The second edition of the Nepal Living Standard Survey has shown a near-double rise in the annual per capita income of the Nepalis, from Rs.7,690 to Rs.15,162 over a period of eight years. The survey, conducted by the Central Bureau of Statistics (CBS) in 2003/04 with the technical and financial assistance of the World Bank, is a sample survey, not a census, done on a ramdom basis on a tiny part of the population. According to the survey, the annual per capita consumption has more than doubled from the year of the first survey in 1995/96, to Rs.15,848, which exceeds the average per capita income. This growth in spending has been attributed to a sharp rise in the remittances from Nepali workers abroad. The survey also registers a drop of 13 per cent in the share of farm income to total income (from 61 per cent to 48 per cent) while the share of off-farm income has been put at 28 per cent (up from 22 per cent). The share of remittances is shown as having jumped to 25 per cent, from 16 per cent.

Several weeks ago, the CBS had published partial figures of the survey, and now it has given the executive summary; the full survey is yet to be made public. Therefore, the full details of the research methodology employed need to be made public and transparent to enable the people, particularly experts, to judge how reliable and representative the survey may have been of the total population. The survey puts the country’s unemployment rate at just 3.8 per cent (down from 4.9 per cent). If this figure is representative, Nepal may be said to be faring better than many developed countries in job creation. However, the figures released do not shed light on the under-employment problem, which is pervasive in the rural areas. Judging by the increased figure for per capita income, one may think the Nepali economy must be growing at a rapid rate.

This picture of the Nepali living standard might lead one to wonder whether the Maoist insurgency has affected the national economy as much as is often made out to be. However, the widening gulf between rich and poor in both income and consumption gives a fair idea of the plight of the vast majority of the people. An important indicator of the poor economic condition of most Nepalis is that although some 80 per cent of the population depend on agriculture for their livelihood, the contribution of the farm sector to the gross domestic product (GDP) continues to decline. The growth in other sectors has not, however, been able to absorb the excess manpower engaged in agricuture in a big way. Unless this takes place, however much the other sectors may grow in terms of foreign exchange earnings or of their contribution to the GDP, the vast majority will continue to be left out in the cold.