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Nepal

 Flag of Nepal

Last reviewed: 09 September 2009

Country information

Map of Nepal


Area: Approximately 147,000 sq km, stretching 800km from east to west and from 90 to 230km north to south.
Population: An estimated 29.5 million (July 2008 est.). Annual rate of growth of 2.5%.
Capital city: Kathmandu. Population of about 800,000 in the city itself. Believed to be approximately 1.5m in the fertile Kathmandu valley.
Peoples: Indigenous peoples include Gurung, Limbu, Newar, Rai, Sherpa, Tamang and Tharu with diverse smaller groups. Major caste groups are the Brahmans and Chhetris. Large numbers of Indians and some Tibetans make their home in the country.
Language(s): Nepali 58% (official language), Newari 3%, mainly in Kathmandu. Tibeto- Burman languages (20%) mainly in the hill areas, and Indian languages (20%) mainly in the Terai areas bordering India. Nepal has over 30 Languages and dozens of dialects.
Religion(s): Officially 90% Hindu, 8% Buddhist and 2% Muslim – but these figures are thought misleading. Hinduism and Buddhism overlap considerably in Nepal. Other estimates also suggest that there are some 400,000 Christians in the country.
Currency: Nepalese Rupee (NPR) which is pegged to the Indian Rupee.
Major political parties: United Communist Party of Nepal – Maoist (Chairman – Pushpa Kamal Dahal AKA ‘Prachanda’), Communist Party of Nepal-United Marxist-Leninist (CPN-UML) (Party Chairman -Jhalanath Khanal), Nepali Congress (Party president - Girija Prasad Koirala), Madhesi People's Rights Forum (MJF) (President – Upendra Yadav), Terai Madhesh Democratic Party (TMDP) (President – Mahanta Thakur). Nepal Sadbhavana Party (NSP) (Party Chairman – Rajendra Mahato).
Government: Constitutionally, Nepal is a parliamentary democracy with a largely ceremonial President as Head of State and a Prime Minister as Head of Government. The Prime Minister currently leads a coalition government. Elections for a 601 seat Constituent Assembly cum legislature were held on 10 April 2008. General elections are due to be held in 2010.
Head of State: President Dr Ram Baran Yadav (Nepali Congress)
Prime Minister: Madhav Kumar Nepal (UML)
State Minister for Foreign Affairs:  Sujata Koirala (Nepali Congress)
Membership of international groupings/organisations: United Nations, South Asian Association for Regional Co-operation (SAARC), Council of Democracies.

Economy

GDP: US$12.62 billion (2007-08) (Economic Survey 2008).
GDP per head: US$470 (Economic Survey 2008) 3 out of 10 people live on less than a $1 a day.
Annual growth: 5.56% (2007-08 ) - (Economic Survey 2008).
Inflation: 14.5% in Mid November 2008 (Nepal Rastra Bank).
Major industries: Tourism, carpet, textile, small rice, jute, sugar and oilseed mills, cigarettes, cement and brick production.
Major trading partners: India 63%, US, China and Germany.

Nepal is the poorest country in Asia and the fourteenth poorest in the world. Real GDP at producer prices grew by 5.56 (EIU) in fiscal year 2007/08. Prices of consumer items which rose due to rise in food and oil prices have not come down despite the subsequent drop in international prices, resulting in high consumer price inflation. Nepal's power shortage is severe with seasonal outages of up to 16 hours a day.  Seventeen foreign carriers now fly to Nepal. 257,181 tourists visited Nepal in the first nine months of 2008, which is a 2% increase over 2007.

The economy is still largely based on agriculture, which employs some 70% of the workforce. The main foreign currency earners are remittances, around US$2 billion annually, from migrant workers, carpet exports (mostly to Germany), garment exports (to the USA) and tourism.

