Professional Documents
Culture Documents
Mandikhatar,P.O. Box 2254, Kathmandu Tel. # 977-1-4378831/1006, Fax # 977-1-4378809 Email: info@iids.org.np; Website: www.iids.org.np
September, 2011
Nepal lies between India and China It cannot remain unaffected from the developments in these countries Planned development started in 1956 with the first five year plan Substantive development achieved during last five decades Improvements in social sector very impressive
Economic performance modest, but still lags behind other countries of the region
Key achievements
Poverty reduction substantial: from 42% in 1995/96 to 31% in 2003/04 to about 25% in 2009/10 Inequality increased from 0.34 to 0.41 during the same period (Gini coefficient)
Economic growth rates vary across development and ecological regions Variations in poverty incidence by geography and ethnicity Benefits of economic growth not uniformly distributed
Constraints to inclusive growth include
lack of productive employment opportunities unequal access to opportunities inadequate social safety nets unequal access to opportunities weak human capabilities uneven playing field limited access to infrastructure and productive assets
Migration offers new source of employment Geographic, ethnic and linguistic diversity contributes to exclusion
Household category Landless framers Marginal farmers Small farmers Medium farmers
Highly fragmented land holding 1.13 ha (1981) 0.96 ha (1991) 0.50 ha (2010) Fragmented land holding contributing to lower agricultural productivity Solution? Land distribution to landless Setting up community farming
Large farmers
Extra large farmers
93700
3800
3.0-10.0
>10.0
- More access to health services - More access to education and and women
empowerment to girls
- Legalization of abortion, but teenage abortions creating criticisms - 80% infants vaccinated in 2008 compared to 10% in 1980, but infant mortality still high - Health expenditure 6% of GDP, more needed
- Health services at the grass root level needs strengthening - Needs to reduce gap between urban and rural areas
Road network density low Only 43% people have access to all weather roads Lowest coverage of road networks in South Asia
65% of migrant workers between 15 and 29 years Most migrant workers unskilled Remittance income almost 25% of GDP Migration of young workers has negative impact on economy, specially in agriculture sector
Mainly caused by Maoist conflict and less opportunities in rural areas Classic urban giantism problem in Kathmandu valley Push Factors: Rural poverty and poor Public Service Delivery Urban bias is creating slums in cities and hinders fight against poverty
Need to improve infrastructure and facilities in rural sectors to discourage rural-urban migration
Cheaper competition from China and India have destroyed Nepalese industries Lack of infrastructure to compete in the world market Very vulnerable to risks posed by liberalization Harder for countries like Nepal to benefit from globalization
Poverty reduction in china succeeded due to reforms during agricultural revolution by Mao TseTung and industrial revolution by Deng Xiaoping
Contributed to unprecedented prosperity and modernity During his regime (1978-1998), per capita GDP quadrupled 9.3 percent GDP growth rate Poverty declined phenomenally.
Reduce inequality between developed eastern region and underdeveloped western and central regions Urban and industrial China are shifting inland Millions of rural Chinese are still left behind
Transport Infrastructure
October 1961: US$ 9.8 million to construct the Arniko highway 1969: construction of the 13 KM road between Kathmandu and Bhaktapur November 1972: Rs 300 million loan to construct NarayanghatGorkha road, trolley bus service between Kathmandu and Bhaktapur, and construction of PokharaSurkhet highway 1984: construction of PokharaBaglung sector of PokharaMustang road 2002: Construction of 18 KM long RasuwaSyafrubesi road linking to Tibet February 2011: a grant for widening Kathmandus Ring Road
helped facilitate business and trade within the national context facilitated in increasing the trade between the regions helped uplift many people out of poverty with opportunities for trade, movement, and access to markets
1972: loan for a textile mill and expansion of Harisiddhi Brick and Tile Factory 1973: established the Hetauda Cotton Mill June 1976: committed to establishing the Hetauda Textile mill 1980: agreed to construct the Lumbini Sugar Mill and Bhrikuti Paper Mill, construction of Bansbari Leather and Shoe Factory 1987: commitment to fund the construction of the International Convention Hall 1997: provided a grant of Rs 400 million to construct the SAF Hall and other sports infrastructures for the SAF games 2002: a grant of Rs 260 million to expand the capacity of Nepal Television
helped Nepalese industries grow and expand helped Hetauda become a major industrial hub in the country building and fostering culture and sports in the country growing sporting culture provides jobs to thousands
Social Sector
1996: grant worth Rs 8.1 million to B. P. Koirala Cancer Hospital 1997: an additional Rs 20 million 1998: an additional Rs 10.1 million 2006: grant of Rs 10 million for the Melamchi drinking water project
projects have provided jobs to many helped improve the lives of many others assistance is lacking when compared to other sectors need more support for healthcare, education, jobs and a decent standard of life
Agriculture
July 1976: US$ 4 million grant to construct a dam in the Seti River in Pokhara 2006: grants worth Rs 3 million to Agricultural Research and Development Fund, Rs 6 million to Horticulture Department, Rs 6 million for seed promotion, Rs 20 million for development of agriculture in the Karnali region, Rs 40 million for agricultural extension, and Rs 60 million for development of livestock
needs more logistic and technical support to improve Nepalese agriculture and productivity of its farmers such support from China has been lacking
Hydroelectricity
2008: loan of Rs 2 billion for Trishuli A hydropower project 2009: additional 1.5 billion 2011: soft loan for Upper Trishuli 3A hydropower project
irregular supply of power to run the factories and the mills assistance in Nepalese hydropower has been limited to cash assistance Nepal needs more technical and logistic support
Tourism
China has started providing loan to finance development projects in Nepal since 2000 Encouraged Chinese investors and business people to invest in Nepal Recently, diversifying its development assistance to other sectors including hydroelectricity, industry, health, agriculture and very recently in tourism as well China has recently opened its market to a number of Nepalese agricultural and industrial products This gesture is expected to reduce the trade imbalance between Nepal and China The assistances have contributed in reducing poverty in Nepal Helped to raise the standard of living of Nepali people
2011 Nepal: very similar to China in 1978 in terms of economic and social characteristics
Economic development efforts in Nepal have focused largely on urban development and growth Eastern and Central development regions are decades ahead in terms of development when compared to other regions
to reduce the economic and social disparities between the rich and poor people of Nepal
Agriculture still contributes around 34 percent of the GDP Employs almost 75 percent of the labor force Nepal should follow Chinas lead and reform agriculture
Should provide technical support to farmers, health care to rural population, improve irrigation facilities Introduce scientific farming techniques including drip irrigation and storage facilities to farmers
Nepal suffers from fragmentation of landholding GON may consider setting up a system where large scale farmers and investors can lease the unused lands This can increase agricultural productivity and efficiency due to economies of scale Lack of proper storage and cold storage facilities Nepal can learn from the Chinese experiences in this regard This will help farmers get appropriate prices for their products Construction and improvements of rural and agricultural roads. Invest heavily on rural roads Connect the rural supply with the urban demand market Farmers become more productive and richer
Similar to the early twenty-first century China, Nepal today suffers from poverty and other developmental ills. Much advancement and progress has been made in terms of health and education However, much of rural population lags behind in both Nepal can learn from Chinese experience in improving the health and education sectors There is a need to have socially committed government like China
Most of the problems, their causes, and potential solutions in Nepal closely match that of early twenty-first century Chinas. Agriculture, rural infrastructure, education of women and children, health care, and public service delivery are some of the core areas that need reforms. Creating jobs in Nepal to retain the youths Rescuing and educating the children who are prone to being trapped in poverty
Thank you