Nepal finds itself at an intersection of two potent forces – a technological revolution sweeping the globe and a dramatic demographic shift. Artificial intelligence (AI) and automation, often seen as the deus ex machina of the 21st century, are making their presence in every part of our lives. This digital metamorphosis comes with its benefits and threats. While they promise to augment economic activities, they simultaneously risk displacing numerous labour-intensive jobs. This concern is acute for a country like Nepal, where remittances from its workers in the Gulf countries, a region rapidly embracing technological shift, account for almost 26% of the nation’s GDP. “Job displacement from labor-intensive industries has been taking place for several decades, as countries move to higher-value-added activities and services,” wrote Mckinsey &amp; Company in The Future of Jobs in the Middle East in 2018, adding that this will accelerate <a href="https://www.mckinsey.com/featured-insights/middle-east-and-africa/are-middle-east-workers-ready-for-the-impact-of-automation">between now and 2030 with 45% of existing work in the Middle East potentially being automated.</a>  <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904090952_a93aeeca5e7480559a7ada068cb22ba7247b73088349c2eedead1f35af622d81.png" data-media-id="editor_1" data-image-id="20230904090952_a93aeeca5e7480559a7ada068cb22ba7247b73088349c2eedead1f35af622d81" data-rendition-name="original" width="918" height="685" loading="lazy" alt="Tech and transition"></figure>   <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904090952_1b3468214a3703bdf69e5c332831d25699cd690e170d2ef7b1418fbbe19ca9f6.png" data-media-id="editor_2" data-image-id="20230904090952_1b3468214a3703bdf69e5c332831d25699cd690e170d2ef7b1418fbbe19ca9f6" data-rendition-name="original" width="676" height="305" loading="lazy" alt="ILO"><figcaption>Source: Recruitment of migrant workers from Nepal: Country Profile (ILO, 2021)</figcaption></figure>  This should be of special concern for policymakers in labour exporting countries like Nepal given the inherent <a href="https://www.mckinsey.com/~/media/mckinsey/featured%20insights/middle%20east%20and%20africa/are%20middle%20east%20workers%20ready%20for%20the%20impact%20of%20automation/the-future-of-jobs-in-the-middle-east.pdf">link between displacement potential by automation and low-to-medium levels of education and experience</a>. Workers who have a ‘high-school education or less’ are most vulnerable to the shocks associated with automation. The average automation potential of jobs requiring less than high school, or high school/some experience is more than 50%. Labour migrating from Nepal predominantly characterised by a preponderance of young unskilled labor (more than 54% of total labor migration) are most vulnerable in this displacement.  <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904090952_184cb0d4a71b043fa9cbc0cf102e6ceee65e43dd27e42e3d5d3befdce491525f.png" data-media-id="editor_4" data-image-id="20230904090952_184cb0d4a71b043fa9cbc0cf102e6ceee65e43dd27e42e3d5d3befdce491525f" data-rendition-name="original" width="918" height="644" loading="lazy" alt="Tech and transition"></figure>   <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904090952_fdb171a296445b16abb2dd9a04e2dac49a0e8d8723b7564bf232b96a4ad16f36.png" data-media-id="editor_5" data-image-id="20230904090952_fdb171a296445b16abb2dd9a04e2dac49a0e8d8723b7564bf232b96a4ad16f36" data-rendition-name="original" width="1106" height="268" loading="lazy" alt="Tech and transition"><figcaption>Source: Recruitment of migrant workers from Nepal: Country Profile (ILO, 2021)</figcaption></figure>  At the same time, Nepal with more than 60% of its population falling in the working age group is undergoing a demographic shift. Drawing upon the 2021 census data, Nepal’s annual population growth rate has decreased to 0.92% with the birth rate having dropped while life expectancy is on the rise. The World Bank data reveals that Nepal’s birth rate dropped from 31 per 1,000 people in 2000 to 20 in 2020, while <a href="https://data.worldbank.org/indicator/SP.DYN.LE00.IN?locations=NP">life expectancy</a> has risen from 63 years to 69 years during the same period. The number of people older than 60 has climbed by 2 percent points. By 2040, the <a href="https://databank.worldbank.org/source/population-estimates-and-projections">population estimates and projections from the World Bank</a> shows that the proportion of elderly population in Nepal will have increased by more than one third. These demographic forces are poised to cause a significant increase in the dependency ratio (dependent people as percent of the working age population), a challenge for an economy primarily dependent on labour remittance.  <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904100944_d1d3d49bf18f40fb0ec96b81bcb77ff1cbf2641896397b71868cae07fc78d131.jpg" data-media-id="editor_8" data-image-id="20230904100944_d1d3d49bf18f40fb0ec96b81bcb77ff1cbf2641896397b71868cae07fc78d131" data-rendition-name="original" width="1000" height="700" loading="lazy" alt="demographic transition"><figcaption>Source: Nepal Population and Housing Census (NSO- NPHC, 2021)</figcaption></figure>  Nevertheless, technological revolution has not only reshaped global superpowers but has also provided emerging economies with opportunities to leapfrog traditional developmental transition. Digital technology’s creative destruction could spawn new sectors of employment, that could help to harness the benefit of demographic dividend and improve the quality of life in the longer run. <a href="https://www.iids.org.np/images/publications/53e4e8a0c60bb963dfdabce67ec5fdcf.pdf">A study by the Institute of Integrated Development Studies</a> offers insightful data that underscores the significance. By 2022, Nepali IT companies had made a substantial investment of $41.26 million across the country. This investment reflects the growing confidence of stakeholders in the potential of the IT sectors. More impressively, these investments translated into staggering revenue of $515 million, showcasing the sector’s profitability, and its capacity to contribute to the national economy. As technology has made more services tradable, Nepal has the opportunity to transition from labour exports to service exports. This not only retains talent within the country but also creates job opportunities for the youth, addressing the brain drain issue. However, the trajectory isn’t as straightforward. Digital inclusion gaps, a limited capacity for innovative digital tech use, myopic labour laws, lack of data security laws, shortage of skills and IT infrastructural challenges pose substantial barriers for inclusive growth. Moreover, Nepal has grappled with governance failure and political instability that have hampered past policy implementation efforts, pointing towards a more critical systemic challenge. On one hand, IT companies seek workforce proficiency in essential areas such as UI/UX, SQL, full stack web development, python, DevOps, and automation testing.  <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904090956_bf93b210720350521983eeebac9d8f82458aaf26608105bd57fb32991929002e.png" data-media-id="editor_10" data-image-id="20230904090956_bf93b210720350521983eeebac9d8f82458aaf26608105bd57fb32991929002e" data-rendition-name="original" width="655" height="455" loading="lazy" alt="Tech and transition"><figcaption>Source: Unleashing IT: Advancing Nepal’s Digital Economy (IIDS, 2023) </figcaption></figure>  While on the other hand, demographic profile of Nepal shows that there are less than 2% youths in the age group 15-39 years with 10+2 or equivalent who have computing and technology as major field of study. The figure is much higher for those enrolled in management at more than 35%.  <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904090956_58e440ecb976281a220e2d16c26ff12c4679418957ca77c33250fbcd26792299.png" data-media-id="editor_11" data-image-id="20230904090956_58e440ecb976281a220e2d16c26ff12c4679418957ca77c33250fbcd26792299" data-rendition-name="original" width="1000" height="800" loading="lazy" alt="Tech and transition"><figcaption>Source: Nepal Population and Housing Census (NSO- NPHC, 2021) </figcaption></figure>  Viewed through a gender lens, females within this age group exhibit a strong inclination towards Education and Health/Medical Sciences. Their representation in the field of Computing and Information Technology remains strikingly low, accounting for less than 1% of the cohort.  <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2023090410090_8697f24662b6a53800810f764bb8d834b5198772b28cf29845ef23ec65bf15be.png" data-media-id="editor_12" data-image-id="2023090410090_8697f24662b6a53800810f764bb8d834b5198772b28cf29845ef23ec65bf15be" data-rendition-name="original" width="1900" height="800" loading="lazy" alt="Tech and transition"><figcaption>Source: Nepal Population and Housing Census (NSO- NPHC, 2021) </figcaption></figure>  While established <a href="https://b360nepal.com/public/putting-his-stamp-on-the-world-kiran-bhakta-joshi">digital enterprises and burgeoning startups are navigating through the talent pool</a>, they frequently encounter a significant void: a dearth of individuals possessing the requisite skills to be deemed employable. This scarcity is particularly pronounced among women, whose specific skill gaps act as a formidable barrier, constraining their full participation in the digital workforce and entrepreneurial ventures. Madhes Province, for instance, with a youthful demographic paradoxically grapples with staggering low female literacy rate (54.7%).  <figure><img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230904100932_7b52c96ac5b03f15a358ec65d94d9485e78aba51c3f2ac8915041e98fd337779.png" data-media-id="editor_14" data-image-id="20230904100932_7b52c96ac5b03f15a358ec65d94d9485e78aba51c3f2ac8915041e98fd337779" data-rendition-name="original" width="1512" height="634" loading="lazy" alt="Tech and transition"><figcaption>Source: Nepal Population and Housing Census (NSO- NPHC, 2021)</figcaption></figure>  It is crucial to consider the <a href="https://www.nber.org/papers/w28551">unequal effects of service-led growth</a>, a phenomenon that has been observed in other developing countries like India. In Nepal, this could exacerbate existing urban-rural divides, as the evolution of informational technology may not absorb the unskilled labour from rural area that currently seeks employment abroad, particularly in the Gulf countries. It is imperative for Nepal to craft policies that are sensitive to these unequal effects. This could include investing in education and training programs that are aligned with the needs of the IT sector, bridging rural development initiatives that complement holistic service led growth, and implementing training programs that help females and individuals from underrepresented groups in the burgeoning IT sector. As the tides of time advance, we find countries steadily pivoting towards realms of higher intellectual yield—towards activities and services that demand less from the body and more from the mind. Nepal with its youthful demographic could, to some extent, harness the power of technology to spur economic growth. However, this same demographic group, given their current education levels, might not effectively complement in the aspired trajectory. Moreover, they are potentially the most vulnerable to unemployment due to automation, especially with over 54% of total labour migration being unskilled. The government faces a herculean task in turning technology into a viable solution for employment and inclusive growth. Development stakeholders in the young republic must guide this transformation with astute policymaking and strategies as we witness Nepal's demographic shift in the age of automation.” Ashutosh M. Dixit is an economist and an Australia Award Scholar with over 15 years of experience. He has worked with the National Planning Commission in Nepal and global institutions including the World Bank, UNICEF, UN-ESCAP, OECD, UNDP, and Standard Chartered.

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Tech and transition in Nepal

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221108151124/636a66f29c7e80680e0599b1jpeg.jpg" alt="" width="1500" height="1062"/><figcaption>Photo : SONIA AWALE</figcaption></figure>Nepal is stepping up preparations for its 10-year census in 2021, which is slated to be the most hitech in history and will go beyond simply counting the <a href="https://archive.nepalitimes.com/article/nation/Nepals-changing-demography-is-having-profound-impact-on-politics,2693" target="_blank" rel="noopener">country’s population</a> to surveying households in order to chart the country’s path in the coming decade.Read also:<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/?p=38051&amp;preview_nonce=38f8426e6c&amp;preview=true" target="_blank" rel="noopener">Nepal in 2030</a>, Sanghamitra Subba<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/?p=38046&amp;preview_nonce=d2d7129548&amp;preview=true" target="_blank" rel="noopener">A future written in the stars,</a> Sanghamitra SubbaEnumerators from the <a style="letter-spacing: 0.01em;" href="https://cbs.gov.np/" target="_blank" rel="noopener">Central Bureau of Statistics</a> (CBS) will be using tablets to enter data during a pilot census in 14 districts next month. The actual census in June 2021 is expected to give an accurate picture of Nepal’s demography and how it has progressed in <a style="letter-spacing: 0.01em;" href="https://www.nepalitimes.com/banner/this-is-how-to-upgrade-nepals-rural-health/">health</a>, <a style="letter-spacing: 0.01em;" href="https://www.nepalitimes.com/banner/after-quantity-nepals-education-needs-quality/" target="_blank" rel="noopener">education</a> and development.Read also:<a href="https://www.nepalitimes.com/?p=38023&amp;preview_nonce=024823c344&amp;preview=true" target="_blank" rel="noopener">Towards 2030</a><a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/?p=38038&amp;preview_nonce=e8166bf726&amp;preview=true" target="_blank" rel="noopener">Another decade to get it right,</a> Editorial<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/?p=38073&amp;preview_nonce=5c5e53a600&amp;preview=true" target="_blank" rel="noopener">How will Nepal develop in the next decade?,</a> Sonia AwaleFor the first time, data will be collected at the lowest administrative unit, the ward, and also include information on housing, migration, jobs and income. The census will cost Rs4.5 billion and employ 43,000 enumerators.