Earthquake-hit Nepal stares at major economic crisis

NEW DELHI: Earthquake-ravaged Nepal is staring at a major economic crisis, with sectors like tourism and agriculture -- on which the country is heavily dependent -- thrown completely out of gear, industry body Assocham said today.

"At this point of time, a major economic crisis is looming over the Himalayan nation which, in any case, falls among the Least Developed Countries (LDCs). The biggest impact would be on tourism that contributes over 8 per cent of the country's GDP," the industry said in its assessment.

The industry body, which will soon be launching a " Rebuild Nepal Programme" in coordination with the Indian government, said reconstruction estimates vary between $10-25 billion.

Besides the contribution to the GDP, the tourism generates employment for hundreds of thousands of people engaged in the entire value chain of tours and travel. It contributes to 7 per cent of the country's total job creation.

"Hundred per cent cancellations have been reported from tour operators who do Nepal bookings. Several countries have given advisories to their citizens to avoid Nepal. All forms of transport have been damaged," Assocham said.

"Even after normalcy is restored in terms of basic needs like water, food, medicines and some civic facilities, it would be a long haul before tourism is restored in a country where, according to UNESCO assessment, many historical monuments have been severely damaged," the industry body said.

Of the seven UN World Heritage sites located in Nepal, three-Durbar Squares of Kathmandu, Patan and Bhaktapur have suffered enormous damage.

"Major damage would be felt on agriculture, the mainstay of the country's $66 billion economy. Agriculture employs 75 per cent of its people," according to Assocham.