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 OJPS  Vol.10 No.2 , April 2020
Prospect of Good Governance and Human Development in Nepal
Abstract: Good governance has now become a buzzword in the political economy. It contributes to accelerating the overall development including human development. Its role in making effective delivery of social and public services is crucial. This paper analyzes the relationship between good governance and human development and its importance based on published data, documents, and theories. The concept of governance and human development emerged after the failure of economic growth based development to reduce poverty and inequality around 1980. Consequently, the UN proposed the concept of a human development approach to fulfill the voids created by past development. It is believed that the proper function of governance in terms of political, economic and administrative can create sound development. Rule of Law, participation, public accountability and responsiveness, transparency, equity and inclusion, efficiency, and decentralization are a key institutional framework for good governance. These principles are structured to perform well-functioning for the assigned goals and objectives. If the institution performs good governance, human development can easily be achieved, and ultimately, sound human development enhances good governance The prospect of good governance and sound human development for developing countries like Nepal is inevitable for economic development.

1. Background/Introduction

Over time, “development” is understood as different meanings. Following the industrialization in the mid-18th century, the modern development process was considered to have begun. Following the World War-II, development was introduced in planning and systematic way through institutions to set up the new political-economic structure and development was focused on economic growth particularly. In the concept of economic growth of development, the human was considered more or less as labors or means; it was not considered as a sole beneficiary. After 1980, resistances emerged in many parts of the world, as development could not go below (Escobar, 1995); and the third countries suffered by debt-problem. Many countries failed to achieve the goals of development due to the lack of political will. As a result, the concept of good governance and human development emerged as a part of alternative development. Governance has been related to the functional way of the institution, and human development implies the human capability and choices in general. The health, knowledge, and skills as a part of human development attracted to the many. The human capabilities boost the human choices and the role of good governance to achieve these goals is crucial.

The concept of good governance and human development was introduced in Nepal following 1990. Nepal’s experience regarding modern development is not more different from other developing countries’ experiences. After 1950, Nepal introduced the modern concept of development in terms of GNI (Gross National Index) or industrialization through five-year plans. However, development could not make a big leap; underdevelopment remains for a long. Pandey (1999: p. 6) mentions that the word “development” sells in the country—as a dream, and as a weapon to beat one’s political opponents with, but the subject has not been internalized as a mission. After 1990, Nepal adopted the human development approach focusing on people and their living standards along with economic growth. Nepal published its first human development report in 1998; five themes of HDRs have been published in different subjects until now. However, Nepal faces poor human development progress. Nepal’s ranking in the human development index is 145, which is lower in the world and medium in South Asia (UNDP-Nepal, 2014). It implies the important role of good governance in order to achieve sound human development. This study aims to explore the relationship between good governance and human development.

2. Objectives and Methods

The main objective of the study is to assess the relationship between governance and human development and its challenges. This paper analyzes an overview of the human development approach and the role of governance in human development. This work is based on literature reviews and secondary data including published Human Development Reports (HDRs) and good governance. The study is exploratory and analytical in nature because it intends to explore the focus on the trends of governance and human development worldwide and Nepal particularly.

3. The Conceptual Framework of Good Governance and Human Development

The governance relates to the institutions by which authority is exercised. Weber (1994) defines governance as broad that the exercise of power and legitimate authority to enhance the equitable process of development (p. 22). Hence, the success of governance in terms of planning, policies, strategy, and implementation determines the success of the development. As of UNDP (1990) governance as the exercise of political, economic and administrative authority in the management of the country’s affairs at all levels. Therefore, it includes the mechanism, process, relationship and institutions through which people and groups communicate and interact for developmental goals. For, the functioning of the political economy, the rule of law is essential. The state, civil society, and private-sectors/markets are three major components of the political economy. Haq (1995) focuses on human governance that enables the state, civil society and the private sector to build capacities, which meet the basic needs of all. Therefore, the relationship between the state, government, and civil society is important and the role of good governance is crucial in this regard. Similarly, economic governance includes decision making in resources, budgetary part and easy access on market for people. The political governance comprises of judicial, executive and legislative in a broader sense (Mudacumura, 2014). It includes elect-representatives i.e. leadership, decision making in the planning of the development and mobilization of resources. Likewise, administrative governance represents the implementation body that delivers social and public services. The public delivery services may be effective if there is good governance. Apart from, the civic society’s role in check and balance on state and market’s monopoly seems to be important. Democratic governance ensures participation, inclusion, equity, responsiveness, and transparency. The democratic based institution is considered as a support means for good governance.

