Nepal improves ranking in human development index

Nepal's Human Development Index (HDI) value is 0.601 —placing the country in the medium human development category and  —positioning it at 146 out of 193 countries and territories. 

Nepal’s ranking was 149 in 2021, according to United Nations Development Programme (UNDP) report. "As compared to 2021, Nepal’s progress on HDI value is 0.010 which is higher than global average of 0.004."

Countries with HDI values between 0.550 and 0.699 fall under the medium human development category.

Between 1990 and 2022, Nepal's HDI value changed from 0.395 to 0.601, representing a change of 52.2 percent. During the same period, Nepal's life expectancy at birth increased by 15.7 years, expected years of schooling by 5.4 years, and mean years of schooling by 2.1 years.

Nepal's GNI per capita changed by about 165.7 per cent between 1990 and 2022, the report adds.

The 2022 female HDI value for Nepal is 0.562, contrasting with 0.635 for males, resulting in a GDI value of 0.885.

Between 1990 and 2022, Nepal's life expectancy at birth changed by 15.7 years, expected years of schooling changed by 5.4 years and mean years of schooling changed by 2.1 years.

The 2022 female HDI value for Nepal is 0.562 in contrast with 0.635 for males, resulting in a GDI value of 0.885.

“Nepal performed progressively in the last 5 decades, yet fall into gridlock at times, particularly following the pandemic– be it related to decent jobs for youths, spatial and social inequalities, economic growth, as well as trust on institutions," UNDP Nepal’s Resident Representative Ayshanie Medagangoda-Labé said, adding that it is fundamental to collaborate not only between three levels of governments, but also with the private sector, civil society, international community, and people at large. "The federal government could focus more on transparency, accountability, and integrity; provincial and local governments can enhance planning and service delivery; Civil Society Organisations (CSOs) could further promote people’s participation and voice to revive hope and trust, and using multilateralism, a proven path that benefit everyone in the society.”

The report argues that advancing international collective action is hindered by an emerging ‘democracy paradox’: while 9 in 10 people worldwide endorse democracy, over half of global survey respondents express support for leaders that may undermine it by bypassing fundamental rules of the democratic process, as per data analysed in the report. "Half of people surveyed worldwide report having no or limited control over their lives, and over two-thirds believe they have little influence on their government’s decisions."

Political polarisation is also a growing concern with global repercussions. Along with a sense of powerlessness, report authors say, it is fuelling inward-turning policy approaches – starkly at odds with the global cooperation needed to address urgent issues like the decarbonisation of our economies, misuse of digital technologies, and conflict. This is particularly alarming in light of 2023's record-breaking temperatures, which emphasise the immediate need for united action to tackle the climate crisis, or in the advent of artificial intelligence as a new and fast-evolving technological frontier with little or no regulatory guard rails.

The report highlights that deglobalisation is neither feasible nor realistic in today’s world and that economic interdependence remains high. It points out that no region is close to self-sufficiency, as all rely on imports from other regions of 25 per cent or more of at least one major type of goods and services.

The report emphasises how global interdependence is being reconfigured and calls for a new generation of global public goods. It proposes four areas for immediate action:

- planetary public goods, for climate stability, as we confront the unprecedented challenges of the Anthropocene;

- digital global public goods, for greater equity in harnessing new technologies for equitable human development;

- new and expanded financial mechanisms, including a novel track in international cooperation that complements humanitarian assistance and traditional development aid to low-income countries; and

- dialling down political polarization through new governance approaches focused on enhancing people's voices in deliberation and tackling misinformation.

In this context, multilateralism plays a fundamental role, the report argues, because bilateral engagements are not able to address the irreducibly planetary nature of the provision of global public goods.

More key data from the report

• In 2023, all 38 countries that are members of the Organisation for Economic Co-operation and Development (OECD) achieved higher Human Development Index (HDI) scores compared to their levels in 2019.

• Among the 35 least developed countries (LDCs) that experienced a decline in their HDI in 2020 and/or 2021, more than half (18 countries) have not yet recovered to their human development levels of 2019.

• All developing regions have not met their anticipated HDI levels based on the trend before 2019. It appears they have shifted to a lower HDI trajectory, indicating potential permanent setbacks in future human development progress.

• The impact of human development losses is in sharp focus in Afghanistan and Ukraine.

Afghanistan’s HDI has been knocked back by a staggering ten years, while Ukraine’s HDI dropped to its lowest level since 2004.

• The report cites research indicating that countries with populist governments have lower GDP- growth rates. Fifteen years after a populist government assumes office, the GDP per capita is found to be 10 percent lower than it might under a non-populist government scenario.

Rich countries attain record human development, but half of the poorest have gone backwards

Uneven development progress is leaving the poorest behind, exacerbating inequality, and stoking political polarisation on a global scale. The result is a dangerous gridlock that must be urgently tackled through collective action, according to a new report released today by the United Nations Development Programme (UNDP).

The 2023-24 Human Development Report (HDR), titled 'Breaking the Gridlock: Reimagining cooperation in a polarised world', reveals a troubling trend: the rebound in the global Human Development Index (HDI) – a summary measure reflecting a country’s Gross National Income (GNI) per capita, education, and life expectancy – has been partial, incomplete, and unequal.

The HDI is projected to reach record highs in 2023 after steep declines during 2020 and 2021. But this progress is deeply uneven. Rich countries are experiencing record-high levels of human development while half of the world’s poorest countries remain below their pre-crisis level of progress.

Global inequalities are compounded by substantial economic concentration. As referenced in the report, almost 40 per cent of global trade in goods is concentrated in three or fewer countries; and in 2021 the market capitalisation of each of the three largest tech companies in the world surpassed the Gross Domestic Product (GDP) of more than 90 per cent of countries that year.

“The widening human development gap revealed by the report shows that the two-decade trend of steadily reducing inequalities between wealthy and poor nations is now in reverse," head of the UN Development Programme Achim Steiner said, "Despite our deeply interconnected global societies, we are falling short. We must leverage our interdependence as well as our capacities to address our shared and existential challenges and ensure people’s aspirations are met."

“This gridlock carries a significant human toll, he said, adding that the failure of collective action to advance action on climate change, digitalisation or poverty and inequality not only hinders human development but also worsens polarisation and further erodes trust in people and institutions worldwide.

The report argues that advancing international collective action is hindered by an emerging ‘democracy paradox’: while 9 in 10 people worldwide endorse democracy, over half of global survey respondents express support for leaders that may undermine it by bypassing fundamental rules of the democratic process, as per data analysed in the report. Half of people surveyed worldwide report having no or limited control over their lives, and over two-thirds believe they have little influence on their government’s decisions.

Political polarisation is also a growing concern with global repercussions. Along with a sense of powerlessness, report authors say, it is fuelling inward-turning policy approaches – starkly at odds with the global cooperation needed to address urgent issues like the decarbonisation of our economies, misuse of digital technologies, and conflict. This is particularly alarming in light of 2023's record-breaking temperatures, which emphasise the immediate need for united action to tackle the climate crisis, or in the advent of artificial intelligence as a new and fast-evolving technological frontier with little or no regulatory guard rails.

The report highlights that deglobalisation is neither feasible nor realistic in today’s world and that economic interdependence remains high. It points out that no region is close to self-sufficiency, as all rely on imports from other regions of 25 per cent or more of at least one major type of goods and services.

"In a world marked by increasing polarization and division, neglecting to invest in each other poses a serious threat to our wellbeing and security," Steiner said, adding that protectionist approaches cannot address the complex, interconnected challenges we face, including pandemic prevention, climate change, and digital regulation. "Our problems are intertwined, requiring equally interconnected solutions. By adopting an opportunity-driven agenda that emphasises the benefits of the energy transition and of artificial intelligence for human development, we have a chance to break through the current deadlock and reignite a commitment to a shared future."

