KATHMANDU, April 3 (Xinhua) -- Nepal is projected to see its poverty rate decline further to 5.6 percent in 2025 based on a per-day income of 3.65 U.S. dollars, the World Bank said on Thursday.

Lauding the South Asian country's progress in poverty reduction over the past decade, the bank noted that it has made further progress by cutting the poverty rate from 7.5 percent in 2022.

"Extreme poverty (2.15 dollars per day) has nearly disappeared," the multilateral lender said in its latest "Nepal Development Update" report, highlighting the central role of migration and remittances in reducing poverty.

According to the report, overall living standards in Nepal have improved across multiple dimensions, as evidenced by increased access to electricity, shorter distances to public hospitals and more extensive paved road networks.

"However, challenges persist, including high youth unemployment rates, spatial inequalities and vulnerabilities to economic and climate shocks, which threaten to reverse these gains," the report cautioned.

The drastic cut in poverty, however, does not match the tally of the Nepali government.

According to the fourth Nepal Living Standards Survey 2022-23 released by the National Statistics Office last year, 20.27 percent of the population lived below the poverty line in 2023 based on spending of 1.9 dollars per day for daily essentials.

"We use a consumption-based approach, but the World Bank's modality might be different from ours," said Dhundi Raj Lamichhane, spokesperson for the statistics office. Enditem