Similarly, human development is an approach that focuses on people primarily; it emphasizes human capability. To promote and sustain human development, the system of good governance is vital. Presently, developing countries including Nepal have been facing problems and challenges of implementing human development effectively in the absence of good governance such as accountability, transparency, inclusiveness, and responsiveness. In human development, health, education, and income are considered as key determinant factors that augment human capability. The easy access to health and education to ordinary people can only be possible unless there is good governance. Good governance makes the institution competency that can deliver the quality of health and education to all.

Therefore, development and governance are more interrelated as Figure 1 mentions. Good governance can only assure and sustain human development (UNDP, 2009) and eventually, effective human development will prompt good governance.

Figure 1. Relationship between human development and good governance.

4. Concept of Human Development

The concept of human development introduced after the publication of the Human Development Report in 1990 prepared by the UN. People have been a central part of human development. Income, Education, and health are considered key elements of human development and these are essential for enhancing human abilities and making people capable of choices. The choices include freedom, guaranteed human rights and personal self-respect. The expansion of freedom is central to development (Sen, 2000). Equity, sustainability, production, and empowerment are four essential components in the human development paradigm (Haq, 1995).

According to HDR 1990 (UNDP, 1990), “Human development is a process of enlarging people’s choices. The most critical of these wide-ranging choices are to live a long and healthy life, to be educated and to have access to resources needed for a decent standard of living” (p. 11). The life expectancy for longevity, literacy rate and school attainment for knowledge and income for decent living standards are fixed as indicators in order to measure these elements. Human development has two concepts such as the formation of human capabilities (improved health, knowledge, and skills) and the use people make of their acquired capabilities. If the scales of human development do not finely balance the two sides, considerable human frustration may result (UNDP, 1990: p. 12). Human development ultimately strengthens human capital, which is considered to be essential for economic development.

Global Human Development reports

UNDP, the body of the UN, has been publishing the human development report yearly in different themes. The first human development report published in 1990 exposed enlarging people’s choices. The mobilization of maximum resources for social services was prioritized by 1991 human development (HD). HD 1993 focused on inclusive and collective action through decentralization, strengthens civil society and people’s participation. Similarly, HD 1995 emphasized gender inequality. Poverty was given a priority by HD 1997. Poverty has two dimensions—in the form of income and in deprivation form. HD 1999 paved the way for the impact of globalization. Human rights and human freedom were discussed in HD 2001. Meanwhile, HD 2002 focused on political implication and democratic governance to safeguard freedom and dignity and empower people. Likewise, HD 2003 explored the Millennium Development Goals (MDGs) adopted by 189 countries in 2000. The MDGs are a global compact among nations to end human poverty. The theme of cultural liberty to choosing one’s identity without being excluded from other choices in building a full life emphasizes multi-cultural policy was focused on HD 2004. Climate change was highlighted in HD 2007/8. In 2010, the Inequality-adjusted HDI (Human Development Index) was first introduced. HD 2016 emphasizes human development for everyone. The latest HDR 2019 (UNDP, 2019) predicts that a new generation of inequalities around education, technology, and climate change could trigger a “new great divergence” in the society of the kind not seen since the Industrial Revolution. Besides, this report also proposes to redress inequalities in policy level within a framework that links the expansion and distribution of both capabilities and income. In this way, various themes have been published on HD as per necessities.

Human Development Index (HDI)

The Human Development Index (HDI) is a summary measure of average achievement in key three dimensions of human development. Long and healthy life, knowledge and a decent standard of living are major three dimensions. Some indicators are used to assess the dimensions. For instance, the health dimension is assessed by life expectancy at birth; the education dimension is measured by means of years of schooling for adults aged 25 years and more and expected years of schooling for children of school entering the age. The standard of living dimension is measured by Gross National Income (GNI) per capita. The indicators of the three dimensions are calibrated and an HDI score sets between zero and one. Four human development categories or quartiles such as very high, high, medium and low are classified for ranking. Very high HDI ranks above 75, 51 - 75 represents high, and 26 - 50 represents the medium group and below it is classified under the bottom quartile. The compile of the three HDI’s scores are aggregated in a composite index using geometric mean and it is used as a human development index of the countries.

