Having undergone a major structural shift over the past few decades,Nepal is facing challenges of managing rapid urbanisation and unplanned growth,a World Bank study has said. While it is still the least urbanised country in South Asia with only 20 per cent of its population living in urban areas,but Nepal is one of the fastest urbanising countries in the region. The urban population growth rate of the country is estimated at more than 5 per cent per year,according to the study. Nepal's economy has undergone major structural shifts over the past few decades,from an agriculture economy to a service-based economy,says the World Bank in its report released today. "Urban areas are at the centre of this transformation and the urban economy is growing significantly faster than the rural one," states the report. "The incidence of poverty more than halved in urban areas from 22 to 15 per cent between 1995 Nepal's cities have the potential to drive economic growth to benefit the entire country. "With the population of five of Nepal's 10 largest cities growing at above 4 per cent a year,managing rapid urbanisation is essential for improving growth,creating jobs and reducing poverty," says Tahseen Sayed,World Bank Country Manager for Nepal. TThe report said that the Kathmandu Valley is the first area in the country to face the unprecedented challenges of rapid urbanisation and modernisation due to its position as the primary gateway for Nepal's economic activity. However,rapid population growth is overwhelming the capacity of existing institutions to manage urbanisation,points out the study. Land patterns are rapidly changing but urban development planning lags behind actual growth,it said. Infrastructure deficits are growing and unplanned growth has significantly increased vulnerability to disasters,says the report calling for urgent action to develop and regenerate the Kathmandu Valley's metropolitan region to improve productivity and livability and to ensure that growth is environmentally sustainable and inclusive.
