Post-Earthquake Reconstruction in Nepal: Rebuilding Lives, One Home at a Time

Challenge

On April 25, 2015, a 7.8 magnitude earthquake struck central Nepal followed less than one month later by 7.3 magnitude earthquake. Together, these earthquakes caused more than 8,700 deaths and some 25,000 injuries. A Post Disaster Needs Assessment (PDNA), supported by the World Bank and other development partners, estimated the physical damage from the earthquake to be around $7 billion, with total recovery financing needs of about $6.7 billion.

The largest need identified in the PDNA was housing, accounting for $3.27 billion or almost half of the total reconstruction needs. The Government of Nepal secured $4.1 billion in pledges at the International Conference on Nepal’s Reconstruction for post-earthquake recovery and reconstruction. The World Bank pledged $500 million for Nepal’s housing reconstruction and immediately processed $200 million Earthquake Housing Reconstruction Project in 2015.  The World Bank approved additional financing of $300 million in December 2017 and a second round of additional financing of $200 million in January 2020 from the International Development Association (IDA).

Approach

The Earthquake Housing Reconstruction Project (EHRP) takes an owner-driven approach to housing reconstruction – homeowners themselves make any decisions related to the reconstruction of their homes. The project provides technical assistance to ensure that homeowners know about resilient reconstruction methods that can withstand natural disasters to ensure that the reconstructed houses comply with technical reconstruction specifications and guidelines. The EHRP project has also helped to establish a culture of resilient construction practices by building capacity of engineers and masons.

The project provides housing grants to homeowners of Nepalese Rupees (NPR) 300,000 (about $3,000) in three tranches. The first tranche of NPR 50,000 is released to eligible homeowners upon signing a participation agreement. The second tranche of NPR 150,000 and third tranche of NPR 100,000 are released upon satisfactory completion of first level of the home and the roof of the home, respectively, when they are deemed to comply with technical construction guidelines upon inspection and certification of field engineers.

Technology has been successfully embedded throughout the project activities to ensure efficiency, transparency and accountability. For example, the initial Earthquake Housing Damage Characteristics Survey was conducted using a tablet-based application and the data set was used to identify eligible beneficiaries. During implementation, the participation agreement signed by each eligible beneficiary is digitized and uploaded to a digital management information system (MIS). Inspection of rehabilitated houses by field engineers is carried-out on a mobile/tablet-based inspection application and the physical inspection sheets are signed off by both beneficiaries and engineers and then digitized. The MIS also maintains the banking information to facilitate the payment of grants to project beneficiaries, as well as a grievance redress function.

Results

The Earthquake Housing Reconstruction Project, which focused on promoting resilient construction practices, empowering women, leaving no one behind, promoting good governance, and supporting overall economic development, has helped achieve the following results between 2015-2020:  

• As of September 2020, 211,985 resilient houses (out of the project target of 335,700) have been reconstructed with full/partial housing grant support from IDA credits. Similarly, 3,766 houses have been reconstructed with support from a Multi-Donor Trust Fund (MDTF) grant.
• The project has introduced a culture of resilient construction in the country by building institutions and policies and by strengthening institutional capacity and the capacity of government officials, engineers and masons. And as the project is owner-driven, project beneficiaries are now aware of safety parameters of houses in rural communities.
• Of the 755 masons employed by the project, 20 percent are women. Nationwide, 8 percent of the more than 3,000 engineers employed for housing reconstruction are women. This is notable as masonry is seen as a predominantly male occupation.
• More than 70 percent of project beneficiaries opened bank accounts to receive project grants. Most had never had a bank account before and of these accounts, 30 percent were opened by women.
• In the 11 most-affected districts, housing reconstruction has generated an estimated economic value equivalent to NPR 454 billion ($3.76 billion), illustrating the contribution of project to stimulating economic activities and creating jobs.

Bank Group Contribution

At the request of the Government of Nepal, the International Development Association (IDA) provided $200 million in emergency financing in 2015 for reconstruction of private houses through the Earthquake Housing Reconstruction Project. This financing also supported the design of an overall umbrella housing reconstruction program. The government subsequently requested an additional $500 million in additional financing in 2018, bringing the total IDA financing for the project to $700 million.

Following the COVID-19 pandemic and lockdown, the project was restructured to allow substantial cashflow to respond to COVID-19 recovery needs. This enabled the project to disburse about $116 million in June 2020, which significantly contributed to the government’s Treasury. The World Bank is also administering a $34.4 million Multi Donor Trust Fund of which $15 million is provided through a grant that the government is managing.

Partners

The Earthquake Housing Reconstruction Project is implemented by the Government of Nepal, through its National Reconstruction Authority. The World Bank also administers a multi-donor trust fund, which enabled other development partners to pool resources for foundational works such as the Earthquake Housing Damage Characteristics survey. The MDTF includes contributions from the governments of Canada ($11.59 million), Switzerland ($7.24 million), the United Kingdom ($6.05 million), and the United States ($9.60 million). The Japan International Cooperation Agency (JICA) has provided parallel financing of $100 million and India is providing parallel financing of $150 million – both development partners are following the EHRP project design.

Moving Forward

The Project aims to enhance the government’s ability to improve long-term disaster resilience through a number of additional activities under both IDA and MDTF financing. To support the Government of Nepal’s transition to federalism, the project is planning to build the disaster risk management capacity of 282 local governments in 32 earthquake-affected districts and transfer the records of the EHRP project to local governments by December 2021 so that the project can be administered at the local level. Through a MDTF grant the project aims to strengthen the institutional capacity of National Disaster Risk Reduction and Management Authority (NDRRMA), which was established in early 2020. NDRRMA is a permanent institution responsible for coordinating Disaster Risk Reduction and Management.

EHRP beneficiary in front of her newly reconstructed house, holding her Participation Agreement, Photo Credit- SW Nepal

Beneficiaries

The Earthquake Housing Reconstruction Project supports 335,700 beneficiaries from predominantly poor rural households in 32 affected districts of Nepal with a full or partial housing subsidy to help them reconstruct their earthquake-damaged homes using disaster resilient construction techniques and materials. The Bank-supported technical assistance program covers all 32 affected districts.