Introduction

Background: In 1951, the Nepalese monarch ended the century-old system of rule by hereditary premiers and instituted a cabinet system of government. Reforms in 1990 established a multiparty democracy within the framework of a constitutional monarchy. A Maoist insurgency, launched in 1996, has gained traction and is threatening to bring down the regime, especially after a negotiated cease-fire between the Maoists and government forces broke down in August 2003. In 2001, the crown prince massacred ten members of the royal family, including the king and queen, and then took his own life. In October 2002, the new king dismissed the prime minister and his cabinet for "incompetence" after they dissolved the parliament and were subsequently unable to hold elections because of the ongoing insurgency. While stopping short of reestablishing parliament, the king in June 2004 reinstated the most recently elected prime minister who formed a four-party coalition government, which the king subsequently tasked with paving the way for elections to be held in spring of 2005. Citing dissatisfaction with the government's lack of progress in addressing the Maoist insurgency, the king in February 2005 dissolved the government and assumed power.

Geography

Location: Southern Asia, between China and India

Geographic coordinates: 28 00 N, 84 00 E

Map references: Asia

Area: total: 140,800 sq km; land: 136,800 sq km; water: 4,000 sq km

Area - comparative: slightly larger than Arkansas

Land boundaries: total: 2,926 km; border countries: China 1,236 km, India 1,690 km

Coastline: 0 km (landlocked)

Maritime claims: none (landlocked)

Climate: varies from cool summers and severe winters in north to subtropical summers and mild winters in south

Terrain: Tarai or flat river plain of the Ganges in south, central hill region, rugged Himalayas in north

Elevation extremes: lowest point: Kanchan Kalan 70 mм highest point: Mount Everest 8,850 m

Natural resources: quartz, water, timber, hydropower, scenic beauty, small deposits of

lignite, copper, cobalt, iron ore

Land use: arable land: 21.68%; permanent crops: 0.64%; other: 77.68% (2001)

Irrigated land: 11,350 sq km (1998 est.)

Natural hazards: severe thunderstorms, flooding, landslides, drought, and famine depending on the timing, intensity, and duration of the summer monsoons

Environment - current issues: deforestation (overuse of wood for fuel and lack of alternatives); contaminated water (with human and animal wastes, agricultural runoff, and industrial effluents); wildlife conservation; vehicular emissions

Environment - international agreements: party to: Biodiversity, Climate Change, Desertification, Endangered Species, Hazardous Wastes, Law of the Sea, Ozone Layer Protection, Tropical Timber 83, Tropical Timber 94, Wetlands; signed, but not ratified: Marine Life Conservation

Geography - note: landlocked; strategic location between China and India; contains eight of world's 10 highest peaks, including Mount Everest - the world's tallest - on the border with China

People

Population: 27,676,547 (July 2005 est.)

Age structure: 0-14 years: 39% (male 5,575,157/female 5,221,794); 15-64 years: 57.3% (male 8,137,410/female 7,720,691); 65 years and over: 3.7% (male 499,039/female 522,456) (2005 est.)

Median age: total: 20.07 years; male: 19.91 years; female: 20.24 years (2005 est.)

Population growth rate: 2.2% (2005 est.)

Birth rate: 31.45 births/1,000 population (2005 est.)

Death rate: 9.47 deaths/1,000 population (2005 est.)

Net migration rate: 0 migrant(s)/1,000 population (2005 est.)

Sex ratio: at birth: 1.05 male(s)/female; under 15 years: 1.07 male(s)/female; 15-64 years: 1.05 male(s)/female; 65 years and over: 0.96 male(s)/female; total population: 1.06 male(s)/female (2005 est.)

Infant mortality rate: total: 66.98 deaths/1,000 live births; male: 65.25 deaths/1,000 live births; female: 68.79 deaths/1,000 live births (2005 est.)

Life expectancy at birth: total population: 59.8 years; male: 60.09 years; female: 59.5 years (2005 est.)

Total fertility rate: 4.19 children born/woman (2005 est.)

HIV/AIDS - adult prevalence rate: 0.5% (2001 est.)

