The Covid-19 pandemic could halt or even reverse progress made in human development and affect the timeline for the country’s graduation from the least developed country status, a new report prepared jointly by the UN Development Programme and the government says.

“The possibility of a slow economic recovery or protracted economic slump—with growing vulnerability among women, low-income earners and older people, leading to higher poverty and inequality—looms large,” the report titled ‘Nepal Human Development Report 2020: Beyond LDC Graduation: Productive Transformation and Prosperity’ states.

Nepal aims to graduate to developing country status by 2024, which was earlier set for 2022.

“A prolonged slowdown implies loss of incomes, rising joblessness and unemployment, an accumulation of public debt, bankruptcies of industries and businesses on a mass scale, and threats to the financial stability of the banking system,” said the report jointly prepared by the National Planning Commission and the UNDP.

According to the United Nations, the gross national per capita income of a country needs to be at least $1,222 for it to be accorded the developing country status. At present Nepal’s per capita income is $1090, according to the World Bank.

Considering the potential impact of the pandemic, the report has suggested reviewing Nepal’s plan to graduate to a developing country by 2024.

The report also casts doubt on Nepal achieving the United Nations Sustainable Development Goals by 2030.

Even though the report has not assessed the impacts of the pandemic on the human development of the country saying that the pandemic was just beginning when the report was being finalised, it has made observations on the impact of the pandemic on health services, education and income of the people.

Deprival of many children from education due to forced closure of schools, workers losing jobs, particularly in the informal sector, and inability of pregnant women to visit hospitals are among the factors highlighted in the report.

The Human Development Index is prepared based on the long-term progress on three basic dimensions of human development—a long and healthy life, access to knowledge and a decent standard of living.

Min Bahadur Shahi, a member of the National Planning Commission told the Post that the impact of the pandemic on human development might not be as horrific as it has been imagined if Covid-19 vaccines are administered in Nepal at the earliest.

But that is debatable if views of others are to be considered.

“Based on the report of unemployment and increased poverty as suggested by the report of the National Planning Commission, we can safely predict the pandemic has a huge impact on human development,” said Jagdish Chandra Pokharel, former vice chairman of National Planning Commission.

But the impact of the pandemic may be offset by the flow of remittances. “If the remittance inflow remains good, the impact will be relatively moderate. I don’t think the remittance will be as usual as the current flow of remittance happened after informal flow of remittance was discouraged after pandemic.”

The government has said that it has been making preparations to procure vaccines.

He, however, said that despite the report's suggestion to review the plan to graduate the country from least developed status, the government is firm on its goal of graduation by 2024.

According to the report, Nepal has made gradual progress in human development over the years. The Human Development Index score of Nepal stood at 0.587 in 2019, the year for which data was published on Sunday, up from 0.579 in 2018, according to the report.

“This puts the country into the medium human development category,” it says.

There has been consistent progress in the Human Development Index since 1990 when the score was 0.378. Nepal had first jumped from the low to the middle human development category in 2016.

But, the country is still behind most South Asian countries in terms of human development.

According to the report, the country is just ahead of war-torn Afghanistan and Pakistan in South Asia and its Human Development Index score is below the regional average of 0.634.

Nepal’s HDI score is also below the average for the medium human development countries at 0.642.

Although Nepal is close to or a little ahead of the average of both South Asia and the middle human development group in terms of life expectancy at birth, the country is behind in average years of education and average per capita income, the report says.

Nepal’s progress in human development is also uneven in different provinces and ecological regions. Among the provinces, Province 2 has the lowest score of 0.51 followed by Karnali with 0.538. Bagmati Province, where capital Kathmandu lies, has the highest score of 0.661 followed by Gandaki with 0.618. The scores of Province 1, Lumbini and Sudurpaschim stand at 0.58, 0.563 and 0.547 respectively.

In terms of ecological regions, the Tarai has the lowest score at 0.563 followed by mountains at 0.564 and the hills at 0.623.

“This is a pattern similar to findings in previous Nepal Human Development Reports regardless of methodological differences,” the report says. “The superiority of the Tarai region in terms of income and life expectancy is nullified by better performance in the mountains on education.”

While the government faces accusations of under-investment in regions with low human development, Shahi claimed that structural issues of society are even more responsible in the case of the Tarai, particularly Province 2.

“The government’s investment in Province 2 is not that bad. But gender and social discrimination prevelent in there are among the reasons behind under-performance in human development,” he said.

The report says that enhancing the catalytic role of provincial and local governance would minimise large spatial development gaps, reduce vulnerabilities and ensure sustainable human development.

It has also measured Nepal’s how inequality in incomes, health and education has affected the overall well being of the people.

Nepal’s Human Development Index scores stand at just 0.439 if inequality in these three sectors are adjusted, according to the report. This indicates an overall loss of 25.2 percent in the score, the report says.

The highest loss for Nepal stems from inequality in income at 31 percent followed by health and education, indicating that income inequality, as measured by wealth, is higher than non-income inequality.

“In order to tackle this issue, we need to continue to push forward the agenda of equality and empowerment. Effective strategy for this is to focus on education and increase its access to the people,” said Pokharel. “Access to education helps improve the situation of the next generation if not this generation.”