History

The five city-states of the Kathmandu Valley, in which the culture of the Malla Kings flourished from the 14th to the 17th centuries, were conquered by the ruler of the central hill state of Gorkha in the mid 18th century. Prithvi Narayan Shah is looked upon as founder of the nation. Further expansion by the Shahs in the early 19th century brought them into conflict with British India. Following the Anglo-Nepal war of 1816 the Treaty of Sugauli was signed. The first British Resident was posted to Kathmandu in 1816, with the British remaining the only foreign diplomatic presence in the capital for well over a century. In 1846 the Shah dynasty were deprived of executive rule by Jung Bahadur Rana, who established a line of hereditary Prime Ministers which ruled until 1951 when King Tribhuvan in a 'Palace revolution' re-established the Shahs as rulers of the country with a cabinet of Ministers drawn from the Nepali Congress Party. In 1960 King Mahendra assumed direct rule and drew up a new Constitution based on the 'partyless' Panchayat (5 man village council) system.

In early 1990, during King Birendra's reign, following widespread agitation for a multi-party democracy, Nepal experienced a virtually bloodless 'revolution' and a new Constitution was promulgated in November of that year which retained the constitutional Monarchy as Head of State but introduced a full parliamentary system of government. The Nepali Congress party formed a government which ruled from 1991-94. From 1994-1999 there were five successive coalition governments.

It was against this unstable political background that in February 1996, the leaders of the Maoist United People's Front began a violent insurgency, waged through killings, torture, bombings, kidnappings, extortion, and intimidation against civilians, police, and public officials in more than 50 of the country's 75 districts. Over 13,000 police, civilians, and insurgents were killed in the conflict and around 1,500 people were 'disappeared'.

The former monarch, King Gyanendra, came to the throne in June 2001 following the murder of King Birendra by his son, the then Crown Prince Dipendra, who subsequently shot and killed himself. After Sher Bahadur Deuba was appointed Prime Minister on 22 July 2001 he announced a unilateral ceasefire against the Maoists, which they reciprocated immediately. The Maoists broke the ceasefire in November 2001, in response to which Prime Minister Deuba declared a State of Emergency. The conflict intensified over the following year and drew in the full participation of the Royal Nepal Army (RNA).

On 4 October 2002 King Gyanendra, citing fears over the handling of the insurgency announced that he had requested Deuba's resignation, and that he would be appointing a transitional government of his own choosing. On 29 January 2003 a cease-fire was once again agreed between the Maoists and the transitional government but peace talks failed and the Maoists unilaterally ended the cease-fire on 27 August 2003. On 1 February 2005 the King deposed the Government, putatively for failing in its mandate to hold elections by April, and took power directly himself. The takeover was met with widespread international criticism from India, the US, the EU and the UK. On 14 April the King announced his intention to restore democracy by holding municipal elections in February 2006 followed by national elections by April 2007.

In September 2005 the Maoists announced a three-month unilateral ceasefire and in November 2005, the Maoists and seven of the political parties (the Seven Party Alliance) announced a 12 point understanding aimed at ending the King's autocratic rule and restoring democracy.

Following weeks of nation-wide civil unrest in April 2006, the King handed power to the political parties and reinstated Parliament. G P Koirala was sworn in as Prime Minister on 30 April 2006 and proposals to hold elections to a Constitutional Assembly and hold peace talks with the Maoists were passed.

International relations

Nepal's relations with the UK

The UK is highly regarded in Nepal. This is through historical ties, development assistance and long term support for democratic peace in Nepal.

Visits to Nepal

Minouche Shafik, Permanent Secretary, DfID, visited 30 June to 01 July 2009.

Kevan Jones MP, Under Secretary of State and Minister for Veterans, MoD, visited 14-18 April 2009.

Mike Foster MP, Minister for International Development, DfID, visited 30 March-2 April 2009.

The British Group of the Inter Parliamentary Union visited 16-20 February 2009.

Mike Foster MP, Minister for International Development, DfID, visited 24-27 November 2008.

Lord Mark Malloch-Brown, Minister of State, FCO, visited from 18-19 July 2008.

Shahid Malik, DfID Minister, visited from 20-22 June 2008.

