Nepal is a land-locked country of about 27 million people in an area of 147 181 square kilometers. The country is in the middle of its demographic transition. Despite an increase in the contraceptive prevalence rate (41%), the population is growing at a rate of 2.25%, which is relatively higher compared to other countries in the Region. Nepal is one of the least developed countries with GDP per capita of only US$ 294. While about 80% of the population depends on agriculture for livelihood, the share of the agriculture sector in GDP is only 40%. Tourism, one of the main sources of income in the past, has been affected adversely due to civil conflict and violence. Remittance from foreign employment has been the major income source for Nepal. The Human Development Index has improved considerably over the years from 0.296 in 1975 to 0.526 in 2003. The population living below the national poverty line has declined from 42% (1990-1995) to 31% (2003-2004).

HEALTH & DEVELOPMENT

Disease burden: The country continues to be afflicted by communicable diseases and upward trends of lifestyle related non-communicable diseases. Incidence of diarrhoeal diseases and acute respiratory tract infection continue to be high (219 and 319 per 1000 population respectively). Vector borne diseases like malaria, visceral leishmaniasis, lymphatic filariasis, Japanese encephalitis and recent emergence of dengue infection are major public health problems together with TB and HIV/AIDS. Increasing incidence of diabetes, hypertension, CVD and cancer have been observed.

Maternal and Child Health: The maternal mortality rate is unacceptably high. Under-5 and infant mortality rates are still very high; 76 and 61 per 1000 live births respectively. The neonatal mortality accounts for two-thirds of infant mortality rate. The major challenge is how to ensure that all women and newborns are provided with a continuum of care throughout pregnancy, childbirth and the post-partum period, by skilled birth attendants (SBAs).

Nutrition and Food Safety: Malnutrition among children, adolescents and women is still a serious public health problem. About half of under-five children are affected by stunting. The proportion of underweight children is around 48%. Of them, 10% suffer from acute malnutrition and 13% by a combination of stunting, vitamin A deficiency and iron deficiency. Food availability and security remains uneven particularly in hill and mountain region.

Vulnerability to disasters: Nepal is a highly disaster-prone country. Several types of natural hazards like floods, landslides and drought affect different geographical zones annually with a varying degree of damage to the health infrastructure and people's health. Nepal, in particular Kathmandu valley is vulnerable to earthquakes, but the preparedness for such a disaster is lacking.

Social and health inequity: Despite of government's efforts in addressing development strategies on an equitable basis, the health gaps between the poor and the rich are very wide.

Human resource for health and decentralization: A good number of medical graduates and other categories are being produced every year. However, human resource planning and development are not presently aligned enough with decentralization and other health sector needs and priorities. Imbalance of production of different categories of health professionals persists. The issue of human resource management with regard to deployment, retention, utilization and accountability is another challenge.