As Donald Trump took over the presidency of the US, the United States Agency for International Development (USAID) funding across the world was scrapped. This also impacted Nepal, affecting collaborations with all three tiers of government and various international and national non-governmental organizations (I/NGOs). The halted projects spanned across critical sectors, including fiscal federalism, biodiversity conservation, education, agriculture, health, economic development, human rights, environmental sustainability, and disaster resilience. With the funding cuts, concerns have been raised about the long-term impact on Nepal’s development trajectory, particularly for marginalized communities and sectors heavily reliant on foreign aid.

The total amount of scrapped or significantly affected USAID funds in Nepal amounted to over $319m. Among the affected projects, the USAID Biodiversity (Jal Jangal) initiative, which had a budget of $19m, was one of the most prominent. However, according to Shiva Kumar Wagle, spokesperson for the Ministry of Forests and Environment (MoFE), only this particular project under the ministry was impacted, and the overall impact on the ministry was minimal. Additionally, a $20m allocation for fiscal federalism was also scrapped, affecting governance and decentralization efforts.

Several other key projects lost funding, including the $24.79m KAWAS project aimed at water security and sanitation governance, the $18.91m Trade and Competitiveness initiative, and the $35m Adolescent Reproductive Health (ARH) program led by CARE Nepal. The USAID Clean Air program, designed to reduce pollution in Kathmandu Valley with a $13m budget, also faced funding cuts. Similarly, the USAID Inclusive Livelihoods project, which sought to empower persons with disabilities, lost its $1m allocation, along with the USAID Agricultural Inputs program, which was set to receive $24.56m.