HIV/AIDS - people living with HIV/AIDS: 61,000 (2001 est.)

HIV/AIDS - deaths: 3,100 (2003 est.)

Nationality: noun: Nepalese (singular and plural); adjective: Nepalese

Ethnic groups: Chhettri 15.5%, Brahman-Hill 12.5%, Magar 7%, Tharu 6.6%, Tamang 5.5%, Newar 5.4%, Muslim 4.2%, Kami 3.9%, Yadav 3.9%, other 32.7%, unspecified 2.8% (2001 census)

Religions: Hindu 80.6%, Buddhist 10.7%, Muslim 4.2%, Kirant 3.6%, other 0.9% (2001 census); note: only official Hindu state in the world

Languages: Nepali 47.8%, Maithali 12.1%, Bhojpuri 7.4%, Tharu (Dagaura/Rana) 5.8%, Tamang 5.1%, Newar 3.6%, Magar 3.3%, Awadhi 2.4%, other 10%, unspecified 2.5% (2001 census); note: many in government and business also speak English

Literacy: definition: age 15 and over can read and write; total population: 45.2%; male: 62.7%;  female: 27.6% (2003 est.)

Government

Country name: conventional long form: Kingdom of Nepal; conventional short form: Nepal

Government type: parliamentary democracy and constitutional monarchy

Capital: Kathmandu

Administrative divisions: 14 zones (anchal, singular and plural); Bagmati, Bheri, Dhawalagiri, Gandaki, Janakpur, Karnali, Kosi, Lumbini, Mahakali, Mechi, Narayani, Rapti, Sagarmatha, Seti

Independence: 1768 (unified by Prithvi Narayan Shah)

National holiday: Birthday of King GYANENDRA, 7 July (1946)

Constitution: 9 November 1990

Legal system: based on Hindu legal concepts and English common law; has not accepted

compulsory ICJ jurisdiction

Suffrage: 18 years of age; universal

Executive branch: chief of state: King GYANENDRA Bir Bikram Shah (succeeded to the

throne 4 June 2001 following the death of his nephew, King DIPENDRA Bir Bikram Shah)

head of government: Prime Minister Sher Bahadur DEUBA; note - the Prime Minister resigned in Februrary 2005;

 cabinet: Cabinet appointed by the monarch on the recommendation of the prime minister; note - the King dissolved the Cabinet in February 2005;

 elections: none; the monarch is hereditary; following legislative elections, the leader of the majority party or leader of a majority coalition is usually appointed prime minister by the monarch

note: King BIRENDRA Bir Bikram Shah Dev died in a bloody shooting at the royal palace on 1 June 2001 that also claimed the lives of most of the royal family; King BIRENDRA's son, Crown Price DIPENDRA, is believed to have been responsible for the shootings before fatally wounding himself; immediately following the shootings and while still clinging to life, DIPENDRA was crowned king; he died three days later and was succeeded by his uncle

Legislative branch:

: bicameral Parliament consists of the National Council (60 seats; 35 appointed by the House of Representatives, 10 by the king, and 15 elected by an electoral college; one-third of the members elected every two years to serve six-year terms) and the House of Representatives (205 seats; members elected by popular vote to serve five-year terms)

elections: House of Representatives - last held 3 and 17 May 1999 (next election NA); note - Nepal's Parliament was dissolved on 22 May 2002

election results: House of Representatives - percent of vote by party - NC 37.3%, CPN/UML 31.6%, NDP 10.4%, NSP 3.2%, Rastriya Jana Morcha 1.4%, Samyukta Janmorcha Nepal 0.8%, NWPP 0.5%, others 14.8%; seats by party - NC 113, CPN/UML 69, NDP 11, NSP 5, Rastriya Jana Morcha 5, Samyukta Janmorcha Nepal 1, NWPP 1

Judicial branch: Supreme Court or Sarbochha Adalat (chief justice is appointed by the monarch on recommendation of the Constitutional Council; the other judges are appointed by the monarch on the recommendation of the Judicial Council)

