Sujeev Shakya

Articles & Publications

20 Mar 2023
Kathmandu Post Permalink

There is no economic crisis

March 20, 2023

While the tightening of monetary policy did help, the focus has to shift to fiscal reforms.

When Nepal Rastra Bank released its seven-month data on the Nepali economy, it was surprising why it did not organise a press conference to share the figures. The central bank’s report shows that Nepal has been recovering from the pandemic shocks. It has a Rs133.21 billion balance of payments surplus in the first seven months compared to a Rs247.03 billion deficit during the same period last year. Foreign exchange reserves have increased by 13.8 percent in rupee terms and 10.2 percent in dollar terms in the first seven months. These reserves now cover 10.8 months of imports. Likewise, in line with the projections of the Nepal Economic Forum Remittance Report, remittance inflows have increased by 27.1 percent to Rs689.88 billion. In United States currency, remittance inflows increased by 16.4 percent to $5.30 billion. There was also little discussion about these results on social media or the news media. When I posted this on various platforms, the responses were mostly cynical and scoffed how these data had either been cooked or did not reflect the real situation.

The International Monetary Fund (IMF) just finished its Article IV mission to review Nepal’s indicators. It has provided a set of observations acknowledging strong recovery and laying down some key areas where Nepal needs to focus. They acknowledged that the “much-needed monetary policy tightening last year helped stabilise the external position and contributed to lowering inflation.” In Nepal where people are used to making decisions or interpreting situations without using data, they don’t know what to do when you throw statistics at them. 

People-national problems

In Nepal, when you say the voice of the private sector—which the government, politicians and international organisations listen to—it is the same set of leaders of different political private sector organisations who, like political leaders, have to address the demands of their constituencies. Many of these key leaders are related to the few businesses that were impacted by tightened monetary policy. 

For instance, automobile sales in Nepal benefited from liberal regulations. Given Nepali buying behaviour, people who went to buy a Rs2.5 million car drove out of the showroom in a Rs4 million car as credit was easily available. More cars were imported, and people took loans to buy them. Now, people do not have money to repay their old loans, so they can’t take new loans to buy cars. Stock purchase is not based on the scientific calculation of demand, but on how much push sales one can make. Importers are saddled with old model vehicles in the stockyard, but the government cannot buy them and bail them out like in the past. With increased interest rates, the debts are piling up, and rather than finding customers, they are defaulting on the repayments. The Nepali culture of impulsive spending and taking loans without thinking of how to pay them back is a big responsible factor.

The story is no different among the other income group levels. In a review of a project, we noticed that people who got grants to expand their micro-enterprises used them instead to buy land, and then borrowed from cooperatives to build houses on the plots. Now they cannot repay their loans and do not have working capital for their businesses either. Another group in trouble came to me to relate their story. They took loans as cooperative members to go on a joint-family vacation in Thailand and were to repay them in instalments. But then the pandemic hit. The other members came to know about this, and are asking them to pay up. Multiple cases come from businesses of different scales and income levels, but they have only one storyline. One got away with these in the past, now you are caught. So now, you portray your problem as a national problem! 

Carrot and stick approach 

While the tightening of monetary policy did help, the focus has to shift towards fiscal reforms, as everyone is saying. Money has to reach the different levels of government fast so it can be spent. The government cannot think of knee-jerk austerity measures but must engage in a strategy as soon as a new finance minister comes in. We do not need any other study or report, there are enough action points in the zillions of past studies and reports. Just implement them! It will also be important to take international organisations into confidence and get guidance in areas the government has no experience handling. 

Just because some party leader’s sycophant, niece or nephew has a degree from the US does not mean he or she can be entrusted to fix things. It is necessary to build a caucus of parliamentarians who can hire teams to help them. There is no dearth of money for such types of work. Fiscal and legislative reforms will be key again to attract investments, whether from Nepalis or foreigners. 

It is important to understand the relationship between investments and reforms. A steady flow of investments can push economic activities and ensure no crisis build-up. Also, we need to understand what the economic crisis entails. As I tell my friends, if there really is a crisis, you would not be sipping whiskey at a bar but rather queuing for fuel or food.

Read the full article on The Kathmandu Post: https://kathmandupost.com/columns/2023/03/20/there-is-no-economic-crisis

06 Mar 2023
Kathmandu Post Permalink

Empowered Nepali women

March 6, 2023

Things will change when men who do not do dishes at home stop lecturing on women’s empowerment.

As the Holi festival approached, my wife and female cousins started chatting about how difficult it used to be for girls to go to school. Schools would generally close for a week or two as boys and men threw water-filled balloons at girls, and this was mostly accepted. When the story of the gory Holi is narrated to younger folks, they can’t believe that such was a state of our society. We have come a long way, and as the world focuses on women (again, mostly ritualistic) on International Women’s Day, it is a suitable time to look at the transformations happening in our society.