The report emphasises how global interdependence is being reconfigured and calls for a new generation of global public goods. It proposes four areas for immediate action:

- planetary public goods, for climate stability, as we confront the unprecedented challenges of the Anthropocene;

- digital global public goods, for greater equity in harnessing new technologies for equitable human development;

- new and expanded financial mechanisms, including a novel track in international cooperation that complements humanitarian assistance and traditional development aid to low-income countries; and

- dialling down political polarisation through new governance approaches focused on enhancing people's voices in deliberation and tackling misinformation.

In this context, multilateralism plays a fundamental role, the report argues, because bilateral engagements are not able to address the irreducibly planetary nature of the provision of global public goods.

Remittance help reduce poverty not government policy: UN human rights expert

Nepal's poverty has reduced not due to government policy rather with the help of remittance inflow, according to a UN expert.

"Poverty reduction owes more to remittances than to proactive government anti-poverty policies," the UN special rapporteur and extreme poverty and human rights, Olivier De Schutter, said today after conducting an 11-day official mission.

"A quarter of the decline in poverty can be attributed to outmigration only, with estimates showing that, without remittances, poverty would have increased in Nepal,” he said, adding that remittances in Nepal were 10 times larger than foreign aid and 2.5 larger than total exports only in 2017. "It is clear that much more needs to be done by the government to meet its own target of reducing multidimensional poverty to 11.5 per cent by 2023-2024,” the expert said, suggesting the government to ensure its skills and training programmes reach the poorest families. "While public works programmes such as the Prime Minister’s Employment Programme (PMEP) have considerable potential, in practice the programme has yet to deliver on its promise of providing 100 days of work per person per year. "In the country, 80 per cent of workers are informal, which exposes them to higher rates of abuse, largely because the government lacks the ability to enforce minimum wage legislation in the informal sector.|

Although informal workers should also contribute to and benefit from the Social Security Fund (SSF), there is currently no plan to include them in the programme, he added.

Nepal has one of the most progressive constitutions in the world, but many of its promises still are to be fulfilled, De Schutter, said, adding that Nepal has succeeded in reducing multidimensional poverty by 12.7 per cent between 2014 and 2019, and its Human Development Index (HDI) has improved, as have indicators related to health and education. "But significant gaps remain."

"Women are still lagging on a number of indicators," he said, adding that though banned, caste-based and ethnicity-based discrimination remain a reality in social life, and it is a major factor explaining the perpetuation of poverty. "Land issues remain unresolved, despite the efforts to accelerate the rehabilitation of former bonded labourers and to ensure landless Dalit benefit from land redistribution."

De Schutter’s fact-finding mission began on December 29, just weeks after the UN General Assembly voted a resolution inviting Nepal, along with Bangladesh and Lao People’s Democratic Republic, to prepare for graduation from the status of Least Developed Country (LDC) to that of an emerging economy. Nepal will benefit from a five-year transition period. “Graduation from LDC status is a major milestone for Nepal,” De Schutter said, adding that poverty reduction must be at the heart of the country’s transition strategy to ensure that no groups are left behind."

The UN expert met with communities who suffer from intersecting forms of deprivation. Most were landless daily wage labourers working in agricultural or informal jobs and struggling to send their children to school. Many were from historically disadvantaged and discriminated groups including Dalit, Madhesi, and Indigenous people, as well as women. “The stark inequalities resulting from the deeply entrenched norms and values of the Nepali caste system continue to perpetuate disadvantage today,” De Schutter added.

Women suffer the brunt of a historically patriarchal society, earning almost 30 per cent less than men, suffering from higher rates of informality, owning only 19.7 per cent of homes and land, and enduring a 17.5 per cent literacy gap compared to men, the UN poverty expert noted. "Nepal can and must do better,” he said.

Children experience the worst forms of deprivation because of the poverty their families face, he added. Over one million children work in Nepal, and in rural areas over a fifth of children do.

"During my mission, I met with countless families whose children, especially girls, engaged in agricultural or domestic work,” De Schutter said. "Wealth inequality is a major factor: over 20 per cent of children in poverty work, compared to only five percent of children from rich families."

“The government must take child poverty seriously and take the necessary steps to end child marriage and labor and improve quality of and access to education,” he added.

During his mission, the special rapporteur visited Bagmati, Karnali, Lumbini provinces, as well as Province 2. He met with nine ministries, including six ministers, as well as local and provincial authorities, people affected by poverty, civil society organisations, and development cooperation and UN agencies.

Human progress needs to be considered with environmental protection: UNDP

 The United Nations Development Programme (UNDP) has underscored the need for redefining human progress that takes into account countries’ carbon dioxide emissions and material footprint on top of traditionally used parameters of human development.

Unveiling the Global Human Development Report (HDR) 2020 today, the UNDP has expressed its concern over widening inequality and environmental challenges that the world is facing while moving forward to achieve human progress. The Covid-19 pandemic is the latest crisis facing the world, but unless humans release their grip on nature, it won’t be the last, according to the report.

“Humans wield more power over the planet than ever before,” UNDP administrator Achim Steiner said, adding that in the wake of Covid-19, record-breaking temperatures and spiraling inequality, it is time to use that power to redefine what is meant by progress, where the carbon and consumption footprints are no longer hidden.

Till the date, the Human Development Index (HDI) considers a nation’s health, education, and standards of living to mark as human progress. But the additional elements – a country’s carbon dioxide emissions and its material footprint – shows how the global development landscape would change if both the wellbeing of people and also the planet were central to defining humanity’s progress.

Currently, the Covid-19 has grappled the world. This has led to more than 50 countries dropping out of the very high human development group, reflecting their dependence on fossil fuels and material footprint. “This shows that no country in the world has yet achieved very high human development without putting immense strain on the planet,” the report reads.

The UNDP has mentioned that it has been projected by 2100, the poorest countries in the world could experience up to 100 more days of extreme weather due to climate change each year, a number that could be cut in half if the Paris Agreement on climate change is fully implemented. “And yet fossil fuels are still being subsidized: the full cost to societies of publicly financed subsidies for fossil fuels – including indirect costs – is estimated at over $5 trillion a year, or 6.5 per cent of global GDP,” the UNDP cited a report published by the International Monetary Fund (IMF).

The Global Human Development Report is a flagship publication of the UNDP. Minister for Foreign Affairs Pradeep Kumar Gyawali launched the report in Nepal, amid a programme.

“For three decades, Human Development Reports have fundamentally shaped the ideas and policy discourse on alternative assessment of development and wellbeing,” he said, awhile launching the report in Kathmandu. “The criteria used for measuring human development have been the basis for advancing social development agenda, including in Nepal,” he said, adding that the contents of the HDR reports have served as useful policy resources for many countries. “Successive human development reports since 1990 have highlighted critical dimensions of human progress and sustainable development, thereby informing, encouraging and assisting the governments and stakeholders to address the impediments in the way of enlarging choices.”

“Nepal strongly supports the implementation of the Paris Agreement and the call to limit global warming to 1.5 degrees,” he said thanking Resident Representative of UNDP in Nepal Ayshanie Labe for the launching ceremony.

Reminding Prime Minister K P Sharma Oli’s address at the climate ambition summit, where he outlined the roadmap for Nepal’s ambition towards a net-zero greenhouse gas emission by 2050, Gyawali said that Nepal submitted it’s updated, more ambitious and progressive Nationally Determined Contribution (NDC-2020). “Nepal has prioritised producing clean and renewable energy as well as promoting e-mobility, low carbon infrastructure and ecotourism.”

