Nepal is witnessing a transition from a predominantly agrarian economy to one where non-agricultural income opportunities are increasingly important. The significance of wage labour in (semi)industrial production and in the service sector is growing rapidly. Along with these changes, there is increasing labour migration as part of the population seeks work in labour markets in urban areas, both in Nepal and India or further abroad. Within the Nepalese urban labour market, carpet production evolved as one of the most prominent industries during the early 1990s, experiencing high annual growth rates. Yet this “gold rush” was followed by a dramatic decline in the mid and late 1990s that severely affected the industry and its workers. In order to analyse these processes, the author conducted an empirical study from 1996 through 1999 consisting of interviews with business people, workers, and officials from governmental and nongovernmental organizations. The study showed that declining income opportunities have drastically affected savings and remittances. As a consequence, those (male) workers with access to more attractive labour markets sought new destinations, particularly in the Gulf states, whereas women workers have been left behind.