Nepal Human Development Reports

The first Nepal Human Development Report (HDR) was published in 1998 and then, five themes of HDRs have been published in different issues till now. The human development index of Nepal in 1998 was 0.432—placing in 193 which was lower ranking. HDR 1998 (UNDP-Nepal, 1998) mentions the national and local life such as the societal structures, the trend of the polity and the economy that help to understand Nepal. It provides a glimpse of past development and the concept and components of human development based on the literature and the potentiality of human development in order to harness in the future. Besides, inequalities by caste and ethnicity are also included in it.

Poverty reduction and governance were dealt with by HDR 2001. This report emphasized governance as a policy to improve the access to education and health sectors. Social and resource mobilization was supposed to be the key factors for sound human development. For it, transparency, responsiveness, participation, accountability, etc. are highlighted for the improvement of human development.

Similarly, HDR 2002 focused on empowerment and poverty reduction. The assumption was made that poverty reduction would require equitable growth, but for it, poor people should have political power, but it remains contested. The democratic participation may help for empowerment. The human development report could not come out between 2003 and 2008 due to the country’s engagement in the civil war and political transition. After the massive political change, in 2006-2007, HDR was published in 2009. It considered the post-conflict situation and state transformation in relation to human development. Recovery, Reconstruction and Rehabilitation were the broad themes with a view to contributing to the government’s preparation of its interim plan of 2007-2010. The next HD report was published in 2014, after five years. It focused on beyond geography, unlocking human potential. Nepal’s human development index in 2014 was 0.54 which seems to be improving as it ranked 145th out of 187 countries whereas it was 157th in 2013. In comparison to South Asian nations like Pakistan (146th position) and Afghanistan (169th position), Nepal has improved the educational and health sectors.

In this way, various themes have been dealt with by human development reports. Tenth plan (2002-2007) of Nepal has also underlined the human development approach, which announced inclusion, empowerment, and affirmative action’s to bring poor, women and disadvantaged to development mainstream (NPC, 2002).

Trends of Nepal Human Development

As of Human Development Indices and Indicators: 2018 Statistical Update (UNDP, 2018), Nepal’s HDI value for 2017 is 0.574, which puts the country in the medium human development category; Nepal ranks 149 out of 189 countries which are lower raking. Table 1 reveals that life expectancy is higher in comparison with the average of South Asia, however, the mean year of schooling is found below South Asia. Similarly, Nepal’s GNI per capita is much lower in South Asia. Sri Lanka represents the highest HDI value (0.77)-positioning 76 out of 189 countries.

Nevertheless, Nepal has been improving its HDI over the decades (Figure 2). In 1990, Nepal was counted in the bottom quartile; mean years of schooling and expected years of schooling were only 2 and 7.5 respectively (see Table 2).

Table 1. Nepal’s human development ındex in comparison to South Asian countries.

Source: UNDP, 2018.

Figure 2. Trend of human development in Nepal over two decades.

Table 2. Trends of human development in Nepal.

Source: UNDP, 2018.

Now it has been near doubled over two decades. Similarly, life expectancy at birth has steadily been increased from 54.4 in 1990 to 70.5 years in 2018. Likewise, GNI per capita has also been doubled over the decades. Table 2 reveals that the overall HDI value is improving as it was 0.378 (in 1990), which represents a low quartile, now it reached 0.579 (in 2018) which represents a lower human development category ranking 147 out of 189 countries. The rank is shared with Kenya of Africa. Table 2 reviews Nepal’s progress in HDI indicators.

Furthermore, HDR 2014 derived human development index by caste/ethnicity based on the 2011 census. Table 3 reveals that the Brahmans/Chhetrees and Newar rank the top with an HDI. The present constitution has categorized Brahman/Chhetrees as the Khas-Arya group and statistically, they represent the dominant group in Nepal. However, Dalits including both hill and Tarai/Madhesh have the highest poverty headcount rate and lower rank in human development, followed by Janajati/ethnic minority and Muslim.