Gareth Thomas MP, Parliamentary Under-Secretary of State, DfID, visited from 2-4 April 2007.

Dr Kim Howells MP, Minister of State FCO, visited from 25-28 September 2006.

Geoff Hoon MP, Secretary of State for Defence, visited in September 2004.

Gurkhas

Gurkhas have been an integral and extremely important part of the British Army since 1948, and prior to that, of the British India Army and the East India Company Army. They are highly regarded around the world for their bravery and professionalism. The Brigade has a current strength of around 3,300 officers and men made up of two Infantry battalions of the Royal Gurkha Rifles and three specialist units comprising the Queen's Gurkha Signals, Queen's Gurkha Engineers and the Queen's Own Guard Logistic Regiment. The bulk of the Brigade is based in the UK, with one battalion in Brunei.

UK Development Assistance

Nepal is the poorest country in Asia - the average annual income per person is about $470. The 10 year conflict was a major obstacle to development. The backdrop to the conflict is deep-seated poverty, inequality, poor governance and discrimination. Britain is the largest bilateral donor to Nepal. Our assistance to Nepal was £110 million in 2007/8.  DfID Minister Mike Foster announced a three year package of support of £172 million when he launched DfID’s Country Action Plan for Nepal during his visit to Nepal in March 2009.  We use both sector budget support and support through NGOs and the UN. The overall purpose of our aid is to reduce poverty and social exclusion, establishing a basis for lasting peace. The DfID programme in Nepal has the following priorities:

  • Support the peace process and help improve security.
  • Make government more effective and deliver better health and education services.
  • Help poor people, particularly women, benefit from economic growth.
  • Help Nepal tackle climate change.

Cultural Relations with the UK

Britain and Nepal retain close cultural links, based on a long history of relations and friendly ties. The British Council has an important role in Nepal promoting the cultural and educational relationship. It is focused on fostering and supporting links between schools in Nepal and the UK as well as links between university departments. It promotes UK education, teaches English and administers large numbers of UK examinations, principally A-levels and IELTS tests. HRH the Princess Royal opened the British Council's new premises in Kathmandu in November 2000. During his visit to Nepal in July 2008, Lord Malloch-Brown opened the British Council’s e-learning facility.

Geography

Nepal covers approximately 147,000 sq km, stretching 800km from east to west and 90 to 230km from north to south. Nepal is land-locked between China (including the Chinese autonomous region of Tibet) and India. Nepal has three geographic regions; the mountainous Himalayan belt (including 8 of the 10 highest mountain peaks in the world), the hill region and the plains region. Nepal contains the greatest altitude variation on earth, from the lowland Terai, at almost sea-level to Mount Everest at 8848 metres. Nepal is divided into five development regions and seventy-five districts.

Climate Change

Nepal is one of the most vulnerable countries in South Asia to climate change, yet it has limited capacity to address impacts of climate change or to take advantage of the opportunities. It has a highly variable climate and fragile ecosystems. The Himalayan glaciers are retreating faster than any other major body of ice. With climate change, climate variability, a driver of poverty in a country where 75% of the population is reliant on agriculture, will only increase. The monsoon rains are already more intense, but of shorter duration, and are arriving later, which has a devastating impact on the rice crop.

The Greater Himalaya region is the water tower of Asia. Nepal sits at a strategic point, in the headwaters of the Ganges basin. 500 million people live in this basin, which is one of the most flood prone in the world. Currently Nepal's Himalayan Rivers supply 70% of the dry season water in the Ganges and 30% of the peak flood waters.

Nepal's potential for hydropower is 100 times its existing energy use. Current development of rivers are sub-optimal, focusing solely on hydro rather than also storing water in the summer to use for irrigation during the rest of the year and reduce flooding.

Yet, if Nepal could export its hydropower to India, it could get financing from carbon markets and raise $2bn p.a. in revenue. If Nepal accelerated the handing over of natiional forests to communities, and reversed forest degradation and deforestation, it could qualify for financing from the World Bank managed climate investment funds and voluntary carbon markets. And, if Nepal reduced flooding in India and Bangladesh, and improved winter water flows, it would be a strategic player in the region, able to negotiate better deals.

