His Majesty's Government of Nepal (HMG/N) will host the Nepal Development Forum (NDF) 2002 in Kathmandu and Pokhara, February 4-7, 2002.

The key objectives of the NDF 2002 will be:

• To take stock of HMG's Agenda of Priority Reform Actions, presently in various stages of implementation;
• To solicit inputs to the Tenth Plan/PRSP preparations; and
• To solicit inputs and broad donor support for HMG's plans to introduce a Medium Term Budget Framework as a tool to integrate Tenth Plan/PRSP strategies and priorities, budget reforms, and the Foreign Aid Policy and as a means of expediting HMG's Reform Agenda.

In order to ensure that Nepal's first-ever in-country Development Forum is as inclusive, transparent and participatory as possible, HMG intends to engage a wide cross-section of development actors in the preparatory and main events. Building on the lessons of the preparatory process of the last NDF, civil society partners will be invited to contribute to the Theme Papers to be produced for purposes of the NDF 2002 discussions. Where practical, the contents of the Theme Papers and the pre-NDF consultations will be couched in the context of Tenth Plan/PRSP preparation and ongoing implementation of HMG's Agenda of Priority Reform Actions.

In addition to senior HMG officials, NDF participants on the Nepali side, in the preparatory and main events, will include Members of Parliament and representatives from the national political parties, civil society professionals, elected local body officials, private sector leaders and the media. Participation on this scale is expected to broaden understanding of reform issues among key development stakeholders and to deepen national ownership of Tenth Plan/PRSP and reform initiatives.

As a part of the main event, the NDF will move to Pokhara for a session between HMG and development partners. The purpose of this session will be to hold an intensive, but free and frank, exchange on donor practices and the urgency to align these with the principles of a Medium Term Budget Framework in order to improve service delivery and development outcomes.

A number of events will be organized in conjunction with the NDF, designed to raise the profile of development issues and to sustain an informed debate long after the main NDF events conclude.

Process Management

An NDF Steering Committee, chaired by the Hon'ble Finance Minister, will be formed to seek the active participation of Members of Parliament in the articulation of key development issues and will vet and validate the NDF documents in the Cabinet and among the various development-related Committees of Parliament.

A Coordination Committee, chaired by the Finance Secretary, will be formed to guide inter-agency coordination within HMG, maintaining linkages with the Tenth Plan/PRSP preparatory process.

A Technical Committee, chaired by the Joint Secretary, FACD-MoF, will be formed to guide the consultative process and the resulting documentation, as well as to supervise the logistical aspects of the NDF 2002. Various task forces under this committee will liaise between the line ministries and reforming agencies, the development partners and their thematic groups, and nationally representative civil society organizations in soliciting contributions toward the production of Issues Papers. Where possible, efforts will be made to establish direct linkages between these task forces and those already working in preparation of the Tenth Plan/PRSP.

Key Documentation

Main Events:
Given the multitude of documents that will already be in various stages of draft during the proposed NDF dates, for purposes of efficiency, HMG will break from tradition and will not produce a Country Memorandum specific to the NDF. Rather, HMG will concentrate on producing forward-looking Issues Papers around which the NDF discussions are expected to revolve. These papers are also be expected to feed into the Tenth Plan/PRSP preparation and in the implementation of HMG's Reform Agenda. However, the World Bank would be invited to take the lead in producing a short Economic Note, as is customary for purposes of NDF background.

Every effort will be made to distribute NDF papers to participating development partners well in advance of the main event. A full set of documents will be compiled and produced in English and Nepali for wide dissemination soon after the main NDF events.

The Ministry of Finance will take the lead in producing and presenting:

• Taking Stock of HMG's Agenda of Priority Reforms (Overview and Synthesis of Issues Papers)
• Foreign Aid Policy - Latest Draft

The Donors Community in Kathmandu will take the lead in producing and presenting:

• Redefining Development Partnerships: Lessons of Experience from Donor Practices

The National Planning Commission will take the lead in presenting:

• Tenth Plan/PRSP - Latest Draft Summary

The Ministry of Finance and the National Planning Commission will provide joint leadership in the production of:

• Medium Term Budget Framework: Achieving Integration Between Tenth Plan/PRSP Priorities, the Foreign Aid Policy and Sustainable Budget Reform

Preparatory Events:
A series of Issues Papers on the key institutional and sectoral themes of the Tenth Plan/PRSP and HMG's Reform Agenda will be produced and discussed in the preparatory phase of the NDF 2002. These papers will feed into the main NDF event in the form of a synthesis paper to be produced and presented by the Ministry of Finance. The following line ministries and reforming agencies will take the lead in the production of the following short papers relating to areas of institutional reform:

• Governance Reform Program - Ministry of General Administration
• Decentralization - Ministry of Local Development
• Financial Sector Reform - MOF/Nepal Rastra Bank
• Private Sector Participation - Ministry of Industry and Commerce
• Civil Society Partnerships - National Planning Commission
• State Owned Enterprises Reform - Ministry of Finance (Privatization)

Line ministries and reforming HMG agencies will take the lead in producing the following short papers relating to areas of sectoral reform:

• Rural Development - National Planning Commission
• Agriculture - Ministry of Agriculture
• Health - Ministry of Health
• Education - Ministry of Education
• Infrastructure - Ministry of Physical Planning and Works
• Hydropower and Irrigation - Ministry of Water Resources

Participation
Invitation to more than 30 development partners (bi-lateral and multi-lateral) have already been extended. HMG/N has the desire and commitment to get the highest-level possible representation and engage the widest possible public participation in this Nepal's first-in-country NDF on its part. HMG also has the desire and confidence to get senior-most possible representation from the side of the donors.

Expected Outcomes:

Because the NDF is a part of the Tenth Plan process, we expect some intermediate tangible outputs such as:

1. donor support to the general direction of the Tenth Plan as initially stipulated in the Approach Paper but also reflecting the discussions during the pre-NDF and NDF meetings;
2. a joint HMG/N-Donor commitment to new ways of working which would result from the recommendations of the Foreign Aid Policy, MTEF and Review of Development Partnerships;
3. Broad support from donors to address the financing gap in a responsive and flexible manner as a result of the outcomes of a. and b. that would lead - eventually - to budget support.