Nepali Times interviewed David Wood, head of the DfID (Department for International Development) of the British government in Nepal. He spoke about foreign aid, corruption, reconstruction and the recent appointment of Sir Jeffery James as Britain's special representative to Nepal.

How is DfID going to respond to Nepal's call for reconstruction and rehabilitation assistance?
Our overall objective of the program here is to do what we can to support the process of bringing about peace and security to this country. The conflict is the major obstacle to poverty reduction, which is our mandate. We are extremely positive about recent developments and we want to give them whatever support we can and in whatever way we can. We believe the development experience in this country has been deficient. It has not delivered to enough poor people in various parts of the country. The conflict and peace process now is an opportunity to correct that. What we want to do is to support the government to deliver visible and tangible benefits to these communities that have been ignored for too long. We have been working on various ideas for elements for RRR (reconstruction, rehabilitation and reconciliation).

Is immediate humanitarian assistance on the agenda?
There is a very, very urgent need, particularly in the mid-west and far west, for food and cash through employment. In addition, work needs to be done to repair infrastructure and to support or restore-and in some cases, introduce basic services-to rural communities. So we are interested in providing support to programs that would do all of these things and do them quickly because the peace process can't wait for things to happen.

How about long-term partnership with the government on issues like poverty and unemployment? When do you think that can resume?
The conflict has forced us to re-examine the ways we were working in support of development in this country. It stressed the importance of making sure that development is actually delivered to people at the grassroots. That is what the government has to do. This is where we can help the government to address these fundamental issues. Addressing issues of inequality, caste discrimination, the position of women and the fact that a part of this country has been left out of the development process are our objective. The other thing, which really matters, is the issue of governance. We really would like to see and provide support to the government to take a much more effective position in relation to corruption and social exclusion.

Do you think the absence of elected local bodies will hamper implementation?
I think the government needs to put in place a committee at the district level that represents all elements of the community in order to implement programs in ways that are seen to be transparent and fair. Once the condition allows for it, we hope the government will re-introduce local elections.

How are you positioning yourself to help with the peace process itself?
The key thing is the responsibility of the peace process rests with the parties in the conflict. We would support this process in whatever way we can, but the leadership has to be taken by the people of Nepal. In other cases, development assistance has been useful in providing benefit to people that have shown the benefits of peace. We are also talking about providing short-term peace dividends. We would be happy to make available to Nepal expertise from other parts of the world.

What is the rationale behind the appointment of Sir Jeffery as special representative?
The mandate of Sir Jeffery James is to help coordinate the response by the international community to the situation here. He is a high-level official who will ensure Nepal receives sufficient priority in London and other world capitals, and he will be able to ensure that the British government's efforts [to restore peace in Nepal] are well coordinated and well targeted. We regard it as extremely important that the country comes together to support the peace process. We would very much like to see the political parties working with the government to restore peace in Nepal.

How badly has the insurgency of the past seven years affected development aid policy?
I don't believe that the problem here is lack of resources. The problem is ensuring that the government provides the right kind of leadership in order to attract resources from the international community. What the government has to do is to demonstrate its commitment on two things: firstly, to help the poor people of this country and secondly, come up with effective reforms to deal with obstacles in terms of poverty reduction. If the government is able to do that, it will unlock a much larger flow of foreign assistance to this country. I don't believe the problem is money. The problem is the evidence of serious commitment to reforms and poverty reduction. We want to see the government providing leadership around which the whole international community can come together to support them.

Have you seen this commitment after the 4 October move?
Yes, there have been some positive developments. We see a commitment to reform on the part of this administration, which we strongly support. The government has made some good official appointments, it confirmed the new management arrangement of the state-owned bank. It announced plan for privatisation of some key enterprises. It is looking for ways to do a short-term program of development assistance in the rural communities. All of these things will help alleviate poverty and we support them. We also support the action being taken by the CIAA to deal with corruption. We want to see more of it. We want these efforts to be continued and strengthened.

How serious is corruption as an impediment to development?
It's a major problem because it erodes both the people's confidence in the government and the government's reputation. It's part of the frustration that many people feel about the government and development in Nepal. It simply must be addressed not only by prosecuting people but also by improving the system that leads to corruption. There must be preventive actions.

DfID has pushed the privatisation process in Nepal. Has it been worth it?
We are considering further support in this area. I would be the first to acknowledge that our previous support was not successful. In the past, the primary obstacle to privatisation was political. There was no serious commitment at the political level for reform. I think the situation is different now. The ADB is supporting a program that will involve the privatisation and liquidation of certain public enterprises. We are considering supporting a few should the present government display a stronger commitment to privatisation.

DfID itself is said to be top heavy, and uses old and inefficient models of aid.
You can hardly expect me to agree with that. I believe we are trying to change the way of our operations. For example, we have appointed a whole team of Nepali advisers for the first time and we no longer use the expertise of our UK-based advisers. We are also going to be more transparent. We are going to have better communication about what we do in Nepal. We have an enormously strong track record of what we have done and what we have achieved in this country and helped others to achieve similar goals. I do acknowledge the fact that people have not known what we did in the past. I want to address that and also want to diversify our staff in the office. We are in a much better position now to understand developments-both political and social-in Nepal.