book1

11
Foreign aid and Educa� on in Nepal:
Some Critical Issues
122
Changing paradigms of aid eff ec� veness in Nepal
– Laxman Acharya
– Dr. Bidya Nath Koirala
Foreign aid: a major means of building rela� onship with outsiders
"Nepal is a yam between two boulders" and “Do not allow foreign
businessmen to come any closer than Parsha-Gadhi (A border-town with
India). If foreign merchants come into the country, they will leave the people
des� tute” are two famous foreign policies of Late King Prithvi Narayan Shah,
the founder of modern Nepal. His fi rst foreign policy of maintaining balanced
rela� ons with India and China is s� ll valid in Nepal and no poli� cal par� es
or government of the country have deviated from this. The second policy,
isola� ng Nepal from all other countries prevailed for almost two centuries,
and got a break especially during the Janga Bahadur’s regime, the fi rst prime
minister of Rana regime 1 .
But, a number of events occurred a� er the Second World War to change
Nepal’s foreign policy from one of isola� onism to a much more open one.
Forma� on of the UNO, India’s independence from Bri� sh rule, the downfall
of the Rana regime in Nepal, China’s emergence as a communist country,
and the cold war poli� cs worked as triggers for the change. Right from the
1950s, successive governments of Nepal have tried to be more open towards
the foreign world in order to modernize the country. To fulfi ll this objec� ve it
was necessary to get foreign aid – the fi nancial support, technological know
how and development ideas and model. Meanwhile, western countries were
also interested to enter into the country because Its geopoli� cal loca� on
1. Acharya ,Laxman (2006)