Table 3. Poverty rate based on caste/ethnicity.

Source: UNDP-Nepal, 2014.

5. Governance

According to the World Bank (WB, 1992), Governance is defined as the manner in which power is exercised in the management of a country’s economic and social resources for development. The participation, transparency, responsiveness, consensus, orientation, equity, effectiveness and efficiency, accountability and strategic vision as a core characteristic of good governance (UNDP, 2009). Moreover, Mudacumura (2014) mentions that good governance or democratic governance is a practice, the implementation of which is critical in allowing both developed and developing countries to be in the driver seat as they control their political, economic and social development effectively (p. 2). Good governance is becoming more and more commonplace as a key element of development. It is central to creating and sustaining an environment, which fosters strong and equitable development (WB, 1992: p. 47).

The Governance practice supports to build capable, efficient, inclusive, responsiveness and accountable institutions and it enhances sound human development. Freedom, participation, public accountability and responsiveness, transparency, equity & inclusion, efficiency, and decentralization are a key institutional framework for good governance. Governance consists of a part of decision-making or leadership processes. Governance has also been defined to refer to structures and processes that are designed to ensure accountability, transparency, responsiveness, rule of law, stability, equity and inclusiveness, empowerment, and broad-based participation. Gellner & Hachhethu (2008) describe governance as a local manifestation. In a broad sense, governance is about the institutional environment where citizens and stakeholders interact and participate in public affairs. Governance is generally associated with a state affair.

State, governance and civil society

The role of civil society in promoting good governance is vital for healthy development. Therefore, balance among government, citizens and civil society is essential for human development.

Concept of Good Governance

In 1989, the World Bank used the term “governance” to describe the need for institutional reform and efficient public sector in Africa (Yu, 2018) and then after, good governance term has frequently been used. Good governance includes participatory, transparent, accountable, effective and equitable and promotes the rule of law. In the 90s, now good governance has become part of a policy.

Nepal Good Governance Policy

Nepal Government has been highly giving important good governance as a policy. Article 51 b (4) of The Constitution of Nepal 2015 mentions Policies of the State guaranteeing good governance by ensuring the equal and easy access of the people to the services and facilities delivered by the State, while making public administration fair, competent, impartial, transparent, free from corruption, accountable and participatory. As Nepal’s first Good Governance Act (2008), good governance is expedient to make legal provision in relation to good governance by making public administration of the country pro-people, accountable, transparent, inclusive and participatory and make available its outcome to the general public. It also emphasizes rule of law, corruption–free and smart (lean or smooth) administration, financial discipline, and efficient management of public work and resources to create a situation for providing public services in a speedy and cost-effective manner. Article 8 of the Act mentions that the duty of the concerned authority shall carry out the administrative function of the country pursuant to this Act or other prevailing laws, in a speedy manner, with the objective of maintaining good governance and make available its outcomes to the people in time. The concern of good governance policy in Nepal is to make effective public service delivery to the lower people. Despite policy and efforts towards good governance, there are many challenges in the wake of good governance.

Issues and Challenges of Good Governance

According to UNDP (1997), there are eight basic principles of good governance and its effectiveness guarantee human development, though there are the challenges:

Participation/Empowerment—Participation is the most essential things for good governance. As far as possible, the most vulnerable groups in society should be included in decision-making. Government alone cannot end corruption, without ensuring accountability, impartiality, and able administration. Besides, the active participation of the people, civil society and non-governmental organizations to maintain good governance is also essential. It is one of the challenges in Nepal. Participation of Nepalese citizens in the state affairs directly or through legitimate institutions or representatives is important for good governance in Nepal.

Rule of law—Good governance requires fair judicial frameworks for maintaining the law that ensures the right of stakeholders and people. Good governance cannot be achieved if there are the weak, incompetent and corrupt judiciary and police forces.

Transparency—Transparency is the most essential things for good governance. Good governance can be promoted only where decisions are made fairly based on rules and regulations in a transparent way and public information on decision-making must be available easily. Nepal ranks 113 out of 180 countries which represent lower ranking (TI, 2019); it implies poor governance.

