In 2018, the Department of Soil Conservation and Watershed Management (DSCWM) under Nepal’s Ministry of Forests and Environment listed Shardu Khola watershed in east Nepal as one of the country’s seven prominent urban watersheds. This comes as a result of four years of engagement between the International Centre for Integrated Mountain Development (ICIMOD), municipalities, and the central government. The DSCWM has allocated NPR 10 million (USD 917,000) to implement low-cost, innovative watershed management solutions that were identified through research by ICIMOD and others. The DSCWM and municipal government acknowledged ICIMOD’s role in identifying the five primary investment areas in urban catchment management: a) sediment management structures; b) green technology development and implementation; c) Spring recharge and water source protection and catchment restoration; and d) study of water sources and availability.

In 2014, ICIMOD’s Himalayan Climate Change Adaptation Program (HICAP) began investigating incentive schemes and watershed management options to provide drinking water to upstream communities in the Shardu Khola watershed. Following findings that such schemes were feasible and best carried out by municipal governments, ICIMOD deepened its engagement with municipal governments and the DSCWM in 2016–17. ICIMOD’s Koshi Basin Program (KBP) and government partners established a local multi-stakeholder platform to conserve the upstream area, as the primary source of water to Dharan, and devolved responsibilities to the municipality to incentivize upstream communities to better manage the watershed.