Economist and former Member of the National Planning Commission, and former Chief Economic Adviser to the Ministry of Finance, Dr. Govind Nepal suggests the government set up a time-bound target for implementing the development programs, which he claims will yield results thereby cheering the long disenchanted public. Khabarhub caught up Prof. Nepal on the government’s completion of one year in office to talk about its performance. Excerpts:
How do you assess the government’s one-year term?
After a long saga of political upheavals, the country got a stable government with a two-thirds majority. People’s expectations were high. Meaning, they were riding on high aspirations, and to experience the country’s overall transformation. But that is something unattainable in just a period of one year. Besides, the government had a Herculean task of executing federalism in the country, and it did succeed on that front by bringing out a number of Acts and managing financing for federalism.
It also dispelled the concern that setting up of the federal structure is impossible given the high cost. The country did not encounter a financial crisis in terms of structuring the central, federal and local governments. Around 50 percent of the revenue was collected in just six months that kept the country’s economy going.
The county also inked treaties with neighbors that are likely to render long-term benefits. Thus, its performance over a period is, in fact, satisfactory.
Is there anything the government missed or it could have done better?
Of course, there are ample of lacunas. Capital expenditure is low, the trade deficit is alarming. The balance of payment is unfavorable. The government needs to be more serious about these economic issues.
What measures should be adopted to increase export and reduce imports?
We cannot forget the fact that Nepal is still an agricultural country. Therefore, we need to focus on high-value crops that are only grown in Nepal. Prime Minister Agriculture Modernization Program should be accelerated.
The government also needs to facilitate the farmers and industrialists by dismantling trade barriers. We have regional organizations like SAARC, BBIN, and BIMSTEC. Nepal is a member to several international organizations as well. The government should exercise to utilize these forums for easy flow of Nepalese goods in the international market. Problems incurred during quarantine tests should be eased. Better trade facilitation is important.
Entrepreneurs should be provided with easy loans on a low-interest rate.
We need to enact laws so that technology transfer takes place easily thereby attracting foreign investment. The government seems committed towards this end but it is taking time to enact the laws.
Communists are assumed to be suspicious of multinational companies? Do you think the communist government will act in their favor?
Let’s look at China. It could make an economic leap thanks to foreign investment. This communist government believes in democracy, judiciary, and election. Practically, you do not find much difference between the Nepali Congress and the communist parties of Nepal. Therefore, the fear is unfounded.
Who is to be blamed for the country’s underdevelopment?
If you look at the history of developed nations today, they went through crises. Some were colonized and some faced terrible natural calamities. Nepal did not have to go through such pains.
It has relied on foreign aid for a long time. We prioritized politics rather than development since 2007. People were politicized rather than becoming professionals. We failed to welcome foreign investment and remained suspicious of foreign investment. Our thoughts and acts need to change. Our narrow thoughts of closed economy held us back. We need to benefit from new technology by mobilizing the youths.
We are also victimized by over consumerism in lack of effective government policy. For example, why do we need to import vehicles in such a huge number? Look at the number of motorcycles in Kathmandu. And think of the fuel consumed. If we had a good public transportation system, we would not be spending a huge amount on imports of vehicles.
What could be the way forward?
The government should make a plan for the next four years. The plans should be practical that can be incorporated in the yearly budget.
Development challenges have been identified. Setting up a time-bound target will help in moving ahead. This will yield results thereby cheering the long disenchanted public.
Planning alone is not enough. Implementation mechanism should also be well defined. The government should go hand in hand with other political parties. Confrontation with political parties will drain away its energy.