Connecting Nepal’s Rural Poor to Markets

Nepal is a small, landlocked but relatively populous country in South Asia, with about 28 million people. Its mountainous topography— includes Mt. Everest and eight of the world’s ten highest peaks—gave rise to a rich diversity of geography, religions and culture.

Nepal Roads

Nepal's rugged terrain prevent people from moving with ease. Nepal’s road network and quality are among the lowest in South Asia. More than one-third of its people live at least a two hours walk from the nearest all-season road; 15 out of 75 district headquarters are not connected by road. In addition, some 60% of road network and most rural roads are not operable during the rainy season.

Hence improving these non-operable roads to an all-weather standard and implementing a maintenance system is essential for Nepal’s economic growth and social welfare.

World Bank’s Role

To help address this problem, the World Bank committed $32 million in 2005 to improve rural roads to provide greater access to markets, schools, and health clinics. The Rural Access Improvement and Decentralization Project (RAIDP) - now active in 20 of 75 districts – focuses especially on remote, rural, and hilly areas of the country.

To date the project has rehabilitated and upgraded 540 kilometers of existing dry-season rural roads to all-season standard. Additionally the remote hill project districts have upgraded another 38 kilometers to dry-season standard. The project financed maintenance of about 3,500 kilometers of rural roads, constructed 102 trail bridges, and developed small community infrastructures.

A survey of five completed roads found an increase of more than 20% in motorized and non-motorized trips during the first year of operations. Similarly, travel time for road users was cut from an average trip time of 2.6 hours to 32 minutes.

Local Communities

Key to the project’s success is the active role played by the local communities. For example, Village Road Coordinating Committees were established to monitor the quality of road works and also to identify other community infrastructure needs. As part of this project villages receive support to develop small community infrastructure, including construction of markets and community trails and roads. The community contributes at least 20% either in cash or local labor and materials. In most of the cases, this is covered through contribution of labor and local materials.

Communities also contribute to the upgrading of rural roads. For the 15km Lamachaur-Machapucchre Road near Pokhara, the communities provided labor and helped to solve land issues.

Market Access

To help scale up the project, the World Bank on December 17, 2009 committed US$ 45 million in additional financing. With the new financing the project will expand its operations to 10 more districts and will upgrade a further 550 kilometers of existing dry-season rural roads to all-season standard. The additional financing is expected to create 150 days a year of off-farm employment for over 30,000 people. By the project end, in 2013, it is expected to have benefitted approximately 2.4 million people.