The UK is helping address the challenges posed by Climate Change by:

  • Working to enable Nepal to effectively influence climate change negotiations. We part funded the Kathmandu to Copenhagen regional climate change conference held in Kathmandu 31 August to 01 September 2009.
  • Supporting Nepal develop a framework for action on climate change and present immediate priorities through its National Adaptation Plan of Action Plus. We will then support the priority actions of the plan.
  • Increasing our support to the forestry sector, working with other donors to support a national, but decentralised, approach in forestry that benefits the poor, reverses deforestation, reduces corruption and attracts carbon finance.
  • Supporting the South Asia Water Initiative to improve water resource management regionally and manage the impacts of climate change, for which Nepal is key to its success.

Interview on the effects of climate change on vulnerable countries.

Trade and investment

Traditionally Nepal looks South and East rather than West for her suppliers. India provides almost two thirds of Nepal's imports. Bilateral trade with the UK is modest: UK exports to Nepal are less than £8m a year and include transport equipment (e.g. aircraft parts) and special industrial machinery. The main Nepalese exports to the UK are clothing and textile fabrics. The United Kingdom is the third largest foreign investor in Nepal. Bilateral Chambers of Commerce have been established, in the UK in January 1995 and in Nepal in December 1995, to promote bilateral trade.

In September 2008, the Embassy of Nepal in London, together with the Britain-Nepal Chamber of Commerce, hosted the first fair aimed at promoting investment, trade and tourism.  This event attracted a large number of visitors and brought together participants with the shared objective of creating a sustainable peace and a prosperous Nepal.

Politics

Recent political developments

On 26 May 2006 the Government and Maoist rebels began peace talks, the first in nearly three years, which culminated in the Comprehensive Peace Agreement in November 2006. Under the terms of the agreement the Nepali Army and Maoist cadres are confined to barracks and cantonments. Both sides agreed a permanent ceasefire and an arms management arrangement.

In August 2006 the Government of Nepal and the Maoists requested UN assistance in support of the peace process, including management of arms. In response, the UN Secretary-General appointed a Special Representative for Nepal in August 2006, with a UN mission (UNMIN) following in January 2007.

An interim parliament was formed in January 2007 and an interim government led by the Nepali Congress, but including Maoists Ministers, was formed on 1 April 2007. Following two cancellations, elections to a Constituent Assembly were finally held on 10 April 2008. Despite some violence and intimidation, these were considered to be largely free and fair. In a surprising result, the Maoists were confirmed as the largest party with 220 seats in a 601-seat assembly.

The first session of the Constituent Assembly was held on 28 May 2008 and declared Nepal a republic, thus ending a 240-year old monarchy.

Following protracted negotiations amongst the four largest parties represented in the Assembly, Dr Ram Baran Yadav of the Nepali Congress was elected President on 21 July 2008. The Assembly also elected Parmananda Jha of MPRF as Vice-President.

On 29 July, President Yadav invited the Chairman of CPN(M), Pushpa Kamal Dahal ('Prachanda'), as the leader of the largest party in the Assembly, to form a consensus government. However, disagreements over nominations and the election of the President continued to cause difficulties and, in the absence of consensus, the election of a prime minister moved to the Legislature-Parliament. As a result of the election, Pushpa Kamal Dahal was elected as Prime Minister.

On 4 May 2009 Pushpa Kamal Dahal resigned as Prime Minister over the President's decision to overturn his decision to sack the Chief of Army Staff. On 25 May, Madhay, Kumar Nepal, a leading figure in the Communist Party of Nepal - United Marxist Leninist (CPN-UML), was sworn in as Prime Minister. He leads a coalition government made up of 22 parties, but which does not include the Maoists, who declined to join.

