The World Bank Group has released the Nepal Human Capital Review (NHCR) as part of its global Human Capital Project. This initiative highlights the importance of investing in people to boost economic growth and prosperity through improved education, health, and nutrition. The review aims to understand why income inequalities persist and why many Nepalis remain in poverty.
The NHCR employs the World Bank’s Human Capital Index (HCI) to evaluate human capital in Nepal at both national and provincial levels. The HCI estimates the future productivity of a child born today if current educational and healthcare conditions remain unchanged. It provides insights into human capital issues with several key aspects:
• A forward-looking measure that predicts potential productivity for future generations.
• A straightforward approach focusing on essential skill formation aspects.
• A lifecycle perspective tracking a child's journey from birth through adulthood in terms of health and education.
• An output-oriented method emphasizing results by combining mortality rates, stunting, years of schooling, learning outcomes, and adult survival rates.
• A focused objective estimating future productivity based on present conditions rather than measuring social welfare.
The Nepal Human Capital Review outlines both challenges and opportunities while stressing the urgent need for investment in human capital. It offers policy recommendations aimed at addressing these challenges. The full report is expected soon, promising further insights into how Nepal can harness its talent for a more prosperous future.