To assess whether Nepal is aid-dependent, we could compare the aid it receives with the aid received by other countries. A more equitable approach would be to compare aid received as a percentage of Gross Domestic Product (GDP) or Gross National Income (GNI). This ratio accounts for the size of economies. A dataset from the World Bank is available on GapMinder that compares foreign aid received as a percentage of GNI. I mapped this data for the year 2010, the most recent year in its dataset.Each bubble represents a country and all countries (61 in total) shown in the map (pictured alongside) receive more aid as a percentage of GNI than Nepal. In the map, the size of the bubble is proportional to the percentage of aid received. Only 61 (instead of all countries) are represented on the map to reduce clutter. Foreign aid as a percentage of GNI shall be referred to as "proportional foreign aid" to simplify its reference. If 60 countries in the world receive more proportional foreign aid than Nepal, does that still make Nepal an aid-dependent country?
It may be argued that data points for a single year may not convey the full story. So, let us look at the historical trend of foreign aid as a percentage of GNI to Nepal from 1960 to 2010. In these 50 years, the proportional foreign aid to Nepal increased from 1.70 percent in 1960 to 14.10 percent in 1989. Surprisingly, proportional foreign aid declined after 1989 and has been declining ever since.
Since 2002, foreign aid contribution to Nepal's GNI has remained steady around five percent. From 2000 till 2010, foreign aid accounts for only 6.02 percent of Nepal's GNI. Since total foreign aid accounts for only six percent of GNI since the start of 21st century and 60 other countries in the world receive more proportional foreign aid, it would be incorrect to say that Nepal is aid-dependent.
If ABC News is open to suggestions, it would be more factually correct to claim that Nepal is becoming increasingly dependent on remittances. The amount of remittance more than doubled from US $1,387 million in 2006 to US $2,811 million in 2009. On average, remittance is increasing by 25 percent every year since 2006. Similarly, the remittance amount is significantly larger than the total foreign aid. In 2006, remittance was more than twice the foreign aid and has been increasing rapidly. In 2010, remittance share was more than four times the total foreign aid.
While foreign aid accounts for 5.1 percent of GNI, remittance accounts for 20.5 percent (for 2010). In other words, Nepal is increasingly dependent on Nepalis working abroad and sending money home than on foreign aid.
Now that we know that foreign aid accounts for a very small fraction of GNI, much smaller than remittance, let me examine the second question: Can I trust ABC news? ABC News is owned by the Walt Disney Company. Yes, it is the same company that makes animated films for children. ABC News is also best recognized for featuring television shows than news. Like a used college textbook, ABC News has been bought and sold multiple times. ABC started as a struggling radio station in 1943, was sold to United Paramount Theaters in 1951, then again to Capital Cities Broadcasting in 1986 and yet again to Disney in 1995. The fact that it is owned by Disney does little to augment its journalistic spirit. While it accuses Nepal of being aid-dependent, it suffers from being overly dependent on advertising revenue.
According to the estimates from the market research firm of Veronis Suhler Stevenson, advertising accounted for about 84 percent of overall network television revenue in 2012, with income from online and mobile platforms accounting for another 12 percent and re-transmission fees of four percent.
According to Kantar Media, ABC World News derived US $130 million from ads in the first three quarters of 2013. Since ABC has multiple ventures (news, TV shows) and is owned by Disney, the annual reports list earnings of Disney as a whole but does not break it down by its subsidiaries. However, if television networks in the US derive 84 percent of their revenue from advertising, it is safe to assume this applies to ABC as well.
So we request ABC News which is dependednt on aid for survival to treat Nepalis with dignity and respect. Yes, our country is economically poor but we choose to live with dignity, regardless.
The author holds a Bachelor of Science in Engineering Science (Electrical) from Trinity University, San Antonio, Texas
Twitter: @digitalsubway
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