By 2030, Nepal aims to maintain 45 per cent of the country’s land under forest cover and aims to extend protected area from 23 per cent to 30 per cent and preserve biodiversity. 

While implementing the NDC, Nepal remains committed to prioritise the issue of gender equality and social inclusion and ensure full, equal and meaningful participation of women, children, youth, indigenous peoples and marginalized communities in all stages of the implementation process.

Human development in Nepal stagnates

Nepal’s HDI value for 2018 is 0.579 – which put the country in the medium human development category – positioning it at 147 out of 189 countries and territories – one rank up from last year’s 148 position, revealing that the country's status in human development almost remained stagnant. The rank is shared with Kenya. The report also reveals that Nepal has just maintained its position in the medium human development with the threshold of 0.55-0.69 points.
Nepal’s 2018 HDI of 0.579 is below the average of 0.634 for countries in the medium human development group and below the average of 0.642 for countries in South Asia. From South Asia, countries which are close to Nepal in 2018 HDI rank and to some extent in population size are Afghanistan and Sri Lanka, which have HDIs ranked 170 and 71 respectively .
Between 1990 and 2018, Nepal’s HDI value increased from 0.380 to 0.579, an increase of 52.6 per cent. Between 1990 and 2018, Nepal’s life expectancy at birth increased by 16.1 years, mean years of schooling increased by 2.8 years and expected years of schooling increased by 4.7 years. Likewise, Nepal’s GNI per capita increased by about 130.5 per cent between 1990 and 2018, according to the report that was launched simultaneously from Kathmandu and seven provinces in Nepal today.
Despite global progress in tackling poverty, hunger and disease, a ‘new generation of inequalities’ indicates that many societies are not working as they should and Nepal is not an exception, according to a new human development report. “The old inequalities were based on access to health services and education whereas the new generation of inequalities is based on technology, education and the climate, according to the United Nations Development Programme’s (UNDP) report.
“Previously, we talked about wealth as a major driver for inequality but now, countries like Nepal are in another inequality trap and that concerns technology and education,” finance minister Dr Yuba Raj Khatiwada said launching the report.
While South Asia was the fastest-growing region, with 46 per cent growth, in the 1990-2018 period, Nepal’s human development index (HDI) rose from 0.380 to 0.579, an increase of 52.6 per cent, the report reads, adding that people are living longer, on average, are more educated and have greater incomes. “For example, between 1990 and 2018, Nepal’s life expectancy at birth increased by 16.1 years to 70.5 years, mean years of schooling increased by 2.8 years and expected years of schooling increased by 4.7 years.”
Likewise, Nepal’s Gross National Income (GNI) per capita also increased by about 130.5 per cent between 1990 ($1,192) and 2018 ($2,748). Nepal, however, is still below the average value of 0.634 for countries in the medium human development group and below the average of 0.642 for countries in South Asia. “Nepal lags behind most South Asian countries, ranking above Pakistan (152) and Afghanistan (170). But the report, which ranks countries on their average achievement in key dimensions of human development, like life expectancy, education and per capita income, reveals that Nepal trails behind Sri Lanka (71), the Maldives (104), India (129), Bhutan (134) and Bangladesh (135).
Despite progress in most human development indicators, the report also shows that Nepal has a poor Gender Inequality Index (GII) with a value of 0.476 – a huge gap between the HDI for men and women in the country – ranking it 115 out of 162 countries. The HDI for men is 0.612 while that for women is 0.549.
“The gender equality gap is so huge that if we started working to reducing the gap now, it will take us 202 years,” resident representative of the UNDP Ayshanie Medagangoda-Labe, said at the report launch. “There are also questions about whether the artificial intelligence era will further increase inequality,” she said, adding, “Yes, but the choice is in our hands.”
The report has also pointed out that prevailing inequality is threatening human development.
Likewise, some 33.5 per cent of parliamentary seats – in Nepal – are held by women, but just 29 per cent of adult women have reached at least a secondary level of education, compared to 44.2 per cent of males, according to the report. “For every 100,000 live births, 258 women die from pregnancy-related causes.”
But female participation in the labour market is 81.7 per cent, compared to 84.4 per cent for men.
Nepal’s HDI at 0.579 is a modest improvement but when the value is discounted for inequality, the index falls to 0.430, a loss of 25.8 per cent due to inequality in the distribution of the HDI dimension indices, the UNDP flagship report reads.
Likewise, in Nepal, some 34 per cent of the population – 9.96 million people – is multidimensionally poor while an additional 22.3 per cent is classified as vulnerable to multidimensional poverty (6.54 million people). Multidimensional poverty takes into account the various deprivations experienced by poor people in their daily lives like poor health and living standards, lack of education and living in areas that are environmentally hazardous.
The breadth of deprivation in Nepal – which is the average deprivation score experienced by people in multidimensional poverty – is 43.6 per cent. The Multidimensional Poverty Index, which is the share of the population that is multidimensionally poor, adjusted by the intensity of the deprivations, is 0.148, the report reads, adding that the multidimensional poverty with income poverty is measured by the percentage of the population living below $1.90 per day.
Norway, with HDI of 0.990, stands at first position, while Sri Lanka is ranked 71st among 189 countries.

Human development in Asia-Pacific region advances dramatically, but unevenly

The Asia-Pacific region has witnessed the steepest rise globally in human development. It leads the world in access to broadband internet and is gaining on more developed regions in life expectancy, education, and access to health care. Yet it continues to grapple with widespread multidimensional poverty, and may be vulnerable to a new set of inequalities emerging around higher education and climate resilience, according to the 2019 Human Development Report, released today by the United Nations Development Programme (UNDP).
The report ‘Beyond income, beyond averages, beyond today: inequalities in human development in the 21st Century,’ reads that as the gap in basic standards is narrowing, with an unprecedented number of people escaping poverty, hunger and disease, the necessities to thrive have evolved. “The next generation of inequalities is opening up, particularly around technology, education, and the climate crisis.”
The Human Development Report (HDR) – which pioneers a more rounded way to measure countries’ progress beyond just economic growth – analyses inequality in three steps: beyond income, beyond averages, and beyond today, proposing a battery of policy options to tackle it. “This is the new face of inequality,” UNDP Administrator Achim Steiner says, adding that inequality is not beyond solutions and as this Human Development Report sets out.
According to the report’s Human Development Index (HDI), no other region has experienced such rapid human development progress. South Asia was the fastest growing region – 46 per cent growth over the period 1990-2018 – followed by East Asia and the Pacific at 43 per cent. Of all countries on the HDI, Thailand had the second-highest increase after Ireland, moving up 12 ranks during 2013-2018. Indonesia and the Philippines both joined the ranks of countries with high human development. South Asia also saw the greatest leap in life expectancy and years of schooling.
Beyond these gains in basic standards and capabilities, however, the picture becomes more complex.
Describing the ‘nextgeneration’ of inequalities likely to drive achievement further along the development spectrum, the report notes for example that in countries with very high human development, subscriptions to fixed broadband are growing 15 times faster and the proportion of adults with tertiary education is growing more than six times faster than in countries with low human development.
The region is in the vanguard of technological transformation. From 1987 to 2007 little changed in the global ranking of installed bandwidth potential, but at the turn of the millennium things started to change, with the expansion of bandwidth in East and North Asia. The report states that China leads the world in installed bandwidth, and East Asia is projected to share with North America about 70 per cent of the global economic benefits tied to artificial intelligence by 2030. But tertiary education rates lag significantly behind wealthier countries, with only 25 per cent of the tertiary school-aged population in South Asia and 44 per cent in East Asia and the Pacific enrolled in higher education.
And although millions throughout the region have escaped multidimensional poverty, the incidence of multidimensional poverty varies enormously across countries, from 0.8 per cent in the Maldives to 56 per cent in Afghanistan. Out of the 1.3 billion multidimensional poor, 661 million are in Asia and the Pacific, which shares almost half of the multidimensional poor living in 101 countries of the world. South Asia alone shares more than 41 per cent of the total number of multidimensional poor. Despite India’s significant progress on the multidimensional poverty front in the past decade, it accounts for 28 per cent of the 1.3 billion multidimensional poor.
Four in ten people in South Asia still lack access to sanitation facilities. And the report warns that the poorest communities remain vulnerable to climate change. Poor people are expected to be more exposed to droughts for warming scenarios above the 1.5°C rise in temperature in several countries in Asia. The rural poor in poor countries are at risk of a double shock: a negative impact on livelihoods and spikes in food prices resulting from drops in global yields.
“The rapid transformations in the region have brought us to an inflection point,” assistant secretary general and director of the Regional Bureau for Asia and Pacific Kanni Wignaraja says, adding that many others remain without the opportunities or basic resources to access a decent life, while many have escaped poverty.
The report also finds that despite progress, group-based inequalities persist on the Indian subcontinent, especially affecting women and girls. The HDI reveals marked contrasts between South Asia and the wider region. East Asia and the Pacific ranks second highest on the Gender Development Index, with the Republic of Korea first in the region on the Gender Inequality Index. Yet worldwide among regions, South Asia has the widest gender gap on the HDI.
While Singapore has the region’s lowest incidence of intimate partner violence against women, the report states that a staggering 31 per cent of women in South Asia have experienced intimate partner violence.
Inequalities persist at the household level as well, the report adds. Over 22 per cent of under-five children in South Asia experience nutritional inequality at home, where one child in the household is malnourished while a sibling is not. And while more than 10 per cent of South Asian girls are out of school and living in a multidimensionally poor household – compared to 9 per cent of boys – that average includes wide variation among countries: in Afghanistan, it is 44 per cent of girls, compared to 25 per cent of boys.
The report also recommends policies that look at but also go beyond income, anchored in lifespan interventions starting even before birth, including through pre-labour market investments in young children’s learning, health and nutrition. Such investments must continue through a person’s life, when they are in the labour market and after.
The report also argues that taxation cannot be looked at on its own, but must be part of a system of policies, including policies for public spending on health, education, and alternatives to a carbon-intensive lifestyle.

