|
Nepal is
a developing country with an agricultural economy. When it
was newly opened to the world in the early 1950s, experts
described the economy as 'pre-feudal'. Today, farming is the
main economic activity - 90 per cent of the population consists
of subsistence farmers operating outside the cash economy
- followed by manufacturing, trade and tourism. In recent
years, the country's efforts to expand its manufacturing industries
and technological sectors have achieved much progress. The
chief sources of foreign exchange earnings are merchandise
export, services, tourism and Gorkha remittances. The annual
Gross Domestic Product (GDP) of the country is about US$ 4.3
billion.
|
|
| Agriculture
|
 |
With
eight out of 10 Nepalis engaged in farming, agriculture accounts
for over 40 per cent of the country's GDP. The country is filled
with rolling fields and neat terraces, from the flatlands of
the Terai to the hills. Even the highly urbanised Kathmandu
Valley has large tracts of land outside the city areas devoted
to farming. The staple crop is rice. In the late 1970s Nepal
exported large quantities of rice. Other major crops include
maize, wheat, millet and barley. Cash crops such as sugarcane,
oil seeds, tobacco, jute and tea are also cultivated in large
quantities.
|
|
| Manufacturing
|
|
Manufacturing
and industry account for about 30 per cent of the GDP, up from
about 20 per cent in the previous decade. Most of Nepal’s industry
is based in the Kathmandu Valley and in small towns in the southern
Terai plains. Although the majority of industries are cottage
or small-scale operations, there are several modern, large-scale
factories in the country. Major industries are woollen carpets,
garments, textiles, leather products, paper and cement. Nepal
also produces steel utensils, cigarettes, beverages and sugar.
The
most extraordinary success story of the last few decades has
been that of Tibetan carpets. Nepal exports more than 244,000
square metres of rugs, valued at about US$ 125 million. The
carpet industry alone earns about 25 per cent of the country’s
foreign exchange from exports and employs around 250,000 artisans.
|
|
| Trade |
|
As
Nepal is wedged between China and India, it has acted as an
intermediary between the two countries from early times. Nepal’s
trade is dominated by India and many activities within the country
are Indian-owned or controlled. More recently, it has become
a transit point for goods from Japan, Singapore and Hong Kong.
Foreign
trade is characterised mainly by the import of manufactured
products and the export of agricultural raw materials. The
value of Nepal’s imports in terms of manufactured goods and
petroleum products is about US$ 1 billion, while the value
of its exports is about US$ 315 million. The major exports
from Nepal include pulses, hides and skins, jute and medicinal
herbs.
|
|
| Tourism |
|
The
tourist trade is another source of income for many people. It
provides a market for handicrafts and small-scale businesses
such as lodges, shops and travel agencies that offer job opportunities
such as hotel staff and porters. Tourism used to be the biggest
foreign exchange earner for Nepal at one time. Thanks to the
country’s natural beauty, rich cultural heritage and its range
of sightseeing and adventure opportunities, the tourism sector
has been rapidly expanding since its inception in the 1950s.
A total of 463,684 tourists visited Nepal in 1998, as a result
of which the kingdom earned over US$ 152 million that year.
|
|
| Development
|
|
Developmental
efforts in Nepal are faced with the constant challenges of its
growing population and difficult terrain. Its natural resources
are under heavy pressure. The gulf between the rich and poor
is extreme in Kathmandu. The upper classes wield considerable
power and influence. As existence itself is hard for a large
number of peasants, migration to the cities – the Kathmandu
Valley (where resources are already strained), to the Terai
and India – is on the rise.
The
challenges facing Nepal are immense. Agriculture is the most
important area for development as most people are dependent
on it. However, the topography is a hindrance as reaching
the isolated peaks and valleys where so many people live is
often very difficult. However, education is spreading into
distant valleys and primary schools thrive even in remote
areas. The communications system has improved dramatically
All the major towns are accessible by telephone. Roads continue
to extend further and further into the remote parts of the
country.
As
Nepal’s physical resources such as minerals and unexploited
arable land are very few, development projects support several
hydroelectric power resources.
|
|
| Foreign
Aid |
|
Although
Nepal does have its share of internationally aided projects
that are ill-planned and improperly executed, there are other
projects such as a British agricultural project near Dhankuta
and an Australian forestry project that have seen much success.
|
|
|
