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Despite nine development plans spanning five decades, Nepal remains one of the world’s poorest countries. Nepal’s underdevelopment is a result of the historical effects of unequal distribution of assets and social and economic status among different groups, and effects of recent development efforts that have generated further iniquitous income and assets distribution.

Understanding Nepal’s underdevelopment has become particularly pressing in light of the Maoist insurgency that began in 1996. In addition to the deaths of more than 6,000 civilians, instability has caused economic stagnation, discouraged foreign investment, and prevented the expansion of the hydropower and tourism industries. Nepal’s future depends on an understanding of how its institutions have created inequity, and how it will respond to the need for institutional reform.

Culturally, Nepal is a patriarchal and hierarchical society. Caste is important in the world’s only Hindu nation. Gender, ethnicity, land ownership, and location are also historically important social determinants.

Nepal’s history and geography have contributed to the perpetuation of these cultural values. Historically, Nepal has been very isolated. Situated between China and India, it is bisected by the Himalayas. The country is divided into three bands running from east to west – the Himalayas furthest north, the flat and dry Terai in the South, and the middle hills sandwiched in between. Extreme differences in topography, and a lack of roadways and efficient transportation, have meant that communities tended to remain isolated and distinct, closely linked to traditional cultural practices and norms. Industry has been slow to change this, as most Nepalese depend upo...

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...astern Nepal, respondents reported that “society does not recognize the merit of physical work in agriculture; it encourages people to prefer leisure over work, and sees working people as belonging to the lower classes. So far, foreign aided projects have not been able to alter people’s attitudes towards physical work by providing alternate examples” (Shrestha, 41). Even as development efforts increase, rural people mistrustful of exploitation, and depressed by development failures, are growing harder to reach.

Nepal’s political crisis is a response to social inequalities increased and hardened by recent development. Future development will require radical reform: redistribution of resources and increased rural development, weakening of traditional power structures, increased access to and transparency in government, and independence from foreign interests.

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