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Number of urban poor hits 7 million
Although Nepal has made a remarkable progress in reducing poverty over the last two decades, urban poverty has increased sharply in recent years.The statistics show rural poverty has steadily declined in last 15 years, while urban poverty declined in 2005 and then increased sharply by 2011.
While remittance has made a significant impact on reducing rural poverty, the number of urban poor increased mainly due to growing urbanisation, rising migration and lack of inclusive growth, said experts.
UNDP’s Senior Economist Basudeb Guha-Khasnobis said growing migration from the rural to urban areas resulted in a rise in urban poor. “The migrated population bound for cities with limited employment are leading to urbanisation of poverty,” said Khasnobis at a programme on “Poverty in Asia: A Deeper Look Disseminating Key Indicators 2014” here on Thursday.
According to Khasnobis, Nepal’s poverty alleviation and growth rates are similar to those of Pakistan. “Both Nepal and Pakistan reduced absolute poverty (below $1.25) significantly, with the slowest growth in per capita GDP,” he said. “Despite slow growth rate, Nepal has been able to reduce the income inequality along with the rise in spending on social security.”
As basic needs change over time and consumption structure differs from region to region, particularly for fast-growing Asia, Asian Development Bank’s (ADB) Principal Economist Guanghua Wan stressed on the need for estimating/updating a regional poverty line for Asia.
“The Asian poverty line should be estimated at $1.51 per capita per day using 2005 base price than the currently used measure of $ 1.25 per capita per day,” said Wan, attributing the change to economic transformation, growing food prices and increasing vulnerability of the people residing in the region.
“Due to the high rate of inflation in food items, change in consumption pattern along with the increasing vulnerability due to climate change mainly in the Asian countries, the actual number of extreme poor people should be more than what the official data shows,” said Wan.
He added poverty reduction would remain a major challenge for the development of Asian countries for the next decade.
The ADB report between 1980 and 2013 shows people suffered mostly by flood and storm and were forced to live under the poverty line. “Beyond economic growth, addressing vulnerability to risks and food insecurity must be a part of anti-poverty strategies,” Wan said.
Baikuntha Aryal, joint-secretary at the Ministry of Finance, said there is a need for assessing poverty through vulnerability. “Besides, entrepreneurial approach could be an effective way to reduce poverty, which involves helping poor people involve in micro-enterprise along with increasing their linkage to the market and developing value chain,” he said.
Economist Bishwambhar Pyakurel stressed on the need for reducing poverty through inclusive growth, rather than focusing on high economic growth and remittance. “There is a need for devising separate policies for the poor living in different areas to address their issues effectively,” he said.