Half a century ago, Nepal ranked as one of the least developed countries (LDCs) standing at the bottom of the global economic pyramid, and in per capita terms, too, it occupied a position far down the line even among the poor. Fast-forward the scene five decades to now, and the country’s relative position in the world, even in South Asian rankings, has not changed much. In absolute terms, however, some improvement has been recorded over the years. Many other countries like Korea and Taiwan were not much different from Nepal in economic development then. But most of them have left it far behind. The available statistics in the past pointed to glaring disparities in income between the few rich and the poor masses. That made things doubly alarming — very low national income co-existing with a situation in which the small highest-income group accounted for the lion’s share of the national cake while the great majority of the Nepalis had to share far less. This gave a clear idea of the general living conditions of an average Nepali. Several regimes afterward, the picture of income distribution, sadly, has not been any brighter.

Statistics show that the rich are growing richer much faster than the poor are getting economically better. According to the Nepal Living Standard Survey (1996 and 2003/04), the average income of the poorest 20 per cent of the population grew by Rs.1,983 over the period, whereas that of the richest 20 percent jumped by Rs.21,161 — a difference of ten times. Consumption has shown a similar pattern. The richest 20 per cent account for 53.3 per cent of national consumption while the poorest 20 per cent have to make do with just 6.2 per cent. Other studies, for instance, the Asian Development Bank survey of 21 countries in Asia between 1999 and 2000 found that Nepal topped the list of relative inequality, ahead of neighbouring Bangladesh, China, and Sri Lanka. Wide income disparities in the poorest countries provide a hot breeding ground for instability and conflict in society.

Nepal exemplifies this — in the ten-year Maoist insurgency and in the still ongoing conflict of class and other interests during the transition period. Domestic and international experts, think tanks and surveys appear to be in general agreement that low national income along with gross distributive injustice constitutes a principal cause of the spectacular rise of Maoism in Nepal. In developed countries, even wide inequalities of income will leave something significant for the poor, because the national pie itself is large. But, in Nepal, where the national pie is very small, wide income gaps leave little for those at the lowest rungs of the national economic ladder. But, the need to enlarge the national cake could not get the priority and seriousness it deserved at the hands of successive governments of whatever ideological hues down the years. And the urgency to narrow the gap between rich and poor was simply ignored — even during the period of Maoist insurgency, and in the present post-Jana Andolan II era.