Nepal becomes Lower-Middle Income Economy while Sri Lanka slips to Lower-Middle Income Economy
As per the 2020-21 World Bank’s Country Classification based
on Income level, Nepal’s economy has moved to a higher category to become a
Lower-middle Income economy while Sri Lanka’s economy has moved to a lower
category to become a Lower-middle Income economy.
Every year, the World Bank classifies countries into four
income groups- (i) Low (ii) Lower-Middle (iii) Upper-Middle (iv) High Income.
This classification of the economies of countries across the world is updated
on the 1st of July every year by the World Bank.
The classification of a
country is done by using the Atlas Method by the World Bank.
World Bank is
using the Atlas Method since 1993 to estimate the size of an economy.
Atlas Method, Gross National Income (GNI) of a country is converted into the
current U.S. Dollars.
As per the 2020 Classification, India remains a Lower-Middle
Two years back, on 22nd May 2018, the Nepal Government
announced that within the upcoming 10 years, its target will be to become a
Lower-middle income country.
Nepal achieved the target of becoming a
Lower-Income country well ahead of its plans.
For becoming a Lower Middle-Income country, the World Bank
has set the GNI per capita to be between USD 1036 to USD 4045.
crossed the line as its GNI in 2019 was USD 1090.
For becoming an Upper-Middle Income country, GNI per capita
to be between USD 4046 to USD 12,535.
Sri Lanka becomes a Lower-Middle Income
country from an Upper-Middle Income country as its GNI per capita in 2019 was
marginally short of the minimum of USD 4046 required to become an Upper Middle