Economic Survey

Year after year, the Economic Survey paints a bleak picture of our development endeavors. It wasn’t different this year either. The Gross Domestic Product grew to 960 billion rupees and the per capita income of Nepalis jumped to US$ 473. But these statistics only belie the states’ ineffectiveness, severe stagnation in many key areas and grinding poverty. Experiences throughout the world show that a poor country like Nepal cannot significantly reduce poverty and improve the living conditions of its people unless there is a sustained growth rate of about 6 percent for over several years. But Nepal’s overall growth rate dipped this year to 3.9 percent, down from 5.3 percent last year, shattering our hopes of back-to-back growth years.



The growth rates in both agricultural and non-agricultural sectors were sluggish this year, each sector growing at a rate less than last year. The agricultural sector grew by only 2.1 percent as against 4.7 percent last year. Remember that a change in agriculture growth rate is more than just a statistical alteration or a change in the national income. For so many Nepalis, agricultural is the only source of livelihood – they consume what they produce and any monetary income comes from whatever they save after consumption. So, when agricultural produce goes down, it impacts farming families’ way of life; it dampens their ability to send their children to school, to go to hospital when needed and to buy the essential commodities. Add to that, this year’s crushing price rise, which was the highest in the last 17 years. It must have broken the backs of low-income farmers, pushing them deeper into the vicious circle of poverty.



The state’s investment in social sectors is also awfully low. The state failed to add even a single bed in public hospitals during the last fiscal year! Nor was there any increase in the number of health centers, sub health posts and primary health centers – the main health institutions that provide service to the rural poor. The return on government’s investment in drinking water has also declined, according to the survey.



Thankfully, the number of schools grew by 3,223 during the last one year, including 1,704 primary schools.



The lesson of all these: We cannot achieve economic growth and development as long as there is political instability. Let’s not forget that underdevelopment is as much about bad governance as it is about lack of resources and know-how. If we can improve governance, arrest anarchy and promote rule of law, it will create an environment for economic activities while luring public and private investment. We sincerely hope this is where the political parties will expend their energy on in the coming fiscal year.

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