Pitamber Sharma

  • Foreign aid has strengthened our sense of helplessness
Pitamber Sharma

May 18, 2014-

The Nepal Human Development Report 2014, jointly released on Thursday by the National Planning Commission and the United Nations Development Programme, broadly states that while Nepal has made some progress in human development and narrowing inequalities, the pace of development has not been as expected. Nepal’s Human Development Index, a composite statistic of life expectancy, income and education, has improved but inequalities between ethnic groups, geographical regions, genders and urban-rural areas remain. Akhilesh Upadhyay and Pranaya SJB Rana spoke to Pitamber Sharma, noted scholar and lead author of the Report, about its focus on spatial inequalities, the lessons Nepal’s planners could take and the role foreign aid has played—or has failed to play—in the country’s development.

How is the new Human Development Report different from its earlier


Every Human Development Report is different. They are national reports focussed on a theme that is relevant for that time. Nepal is passing through a crucial transition and is trying to institutionalise political and structural changes. Now, the challenge for Nepal is development and accordingly, we have focussed on human capability and human productive ability and through them, we have looked at Nepal’s existing spatial inequality. Human capability is a philosophically rich term but it is very difficult to operationalise. So we looked at capability through productive ability and total factor productivity in various sectors like manufacturing. We also accounted for human Development, poverty and gender.

How will this report help our planners achieve development that is sustainable and inclusive?

This report will help identify priority areas. The Mid- and Far-West have been priority areas for long. We have even made some progress, especially in reducing poverty. There is still much left to be done there but it is time to focus on regions that haven’t received the attention they need, like the Central and Eastern Tarai. These regions have very little social awareness, women’s literacy is low and the status of disadvantaged groups like women, Dalits, Janajati and Muslims is weak. These groups need social mobilisation. It is not enough to simply supply services like health and education, a demand for those services has to also be created.

What suggestions do you have for the government and its planners in addressing these problems?

The problem with our plans is that we fail to monitor our progress in priority areas. We need to be able to see how and why we are making progress, along with our weaknesses. Concerning the human development and social mobilisation of the Central and Eastern Tarai, donors cannot help us here. This is the responsibility of the state. The political parties must also get involved because raising awareness has political implications. Political awareness must reach to the lowest levels; they must reach Dalits and Muslims. Along the way, political awareness must be transformed into social awareness. This can be done most effectively through education.

Previously, the Report divided Nepal into 15 eco-development regions but this time, they have been combined into nine with Kathmandu as a region of its own. Why look at Nepal this way?

The reasons behind dividing Nepal into five development regions and 15 eco-development regions was to help develop specific plans and policies for each region. But we saw that this division was not exactly working. Previous reports had pointed out that inequalities between ethnic groups also had a geographic dimension. Hill Dalits are better off than Tarai Dalits. This was a message that we need to focus more on uplifting Tarai-Madhes Dalits, Janajatis and Muslims. Furthermore, we do not look at Kathmandu separately. The Kathmandu Valley brings up all the indicators for the entire Central region. But this does not reflect the status of Sindhupalchowk’s extremely poor Tamang community. Now, we are looking at Kathmandu separately so we can compare it with other districts. For example, the Valley’s Human Development Index is 70 percent greater than Bajura’s. This helps us look at spatial inequality, to see if it has increased or decreased.

Has inequality increased or decreased?

The level of spatial inequality has decreased but the rate at which it is decreasing is not satisfactory. This report is both sobering and encouraging. It is sobering because inequality remains, the socio-economic status quo continues to maintain and inequalities among different ethnic and caste groups remain. But it is also encouraging because inequalities seem to be narrowing among regions, between urban-rural and between genders. Just not at a rate or pace that we would want. So we need to pursue policies that will hasten this process.

In the past few decades, we have seen a large population gravitate towards the highway belt. Isn’t it time for our planners to look at this big section of the population as a separate demographic?

