Abstract
Regional planning has become a major issue in Nepal. In its proposals for development through regional promotion measures, the Fourth National Development Plan selected particular growth areas, one of which is Kosi Growth Axis in Eastern Nepal. A joint CEDA/GDI team analysed Kosi Zone from November 1971 to February 1972. The economic structure of the Zone and its intersectoral, intraregional and interregional interdependencies were identified within the formal framework of a 40x41 input-output table. The analysis showed that the Terai Districts have an export surplus as compared to the Hills. Exports of the Hill economy to the Terai are comparatively low. Kosi Zone as a whole is heavily dependent on agricultural and industrial exports to India and on significant inputs of Indian labour both in Terai industry and agriculture. This economic orientation of Kosi Zone towards India is at the moment definitely much stronger than the links with other regions of Nepal. The Gross Regional Income of Kosi Zone totals Rs 453 million, which means an average per capita income of Rs 600. However, per capita income in the Hills is much lower than in the Terai and barely at subsistence level. Biratnagar is the industrial centre of the Zone with 11,000 employees in industry, the majority of whom are Indian. The jute industry is the leading branch, but it operates at very high costs as compared to competing mills in India, and is heavily dependent on the export bonus system. Stainless steel and (synthetic) textile industries have either closed down or are in serious difficulties as a consequence of the Indo-Nepal Trade and Transit Treaty. Biratnagar has not yet reached a stage of ‘self-sustained growth’, and its economic and social spread effects should not be overestimated, particularly with regard to the development of the Hills. Yields in Terai agriculture are limited mainly by the lack of irrigation and the insufficient availability of fertilizer. More than 10 per cent of the harvest is lost due to inadequate storage facilities. The farmers find it difficult to meet their basic needs, i.e. food and clothing. At the same time they have fairly clear ideas about the additional inputs necessary to increase yields and the marketing facilities needed. Sixty-one per cent of the farmers of a sample survey said that they were willing to contribute voluntary labour; this could be channelled into coordinated development efforts if additional management, technical knowhow and equipment could be provided.
Published Version
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