New Target: Cut ‘Learning Poverty’ by at least half by 2030

The World Bank introduced today an ambitious new Learning Target, which aims to cut by at least half the global rate of Learning Poverty by 2030. Learning Poverty is defined as the percentage of 10-year-olds who cannot read and understand a simple story.  Using a database developed jointly with UNESCO Institute of Statistics, the Bank estimates that 53 per cent of children in low- and middle-income countries cannot read and understand a simple story by the end of primary school. In poor countries, the level is as high as 80 per cent. Such high levels of learning poverty are an early warning sign that all global educational goals and other related sustainable development goals are in jeopardy.
“Success in reaching this learning target is critical to our mission,” World Bank Group president David Malpass said, adding that tackling learning poverty will require comprehensive reforms to ensure domestic resources are used effectively. “The target points to the urgency of investments in better teaching and better coordination of vital learning priorities.”
This new target aligns with the Human Capital Project’s efforts at building the political commitment for accelerating investment in people. Much of the variation in the Human Capital Index – used to track countries’ progress in health, education, and survival – is due to differences in educational outcomes.
“We know that education is a critical factor in ensuring equality of opportunities,” said World Bank Group vice president (Human Development) Annette Dixon. “Many countries have almost eliminated learning poverty – with levels below 5 per cent,” Dixon said, adding that it is incredibly high – but in others – and we are putting at risk the future of many children. “That is morally and economically unacceptable. This Learning Target aims to galvanise action toward an ambitious but reachable goal.”
Several developing countries are showing that accelerated progress is possible. In Kenya, progress has been accomplished through technology-enabled teacher coaching, teacher guides, and the delivery of one textbook per child – in both English and Kiswahili – with contents suitable to the level of students. In Egypt, the government has changed its curriculum and assessment systems, so students are evaluated throughout the year, with the key element of the reforms focused on learning, instead of getting a school credential. And in Vietnam, the clear and explicit national curriculum, the near-universal availability of textbooks, and the low absenteeism among students and teachers are credited for contributing to the country’s outstanding learning outcomes.
Unfortunately, in many other countries the current pace of improvement is still worryingly slow. Even if countries reduce their learning poverty at the fastest rates seen over the past 20 years, the goal of ending it will not be attained by 2030.
“Cutting learning poverty by at least half is feasible but requires large political, financial and managerial commitments and a whole of government approach,” said Global Education Director at the World Bank Group Jaime Saavedra. “Taking learning poverty to zero -assuring that all children are able to read- is a fundamental development objective, as is eliminating hunger or extreme poverty,” Saavedra said, adding that all children have the right to read – and in each country, a national dialogue is needed in order to define how and when learning poverty can be eliminated, and to set intermediate targets for the coming years.
The bank says, it will use three pillars of work to help countries reach this target and improve the human capital outcomes of their people: A literacy policy package consisting of country interventions that have proven to be effective in promoting reading proficiency at scale: ensuring political and technical commitment to literacy grounded in adequately funded plans; ensuring effective teaching for literacy, through tightly structured and effective pedagogy; preparing teachers to teach at the right level and providing practical in-school teacher training; ensuring access texts and readers to all; and teaching children in their home language.
A refreshed education approach to strengthen entire education systems, so that literacy improvements can be sustained and scaled up and all other education outcomes can be achieved. This approach comprises of five pillars: i) prepared and motivated learners, ii) effective and valued teachers, iii) classrooms equipped for learning, iv) safe and inclusive schools, and v) a well-managed education system.
An ambitious measurement and research agenda to include measurement of both learning outcomes and their drivers, as well as a continued action-oriented research and innovation, including smart use of new technologies, on how to build foundational skills.
Change is needed at scale, quickly, and for large populations. That cannot be done without technology. Open-source digital infrastructure and information systems will be used to assure resources reach all teachers, students and schools.
Tracking progress calls for a dramatic improvement in the capacity to measure learning, particularly in low-income countries. A World Bank-UNESCO Institute for Statistics partnership will help countries strengthen their learning assessment systems and improve the breadth and quality of country data on learning to better monitor performance over time and in internationally-comparable ways. Further, the World Bank’s new Learning Assessment Platform will enable countries to evaluate student learning more efficiently and effectively.