Yes, it is time. But the problem is that there is a difference between human development and other forms of development. The title of our report is Beyond Geography and this is because there is a geographic dimension to inequality but also that each region, caste and individual has the same right to human development as anyone else. The state has a responsibility to make sure that an individual from Bajura has the same right to reach the standard of an individual from Kathmandu. So we need be thoughtful while allocating resources. We shouldn’t be thinking about how much profit we can make by allocating resources to certain places. The focus should be on allocating resources for human development.

How does Nepal’s human development fare against other comparable countries in South Asia?

We are just above Afghanistan. So we are not performing particularly well. One of the reasons for this is our level of income. Income has to be enhanced through expenditure, investment and productive abilities. In other areas, like Millennium Development Goals, Nepal has made commendable progress. The underlying message of the report is that we are walking on the right path but the pace is not good enough. The rate of economic growth has to accelerate without losing the content of inclusiveness. This means the government will have to spend more on social security programmes that help economic growth.

In your experience, how much have our planners made use of the information, recommendations and data contained in reports like these?

There is no shortage of ideas in Nepal but there is a shortage of workable ideas. It is a matter of shame that we are a poor country and we go around begging from donors. Our ministers are proud of bringing in funds from donors. But these funds are very rarely fully spent. But look at poor people—they make use of all the resources they have. We have resources but we go around saying we are poor. We need to build our capacity to spend and absorb these resources. This is not just about an individual or an institution. It is about our whole development paradigm. It is not just about progress but about quality. What is the point of making a road on which 400 people die every day?

Like you said, our ministers are happy bringing in donor money and the donors seem happy transferring their funds to us. There is no follow-up on the judicious utilisation of those funds. Who is to blame here? Is this system even working?

The primary blame lies with the government. Donors can come only when we want them to come. There might be imperatives but they are imperatives that we create.

When our leaders go begging shamelessly for funds just to build a four-kilometre road, of course the donors will make use of us. In this process, we lose faith in ourselves. The biggest problem with us is that we have lost all self-respect.

Has this aid dependency increased over the years?

It has increased over time. Before, a limited group would make use of these funds but now, since the restoration of democracy in 1990, this circle has only widened to include more. And the donors have used this creamy layer of society to defend themselves. Furthermore, about 30 percent of foreign aid is outside the red book and the donors want to lecture us on good governance. More than 90 percent of USAID’s funds is outside the red book. So why can’t we tell them that we don’t agree with this? We are signatories to the Paris Declaration, the Accra Accord and all other accords on foreign aid so maybe it is time to change the regulations. Why can’t we tell them that from now, the Government of Nepal wants all foreign aid to come through the red book?

What’s stopping us?

Our mentality. We don’t believe in ourselves. We are not politically committed to Nepal and in that sense, we are not nationalist.

Here’s a radical thought: some have even suggested stopping foreign aid altogether.

I am all for it. I have no problem with this. Back in the 80s, Chaitanya [Mishra] and I argued that Nepal would be better off without foreign aid.

Do you still think so?

If this is the way foreign aid is going to work, then perhaps that would be better. Foreign aid has strengthened our sense of helplessness and has made NGOs profitable without making them accountable. It has denuded our faith in the government and eroded the perception of the state as a major agent of development. In a poor country like Nepal with so many geographical disparities and so many inequalities, the market and the private sector can play a role but the state has to defend those who need defence—the people who are marginalised, vulnerable and disadvantaged. And when these people form a majority of the people, it behooves the state to take care of them.

In the report, you mention that the economic liberalisation of the 90s failed to address inequalities. With a market-friendly government in place, are we headed in that direction again?

Addressing inequalities is not a priority of the market. The market values capital, skill and technology. It does not value individuals, except when there is a demand. But it is not a question of the market or the government. The question is, how can the two work in tandem to deliver the greatest benefits to the greatest number of people?

In this context, how would you rate the Nepali Congress in terms of both wealth creation and wealth distribution?

In the past, the Congress has basically followed a neo-liberal path. I think that approach needs a cool-headed review. Not that we go against the market, but how to make the market and the public sector work together so that growth is maximised and is inclusive. 

Published: 19-05-2014 09:09

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