Economic conditions. – As regards the economic and social conditions of the population, estimates by the World Bank, relative to 1991, attributed to the country a gross domestic product per capita of less than 200 dollars. Despite the difficulties of estimating on a monetary basis the income produced by a country still largely dominated by a subsistence economy, the fact remains that the Nepal has a strongly backward economic structure characterized by the persistence of great poverty. GDP per capita growth in the period 1969-90 in real terms it was around 0.6% per year; life expectancy at birth is just over 50 years, while around three quarters of the population are still illiterate today. Also in 1990, 60% of income came from agriculture (to which more than 90% of the active population devoted themselves) and only 6% from the manufacturing sector. At the same date, the total amount of external debt was approximately $ 1.4 billion.

According to Localcollegeexplorer, in 1985 a long-term program (divided over 15 years) was launched to satisfy the so-called basic needs, with the aim of doubling agricultural production, in order to lighten the dependence of the Nepal on the massive importation of food products. Despite the existence of a huge potential of hydroelectric energy (of which only 0.2% is currently used), the exploitation of the forest heritage for domestic energy uses is still very intense. To relieve the trade balance of the import costs of energy products, the Nepal has signed an agreement with two multinationals to undertake a systematic oil exploration campaign in the southeastern section of the country. Finally, a good active voice in the balance of payments concerns tourism: in 1991 over 290,000 tourists visited the country.

History. – The history of Nepal during the seventies and eighties appears to be characterized by a strong demand for the democratization of political life; the main objectives were the transition from an absolute monarchy to a constitutional monarchy, the replacement of the system of the Rashtiya panchayat (National Assembly, partly unicameral, indirectly elected, partly appointed by the king) with a parliamentary government on a party basis, the end of a ban on parties and censorship. After the first lukewarm reforms of 1975, which limited themselves to granting more frequent elections, a referendum was held in May 1980 which rejected, with 54% of the votes, the opposition’s proposal in favor of a multi-party democracy, preferring a panchayat system.reformed. However, amendments to the constitution were passed which allowed, in May 1981, the holding of the first direct legislative elections after 1959, still on a non-party basis.

The difficult economic situation, aggravated by a famine following an exceptional drought in 1982, and the tightening of repressive measures, especially with regard to the press, rekindled the tension, which culminated in 1985 with a campaign of civil disobedience promoted by the NCP (National Congress Party) and with bomb attacks probably organized by recently established anti-monarchist extremist movements. The government responded with severe anti-terrorist laws and with an even more accentuated policy of repression which was followed, especially between 1988 and 1989, by numerous political arrests, including that of the president of the NCP. On February 18, 1990, the MRD (Movement for the Restoration of Democracy) was formally established, founded by the NCP and the ULF (United Left Front), which brought together Communist and Labor-inspired groups. The government tried to prevent its inauguration with arrests and censorship of the press, and the violent riots that followed escalated in the following days, when the police opened fire on a huge crowd of demonstrators marching towards the royal palace, causing a fifty dead.

The government was forced to surrender, and on April 8 a historic announcement by King Birendra authorized the revision of the constitution for the transition to a constitutional monarchy, with multi-party elections. Shortly thereafter, the amnesty for all political and religious prisoners and the abolition of the death penalty followed. The new constitution, which was officially promulgated by the king on November 9, 1990, sanctions the constitutional monarchy regime and fundamental rights; Hinduism is recognized as the state religion but, with the exception of some restrictions on proselytism, freedom of worship is guaranteed. The government is based on a bicameral system, composed of the Pratinidhi Sabha (House of Representatives), with 205 members, and the Rashtriya Sabha (National Council), with 60 members. A Council of State (Raj Parishad), consisting of 15 members, 8 of whom are chosen by the king, was established at the proposal of this.

Twenty of the 44 officially registered parties took part in the elections of May 12, 1991; the majority party resulted in the NCP with 110 seats, followed by the UCPN (United Communist Party of Nepal) with 69 seats. Despite the important democratic achievements in politics, social tensions did not ease due to the heavy economic situation. April 1992 was a month of violent unrest: during a general strike in Kathmandu against rising cost of living and government corruption, violent clashes with police killed six demonstrators, sparking a series of riots that placed the government in serious difficulty, already tried by strong dissensions within the majority party.

In economics, relations with the Indian Union are of great importance, governed by trade and transit treaties, the latter of vital importance for a geographically closed country like Nepal. A serious crisis occurred in 1987, a few months after the signing of an economic cooperation treaty: India accused the Nepal of providing asylum to the nationalist rebels in West Bengal, an accusation rejected by the Nepal who in turn recriminated repeated violations of border by Indian police during the pursuit of rebels. Another point of contention was the Nepal’s purchase of military supplies from China; considering it a violation of the peace treaty signed in 1950, India refused to renew trade treaties in 1989, closing 13 of the 15 transit points, with serious repercussions on the already precarious economy of Nepal. The crisis subsided and in a gesture of pacification Nepal suspended military supplies from China; in 1991 the treaties were renewed and in 1992 bilateral economic cooperation was extended with further agreements on trade and exploitation of common water resources.

China also represents an important economic point of reference for the Nepal in 1984 a first programmatic meeting for cooperation between the two countries was held, which since 1986 has become an annual event. A tangible help from China has been the increase in imports in order to reduce the imbalance in the trade balance. Relations with Pakistan are also significant (a 1962 trade agreement was renewed in 1982) and with Bangla Desh, especially for the exploitation of common waters; an economic cooperation treaty with Japan was enacted in 1991. The Nepal pursues a foreign policy of non-alignment, and maintains diplomatic relations with 99 countries. He is also a founding member of SAARC (South Asian Association for Regional Cooperation), formally established in 1985.