Nepal less competitive economy in South Asia

Nepal still is the third competitive economy in the South Asia after India, Sri Lanka snd Bangladesh, though with 51.9 score, Nepal has stepped up by one rank – to to 108 – from last year, in the Global Competitiveness Index 2019. Nepal ranked at 109 with 50.8 score in the Global Competitiveness Index 2018.
Nepal was the 109th most competitive nation in the world out of 140 countries ranked in the 2018 edition of the Global Competitiveness Report. Competitiveness rank in Nepal averaged 115.42 in a decade – from 2007 until 2018 – reaching an all time high of 130 in 2011 and a record low of 100 in 2016.
Likewise, In South Asia, India ranks in 68th followed by Sri Lanka (the most improved country in the region at 84th), Bangladesh (105th), Bhutan (82-2018 ), Nepal (108th) and Pakistan (110th). India has moved down 10 places to rank 68th on an annual global competitiveness index, largely due to improvements witnessed by several other economies, while Singapore has replaced the US as the world's most competitive economy.
Despite recording three successive years of high economic growth, macro-economic stability and average annual gross domestic product growth of 4 per cent in the past decade, Nepal ranks 108th out of 141 economies and is the worst performer in South Asian region in terms of competitiveness, the report by the World Economic Forum (WEF) revealed. The annual assessment report, Global Competitive Report 2019 published today measures national competitiveness based on the state of institutions, policies and factors that determine an economy’s productivity.
Out of the total competitiveness score of 100 or the ‘frontier’ where productivity constraints cease to exist, Nepal has gained 51.6 points – far below India (68th) with 61.4 points and Srilanka (84th) with 57.1 points – and the global average of 60 points.
The economy performed poorly in terms of innovation capability, information, communication and technology adoption, product market development, judicial independence and government’s long-term vision, iut reads, adding that Nepal has performed better in indicators such as macro-economic stability, road connectivity, electricity access and supply, despite its low rank.
The report appears amid fears of slowing economic growth in Nepal owing to a drop in manufacturing and foreign direct investment, despite government claims that it has improved the investment climate by reforming over a dozen laws in a year. Figures show that the country's investment outlook has remained bleak despite political and macroeconomic stability. According to the central bank, the inflow of foreign investment plummeted by 25 per cent to Rs 13.07 billion in the last fiscal year from Rs 17.5 billion in 2017-18. Likewise, industry registrations fell to 436 in the last fiscal year from 498 in the previous year, the total committed investment dropped to Rs 282 billion from Rs 350 billion in the previous year, and foreign direct investment (FDI) pledges also nosedived to Rs 24 billion from Rs 56 billion, according to the Department of Industry.
The 2019 index that offers insight into economic prospects ranks 141 economies accounting for 99 per cent of the world’s GDP based on 103 factors of productivity related to 12 pillars of infrastructure, institutions, ICT adoption, macroeconomic stability, health, skills, product market, labour market, financial system, market size, business dynamism, innovation and capability.
According to the World Economic Forum, the report demonstrates that despite central banks injecting nearly $10 trillion into the global economy 10 years on from the financial crisis, productivity-enhancing investments such as new infrastructure, research and development and skills development in the current and future workforce have been suboptimal.
“The global economy is ill-prepared for a downturn after a lost decade for productivity-enhancing measures,” the report reads, adding that monetary policy may have run out of steam and some countries are facing a liquidity trap. “Furthermore, the geopolitical context is more challenging than in 2007, with gridlock in the international governance system, and an escalating trade and geopolitical tensions fuelling uncertainty, which holds back investments, and increases the risk of supply shocks.”
According to the report, Asia-Pacific is the most competitive region in the world with Singapore as the most competitive economy, followed closely by economies in Europe and North America and Nordic countries are among the world’s most technologically advanced, innovative and dynamic while also providing better living conditions and social protection.
With a score of 84.8 out of 100, Singapore is the country closest to the frontier of competitiveness
Other G20 economies in the top 10 include the United States (2nd), Japan (6th), Germany (7th) and the United Kingdom (9th) while Argentina (83rd, down two places) is the lowest ranked among G20 countries
The Global Competitiveness Report 2019: How to end a lost decade of productivity growth paints a gloomy picture, yet it also shows that those countries with a holistic approach to socio-economic challenges, look set to get ahead in the race to the frontier.
Persistent weaknesses in the drivers of productivity growth are among the principal culprits. In advanced, emerging and developing economies, productivity growth started slowing in 2000 and decelerated further after the crisis. Between 2011 and 2016, ‘total factor productivity growth’ – or the combined growth of inputs, like resources and labour, and outputs – grew by 0.3 per cent in advanced economies and 1.3 per cent in emerging and developing economies.

Per capita income to reach $1,400 in five years

The government has projected that Nepal’s per capita income to reach $1,400 by the end of the 15th periodic plan in fiscal year 2023-24.
During the first meeting of the National Development Council (NDC), here today vice chair of National Planning Commission (NPC) Dr Pushpa Raj Kandel said that Nepal's per capital income will increase by $400 in next five years. "The country’s per capita income will increase by seven per cent or $70 to $1,074 in the current fiscal year from $1,004," he said, adding that by the end of fiscal year 2042-43, Nepalis per capita income will reach $12,100.
Speaking at the meeting, finance minister Dr Yubaraj Khatiwada, said that political and social stability can guide the government’s long-term vision to achieve the targeted goal. "We need to improve the implementation capacity that will directly affect per capita income and sustainable development," he said, adding that the government will achieve the targeted goal by accelerating development works of major indicators like rail, roadways, tourism, agriculture and electricity. "The government is however occupied with formulating and amending the necessary laws in the current fiscal year."
Claiming that the government is close to achieving the goals set in current 14th periodic plan the finance minister also said that the next fiscal year will see increment in expenditure with coordination of provincial and local level governments.
Likewise, the government has planned to reduce the unemployment rate by three percentage points from current 11.4 per cent in the next five years. Nepal has also planned to graduate from least developed country (LDC) status to the developing country status by 2022 and to a middle income country by 2030.
Progress in development indicators of the country’s 14th development plan have been more satisfactory compared to those in the past plan periods, according to a report of National Planning Commission.
In the first two years of the three-year plan (fiscal year 2016-17 to fiscal year 2018-19), indicators in agriculture, social development, poverty reduction, access to drinking water, and average economic growth have posted fair progress, it reported, adding that the figures of physical infrastructure is however still bleak. "The review has also stated that the successful election of three tiers of government and formation of a stable government at the center have laid a ground for stability and confidence among investors to invest."
The finance minister, who had portrayed a bad shape of the country’s economy issuing a white paper last year after assuming office, has now portrayed the overall economic indicators to be in the positive direction.
"The average economic growth in the last two fiscal years has been 6.64 per cent, against the target of 6.6 percent," the report added. "“The achievements are the closest to the target after the 8th development plan."
Figure of Human Development Index (HDI), which was targeted at 0.57 has already been achieved, and the index was 0.574 by the end of fiscal year 2017-18. "Likewise, target of life expectancy in the plan period was 72 years, which has reached 70 years at the end of fiscal year 2017-18 and population having access to safe drinking water has already reached 94.9 per cent against the target of 90 per cent."

राजनीतिक स्थायित्वले समृद्धि देला ?