“Previous censuses only went down to the district level, and enumerators used two forms: a short form for every household, and a long form used on every eighth household,” says Bijay Thapa of the United Nations Population Fund (UNFPA), which is collaborating with the government on the census. “After federalism, local governments also want disaggregated data and we will have detailed information on every household.”Next year’s exercise will also count the number of old and new buildings and note whether they are residential, official, commercial or unused. It will include a community survey, one of the first in the world, to assess availability of government services, <a href="https://www.nepalitimes.com/banner/disastrous-management-in-nepal/" target="_blank" rel="noopener">disaster preparedness</a> and access to natural resources.“This will help us determine if people are making the best use of government services,” says CBS Director Dhundiraj Lamichhane. “Nepal has categorised 276 municipalities as urban, but we do not know if the resources available match the international criteria for urban municipalities. This survey will help us determine that. If successful, it will be a model for other countries.”Read also: <a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/?p=38051&amp;preview_nonce=38f8426e6c&amp;preview=true" target="_blank" rel="noopener">Nepal in 2030,</a> Sanghamitra Subba<a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/?p=38051&amp;preview_nonce=38f8426e6c&amp;preview=true" target="_blank" rel="noopener">A future written in the stars,</a>Sanghamitra SubbaLamichhane said the questions enumerators will ask have not yet been finalised, but there are demands from various communities to include ones on mother tongue, <a href="https://www.nepalitimes.com/here-now/the-right-of-passage/">disabilities</a> and sexual orientation. Activists say there are 900,000 <a href="http://archive.nepalitimes.com/article/nation/Night-and-%20Day,3145">LGBTI people in Nepal</a>, but the 2011 census showed only 1,500 so the figure was not included in the results.“This time they want more detailed questions to reflect their diversity, but we think it is better to do a separate survey,” says Lamichhane. “Various castes and ethnicities are also demanding to be included, but we will only do so if recommended by relevant government bodies.”Going by past trends and other sample surveys, experts have already projected results of the 2021. Nepal is expected to continue showing improvements on most indicators, including birth rate, population growth, health and education. However, they say some indicators, like the sex ratio and migration, may not show progress.One of the reasons Nepal’s <a href="https://www.nepalitimes.com/here-now/migrating-males-and-population-decline/">population growth rate is low is because of the absentee population</a>: 1.92 million according to the last census. And there is no reason to believe that the percentage of migrants will decrease or even stabilise in next year’s count. However, internal migration is expected to slow because of more education and employment opportunities at local levels.Nepal’s current sex ratio is 94 males per 100 females,<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221108151124/636a66f59c7e80680e0599b2jpeg.jpg" alt="" width="461" height="500">and the sex ratio at birth is 106 males per 100 females. This is considered normal, since there are usually slightly more male children born than females, but females tend to live longer.