Kathmandu: Japan on Sunday pledged a financial assistance of USD 3.85 million to Nepal to purchase fertilizer and increase food production in the country.

An agreement in this regard was signed on Sunday during the visit of Japanese Foreign Minister Koichiro Gemba to Nepal.

Japanese ambassador to Nepal Kunio Takahashi and Finance Secretary Krishna Hari Banskota signed an agreement on behalf of their respective governments at a function at Foreign Ministry office.

Gemba met Nepal's President Rambaran Yadav, Prime Minister Baburam Bhattarai and Foreign Minister Narayankaji Shrestha before leaving for New Delhi.

Nepalese authorities requested Gemba for Japan's assistance to construct 200 MW Upper Seti Hydropower plant and a highway.

Japan, one of the biggest aid donors to Nepal, has also provided technical equipments to the election commission to this country.