अन्ततः संघीय संरचनामा जाने कसरतमा संविधानसभामा सुरु भएको बहसको पटाक्षेप गर्दै नेपाल संघीयतामा प्रवेश गरेको छ । बिहीबारको प्रतिनिधिसभा तथा प्रदेशसभाको निर्वाचनले करिब ७ दशकदेखिको राजनीतिक संक्रमणको अन्त्य पनि गरेको छ । यसबाट लामो समयदेखि ’पर्ख र हेर’ को मनोभावमा रहेका निजी क्षेत्र अब राजनीतिक स्थायित्वले समृद्धिको यात्राको बाटो कोरेको बताउँछन् । राजनीतिक दलहरूले भनेझैं अब राजनीतिक लडाइँको पटाक्षेप भएको त छ, तर आर्थिक क्रान्तीको बाटो पनि सहज भने छैन । विगतमा राजनीतिक स्थिरता नभएर लगानीयोग्य वातावरण भएन भन्ने निजी क्षेत्रको गुनासो केही हदसम्म अब हट्नेछ । निर्वाचनको परिणामपछि नयाँ संविधानअनुसार बन्ने नयाँ सरकारलाई कम्तीमा २ वर्षसम्म हटाउन पाइने छैन । यसबाट पछिल्ला करिब २ दशक लगातार अस्थिरता तथा अनिश्चयका कारण हच्किएको निजी क्षेत्रमा अर्थतन्त्रमा केही सुधार हुन्छ भन्ने विश्वास छ ।
तर, के राजनीतिक स्थिरतामात्र आर्थिक उन्नतीको लागि आवश्यक शर्त हो त ? अर्थविद् विश्व पौडेल भन्छन्, “हैन, राजनीतिक स्थिरता एउटा शर्त हो तर यो नै सम्पूर्ण सत्य भने होइन ।” उनका अनुसार नेपालमा राजनीतिक स्थिरता पहिले पनि थियो । तर, राजनीतिक स्थिरतासंगै उपयुक्त आर्थिक नीति तथा कानुन नभएकोले नेपालको आर्थतन्त्र घिटिघिटि गरेर अगाडि बढ्यो ।
नेपालको इतिहासमा धेरै स्थिर राजनीतिक समय थिए । जस्तै, २०१७ सालदेखि २०४६ सम्म पञ्चायत कालमा राजनीतिक स्थिरता त थियो तर, पंचायतकालीन ३० वर्षमा नेपालको आर्थिक वृद्धि भने औषत ३.१३ प्रतिशतमात्र थियो । साथै तीन दशकमा ६ पटक आर्थिक वृद्धिदर नकारात्मक रहेको थियो । २०४६ सालपछि प्रजातन्त्रको आगमन तथा विश्वमा चलेको आर्थिक स्वतन्त्रताको लहर नेपालमा पनि भित्रियो । जसका कारण निजी क्षेत्रले खुलेर उद्योगधन्दा चलाउन पाए । नेपालमा विदेशी लगानी भित्रियो र यसले रोजगारीमात्र सिर्जना गरेन नेपालको प्रतिव्यक्ति आय पनि ह्वात्तै बढाउन मद्दत गर्यो ।
विश्व बैकका अनुसार २०१७ सालमा ५० अमेरिकी डलर हाराहारीमा रहेको नेपालीको प्रतिव्यक्ति आय ३० वर्षमा बढेर जम्मा १९३ अमेरिकी डलर बढ्यो । तर, २०४६ सालदेखिको पछिल्लो २७ वर्षमा नेपालीको प्रतिव्यक्ति आम्दानी बढेर ८५३ अमेरिकी डलर भएको छ । २०४६ सालको परिवर्तनपछि देशमा औद्योगिकीकरण भएका कारण रोजागरीमात्र बढेन २०४७ सालदेखिको पछिल्ला वर्षहरूको औषत आर्थिक वृद्धि ४.५ प्रतिशत रह्यो । अर्थात्, २०४६ सालपछिको सरकारले लिएको आर्थिक नीतिका कारण नेपालले १० वर्षे माओवादी विद्रोह, ९-९ महिनामा फेरिइरहने सरकार, रोजगारदाता तथा कामदारबीचको अप्रिय सम्बन्ध र उद्योगका लागि चाहिने न्यूनतम बिजुलीको चरम अभावका बाबजुद पनि आर्थिक वृद्धिको जग हल्लिन सकेन । भलै, अपेक्षित रूपको आर्थिक वृद्धि तथा रोजगारी निर्माण भने हुन सकेन ।
अब, देश संघीयतामा गइसकेपछिको अवस्थामा सही आर्थिक नीति लिएर आर्थिक वृद्धिपछिमात्रै वितरणमा ध्यान दिनुपर्ने पौडेलको भनाइ छ । “यदि लोकप्रिय बन्ने नाममा अब बन्ने सरकारले बिनास्रोत वितरणतिरमात्रै लाग्यो भने फेरि अर्को दुर्घटना हुने निश्चित छ,” उनी भन्छन् ।
यसका लागि अब बन्ने सरकारले नागरिकको आर्थिक स्वतन्त्रताको प्रत्याभूति गर्नु आवश्यक छ । जहाँ मानिस पुँजी निर्माण गर्ने स्वतन्त्र हुन्छन्, त्यो देशको आर्थिक उन्नति हुने हुनाले सम्पत्तिको अधिकार, दुई पक्षबीच करारको पालना, स्वतन्त्र न्यायपालिका तथा सुरक्षाको प्रत्याभूतिको कारण स्वतन्त्रतापूर्वक हिँडडुल गर्न पाउने अधिकार, स्वतन्त्रतापूर्वक पुँजी निर्माण गर्न पाउने अधिकार तथा स्वतन्त्रतापूर्वक व्यापार गर्न पाउने अधिकारको प्रत्याभूति हुन नसके करिब ७ दशक लगाएर प्राप्त भएको राजनीतिको स्थिरताको जगमा आर्थिक क्रान्ती गर्ने सपना तुषारापात हुन बेर लाग्दैन ।
आर्थिक स्वतन्त्रताअन्तर्गत सरकारले सबै नागरिकलाई बराबरको व्यवहार नगरी कसैलाई छुट वा सुविधा दिनेवित्तिकै त्यसले बजारमा एकाधिकारको सिर्जना गर्दछ र प्रतिस्पर्धाको घाँंटी निमोठ्छ । त्यसबाट सरकारले ‘क्रोनी क्यापिटलिज्म’ बढाउँछ र बजारमा नयाँ खेलाडी आउने वातावरण बन्दैन । पुरानामात्र बजारमा रहिरहने तर नयाँं सिर्जना र नवीन सोच स्थापित हुने वातावरण नबन्नासाथ लगानीकर्ता हतास हुन्छन् । त्यसैले संविधानसभामार्फत बनेको संविधानको कार्यान्वयन सुरु भएसँगै नेपालका विकास साझेदार, विदेशी तथा स्वदेशी लगानीकर्तामा छाएको उत्साह कायम राख्न पनि निर्वाचनपछि जुनसुकै दलको सरकार आएपनि निजी क्षेत्रलाई प्रतिस्पर्धी वातावरणमा काम गर्न दिनेमा नेपाल उद्योग परिसंघका अध्यक्ष हरिभक्त शर्मा आशाबादी छन् । जिम्मेवार राजनीति, सुशासन तथा नीतिगत र कानुनी सुधार, पूर्वाधार विकास र दृढ अठोट नभइ राजनीतिक स्थायित्वलेमात्र आर्थिक वृद्धि तथा समृद्धि प्राप्त नहुने उनको विचार छ ।
“अहिले हाम्रा छिमेकी देश औद्योगिकीकरणको दिशामा अगाडि बढिसकेका छन्, अब हाम्रो पालो,” उनी भन्छन्, “लम्बिँदो राजनीतिक संक्रमणकाल र अनिश्चितताबाट मुक्ति पाएपछि निजी क्षेत्रले पनि देशमा केही गरेर देखाउने छ ।”
निजी क्षेत्रले लगानी बढाउनासाथ देशमा रोजगारी बढ्ने र नेपाली युवाहरू वैदेशिक रोजागरीमा जाने क्रम घट्ने पनि उनको भनाइ छ । संयुक्त राष्ट्रसंघको प्रतिवेदनअनुसार देशको बढ्दो बेरोजगारी सम्बोधन गर्न नेपालले प्रत्येक वर्ष ५ लाख ५० हजार रोजगारीको अवसर सिर्जना गर्न आवश्यक छ । त्यो क्रम बढ्दै गएर सन् २०२० सम्म प्रत्येक वर्ष ६ लाख ३३ हजार युवा बेरोजार हुने अवस्था रहेको प्रतिवेदनले जनाएको छ । रोजगारी सिर्जनाका लागि मुलुकभर समानुपातिक रूपमा विकास निर्माण तथा आर्थिक गतिविधि सिर्जना गरिनुपर्छ भने लगानीका लागि निजी क्षेत्रलाई उत्प्रेरित पनि गरिनुपर्दछ ।
संघीयताका कारण काठमाडौंकेन्द्रित अर्थतन्त्र विस्तारित भएर पक्कै प्रदेशमा धेरै नै रोजगारी सिर्जना हुनेछ । संयुक्त राष्ट्रसंघीय विकास कार्यक्रमले प्रकाशित गरेको नेपाल मानव विकास सूचकांक २०१४ अनुसार कुल गार्हस्थ्य उत्पादनमा जिल्लागत रूपमा हेर्दा काठमाडौंको योगदान १५.८ प्रतिशत छ । काठमाडौंपछि समग्र अर्थतन्त्रमा दोस्रो धेरै मोरङको ३.९ प्रतिशत, बाराको ३.३ प्रतिशत, झापा र रुपन्देहीको ३.२ प्रतिशत योगदान छ । यस्तै, कुल गार्हस्थ्य उत्पादनमा ललितपुरले २.९ प्रतिशत, सुनसरीले २.७ प्रतिशत, कास्कीले २.५ प्रतिशत, नवलपरासी र पर्सा जिल्लाले २.४ प्रतिशत र सबैभन्दा कम मुगुले ०.२ प्रतिशत एवं हुम्ला, डोल्पा, मुस्ताङ र मनाङको बराबरी ०.१ प्रतिशत योगदान छ । प्रादेशिक विभाजन गर्दा आर्थिकभन्दा राजनीतिक विषयलाई बढी महत्व दिइएकाले सबै प्रदेश र प्रदेशभित्रका एकाइहरूबीच समान आर्थिक अवस्था छैन । त्यसैले, देश अव संघीयतामा गइसकेपछि आर्थिक रूपमा सबल प्रदेश निर्माण गर्नुपर्ने दायित्व पनि राजनीतिक दललाई थपिएको छ ।

