Analysis of Resource Productivity and Decoupling in Nepal and Bangladesh

Developing Asian countries such as Nepal and Bangladesh have been doing well in recent years in terms of achieving improved economic growth and environmental performance. This study makes an inventory of historical data on energy and material use/intensities, GDP, and CO2 intensity to analyse the changes in environmental and economic efficiency using Data Envelopment Analysis (DEA) in a time-varying context. In the last 25 years, the Gross Domestic Product (GDP) has increased by almost seven-fold for Nepal and nine-fold for Bangladesh, and whilst the absolute amount of energy and material use have substantially increased, energy and material intensity has fallen by almost 30 per cent for Nepal and 10 per cent for Bangladesh. The research analysis indicates the rate of increase of GDP is much higher than the rise in CO2 intensity per energy use, as there have been efforts to achieve technical efficiency by setting favorable policy instruments, and because of changing levels of activity in contributing economic sectors. If the progress made recently can continue, particularly regarding energy and material intensity improvements, there is further potential to reduce resource use and CO2 emissions with similar or higher GDP growth.