1. POVERTY IN NEPAL: CHARACTERISTICS, STRATEGIES AND CHALLENGES Trilochan Pokharel, NASC, tpokharel@nasc.org.np

2. Objectives © NASC 2015 2  explain the concept of poverty  examine the characteristics of poverty  describe the poverty reduction strategy in Nepal  discuss policy gaps

3. Session content © NASC 2015 3  Understanding poverty  Characteristics of poverty  Poverty reduction strategy in Nepal  Policy gaps

4. Story about poverty © NASC 2015 4  Who are poor?  Why are they poor?  Difference between poor and poverty?  What are the characteristics of poverty?  What can be done to reduce poverty?

5. Story… © NASC 2015 5  1 million death  Period 1973-1977  Cause – famine Lack of entitlements Amartya Sen, 1981, Poverty and Famines: An Essay on Entitlement and Deprivation. Why people die in famine? – Amartya Sen Bangladesh Famine

6. Which line we travel? © NASC 2015 6 PROTECTIVE Capabilities, enabling people to with stand economic shocks natural disasters conflicts PROTECTIVE Capabilities, enabling people to with stand economic shocks natural disasters conflicts ECONOMIC Capabilities to earn income consume have assets ECONOMIC Capabilities to earn income consume have assets POLITICAL Capabilities including human rights voice political freedom participation POLITICAL Capabilities including human rights voice political freedom participation HUMAN Capabilities based on health education nutrition shelter HUMAN Capabilities based on health education nutrition shelter SOCIO-CULTURAL Capabilities concerning dignity valued membership society social status SOCIO-CULTURAL Capabilities concerning dignity valued membership society social status GENDER GOVERNANCE Source: www.poverty-wellbeing.net

7. Is this the difference? © NASC 2015 7

8. Understanding poverty © NASC 2015 8 If poverty were deprivation, the questions are:  Yet deprivation of WHAT?  By how much?  Over what time period?  Whose? A country, region, village, family individual.

9. Understanding poverty © NASC 2015 9  Money metric (conventional approach)  World Bank's $1 ($1.25 since 2005) and $2 concept  NLSS 's poverty line  Capability approach (Human Development- Amartya Sen)  Social exclusion approach  Participatory approaches (Robert Chambers)

10. Convergence in poverty measurement (Nepal) Source: World Bank, 2013 © NASC 2015 10

11. But… Source: World Bank, 2013 © NASC 2015 11

12. Poverty Measurement in Nepal (2010/11)... © NASC 2015 12  Food - NRs. 11,929  Non food - NRs. 7,332  Total- NRs. 19,261  Average calorie required - 2,220 cl Source: CBS, 2011

13. % pop below poverty line © NASC 2015 13 Source: CBS, 2011

14. Progress made so far... © NASC 2015 14 Source: CBS, 2011

15. Gini coefficient © NASC 2015 15 Source: CBS, 2011

16. Share of Income (%) Source: World Bank, 2013 © NASC 2015 16

17. Per capita consumption deciles (in NRs.) © NASC 2015 17 Source: CBS, 2011

18. % of hh receiving remittance © NASC 2015 18 Source: CBS, 2011

19. % of GDP © NASC 2015 19 Country name2009201020112012 Tajikistan35.1(47.2)40.946.947.5 Kyrgyz Republic 20.926.427.630.8 (38.0) Nepal23.121.7 (25.2)22.425.0 Moldova22 (26.3)23.322.824.5 Lesotho32.12826.123.8 Samoa23.821.32223.2 Bermuda23.22222.621.8 Armenia8.810.719.721.3 (32.4) Haiti20.922.320.620.4 (58.7) Source: World Bank, 2013 Figures in parenthesis are percentage of population below national poverty line in respective year.

