411 पटक हेरिएको 
Nepal is steadily progressing toward Sustainable Development Goal 6 (SDG 6), which aims to ensure clean water and sanitation for all. While access to water supply services has expanded significantly over recent years, the greater challenge now lies in ensuring the long-term sustainability, reliability, and resilience of these systems. Rural and underserved communities remain particularly vulnerable, where infrastructure may exist, but the financial resources, governance systems, and technical capacity needed to maintain services are often weak.
This agenda goes far beyond technical construction. In many cases, systems are built according to engineering standards but still fail over time due to weak institutions, inadequate financing, poor maintenance, and lack of accountability. Reliable water services are essential for public health, education, livelihoods, gender equality, and economic growth. Sustainable systems are therefore not only about pipes and pumps they are about resilience, inclusion, dignity, and national development. Nepal must invest not only in infrastructure, but in systems that endure.
Growing financial pressure in the water sector
Nepal’s water supply sector is facing growing financial pressure, with investment needs for expanding, rehabilitating, and sustaining systems far exceeding available resources. Government budgets alone cannot close this gap, while traditional donor support is gradually declining. At the same time, many utilities including rural water management boards and community-managed schemes struggle to maintain even basic service levels. A key issue lies in the current financing model: user tariffs are often politically set rather than cost-reflective, meaning revenues typically cover only routine operations and minor maintenance, leaving little for system upgrades, major repairs, or long-term asset replacement.
This imbalance points to a deeper structural challenge rather than just a funding shortage. In many municipalities, insufficient revenue leads to deferred maintenance, which ultimately results in service deterioration and system failure. These financial constraints are further intensified by systemic issues such as unclear institutional roles, weak governance, underfunded operation and maintenance, and poor integration between infrastructure development, environmental management, and service delivery. As a result, short-term project approaches frequently fail to align with long-term sustainability needs, creating infrastructure that exists but does not function effectively over time.
Addressing these challenges requires a shift toward a systems-strengthening approach, as emphasized in Nepal’s Agenda for Change WASH framework. Sustainable water services depend on financing models that cover full lifecycle costs-from initial investment to long-term maintenance and institutional capacity. No single funding source is sufficient; instead, Nepal must adopt a blended financing approach that combines public funding, user tariffs, donor support, private investment, and community contributions. This direction aligns with priorities highlighted at the Global WASH Financing and Sustainability Conference 2026 in Kathmandu, which called for cost-reflective yet equitable tariffs, stronger local government leadership, and greater mobilization of private and Environmental, Social, and Governance (ESG)-aligned finance to ensure long-term sector resilience.
The strategic role of the private sector and CSR
With public resources limited, the private sector can play an important complementary role, not only through direct investment, but also through innovation, technology, efficiency gains, management expertise, and service delivery partnerships. Financial institutions in Nepal are increasingly aligning with ESG principles, creating further opportunities to support socially beneficial infrastructure such as water and sanitation.
Among the most practical domestic financing opportunities is Corporate Social Responsibility (CSR). Nepal already has legal and regulatory provisions requiring certain profitable businesses to allocate part of their earnings to social causes. Medium and large industries are required to allocate at least 1% of annual net profit to CSR activities, while banks and financial institutions are also required to maintain dedicated CSR funds based on at least 1% of net profit. Recent regulatory guidance has further emphasized that CSR spending should be transparent, targeted, and socially beneficial.
This creates a strong policy basis for directing CSR resources toward high-impact WASH outcomes, including clean water and sanitation services. Investing in water systems generates both social and economic returns: improved health, lower disease burden, time savings for women and girls, increased productivity, and stronger local economies. WASH investment is therefore not just social responsibility; it is smart and strategic investment.
From scattered charity to strategic investment
In practice, however, CSR resources in Nepal are often fragmented, short-term, and dispersed across many small activities with limited lasting impact. Much of the funding is spent on ad hoc donations, one-time events, or highly visible but low-sustainability initiatives. While such activities may provide localized benefits, they rarely address structural financing gaps in the WASH sector.
Nepal should therefore consider a more systematic mechanism to channel a defined share of CSR funding into nationally prioritized WASH outcomes. This does not mean eliminating corporate flexibility but creating a clear framework through which part of annual CSR allocations can support sustainable and measurable public benefits.
Potential priority areas for CSR-supported WASH investment include:
• Safe drinking water systems in underserved rural and peri-urban areas
• Rehabilitation of non-functional or underperforming schemes
• Water quality testing and treatment systems
• Climate-resilient and disaster-resistant WASH infrastructure
• School and health facility sanitation
• Faecal sludge and wastewater management
• Innovation, digital monitoring, and leakage reduction systems
• Hygiene behaviour changes in vulnerable communities
• Capacity building of local water user committees and utilities
Such an approach would transform CSR from scattered charity into strategic national investment while improving accountability, measurable impact, and alignment with Nepal’s SDG commitments.
Tariff reform and equity
No financing model can succeed without addressing tariffs. In Nepal, tariffs are often politically sensitive and set below cost-recovery levels, undermining the financial viability of utilities and water schemes. Reform is essential, but it must be fair and inclusive. Cost-reflective tariff systems, combined with targeted subsidies or social protection mechanisms for poor and vulnerable households, can help ensure affordability while generating the revenue needed for maintenance, service improvements, and long-term sustainability. Avoiding tariff reform is no longer a viable option.
Breaking barriers and building enablers
Progress is further constrained by weak utility capacity, limited regulatory frameworks for PPPs, uncertain revenue streams, and the perception that water should rely solely on public funding. These barriers can be overcome through practical reforms, including:
• Strengthening utility performance and governance
• Improving financial transparency and accountability
• Establishing clear policies for private sector participation
• Enhancing citizen trust and social accountability
• Improving coordination among federal, provincial, and local governments
• Integrating climate resilience and environmental safeguards into planning
• Building institutions alongside infrastructure
A system that cannot adapt, recover, and sustain itself will eventually fail, regardless of how well it was engineered.
The way forward: A collective call for sustainable WASH financing in Nepal
Nepal’s water challenge is no longer simply about building infrastructure; it is about sustaining systems that can deliver safe, reliable, and equitable services for the long term. Achieving universal access to WASH services will require a shift from short-term, fragmented projects toward stronger systems, sustainable financing, and coordinated partnerships.
The path forward calls for several strategic actions: shifting from fragmented projects to system strengthening; reducing dependence on donor funding through greater domestic resource mobilization; adopting blended financing models that combine public, private, and development finance; transforming Corporate Social Responsibility (CSR) from one-time charity into strategic investment; reforming tariffs with equity safeguards to ensure affordability for vulnerable groups; and aligning government, utilities, communities, and the private sector around long-term service delivery goals.
The urgency is real, but so is the opportunity. Nepal cannot close its WASH financing gap through public finance and tariffs alone. Government budgets, development partner support, and user fees remain essential, but they are insufficient on their own. Mobilizing CSR in a structured, transparent, and results-oriented manner especially from banks, financial institutions, and profitable enterprises can offers a realistic and underutilized domestic resource for the sector.
If properly governed and aligned with national priorities, even a modest share of mandatory CSR allocations could make a significant contribution toward safe, sustainable, and equitable WASH services across Nepal. By embracing system strengthening, tariff reform, blended finance, and strategic private sector engagement, Nepal can build water systems that are reliable today and secure for generations to come.
Sunil Acharya, Oxfam Nepal
Disclaimer: The views expressed here are personal and do not necessarily reflect the organization.
