Nepal: A State of Poverty by David Seddon

Vikas Publishing House 1987
Review  by R.S.   Mali at
This is the latest in a series of published works on Nepal by the author (including Nepal in Crisis, 1980). A common theme through his works has been that the state of under-dcvelopmenl, poverty and crisis in Nepal is not purely an economic phenomenon and should be understood in the broader context of the political economy and class relationships. In his analysis of these issues, the author´s contributions on the Nepali economy differ from those of other individuals and national and international agencies. Seddon starts by reviewing the political economy of the population growth in the historical context. Population increased as a result of state policy to encourage immigration to augment the labour force. Increased population resulted in land reclamation to increase agricultural output and raise state revenue. While the balance between fertility and mortality changed drastically for the better in the second half of the twentieth century, agricultural production failed to keep pace with population growth, both in the Tarai and hills.
The author explains economic inequality and poverty in terms of unequal ownership of land and social inequality based on caste, ethnic and gender factors. Another theme the author repeats in this book is the environmental deterioration caused by population growth, deforestation and land erosion.

Against this background of rapid population growth, failure in the agricultural front, the deteriorating ecological balance and economic inequality, the author analyses the increasing poverty of the Nepali population as evidenced in food shortages, malnutrition and indebtedness. Seddon concentrates on those most vulnerable: landless labourers, sub-marginal peasants and small craftsmen relying on wage labour.
The widespread poverty and deprivation of basic needs is an accepted fact which has been supported by a number of studies, both official and unofficial, Seddon´s explanation of the problems that exist in the political-economy of Nepal will receive wide acceptance.
In point of fact, no anti poverty programme, whether target group oriented or redistributive welfare measures, will have much chance of success as long as the present sociopolitical power structure based on property relations continues. However, one should be careful not to extend this logic to explain all facets of under development and poverty. There are thousands of villages in Nepal where poverty cannot be explained just in terms of class relations. It is deeply associated with low productivity resulting from shortages of productive assets, modern inputs, technology and market.
Another impediment is the present land tenure system, which allows a separation between ownership and cultivation, resulting in a serious "incentive trap" to produce more. Interestingly, the author does not seem to have analyzed this important aspect.
The final chapter contains Seddon´s message for the future. He rightly regrets the limited scope for articulating the views and interests of the poor within the present political system. In the event, the government and bureaucracy have a virtual monopoly of decision making over all areas of economic and social policy. Curiously, he pleads for more active and interventionist role by the international donor community, whose ability to influence official policy is assumed to be proportional to their substantial contribution to the economy. He believes that with more activist donors, the cleavages and contradictions within the socioeconomic and political structure could be sharpened to open up new possibilities for social transformation.
While the sincerity inherent in such an approach is beyond question, it is pertinent to note its pitfalls.  Firstly, this
 
theory conveniently ignores the role of external assistance itself in strengthening the economic power and consequent bargaining position of the economic elite over the last three decades. Secondly, even if the donor community departs from its past practice and offers radical prescriptions to give more economic and political power to the underclass, it would be naive to believe that such prescriptions would be readily accepted. This would at best lead to weak compromises which will only prolong the status quo. The "new conventional wisdom" as reflected in the integrated rural development projects (IRDPs), the Decentralization Act, and the basic needs approach are only parts of such a compromise. In short, external pressure is not without limitations as an alternative to effective internal pressure.