdhunga Tunnel Construction Project, bringing the total Japanese loan assistance for the project to more than 22 billion yen.
The Exchange of Notes on the additional assistance was signed by Ghanashyam Upadhyaya, Secretary at the Ministry of Finance, on behalf of the Government of Nepal, and Maeda Toru, Ambassador of Japan to Nepal, on behalf of the Government of Japan.
Likewise, the Loan Agreement was signed by Dhani Ram Sharma, Joint Secretary of the Foreign Aid Coordination Division at the Ministry of Finance, and Matsuzaki Mizuki, Chief Representative of the JICA Nepal Office.
The Nagdhunga Tunnel Construction Project aims to improve transportation across the Nagdhunga pass, strengthening connectivity between Kathmandu and other key regions of the country.
Construction of the tunnel has entered its final phase, with approximately 99 percent of the physical work completed. The tunnel is expected to open to the public in July 2026. Stretching 2.68 kilometres, the tunnel is expected to significantly improve travel efficiency, reduce congestion, and serve as a model for future infrastructure projects in Nepal.
The project incorporates modern tunnelling technology and is expected to contribute to economic resilience, regional connectivity, and sustainable development. Beyond easing transportation challenges, it is anticipated to support long-term economic growth and infrastructure modernization.
The initiative contributes to the achievement of Sustainable Development Goal (SDG) 9: Industry, Innovation and Infrastructure, reaffirming Japan’s longstanding commitment to supporting Nepal’s transport and infrastructure development.
Nepal’s partnership with Japan, particularly through JICA, has played a vital role in advancing the country’s road and infrastructure sectors. Notable contributions include the 160-kilometre BP Highway (Sindhuli Road), the 9.1-kilometre Kathmandu–Bhaktapur Road, and the construction of numerous bridges in Kathmandu Valley and rural areas across the country.
With the successful completion of these landmark projects, the Nagdhunga Tunnel is expected to stand as another world-class engineering achievement and a significant milestone in Nepal’s infrastructure development history.
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