Transformation continues

I continue to write about how Nepali women can push themselves hard, and society adjusts over time. The best example is how traffic police women check on potential drunk drivers and take action. My friends from Delhi say they cannot imagine an all-women team conducting checks late at night in their city. Social media platforms have influenced women to express themselves. Daughters-in-law, who are supposed to cover their heads and wear specific traditional dresses in conservative families, now flaunt their dance moves in TikTok videos that their in-laws have no other option but to watch and let go. From being homebound, women today are in large numbers driving two- and four-wheelers, which was perhaps unimaginable three decades ago.

We have seen such transformations happen across society, where many traditional ways of thinking and behaving have changed. In music concerts, we see an equal number of women in the audience without fear of being harassed. We see women alone or with friends in restaurants enjoying a drink or having a good time without worrying about what relatives will say. We are seeing this change not only in Kathmandu but across the country. I still remember eyeballs rolling when two female friends entered a restaurant in Thamel two and a half decades ago. The role of women at home is becoming an acceptable way of contributing to the family as they take breaks to look after children, their ageing parents or other family members. Their economic contribution is being discussed rather than looked down upon and labelled a “housewife”. We are finding women taking leadership positions, and more women are speaking in seminars, providing interviews and sharing stories. Platforms like Boju Bajai are ensuring women connect and are also mainstream in discourses.

We see women in workplaces like never before. Eighty-eight percent of the people who passed the Bar exam two years ago were women, which means we will see women-led law firms across Nepal in a decade. Similarly, women are joining the civil services like never before. Sans nepotism and unequal treatment in bureaucracy, half of our ambassadors in fifteen years will be women. Women in Nepal have also benefited from the fact that we see many women diplomats in Nepal and women in key positions in international programmes. Women Ambassadors are engaging in mentorship programs which will also push others to follow suit.

Women have long faced hurdles due to the patriarchal supremacy imposed by religion and culture. Religious leaders across religions are generally male, and the role of women is secondary. But practices such as Vipassana meditation and other religious groups can have women as leaders. Thirty years ago, it would have been impossible to think of getting to a yoga class led by a female teacher, but it is changing globally nowadays.

Small, unplanned steps can also trigger transformation. I have written about how women in Bangladesh are being allowed to ride pillion on motorbikes driven by unknown men, bringing about massive empowerment in a Muslim country with many dos and don’ts.

Change through awareness 

Nepal has been one of the few countries to take women’s reservations in Parliament seriously, but such legislative changes will work only when we internalise the change through awareness of personal conduct. Political reservation has just ensured family members get engaged. We also need to understand that wives and daughters of politicians in a patriarchal structure can be as corrupt as the brothers, sons and sons-in-law of male politicians. A woman leader who derives power through a patriarchal system will never drive change. As the current tenure of Nepal’s first woman President, Bidya Devi Bhandari, is coming to an end, we will remember her term for working against the interests of women. She stopped the citizenship bill by stepping beyond her role, taking her privilege to an entirely different level by elaborately travelling in motorcades and wanting to stand at functions in the exact spots where the former Kings stood. She had an opportunity to build an excellent team of women advisors and mentees but allegedly preferred to be advised by men of particular ethnic groups.

The change that we desire will accelerate only when it begins from within. It will happen when men are comfortable listening to a woman make a presentation or share her views. It will happen when men who do not do dishes at home stop lecturing on women’s empowerment. It will happen when women are no longer assigned to carry the tray with badges, and men are not the only ones wearing them (which is an outdated ritual). It will happen when men are unbothered by women deciding the food to order at a restaurant. It will happen when parents stop having different rules for sons and daughters and stop engaging in rituals for a son to be born in the house.

I keep learning and trying to change as the two pillars of my life—my wife and my daughter—often make me aware of their points of view.

Read the full article on The Kathmandu Post: https://kathmandupost.com/columns/2023/03/06/empowered-nepali-women

21 Feb 2023
Kathmandu Post Permalink

Reimagining South Asia

February 21, 2023

Let’s imagine a South Asian digital currency and other initiatives for the region.

Last week, I was watching on YouTube a video of the performances at the virtual event organised by the South Asia Symphony Foundation where many South Asian talents got together to perform. This foundation founded by a former Indian foreign secretary Nirupama Rao and her husband has been trying to promote peace through exchange related to music. I kept wondering how many such efforts there are in South Asia, and how many who believe in the concept of South Asia. Nearly three decades ago, Himal Southasian, a publication of the Southasia Trust, brought about a competitive spirit in the region with many wanting to get publications out and put together events and programmes. Even international organisations started to use the word “Southasia” more liberally. Kanak Mani Dixit has to be credited with the work that Himal did in trying to bring together a common agenda rather than squabble about our differences. We have people like C Raja Mohan and Bibek Debroy in India who kept the South Asia agenda alive. 

The National University of Singapore hosts the Institute of South Asian Studies, where I have been fortunate to hold a Senior Fellow position, and I try to make Nepal also heard on the South Asian platform along with another Senior Fellow Nishchalnath Pandey. While there are many South Asia-oriented institutions in different academic institutions worldwide, the discussions and publications are just centred around India and Pakistan. The competition in many institutions has been to focus on the strained relations between these two neighbours rather than find common areas to talk about.

Imagine no borders 

There are three reasons why it is important to reimagine South Asia. 

