Cover Story (Spotlight Weekly)

Sustaining Is The Challenge

Initiatives taken in the last eight years have shown that participation of people and proper policy can bring about substantial result in the development process. Lesser the government intervention, better the possibility for effective and sustainable development. This is what the country has learnt following significant reduction of poverty level. Nepal Living Standards Survey II published by the Central Bureau of Statistics (CBS) has revealed that there has been an overall reduction in poverty level. Despite frequent changes in the governments, political violence and near anarchy, Nepal has shown that level of poverty could be reduced because of popular participation of people, donors' contribution and lesser intervention by the government. In the changed circumstances, the government as well as the development partners need to ensure that the support to poorest section of the country is not hampered. Otherwise, the progress made could be scuttled

By KESHAB POUDEL

Maili Tamang, 45, a resident of Barpak village of Gorkha district had to walk for a couple of days before she could reach Prithvi Highway to board a bus till a few years ago. For Maili’s son and daughter, attending school was beyond imagination.

A hilly village : Witnessing transformation

But now despite the intensification of the violent insurgency and threat to life, Maili can board a bus after walking for few hours from her residence (by reaching to Arughat) and there is also a primary school in a walking distance and high school in the next village. A health post nearby her house provides primary medical facilities and solar power supplies the electricity.

Known as a remote village that is located on the way to Ganesh Himal, 150 miles North West of capital, Barpak has transformed in a few years time into a relatively accessible village equipped with most of the facilities like drinking water, solar power, high school, health posts and others.

Till a decade ago, such facilities were only limited to few urban areas. “I saw electric lamps, hospitals and buses for the first time when I was 25 and when my husband took me to Kathmandu,” said Maili. "My ten-month-old grandson was born in the district hospital in Dhadingbesi, the district headquarters of Dhading, which is closer. Had there been no insurgency, our village would have achieved much more.”

Barpak is not the only village to witness such transformation. According to NLSS II, only 37 percent of households have paved road within 30 minutes, while 27 percent have to travel for 3 hours or more and 68 percent have access to vehicle passable dirt road within 30 minutes. Access to impassable dirt road is almost universal.

Agro-scientists : Working for better yield

Like Maili, many other rural people of the country also have easy access to facilities. Ninety-one percent of households in Nepal are within 30 minutes of access to a primary school. In urban areas, almost all household (99 percent) are within the reach. The population of plain has somewhat better access compared to their hill and mountain counterparts.

Despite increasing health facilities, only 62 percent of households in the country are within 30 minutes reach of primary health center. The situation is much better in urban areas than the rural parts of the country. The access to the drinking water facility has also changed. More than 98 percent households are within 30 minutes of these sources.

Remarkable Achievements

The study report Nepal Leaving Standards Survey (NLSS) 2003/04, indicating remarkable achievements in the area of poverty alleviation and infrastructure development in the last eight years, reveals the importance of participation of people to decide their own future course. Based on the last eight years of performance of the development results, Nepal Living Standards Survey (NLSS) 2003/04 reveals that Nepal has made enormous progress in infrastructure building and poverty alleviation during the period despite insurgency and instability.

In the study period of 1995/96 to 2003/04, the report showed interesting progress. Although the country's politics was mired by violent insurgency and instability with eight different prime ministers assuming power, the country’s development and progress went on smoothly.

Conducted by the Central Bureau of Statistics (CBS) as a follow up to the first NLSS 1995/96, the NLSS II enumerated 3912 households. The study estimates that 92 percent of households reside in their own housing units; this constitutes only a 2 percentage points decrease from 1995/96. The proportion of renters has increased from 2 to 5 percent in the last eight years. Similarly, household’s access to electricity and piped water has increased from 14 to 37 percent and from 33 to 44 percent respectively. Almost 39 percent of households now have toilet facility in their own dwelling, compared to 22 percent in 1995/96.

Between 1995/96 and 2003/04, access has improved almost universally across all types of facilities. Household’s access to primary schools within 30 minutes (of travel time) was already high eight years ago, and now stands at 91 percent. By this measure, proportion of households with access to health post/hospitals has increased by 17 percentage points and cooperatives and agricultural centers by 8 percentage points each. Similarly, access to commercial bank increased by 7 percentage points, market center by 10, Haat Bazaars by 20, paved roads by 13, vehicle passable dirt-roads by 10 and bus stops by 20 percentage points during the same period.

Highway traffic : Increasing connectivity

Education sector has seen major transformation in the period. According to the report, almost all education indicators show a very noticeable improvement between 1995/96 and 2003/04. Overall adult literacy rate has increased by 12 percentage points. Proportion of population aged 15 years and above that ever attended school was 34 percent in 2003/04. Primary school net enrollment ratio increased from 57 to 72 percent, lower secondary school from 9 to 15 over the last eight years.

