KATHMANDU, Nepal—Nepal has long been loved for its beautiful Himalayas, its peaceful and easy-going people, its ancient culture, and the neatly groomed hillsides of rice paddies climbing thousands of feet into the sky.

And while for 40 years it was safe and free for visitors and Nepalese to walk in the cities or trek to villages far beyond the roads, the Nepalese people lacked any say in their government and lived a quasi-feudal life of hardship—a side of life that many visitors failed to see. It was a life of poverty, hunger, and illness caused by lack of jobs, food, and health care.

Since 1951, a decade before the creation of USAID, the United States has provided more than $1 billion in foreign assistance to Nepal for education, farming, infrastructure, health, and government. USAID’s budget in Nepal has remained about $35 million to $45 million per year for the last few years.

A quick visit to farms, villages, and cities from the steep Himalayan Mountains to the hot Terai plains bordering India reveals a country that has made great progress but is still struggling to overcome enormous development problems.

Roads link major cities and some towns, schools have opened, and health programs are reaching most rural communities.

But Nepal remains among the poorest and least developed countries in the world with almost 60 percent of its 28 million people living on less than $1.25 a day, according to the World Bank. Less than threequarters of the people can read.

Nearly 40 percent of children under five are below normal weight. Nearly half the people are unemployed, leading many to seek jobs abroad in India, Malaysia, and the Gulf states.

Poverty is linked in part to the rugged environment. Steep mountains impede transport and use of farm machines. Monsoon rains often lead to flooding, landslides, and spoiled harvests.

Hydropower and tourism are most likely to bring cash into Nepal, but the country’s political troubles have blocked progress in many areas. A protracted conflict from 1995-2006 reduced investment and drove some factory owners to flee to India. The peace process—strongly supported by USAID (see accompanying article on peace)—ended the fighting in 2006 and led to elections that chose a Constituent Assembly. In 2008, the 240-year-old monarchy was ousted, but political stability remains elusive.

Another damper on development has been the long, landlocked borders the country shares with rival Asian giants China and India.

Geographic isolation—along with Buddhist and Hindu teachings of acceptance and nonattachment— let Nepal retain its timeless ways as the world’s only Hindu monarchy until 2006.

U.S. assistance—the focus of the articles in this special report—has already helped achieve important results. Since 1951, with U.S. assistance, life expectancy has more than doubled to 65, literacy has grown, and many diseases have been reduced.

In the 1950s, U.S. assistance eliminated malaria from much of the country, founded the College of Education, trained the first public health nurses, and created the first telephone exchange. In the 1960s, USAID backed administration reforms, set up 104 health units, added a surgery wing to Bir Hospital, helped boost air traffic from 25,000 to 210,000 flights per year, and opened an industrial park.

In the 1970s, USAID helped double primary school enrollment, built the Western Hills road to link the Terai to the hills, tripled the number of people getting health services, introduced family planning, and boosted use of fertilizer by 18 percent. In the 1980s, USAID promoted the private sector and NGOs, female literacy rose to 18 percent, some food-short areas became surplus producers, and real income rose an average 62 percent.

In the 1990s, Nepal became a parliamentary democracy and U.S. aid helped improve government services, privatize some state-run businesses, get women to run for local and national offices, deliver Vitamin A to nearly 80 percent of districts, and handed over 123,000 hectares of forests to community forest user groups.

Source: USAID