Constituent Assembly

The Constituent Assembly (CA) is made up of 601 members, 240 directly voted, 335 through the Proportional Representation (PR) system and 26 nominated by the Cabinet. The Maoists are the biggest party with 38% followed by Nepali Congress with 19% and Unified ML with 18%. It is the youngest (average age 44) and most inclusive (33% women and the highest number of members from excluded groups) institution in Nepal's history, but it is also inexperienced with almost 1/3 illiterate and many from NGOs with no political or parliamentary experience.

The new government faces a number of significant challenges, including decisions over the future of former combatants (both the Maoist People’s Liberation Army and Nepal Army), federalism, and the need to tackle impunity.

Terai unrest

In December 2006, following widespread protests and rioting in the southern region (Terai), Madhesi People's Rights Forum (MJF), led by Upendra Yadav, signed an agreement with the then government. The uprising was pacified after the government amended the interim constitution.

In January 2008, the three Terai-based parties- Madhesi People's Rights Forum (MJF), Terai-Madhes Democratic Party (TMDP) and Sadbhavana Party SP - joined forces to create a coalition named the United Democratic Madhesi Front (UDMF) aiming to project a united front to negotiate with the Government. On 26 February 2008, an agreement was signed between the then Government and agitating UDMF, paving the way for the Constituent Assembly election. The UDMF coalition parties participated in the CA election and secured  13% of the seats in the CA. MJF and TMDP are the fourth and fifth largest political parties in the CA respectively. Currently MJF and SP are partners in the coalition government, while the TMDP has remained in opposition.

There are reportedly more than three dozen armed groups operating in the Terai region. In October 2008, the government of Nepal called for talks with the armed groups aimed at ending the violence. However, apart from holding talks with some smaller groups, there has not been any  tangible progress. Public security continues to be poor with occasional killings, kidnappings and bombings.

Human rights

Impunity for human rights abuses continues to be a major issue in Nepal. The lack of political will to address human rights violations and abuses, exacerbated by the weak capacity of the state to provide public security, means that lack of respect for human rights is widespread. None of the major parties see tackling impunity as being in their interests; many political leaders (and senior Nepal Army officers) are themselves implicated in human rights violations and abuses. Continuing impunity also contributes to lack of rule of law. Maoist cadres are increasingly ignoring state structures and filling the vacuum left by the absence of the state. There are also abuses by violent armed groups operating mainly in the southern plains, bordering India. State security forces fail to deal adequately with crime due to political interference in cases.

UK action

Recognising that respect for human rights is a key component of sustainable peace, the UK consistently encourages all parties to respect human rights and to reduce human rights violations through diplomatic representation as well as through project funding.   In addition, we regularly raise our concerns about the human rights situation, both in public and private, in coordination with OHCHR and with the EU – indeed human rights was one of the key priorities for our local EU Presidency in the second half of 2007.

We continue to engage with the Nepal army (NA) to encourage greater respect for human rights, including through training courses which have started to introduce an understanding of International Humanitarian Law into all levels of the NA.  UK ministers have engaged in constructive dialogue with the Chief of Army Staff to stress that tackling impunity is in the army’s own interests and would send a clear signal that the NA is working for democracy.

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Contacts

Nepal, Kathmandu, British Embassy

Address:

P O Box 106
Lainchaur

General Enquiries - BEKathmandu@fco.gov.uk

Consular Enquiries - Ktm.Consular@fco.gov.uk

Telephone:

(977) (1) 4410583
(977) (1) 4411281
(977) (1) 4414588
(977) (1) 4411590

Mobile: (977) 985 103 7231

Fax:

(977) (1) 4411789

Office hours:

GMT:
Mon-Thurs: 0230-0645/0745-1115
Fri: 0230-0730

Local Time:
Mon-Thurs: 0815-1230/1330-1700
Fri: 0815-1315

Consular opening hours:
Mon-Thurs: 0815 - 1230hrs
Fri: 0815 - 1315hrs

Emergency contact number: (977) 98510 37231 (Mobile)

Website: http://ukinnepal.fco.gov.uk/en/

Nepal