In the health sector also there is a major achievement. From immunization to other health matters there have been significant changes. According to the finding, the proportion of fully immunized children has increased remarkably from 36 to 59 percent. The proportion of diarrhea episodes in acute cases has decreased by 6 percentage points during the same period.

In the maternity and family planning front, the report reveals major success. The report shows that the number of children ever born per 15-49 year old woman has decreased from 2.6 in 1995 to 2.4 in 2003/04 while total fertility rate declined from 5.1 to 3.6 during the same period. The proportion of women (15-49 years) who have knowledge of at least one family planning method has increased by 17 percentage points. NLSS II estimates the proportion of women receiving prenatal care at 57 percent and those receiving post-natal care at 13 percent.

“Central Bureau of Statistics conducted Nepal Living Standards Survey 2003/04 (NLSS II) as a follow up survey of NLSS 1995/96 (NLSS I). The survey followed the Living Standards Measurement Survey (LSMS) methodology developed at the World Bank,” said Tunga Shiromani Bastola, director general of Central Bureau of Statistic in his introduction. “This report provides many useful insights into trends and levels of various aspects of socio-economic situation in Nepal in the last eight years.”

Then And Now

Fifty-five years ago when King Tribhuwan landed in Kathmandu with the proclamation of democratic government and end of the century-old Rana rule, the country’s overall scenario was so poor that Nepal’s development partners did not know from where to start the process of change. The NLSS II report reveals now that the country has made tremendous progress while pointing out the areas where it needs to work further to improve the situation.

This progress was made when the country’s overall political situation was unstable and there were 10 prime ministers in just a decade. Furthermore, the violent insurgency intensified to the rural parts of the country paralyzing almost all local institutions.

“Today, Nepal stands at the crossroads between a brighter future that promises more sustained poverty reduction and the possibility of the country becoming mired in a more protracted internal conflict. During the past few years, the insurgency has escalated sharply, involving an open conflict with the army since November 2001. This combined with external developments, has undermined the economy and weakened the country’s fiscal position. Despite the many positive changes Nepal has seen since the advent of multi-party democracy in 1990 and the first wave of economic liberalization measures in the early 1990s, the recent developments have highlighted the stark and worsening inequities in Nepal, not only in terms of incomes, but also of the fundamental ability of the Nepalese citizen to participate in social and political decision making processes,” writes The World Bank’s Nepal Country Assistance Strategy 2004-2007.

Role of Remittances in Rural Areas

With approximately 85 percent of the total population living in rural areas, poverty is largely a rural phenomenon in Nepal. Since large number of Nepalese have gone abroad for jobs, it has changed the overall income pattern in the rural areas. According to the NLSS II, the proportion of households receiving remittances has increased from 23 percent in 1995/96 to 23 percent in 2003/04. The amount of remittance received has increased from Rs.13 billion to more than Rs.46 billion in nominal terms - while per capita remittance for the entire country has more than tripled in nominal terms between two rounds of NLSS.

Community meeting : Participatory approach

The report also indicates that average households income in the period has increased considerably. According to the report, in nominal terms, average household income grew by more than 80 percent from 1995/96 to 2003/04. During the same period, per capita income increased from Rs.7,700 to Rs.15,162. Eight-year growth rate for the poorest twenty of population is 98 percent while that for the richest twenty percent of population is 110 percent. Other significant changes observed in the past eight years is the composition of income sources: the share of farm income in total income has declined from 61 percent to 48 percent while that of non-farm income increased from 22 to 28 percent and other sources including remittances increased from 16 to 25 percent.

Along with the increase in the annual income, there was also change in the per-capita consumption. The report reveals that in nominal terms, per capita consumption has increased from Rs. 6802 in 1995/96 to Rs.15, 845 in 2003/04. According to the report, growth in per capita consumption is 91 percent for the bottom quintile of the population and 177 percent for the top quintile over the last eight years: an impressive growth across all population groups.

But there are persistent gaps in the consumption pattern. The report shows that in 2003/04, the bottom twenty percent of the population accounted for a mere 6 percent of total consumption while the richest twenty percent of the population a whopping 53 percent. A large gap in consumption share across population groups has become even worse during the past eight years. There are also disparities in income growth rate. The growth rate of poorest twenty percent of population is 98 percent while that for the richest twenty percent of population is 110 percent.

