Nepal relies heavily on foreign aid, and donors coordinate development aid policy through the Nepal Development Forum, whose members include donor countries, international financial institutions (such as the World Bank), and inter-governmental organizations (such as the United Nations).
Donors have been reported as losing confidence in Nepal as a result of political interference and corruption in poverty relief efforts as well as the country's apparently poor capacity to utilize aid.
By the end of 2012, the outstanding World Bank IDA loan totaled $ 1.48 billion Archived 2015-05-05 at the Wayback Machine.
Nepal has been a recipient of foreign assistance since 1952 when it joined the Colombo Plan for Cooperative, Economic, and Social Development in Asia and the Pacific.
During the 1950s, many Nepalese received scholarships through the Colombo Plan to go to different countries for studies in technical and professional areas Also during that time, all other aid was in the form of grants.
The United Kingdom, Switzerland, Australia, Japan, and New Zealand also were involved in lesser assistance programs.
The Soviet Union helped to build cigarette and sugar factories, a hydroelectric plant, and part of the East-West Highway (Nepal).
Grants from China helped to construct roads; a trolley bus line in Kathmandu; BICC, Rastriya Sabha Griha, Civil Hospital in New Baneshwor, Bharatpur Cancer Hospital in Chitwan and leather, shoe, brick and tile factories.
Commodity assistance targets included fertilizers, improved seeds, and construction materials provided by donor aid agencies.
Technical assistance covered services of experts to advise the government in training indigenous personnel to perform research in technological fields and resulted in the development of skilled labor.
In the 1980s, bilateral United States economic assistance channelled through the Agency for International Development averaged US$15 million annually.
Other Western countries and official development assistance and bilateral commitments for the 1980-87 period totaled US$1.8 billion.
There is an increasing number of social entrepreneurs who try to address development issues through individual, financially sustainable and more home-grown initiatives.