Nepal - Poverty and wealth

Nepal's largely rural population depends on subsistence agriculture for a living. As this is outside the realm of the quantifiable modern economy, the low GDP per capita of US$217 in 1998 may be misleading. Nonetheless, 42 percent of the population lives below the poverty

Exchange rates: Nepal
Nepalese rupees per US$1
Jan 2001 74.129
2000 71.104
1999 68.239
1998 65.976
1997 58.010
1996 56.692
SOURCE: CIA World Factbook 2001 [ONLINE].

GDP per Capita (US$)
Country 1975 1980 1985 1990 1998
Nepal 149 148 165 182 217
United States 19,364 21,529 23,200 25,363 29,683
China 138 168 261 349 727
Bhutan N/A 232 292 387 493
SOURCE: United Nations. Human Development Report 2000; Trends in human development and per capita income.

line (1996), and patterns of income and resource distribution reveal chronic inequalities within a population separated along the lines of the caste system (a hierarchical class system), gender, and place of residence.

Hindus fleeing Muslim invaders in India hundreds of years ago brought the caste system to Nepal. The educational and technological superiority of the Indo-Nepalese migrants allowed them to dominate both the indigenous and Tibeto-Nepalese ethnic groups. The caste system— with its notions of hereditary superiority and traditional rights to power, access, and livelihood—was imposed upon Hindus and non-Hindus. In order of status, the Brahmins (priests) were followed by Chhetris (administrators), Vaishyas (merchants), Sudras (farmers, artisans, and laborers), and untouchables (outcasts and the socially polluted). These divisions are not as sharply defined in the changing Nepal of today where caste has no legal justification, but a 1991 study revealed that 80 percent of civil service, army, and police posts were held by Brahmins and Chhetris of the hills (less than 50 percent of the population). The Newars of the Kathmandu Valley have also occupied an important niche in the political and economic culture of Nepal relative to their numbers.

Not surprisingly, land and income distribution is skewed. A 1983 study indicated that more than 50 percent of landholdings in the Hill region were smaller than half a hectare. In 1990, 75 percent of the families in Nepal earned less than 35 percent of the total national income. The harsh reality behind these figures has forced many in the Hill and Mountain regions to migrate to urban centers, the Tarai, and abroad to seek employment as soldiers, laborers, and domestic help. The burden of poverty is particularly hard on women, and a growing population of Nepalese sex workers in the brothels of India is sad testimonial to this problem.

Although government planning has channeled resources into the health and education sectors, doctors and health care centers are concentrated in urban areas, and rural services are still inadequate. Health services barely cope with widespread malnutrition, gastrointestinal diseases, tuberculosis, and polio. There is a rising incidence of cardiovascular disease in urban centers and a shortage

Distribution of Income or Consumption by Percentage Share: Nepal
Lowest 10% 3.2
Lowest 20% 7.6
Second 20% 11.5
Third 20% 15.1
Fourth 20% 21.0
Highest 20% 44.8
Highest 10% 29.8
Survey year: 1995-96
Note: This information refers to expenditure shares by percentiles of the population and is ranked by per capita expenditure.
SOURCE: 2000 World Development Indicators [CD-ROM].

of trained medical personnel and supplies. Those who can afford it prefer to be treated for serious illnesses abroad. Though many Nepalese are aware of the link between education and socio-economic betterment, regular attendance at school (conventional school is usually the only option; there are no distance/part-time/private tuition type educational courses in the villages) means time away from vital household and farming chores. Primary education is free, but standards in public schools are low, and literacy was still only 45 percent in 1999 among those over the age of 15. A college education abroad is much coveted, and is the prerogative of the rich or the fortunate few who secure scholarships.

So far, government policies have not significantly improved the lot of the poor Nepalese peasant. Programs targeting rural areas often end up enriching local officials and prosperous farmers. Ironically, the "development industry," fueled by foreign aid, has provided income for many in Kathmandu, while conditions remain bleak in the countryside. Governmental neglect of rural areas and ongoing political instability only add to the resentments that are manifest in the violence surrounding the Maoist "People's War" in the country.

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