Key highlights of Nepal's long-term economic vision (FY2020-FY2044)

According to a press note by National Planning Commission, the government is aiming to graduate Nepal from LDC category (to a developing country status) by FY2022 with per capita income of USD 1,400 and a middle-income country by FY2030 (according to WB classification, Nepal is now in the lower middle-income country category). In FY2019, which is considered as base year for the long-term vision, per capita income was USD 1,047. 

Furthermore, by FY2044, the national goal is to achieve a high-income country category with per capital income of USD 12,100. To be fair, these are actually adapted from long-term development vision published by the government in 2018. They are also in the recently published the 15th Five Year Plan (FY2020-FY2024). 

Three phases of long-term economic development vision (Prosperous Nepal, Happy Nepali) are:

• Generating prosperity and happiness (15th five-year plan, FY2020-FY2024), which aim to create the foundation of prosperity and happiness through economic, social and physical infrastructures to accelerate economic growth.
• Accelerating prosperity and happiness, and achieving SDGs (16th and 17th five-year plan), which aim to rapidly achieve the indicators of prosperity and happiness. By the end of 17th five-year plan (FY2034) Nepal will have graduated to a middle-income country with a goal to high-income status.
• Sustaining prosperity and happiness (18th and 19th five-year plan), which aim to achieve sustainability by maintaining balance between prosperity and happiness. Social justice and double-digit economic growth on average are to be achieved during this period. By the end of this phase (FY2044), the economy will be self-reliant, independent, and prosperous. 

It outlines 10 national goals and 76 indicators for long-term economic development vision. It also identifies 8 strategic national strategies, 9 drivers of economic transformation, and 8 enablers. 

The ten long-term national goals are:

1. Accessible and modern infrastructure and connectivity
2. Development and full utilization of human capital potential
3. High and sustainable production and productivity
4. High and equitable national income
5. Well-being and decent standard of living
6. Safe, civilized and just society
7. Healthy and balanced ecology
8. Good governance
9. Comprehensive democracy
10. National unity, security and dignity

The eight long-term national strategies are:

1. Achieve rapid, sustainable and employment-oriented economic growth
2. Ensure affordable and quality health care and education
3. Develop internal and international interconnectivity and sustainable cities/settlements
4. Increase production and productivity
5. Provide a comprehensive, sustainable and productive social security and protection
6. Build a just society characterized by poverty alleviation and socio-economic equality
7. Conserve and utilize natural resources and improve resilience
8. Strengthen public services, enhance balanced provincial development, and promote national unity

The nine drivers of economic transformation are:

1. High-quality and integrated transport system, information technology and communication infrastructure, and massive networking
2. Quality human capital and entrepreneurial work culture and full utilization of potential
3. Hydroelectricity production and promotion of green economy
4. Increase in production, productivity, and competitiveness
5. Development and expansion of quality tourism services
6. Modern, sustainable and systematic urbanization, housing and settlement development
7. Development and strengthening of the provincial and local economy and expansion of the formal sector
8. Guaranteed social protection and social security
9. Governance reform and good governance

The eight enablers that will provide support for the realization of drivers of economic transformation are:

1. Political commitment to the constitution, democracy, and development
2. Demographic dividends and civic awareness
3. Geographic location as well as natural diversity and abundance of natural resources
4. Socio-cultural diversity and unique identity
5. Social capital and Nepali diaspora spread around the world
6. Clean and renewable energy
7. Goodwill of friendly nations and the international community
8. Federal governance and fiscal federalism

The overall structural strategy over the next 25 years is to reduce share of agriculture sector in GDP to 9%, but increase share of  agriculture and services sectors to 30% and 61%, respectively. The annual average GDP growth target of 10.5% is set for the period. A summary of the targets (which may be reviewed in subsequent plans) to be achieved by FY2044 are as follows:

• Average annual GDP growth: 10.5%
• Per capita income: USD 12,100
• Population under absolute poverty line: 0 (or below 1%)
• Population in MPI: 3%
• Gini coefficient based on property: 0.25
• Ratio of richest 10% and poorest 10% population (Palma ratio): 1.1
• LFPR (15+ years): 72%
• Share of formal sector employment: 70%
• Electricity generation (installed capacity): 40,000 MW
• Households with access to electricity: 100%
• Per capita electricity consumption: 3,500 kilowatt-hours
• Households with access to motor transport within 30 minutes of travel: 99%
• National and provincial highways (black topped up to two lanes): 33,000 kms
• National highways (>two lanes and fast tracks): 3,000 kms
• Railroads: 2,200 kms
• Population with access to internet: 100%
• Life expectancy at birth: 80 years
• Maternal mortality (per 100,000 live births): 20
• Child mortality rate (per 1000  live births): 8
• Underweight children: 2%
• Literacy rate (15+ years): 99%
• Net enrolment rate at secondary level (9-12): 95%
• Gross enrolment rate at higher education: 40%
• Population with access to improved drinking water: 96%
• Population covered by basic social security: 100%
• Gender development index: 0.99
• Human development index: 0.760