Nepal's GDP will grow significantly through power trade: Report

Nepal's gross domestic product (GDP) could reach to Rs 13,100 billion (over $120 billion) in 2045, which is 39 per cent more than with existing trading mechanisms, with accelerated power trade (APT) between India and Nepal, according to a report.
The report, 'Economic Benefits from Nepal-India Electricity Trade,' released here today, also states that the growth in GDP is driven in part by the three-fold increase from Rs 310 billion in 2030 to Rs 1,069 billion in 2045 in revenue earned from electricity trade.
However, Nepal needs to invest up to Rs 2,596 billion in between 2012 and 2030 and another Rs 2,216 billion in between 2031 and 2045 to harness electricity of this quantum, the report added.
Highlighting the key findings of the report, chairman of Integrated Research and Action for Development (IRADe) – which conducted the study – Kirit Parikh said that the increased power trade will also fuel Nepal's per capita electricity demand to jump from the current 139 kWh/year to 1,500 kWh/year by 2045.
The report attributes it to increased domestic hydropower production that is 34.4 Gigawatt (Gw) in 2045. "Per capita electricity demand reflects strongly on the Human Development Index (HDI) of a country as increased access to electricity is directly linked to better quality of life," it added.
Nepal’s per capita electricity consumption stood at a low of 139 units per year in 2012, as against South Asian average of over 600 units and global average of around 2,800 units.
The first of its kind study was conducted by the India-based research institute IRADe under the fourth phase of the South Asia Regional Initiative for Energy Integration (SARI/EI) Programme. SARI/EI is a United States Agency for International Development's (USAID) programme that works to promote cross-border electricity trade for revitalising and accelerating regional economic development in South Asia.
Member of National Planning Commission (NPC) Swarnim Wagle, Chargé d'Affaires at the US Embassy in Kathmandu Michael Gonzales and second secretary at the Indian Embassy in Kathmandu Mala Narendra, released the report amid a function here today.
The report analyses the potential of cross-border electricity trade (CBET) between Nepal and India, and its feasibility and impact on the economy, power systems and power infrastructure of both countries.
Wagle, on the occasion, said that the report will be useful for the NPC while preparing periodic plans. "Electricity trade and hydropower development can significantly energise Nepal's economy and can help in the process of industrialisation," he said, adding that both the countries stand to gain from India-Nepal electricity trade. "Bangladesh and other South Asian countries also stand to reap benefits from the power trade."
Saying that power shortage is the biggest binding constraint to Nepal’s economic growth," he further added that Nepal can revive the manufacturing sector, if it can generate more electricity. "This could absorb youths, who want to move away from subsistence agriculture, reducing outflow of workers to various labour destinations."
He also opined that abundant supply of clean and reliable power through hydro sources will not only drive economic development but also improve the country’s ranking in HDI.
Nepal, home to around 6,000 rivers, rivulets and tributaries, has the potential to generate over 40 Gw of electricity through hydropower plants. But as of now, the country’s installed capacity stands at less than 1,000 MW, whereas peak demand stood at around 1,385 MW in the last fiscal year.
There is a big gap in demand and supply of electricity because Nepal has not been able to build relatively bigger hydropower plants since 70MW Middle Marsyangdi Hydroelectric Project, located in Lamjung, came into operation in 2008.
Nepal has now set an ambitious target of generating 10 Gw of electricity through hydro resources in the next 10 years, which, many say, is achievable.
However, Nepal will not be able to take advantage, if there is a delay in capacity addition. For instance, if project implementation is delayed by five years, not only will the country lose the earnings from power exports in that period, it will also have to pay for the power that it imports until the projects are implemented, the report reads, adding that the country will be net importer of electricity and will have to spend more to purchase power, if project implementation is delayed. Currently, the country has been importing around 450 MW of electricity from India to manage its power deficit. However, Nepal has planned to export electricity to India and gradually to the regional power market from the fiscal year 2021-22.
The country will require around Rs 2,596 billion to develop 18.6 Gwof power by 2030 and Rs 4,812 billion to exploit 34.4 Gw of hydropower potential, according to the study. "Nepal itself has huge possibility to increase consumption, as the share of electricity in the total energy demand of the country is merely two per cent."
Based on the IRADe-System for Analysis of Power Trade and Economic Growth (I-SAPTEG) modeling system, the research uses five models – three power system models and two macro-economic models to capture the impacts of electricity trade in India and Nepal under three scenarios – trade, business as usual and delayed capacity addition.
The study assesses potential power trade and the price of tradable electricity in between 2012 and 2050 consistent with the country’s macroeconomic framework. It also quantifies and analyses socioeconomic benefits of cross-border electricity trade arising from investment, export revenue and reduced electricity price between Nepal and India.
Similarly, on the occasion, Gonzales said that Asia, which is the fastest growing region in the world, lacks reliable power infrastructure. "With optimum utilisation of resources and a coherent regulatory framework in place, better regional integration could be achieved through CBET," he said, adding that the report rightly points out Nepal can gain tremendously from CBET. "For India, the benefits are more in terms of lower electricity system costs due to electricity imports from Nepal." Additionally, the import of hydropower electricity from Nepal will reduce carbon emissions of the power sector in India as the country's electricity generation is largely coal-based," he added.
Calling the findings of the report 'a win-win opportunity for both India and Nepal,' Mala Narendra said that India was committed to cross-border electricity trade in South Asia.
"To facilitate this, India's Ministry of Power in consultation with Ministry of External Affairs recently issued the 'Guidelines on Cross Border Trade of Electricity',” she added.
However, experts have been claiming that the guideline is against the ethos of Power Trade Agreement (PTA) signed between Nepal and India.
On the occasion, Jyoti Parikh of IRADe said that the power systems of the two countries are linked for different periods – peak and off-peak hours – to capture the compatibility for trade in the model which gives very different insights. "Our aim was to see, if Nepal too can follow Bhutan's example in transforming its economy," she said, adding that the primary objective of the study is to provide critical research on the viability and advantages of CBET so as to assist policy-makers in making strategic decisions.