“Female foeticide is growing even though it is illegal. The next census may show a greater ratio of male babies born to female ones, and we estimate the sex ratio at birth to rise to 110 males to 100 females. Additionally, the national average may hide greater discrepancies in certain districts or cities where female foeticide is more rampant, and we need to watch out for that,” explains Tirtha Tamang of UNFPA.Demographic indicators like birth, fertility and death rates are all set to decrease, which means that Nepal’s population growth rate will continue to slow. The 2021 census is likely to show a wider ‘youth bulge’ in the population pyramid. Although this provides a ‘<a href="http://archive.nepalitimes.com/article/editorial/editorial-reaping-demographic-dividend,3621">demographic dividend</a>,’ with a bigger workforce that could lead to a development boom, Nepal must be able to cash in on this window of opportunity in the next 10 years. Given the current quality of governance, experts doubt it will happen.Nepal’s youth advantage will last till 2047. After that, the country will be grappling with the complications of <a href="http://archive.nepalitimes.com/article/Nepali-Times-Buzz/need-to-prepare-for-ageing-society,3624">an ageing society</a>. In fact, Nepal will start losing some of its youth power about 2028, when the population over 65 will be more than 7%. The next decade is key for Nepal to use its demographic dividend to provide jobs at home and boost economic growth.Despite improvements in education, health, life expectancy and income, the country may not be in a position to make the best of its demographic dividend because of the skewed sex ratio caused by <a href="https://www.nepalitimes.com/latest/irresistible-forces-wage-differentials-and-demographic-trends/">outmigration</a>. According to a report by the National Planning Commission, the country sorely needs to invest in policies that make the best of the potential of youth.Says Lamichhane at the CBS: “If young Nepalis at the peak of their abilities <a href="https://www.nepalitimes.com/banner/migration-certificate/">continue to leave the country</a>, then Nepal will not make great strides in development. In the next decade we need policies to modernise agriculture and improve infrastructure if we want to retain our youth and have them contribute to the country.”<h2>21 of Nepal’s most endangered languages</h2>When Nepal’s last census was published in 2011, language became one of the most hotly-debated indicators. Many doubted that the census accurately reflected the status of Nepal’s languages. This time, the Language Commission is working with the Central Bureau of Statistics (CBS) to make a more comprehensive tally.The 2011 census counted 123 languages spoken in Nepal, including foreign languages like English, French, Spanish and Chinese. Also, there was a belief that many people who had forgotten their ancestral language nevertheless registered those languages as their mother tongue, leading to higher numbers of speakers of <a href="https://archive.nepalitimes.com/article/nation/Mind-your-languages,133" target="_blank" rel="noopener">endangered languages</a> registered than in reality. The Kusunda language, for example, has only two speakers left, but the census records 28.“The languages should be categorised as foreign and native to Nepal, so that we don’t count European languages as our own,” says Bharat Tripathi of the Language Commission. “Also, the last time there were only two questions asked about language: <a href="http://archive.nepalitimes.com/news.php?id=13412#.XftV_JMzaUk" target="_blank" rel="noopener">mother tongue</a> and second language. This time we want to change that to: mother tongue, second language and ancestral language.”<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221108151124/636a66f79c7e80680e0599b3jpeg.jpg" alt="" width="1500" height="947">While the CBS is still debating these suggestions, it has agreed to include six more languages newly catalogued by the Language Commission, bringing the total to 129. “We investigated Rana Tharu, Narafu, Chum, Nubri/Lharke, Poike and Serake languages in the past year. Through linguistic methodologies, we have established that they are distinct languages,” says Tripathi. “This year we have received claims from speakers of Marek Yakhya and Walung languages in Taplejung — we are in the process of investigating them.”These languages are usually spoken by very few people, and are added to the list of endangered languages. The commission has identified 37 languages spoken by fewer than 1,000 people, and placed 21 of them on that list, but there may be many more hidden among less populous communities. The commission is working to document these 21 languages by collecting their grammar, determining their alphabets, writing their language histories and documenting the available folklore.It is doubtful if all of the 129 languages will survive even till the census in June 2021. But most certainly many will be gone by the 2031 census.

Nepal in the 2020s

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Tech and transition in Nepal

Nepal in the 2020s