Tuesday, June 16, 2026 09:01 AM

Nepal’s New Budget: Uplifting the Middle Class or Eliminating Poverty?

By Shashi P.B.B. Malla

In his new budget, the Finance Minister Dr. Swarnim Wagle said that the government’s main policy aim was to uplift the ‘middle class”.

This policy choice raises several significant questions.

The most important point is whether this policy decision is at all appropriate. Would it not have been better to concentrate on poverty elimination which has plagued Nepalese society since generations?

Another relevant question is who or what comprise the ‘middle class’.

Class

The ordinary definition of ‘class’ is “a division or order of society according to status; a rank or grade of society” (OED).

Max Weber made the further explicit distinction between a class and a status group.

As he put it: ‘status position .  .  . is not determined by class position alone; possession of money or the position of entrepreneur are not in itself status qualifications, although they can become such; property-lessness is not in itself status disqualification, although it can become such.’

The ‘middle class’ or social stratum lying above the working class and below the upper class.

The middle class are distinguished from the working class by occupation and education.

They are distinguished from the upper class, apparently by seriousness, moral purpose, and earning a living.

The concept of the middle class is an imported one, but has become established.

However, in Nepal we cannot speak of a unified ‘middle class’. It would be more relevant to speak of the upper middle class, middle classes and the lower middle classes.

Caste

Then, in Nepal, the ‘class system’ is overlaid by the traditional ‘caste system”.

In modern times, the caste system is increasingly becoming irrelevant, with the exception of the so-called ‘untouchables’/Dalits who still struggle enormously for recognition for ‘equals under the law’.

Caste defines a group of people bound together through Hindu religious sanctions and rituals.

Many of these sanctions and rituals just cannot be upheld in modern society.

Many caste barriers have fallen. No one can forbid inter-caste marriages.

However, it is still strange and loathsome that marriages between Nepalese and foreigners are accepted as ‘normal’; whereas those of higher caste Nepalese and dalits are frowned upon!

We would also have to incorporate the role of ethnic groups in the hierarchy of society.

Ethnic Groups

Considering all of this, the Nepalese social system is an unfathomable labyrinth for many Nepalese and most foreigners.     

Since the time of the unification, many ethnic groups have integrated themselves into the mainstream.

The martial ethnic groups of West Nepal — the Ghales, Gurungs, Puns, Magars, distinguished themselves during the Unification.

They and the martial races of East Nepal – the Rais and Limbus served with distinction in the armies of Nepal, Britain and India since the First World War.

They have brought great honour to Nepal.

The Sherpas have become renowned as excellent mountaineers and contributed to Nepal’s international prestige.

The Newars of the Kathmandu Valley contributed enormously to the creation and preservation of the syncretic culture.

However, among all classes, castes and ethnic groups, a conservative estimate records that 20 % percent of all Nepalese live below the poverty line.

Even some high caste Chhetris from the Far Western regions fall into this category.

The government would do well to concentrate on ways and means to radically reduce poverty in all sections of the Nepalese people.

One of the ways would be to make quality education free and compulsory until class 12, and introduce vocational education/training as in the German model.

The depressed classes/castes should be especially targeted.

In this regard, there is a need for close cooperation between the ministries of education and that of science, technology and innovation.

The writer can be reached at: shashimalla125@gmail.com  

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