Nepal’s graduation to middle-income nation status: Opportunities & challenges

KATHMANDU: The 40th plenary meeting of the 76th Session of the United Nations General Assembly (UNGA) unanimously adopted a resolution on Thursday (November 25) endorsing the graduation of Nepal from the Least Developed Country (LDC) category with the preparatory period of five years.

With the unanimous adoption of the proposal, it has become inevitable to focus the vision of all political players in the activities of national income generation and maintaining political stability in the next five years.

The meeting approved Nepal’s proposal on the basis of Gross National Income, Human Asset and Economic and Environmental Vulnerability, in view of the unwavering plan of the Government of Nepal to realize the national aspirations of ‘Prosperous Nepal, Happy Nepal’ reflected in the 15th Periodic Plan.

It is a matter of pride for all Nepalis that Nepal, which has been a victim of poverty and backwardness for more than five decades, is moving towards a transformation into a middle-income developing country. Not only has the country’s elevation been a sign of progress, but it has also sent a positive message to the world community about Nepal’s development prospects.

Although the challenge for Nepal is to increase the income of every Nepali, free the general people from the vicious cycle of poverty and keep them busy in sustainable income generation, upgrading can be marketed as an attractive destination for foreign direct investment. There is also ample opportunity to increase domestic investment from the private sector for the smooth up-gradation.

There is no alternative to moving forward for sustainable and irreversible development by gradually devising development strategies, expediting policy and procedural reforms and adjustments in cooperation with Nepal’s development and trade partners, and creating a conducive environment for investment.

It has become imperative for the country’s political leadership to immediately engage in dialogue with Nepal’s bilateral and multilateral development and trade partners to ensure that the common ‘agenda’ of national development remains the same, despite political differences. For that, strong will and sincerity must be demonstrated. Nepal’s political leadership, which has been able to resolve the decade-long armed conflict peacefully, once again can take advantage of the opportunity to exhibit that they are not divided in order to remove Nepal from the list of poor countries and restore its lost image to the world community.

Even though Nepal, as a least developed country, will continue receiving favor, facilities, concessions and assistance from the international community till December 2026, it will be reduced thereafter. In order to work with a clear action plan focusing on the country’s abundant water resources, commercialization of agriculture, optimum utilisation of forest and forest products including herbal medicine and tourism sectors, it has become imperative to formulate a national transition strategy of upgrading in collaboration with bilateral, regional and multilateral development and trade partners, including the UN system.

The five-year preparatory period is provided for a smooth transition, recognizing the effect of the COVID-19 pandemic and the resulting need to implement policies and strategies to reverse the pandemic’s damage to the economic and social sectors. The five-year transition period is provided on an exceptional basis mainly in the context of the COVID-19 pandemic, which would normally be for three years.

The resolution has mandated the Committee on Development Policy, a subsidiary body of the Economic and Social Council, to analyze the adequacy of the preparatory period at its 2024 triennial review and recommend further extension if necessary. The resolution also invites Nepal and the other two graduating countries to prepare smooth national transition strategies, with the support of the United Nations system and in cooperation with their bilateral, regional, and multilateral development and trading partners.

After the adoption of the resolution, Nepal has reiterated her commitment to making an all-out effort for smooth graduation with the enhanced level of support from the development partners including the UN.


Fiscal Nepal |
Sunday November 28, 2021, 12:53:56 PM |

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