Public participation in hydro projects to help Nepal graduate from LDCs status

Locals of Rasuwa district have added assets worth Rs 4,439 per head in an average, apart from cash dividends in the last three fiscal years thanks to Chilime Hydropower that floated shares to the locals in 2010.
The distribution of wealth by Chilime Hydropower in Rasuwa — ranked 40th in the Human Development Index among the 75 districts in the country — will not only help the district climb up the ladder in the index but also come out of the poverty trap.
The 22.1 MW Chilime Hydropower project had floated 960,000 units of ordinary shares at a face value of Rs 100 per unit to the locals of Rasuwa district, where it is located.
The first indigenous hydropower project that has been constructed with domestic capital and technical know-how had then distributed 60 per cent cash dividend from the profit of fiscal year 2009-10; 30 per cent cash and 40 per cent stock dividend from fiscal year 2010-11’s profits; and 20 per cent cash and 30 per cent stock dividend from the profit of fiscal year 2011-12 to its shareholders.
The locals have received a total of Rs 1.92 billion stock dividends at current market prices and Rs 113.28 million cash dividends in the last three fiscal years.
According to the latest census of the Central Bureau of Statistics (CBS), Rasuwa has 9,778 households, with a total population of 43,300, which means today each individual shareholder of Rasuwa has Rs 4,439 worth of assets in the form of Chilime Hydropower’s stocks.
The Chilime model of hydropower development — that has been replicated at the Upper Tamakoshi Hydropower — is the best example of wealth creation and distribution through capital market, according to market analyst Rabindra Bhattarai.
However, it took the government and Nepal Electricity Authority (NEA) — one of the key promoters of Chilime Hydropower — almost 10 years to replicate the model that has proved to be an effective instrument to alleviate poverty.
"Locals should be involved and get shares not only to boost local growth but also to develop and exploit hydropower that has tremendous potential to help Nepal graduate from the current Least Developed Countries (LDCs) status to Developing Country club, by distributing wealth through public participation," according to president of Federation of Nepalese Chambers of Commerce and Industry Suraj Vaidya.
"The government is planning to graduate Nepal from the LDCs status by 2022 and hydropower development with active public participation will make the dream possible," he said, adding that it will also make locals responsible and the hydropower projects will not face any unnecessary trouble as locals will develop a sense of ownership as is happening with the Upper Tamakoshi Hydropower project.
Dolakha, which is ranked 37th in the Human Development Index, will be the next district to climb up the ladder in the index as the 456 MW Upper Tamakoshi Hydropower project is going to change the future of not only the district but also of the country by boosting energy supply.
The hydropower project which is under construction with active participation of locals will be completed by April 2016. It has completed around 50 per cent of construction and is planning to float shares worth Rs 3.60 billion soon to locals of Dolakha district and NEA, besides employees of lender agencies like Nepal Telecom, Employees Provident Fund, Rastriya Beema Sansthan and Citizen Investment Trust in the first phase, according to the hydropower company that will float shares worth Rs 1.58 billion to the general public in the second phase.
Energy is the key priority in the budget for next fiscal year, according to finance minister Shankar Koirala, who was once the energy secretary too.
Energy is the engine of growth, he said, adding that the budget will concentrate on energy also to reverse the trend of import-based economy to export-based economy, which is not possible without enough power supply for industrialisation.
"Hydropower projects — if attracted to capital market with incentives through budget — will not only help supply energy but also help reduce poverty," said expert member of the Securities Board of Nepal (Sebon) Dr Rewat Bahadur Karki.
Currently, there are only four listed hydropower companies — National Hydropower, Butwal Hydropower, Chilime Hydropower and Arun Valley Hydropower — at Nepal Stock Exchange (Nepse). But the secondary market will have two more companies — Upper Tamakoshi and 22-MW Sanima Mai Hydro — soon as Sanima Mai has already floated 1,055,000 units of shares at a face value of Rs 100 per unit making it a total of Rs 105.5 million to the locals recently.
The increasing number of listed hydropower companies will also help the capital market expand, apart from helping in poverty alleviation.
According to the amended Securities Registration and Issuance Regulation – 2065, hydropower companies must float shares to locals before they open their issue to the general public. "A company has to float a minimum of 30 per cent shares to the public and out of the 30 per cent, five per cent has to be separated for the company’s staff, 10 per cent for locals and the remaining for the general public," states the amended regulation that has fixed a lock in period of three years for shares distributed to locals.

Nepal features in low human development group, ranks 157 in HDI 2013

Almost half of Nepal's population is living under multidimensional poverty, according to a UNDP report released today globally.

The 2013 Human Development Index's (HDI) Multidimensional Poverty Index (MPI) — an alternative to income-based poverty estimates — revealed that some 44 per cent Nepalis are living under multidimensional poverty.

The UNDP today released its 2013 Human Development Index (HDI) along with report – that has ranked Nepal at 157^th position – that has ranked 186 countries in terms of economic and human development indicators. Nepal’s ranking has been unchanged since last report that was published in 2011.
"In South Asia, Sri Lanka is in the high human development group, three countries — Maldives, India and Bhutan — are in the medium and the remaining four — Bangladesh, Pakistan, Nepal and Afghanistan — are in the low human development group," it revealed.

Although South Asia has reduced the proportion of the population living on less than $1.25 a day from 61 per cent in 1981 to 36 per cent in 2008, more than half a billion people there remained extremely poor, the report added. The multidimensional poverty is high throughout South Asia, with the highest rates in Bangladesh (58 per cent), India (54 per cent) and Pakistan (49 percent)," it added.

Nepal, however, has the biggest gap due to inequalities at 34.2 per cent in the region followed by Pakistan at 30.9 per cent. Similarly, Sri Lanka has the least gap of 15.1 per cent in the region.

"Likewise, child labour is relatively high in Nepal, where more than one-third of children of ages five to 14 years are economically active and the lowest is observed in India at 12 per cent," it stated.

The South Asia region’s average employment-to-population ratio stands at 61.2 per cent, below the world average of 65.8 per cent. But Nepal has 86.4 per cent employment-to-population ratio, said the Report — 'The Rise of the South: Human Progress in a Diverse World' — that analyses more than 40 developing countries that have made striking human development gains in recent years. It attributes their achievements to some strong national commitments: better public health and education services, innovative poverty eradication programs and strategic engagement with the world economy.

"The rise of the South is unprecedented in its speed and scale. Never in history have the living conditions and prospects of so many people changed so dramatically and so fast,” said the report, which uses the term 'the South' to denote developing countries and 'the North' to denote developed countries. "By 2030, more than 80 per cent of the world’s middle class will live in the South and account for 70 per cent of total consumption expenditure. The Asia-Pacific region alone will host about two-thirds of that middle class."

The South as a whole is driving global economic growth and societal change for the first time in centuries,” according to UNDP administrator Helen Clark.

New ideas and entrepreneurship are coming from the South and will be the defining movers of the 21st century,” said UNDP regional director for Asia and the Pacific Ajay Chhibber. "In our changing world, solutions are moving across the South, not just from the North to the South."

The new middle class in the South is driving economic, social and political expectations. Increasingly, the most important engine of growth for developing countries is their domestic market. By 2025, annual consumption in emerging markets is estimated to rise to $30 trillion. By then, the South will account for three-fifths of the one billion households earning more than $20,000 a year, creating a new global middle class, the report added.

 

South Asian ranking
Sri Lanka – 92 (High Human Development)

Maldives – 104 (Medium Human development)
India – 136 (Medium Human development)

Bhutan – 140 (Medium Human development)

Bangladesh – 146 (Low Human Development)

Pakistan – 146 (Low Human Development)

Nepal – 157 (Low Human Development)

Afghanistan – 175 (Low Human Development)

(Human Development Index 2013)