Responsiveness—Responsiveness is the most essential thing for good governance; it means being responsive to the needs and expectations of the people. It is the duty of the responsible officials and leaders to serve and deliver services to the people within a stipulated time-frame.

Consensus—Good governance requires rigorous consultation to understand the interests of stakeholders in order to reach a broad consensus. It makes development as sustainable because consensus ensures ownership’s feelings among stakeholders or user-groups.

Effectiveness & efficiency—Good governance should ensure the effective and efficient use of available resources in the most transparent and accountable ways. This will make sure social and public service delivery.

Accountability—Good governance requires accountability on the part of every institution: the government or private sector should be accountable towards the people who will affect by its decisions or actions.

Challenge in political governance—Political instability, frequent change in government, weak peace and security, agitation, and so on are the key challenges in political governance. Nepal faced civil war between 1996 and 2006 and then after, the political transition was lingered up to 2015. After 1990 there is no record that any government took its tenure at least two years. More agitations and movement (social, political movements, ethnic and Maoist movement) have been faced by Nepal after 1995. The monarch has been abolished and the country adopted the “federal republic political system” following the 2006 movement.

Challenge in economic governance—many developing countries have been facing a shortage of human/cultural capital. Presently, Nepal is facing a scarcity of skilled manpower because most of them are going abroad. As CBS (2011) & MoFA (2017-2018), 57% of the households depend on international migration and it contributes 26% to the national GDP. Nepal issued 3.5 million labor permits to migrant workers between 2008 and 2017 (DoFE, 2020). However, there are also challenges in terms of scarcity of human capital and sustainability in the wake of international migration. Nepal is facing a shortage of skilled human capital in the lack of good migration-governance.

Challenge in the legal and constitutional sector—The lack of practicing law or rules, the ineffectiveness of proper punishment for corruption, political interference in the judiciary (appointment of the judge based in parties quotas in Nepal), and delay in making rules are the challenges in the wake of good governance.

Challenge in administrative governance—Lack of trained staff and professionals, poor technology, and corruption are the key challenges in administrative governance.

6. Concluding Remarks

The aim of Human development is to make people capable of assuming that it will make them able to choices of their own, and its positive role in alleviating poverty is unambiguous. Some examples suggest that good governance can play a vital role to achieve sound human development. The Kerala state of India is a worthy example in the world who achieved sound human development (education and health sector) through good governance despite low economic development and it strengthened social integrity. The experiences of Gambia also seem to be relevant herewith. As the Human Development Report of Gambia (2000), good governance is pre-requited for Human Resources Development and sustainable growth. The Chinese human development experience can also be quoted herewith which has largely been associated with leadership governance. The leadership’s vision and insightful governance can lead to the development (Zhou, 2017) and the modern state (Fukuyama, 2016). Similarly, good governance boosts the decentralization process and hence, both decentralization and good governance are likely to be a compliment. In Rwanda, the promotion of good governance as the part of decentralization promoted effective and accountable service delivery and this concept has largely been taken as positive. The poor performance of the delivery of public services like health and education implies bad governance as many developing countries like Nepal has been facing such problems. Despite some improvements in Nepal’s education and health sectors, there is still poor performance. As of Nepal Demographic and Health Survey 2016 report, almost half of the households (49%) are within 30 minutes of a government health facility, and 34% of households in the lowest wealth quintile have to travel more than an hour to reach the nearest government health facility (MoH, 2017). Similarly, two in five women and one in five men in Nepal have no education. Corruption and poor participation and consensus in public decisions and developments are major deficiencies in the wake of sound governance that eventually hampering human development. Advanced technology and innovation augment good governance; the expansion of digital or e-governance will make the institution more efficient. However, the institution/organization, leadership, and governance are largely associated with each other (Chaudhary, 2019), but its boundaries have not been cleared that need to be identified. Therefore, governance itself is not a whole solution but a way of a good solution.

Cite this paper: Chaudhary, D. (2020) Prospect of Good Governance and Human Development in Nepal. Open Journal of Political Science, 10, 135-147. doi: 10.4236/ojps.2020.102010.
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