Economy

Economy - overview: Nepal is among the poorest and least developed countries in the world with 40% of its population living below the poverty line. Agriculture is the mainstay of the economy, providing a livelihood for over 80% of the population and accounting for 40% of GDP. Industrial activity mainly involves the processing of agricultural produce including jute, sugarcane, tobacco, and grain. Security concerns in the wake of the Maoist conflict have led to a decrease in tourism, a key source of foreign exchange. Nepal has considerable scope for exploiting its potential in hydropower and tourism, areas of recent foreign investment interest. Prospects for foreign trade or investment in other sectors will remain poor, however, because of the small size of the economy, its technological backwardness, its remoteness, its landlocked geographic location, its civil strife, and its susceptibility to natural disaster.

GDP: purchasing power parity - $39.53 billion (2004 est.)

GDP - real growth rate: 3% (2004 est.)

GDP - per capita: purchasing power parity - $1,500 (2004 est.)

GDP - composition by sector: agriculture: 40%; industry: 20%; services: 40% (2002 est.)

Labor force: 10 million

note: severe lack of skilled labor (1996 est.)

Labor force - by occupation: agriculture 81%, industry 3%, services 16%

Unemployment rate: 47% (2001 est.)

Population below poverty line: 42% (1995-96)

Household income or consumption by percentage share: lowest 10%: 3.2%; highest 10%: 29.8% (1995-96)

Distribution of family income - Gini index: 36.7 (FY95/96)

Inflation rate (consumer prices): 2.9% (2002 est.)

Budget: revenues: $665 million; expenditures: $1.1 billion, including capital expenditures of NA (FY99/00 est.)

Agriculture - products: rice, corn, wheat, sugarcane, root crops; milk, water buffalo meat

Industries: tourism, carpet, textile; small rice, jute, sugar, and oilseed mills; cigarette; cement and brick production

Industrial production growth rate: 8.7% (FY99/00)

Electricity - production: 2.054 billion kWh (2002)

Electricity - consumption: 2.005 billion kWh (2002)

Electricity - exports: 142 million kWh (2002)

Electricity - imports: 237 million kWh (2002)

Oil - production: 0 bbl/day (2001 est.)

Oil - consumption: 16,000 bbl/day (2001 est.)

Oil - exports: NA

Oil - imports: NA

Exports: $568 million f.o.b., but does not include unrecorded border trade with India (2002 est.)

Exports - commodities: carpets, clothing, leather goods, jute goods, grain

Exports - partners: India 48.8%, US 22.3%, Germany 8.5% (2004)

Imports: $1.419 billion f.o.b. (2002 est.)

Imports - commodities: gold, machinery and equipment, petroleum products, fertilizer

Imports - partners: India 43%, UAE 10%, China 10%, Saudi Arabia 4.4%, Singapore 4% (2004)

Debt - external: $2.7 billion (2001)

Economic aid - recipient: $424 million (FY00/01)

Currency (code): Nepalese rupee (NPR)

Exchange rates: Nepalese rupees per US dollar - 73.674 (2004), 76.141 (2003), 77.877 (2002), 74.949 (2001), 71.094 (2000)

Fiscal year: 16 July - 15 July

Communications

Telephones - main lines in use: 371,800 (2003)

Telephones - mobile cellular: 50,400 (2003)

Telephone system: general assessment: poor telephone and telegraph service; fair; radiotelephone communication service and mobile cellular telephone network; domestic: NA; international: country code - 977; radiotelephone communications; microwave landline to India; satellite earth station - 1 Intelsat (Indian Ocean)

Radio broadcast stations: AM 6, FM 5, shortwave 1 (January 2000)

Television broadcast stations: 1 (plus 9 repeaters) (1998)

Internet country code: .np

Internet hosts: 917 (2003)

Internet users: 80,000 (2002)

Transportation

Railways: total: 59 km; narrow gauge: 59 km 0.762-m gauge (2004)

Highways: total: 13,223 km; paved: 4,073 km; unpaved: 9,150 km (1999 est.)

Airports: 46 (2004 est.)

Airports - with paved runways: total: 9; over 3,047 m: 1; 1,524 to 2,437 m: 1; 914 to 1,523 m: 7 (2004 est.)