20. Live example © NASC 2015 20

21. Utilization of remittances © NASC 2015 21 Source: CBS, 2011

22. Poverty reduction strategies © NASC 2015 22  Ninth Plan (1997-2002)  poverty alleviation as its main objective and interlinked with development sectors  reduced poverty from 42.0 (1996) to 30.8 (2003)  Tenth Plan (2002-2007)  poverty alleviation by mobilizing the means and resources, through the mutual participation of the government, local agencies, NGOs, private sector and civil society, to extend economic opportunities and open new environment that enlarge employment opportunities

23. Poverty reduction strategy paper (PRSP) © NASC 2015 23 Four pillars of Tenth Plan/ PRSP  High, sustainable, broad based economic growth  Social sector development including human development  Targeted programme including social inclusion  Good governance

24. Three Year Plan (2013/14-2015/16) © NASC 2015 24 Objective Reduce population below poverty line to 18 percent Strategies 1.Increase productive employment and opportunities 2.Emphasize on capacity development, productivity, distributive justice and equitable development 3.Coordinate poverty reduction programmes organized by different sectors and organizations 4.Implement demand based targeted programme 1.Increase productive employment and opportunities 2.Emphasize on capacity development, productivity, distributive justice and equitable development 3.Coordinate poverty reduction programmes organized by different sectors and organizations 4.Implement demand based targeted programme

25. Big questions  What have made contributions to poverty reduction?  Government policy interventions?  NGOs intervention?  Market?  Labour migration?  Anything other?  Reaching the bottom of pyramid?  Decomposed analysis?  Targeting the targets? © NASC 2015 25

26. Policy gaps © NASC 2015 26  Poverty reduction and employment  Mainstreaming poverty reduction programmes  Poverty as a cross-cutting issue  Effectiveness of poverty reduction policies  Utilization of fragmented money

27. Opportunities... © NASC 2015 27  Level of people's awareness  Demographic, gender and peace dividend  National and international commitment for inclusive development  Social capital  Remittances

28. The focus areas… © NASC 2015 28  Pro-poor and inclusive growth  Investing in human capital (health, education, food security etc)  Investing in physical capital (water, sanitation, rural roads, electricity, rural development etc)  Redefining investment- nutrition, health, education  Reducing social inequality  Good governance  Rights-based approach to development

29. References © NASC 2015 29 National Planning Commission, 2002, The Tenth Five Year Plan 2002-2007, Kathmandu: National Planning Commission. National Planning Commission, 2003, The Tenth Plan: Poverty Reduction Strategy Paper 2002-2007, Kathmandu: National Planning Commission. National Planning Commission, 2007, Three Year Interim Plan 2006/07-2009/10, Kathmandu: National Planning Commission. National Planning Commission, 2011, Three Year Plan 2010/11 -2012/13: Approach Paper, Kathmandu: National Planning Commission. National Planning Commission, 2011, Millennium Development Goals: Needs Assessment for Nepal 2010, Kathmandu: National Planning Commission. National Planning Commission, 2013, The Thirteenth Plan Approach Paper, Kathmandu: National Planning Commission. Central Bureau of Statistics, 2011, Nepal Living Standard Survey-III: Press Release, Kathmandu: Central Bureau of Statistics.

30. Contd... © NASC 2015 30 Pokharel, Trilochan, 2015, Poverty in Nepal: Characteristics and Challenges, Journal of Poverty, Investment and Development, pp 44- 55. Polak, Paul, 2008, Out of Poverty: What Works when Traditional Approaches Fail, San Francisco: Berrett-Koehler Publishers, Inc. The World Bank, 2000, Poverty Reduction in the 1990s: An Evaluation of Strategy and Performance, Washington D. C.: IBRD. United Nations Development Programme, 2010, Human Development Report 2010, New York: UNDP. Sachs, Jeffrey D, 2005, The End of Poverty: Economics Possibilities of Our Time, New York: The Penguin Press. The World Bank, 2003, Poverty in Guatemala, Washington DC: The World Bank.

31. © NASC 2015 31 Thank you for your patience