Looking Back

Nepal has made major strides in the last fifty years. According to "Half-a-Century of Development, the History of U.S Assistance to Nepal 1951-2001": the legacy of Rana regime was highly centralized government administration whose functions were primarily confined to maintaining law and order and collecting taxes; a subsistence economy and overwhelmingly dependent on agriculture and controlled by large landowners preoccupied with maintaining the status quo and near-total lack of physical infrastructure, including roads, telecommunications, hospitals, and schools; there were very few skilled personnel capable of formulating and directing policies appropriate for Nepal’s new identity. The literacy rate was just two percent with only 300 college graduates in the entire country. There were less than 400 kilometers of road and life expectancy was below 40.

Nepal Human Development Report 2004, published by the United Nations Development Program (UNDP), also shows that there were 321 primary schools and 11 high schools that constituted the whole of its public educational establishment with 2 percent of literacy in 1951. By 2002, the literacy rate had surged to 54 percent, the number of primary schools to 25,927 and the lower secondary schools to 4,350.

Although some significant progresses have been made in the last fifty-five years, there are still many more that needs to be done to fully alleviate the poverty. With the drastic progress in many areas, the poverty is said to have declined from 40 to about 30 percent even as Nepal continues to follow reform process and encourage people’s participation.

Agriculture Sector

Karpuri Yadav, 54, a farmer from Gaushala village of Mahottari district, has never imagined that his family income can increase in such a manner through the production of tomato and other cauliflower. Combined with the remittances sent by his 28-year-old son who works in Malaysia, Yadav’s income has seen significant improvement.

Despite frequent general strikes and uncertain market, Yadav annually sells Rs. 100,000 worth of tomatoes and other vegetables. Till a decade ago, farmers like Yadav did not realize that their land could be used to grow anything other than traditional products like rice, wheat and maize. Likewise, it was beyond his imagination that he could have supplementary income from remittances.

From remittances to the marketing of high value crops, farmers in the remote parts of the country have reasons to celebrate the changing trends.

Despite the increase of income of farmers like Yadav, there is still a long way to go to see the change in the lives of millions of farmers who are still poor. According to the report, the percentage of agricultural households has decreased from 83 in 1995/96 to 78 in 2003/04. Thanks to the increase in the proportion of irrigated land from 40 to 54 percent, the country’s overall production has improved.

“Agriculture is the key to Nepal’s high growth and poverty reduction. Although the share of agriculture in GDP has fallen from 65 percent to 40 percent in the past three decades, the sector employs more than two thirds of Nepal’s labor force and offers a primary shelter to some 300,000 new entrants to this force every year,” writes Dr. Hari Krishna Upadhyaya, member of National Planning Commission. “Poverty is widespread in Nepal. An estimated 38 percent population lived below the national poverty line in 1995/96. Preliminary results of second NLSS indicate a very significant decline in poverty level – around 30 percent or even less by 2003/04.” (See Spotlight January 14-20)

A primary sochool : Growing reach

The growth in the agriculture sector and its contribution to the reduction of the poverty cannot be undermined. Many small and marginal farmers in the rural parts of the country with access to road are moving from the traditional types of crops to off-season crops. Next to Kathmandu Valley, the farmers in Sankhu village of Kavre district have also shown how their village was transformed from a subsistence-based agriculture society to budding orange grower. The road, market and population and growing urban market encourage farmers to switch their farming to cash and market-oriented crops. With the growth in more orange, farmers' annual incomes have shot up.

“We have seen broad-based economic growth as the rural activities have increased. Diversification and commercialization of agriculture and infrastructure development including irrigation and road helped a lot,” said Dr. Shankar Sharma, vice chairman of National Planning Commission (NPC). "Most important aspect is remittance. For the foreseeable future remittances will continue to play a major role in reducing the poverty.”

Nepal is celebrating fifty-fifth democratic day this week noting the King and people’s joint effort to deliver the fruit of democracy to all. Nepal’s democracy is a product of joint struggle and sacrifice between the King and the political parties, which represent the people through periodical elections.

Role of Nepal’s Development Partners

Pipe of drinking water : Rural infrastructure

Nepal’s development partners have played important role in the success being achieved in the development and poverty alleviation front. Thanks to their uninterrupted support, many rural people are able to secure the basic facilities including health, education, drinking water as well as other services.

After the recent royal proclamation and the changing political scenario, how donors will play their role remains to be seen. Their decision to suspend any program will harm the poorest of the poor of Nepal. If donors do stop funding immunization, many children will die. In this very difficult and different scenario and given the donors' commitment to democracy and human rights, how they will find the middle way to continue supporting the poor remains to be seen.

However, if there is any interruption on their funding, the first victim will be poor people of Nepal and not any particular political party or political force. People of Nepal must not be hurt - this should be the bottom line before the donors take any decision.

In the changed political scenario, Nepal also faces difficult challenge of not only maintaining the achievements made in the previous ten years but also continuing to encourage the people to take part in the development programs.