First, the impact of climate change is real and not an issue that is seen as an activists’ delight. We have seen how polluted air or migratory birds do not see political boundaries. If India is to build the infrastructure it wants to, it is also important to figure out how it will not be at an ecological cost to Bhutan or Nepal. In Nepal, we have seen in the past few decades stones, sands and aggregates cross the border through a not so transparent mechanism that operates under the protection of the highest level of political leadership. We have seen that Bhutan, despite its 70 percent forest cover, still faces challenges of air pollution due to transboundary movement of pollutants. 

There are institutions like the International Centre for Integrated Mountain Development (ICIMOD) that have a knowledge repository of research, but it is time to see how we can make this useful for individuals, businesses and institutions. There is lot of common work to be done in the areas of adapting and mitigating the impact of climate change. No country can tackle these issues alone, which means there is no alternative to regional initiatives. The World Bank has embarked on the One South Asia programme, and it is trying to revisit some of the past successes in bringing people who believe in the potential of an integrated region together. 

The second reason is that the Covid- 19 pandemic accelerated the pace of digitisation and digitalisation. Internet penetration, e-commerce and digital payments proliferated along with the use of social media. This means there is an opportunity for regional collaboration. In Unleashing Nepal, I have talked about the concept of a common South Asian currency to be named Rupa. Now is the right time to revisit this in the form of a digital currency that can be stored in digital wallets with convertibility protocols determined by the central banks of the respective countries. Imagine, a truck driver travelling from Chittagong port in Bangladesh to Bhutan or Nepal can just rely on the currency he has stored in this digital wallet without having to bother about where to exchange money. Similarly, movement within South Asia can be regulated using digital platforms as every country has created its own digital ID which makes monitoring so much easier. 

Expensive Bhutan 

Third, it is important to ensure there are more youths who believe in reimagining South Asia. Whenever we discuss South Asia, we hardly find young people in any of the countries really understanding the potential of working jointly. Never before in history has the world been so connected, but never before has it been so difficult to cross boundaries physically either. While Nepali music and films are popular in Bhutan, there is no way a Nepali can travel to Bhutan without paying high fees. Similarly, there are so many collaborative efforts that can be brought to fruition by Indian and Pakistani artists, but it is like close to impossible to make such things happen. We need to ensure that people who host South Asian events provide as much space as possible to every country. 

Talk of making South Asia should revolve around people-to-people cooperation between different countries, not the strained relations between India and Pakistan. I have been continuously writing about Border Economic Zones and embracing frontier opportunities. For Nepal, it is in its own interest to push the agenda of South Asia, not leverage the ease of travel to Nepal to convene South Asian platforms and events. There is renewed interest in South Asia, we just need to reimagine and make many of the things we have been talking about for decades happen.

Read the full article on The Kathmandu Post: https://kathmandupost.com/columns/2023/02/21/reimagining-south-asia

07 Feb 2023
East Asia Forum Permalink

Stubborn challenges and fresh faces for Nepal in 2022

February 7, 2023

While 2022 began with modest expectations for Nepal, it was also a year of hope. The pandemic receded and lives returned to normal, while elections brought some hope, with new leaders dislodging old ones.

Despite challenges in governance and politics, Nepal vaccinated nearly all of its eligible population — 95.7 per cent, one of the highest numbers in South Asia. This was possible due to responsibility being passed on to Nepal’s 753 local government units — rather than being managed at the federal level — demonstrating the role of local governments in delivering public goods. Nepal was also fortunate to have foreign governments donate vaccines and facilitate purchases and supply.

In terms of Nepal’s relationship with the world, 2022 was eventful. A US$500 Millennium Challenge Corporation grant from the United States became a point of major political controversy, but was ultimately approved by Parliament. The debate also revealed a deep divide in the way Nepalis perceive the United States, as well as the increasingly overt role of China in national issues.

The first half of 2022 was also about balancing geopolitics, with China–India rivalry pushing Nepal to continuously balance these two large neighbours’ interests. When Indian Prime Minister Narendra Modi visited Buddha’s birthplace in Lumbini, Nepal on Buddha’s birthday, he came in a helicopter from across the border rather than flying into the newly built Bhairawa airport. The airport was built by a Chinese contractor under an Asian Development Bank arrangement and is seen as a Chinese-funded project.

Nepal’s economy saw a continued decline in liquidity as interest rates increased. Collusion among bankscontinued, limiting options for managing the challenge posed by the liquidity crisis. The central bank continued to intervene by banning imports of luxury items and instituting strict restrictions on foreign exchange. A spat between the finance minister and central bank governor did not help — the governor was fired by the finance minister, only to be reinstated by the Supreme Court.

The economic crisis in Sri Lanka also hurt Nepal, as Indian media and think tanks lumped Nepal with Sri Lanka as countries facing economic crisis. Hindi-language news channels with huge followings in Nepal produced especially critical stories. But the Nepal Economic Forum and other think tanks in Nepal maintained that the issues affecting Sri Lanka and Nepal are chalk and cheese.

The biggest events of 2022 were two elections — local elections were held in May and the federal election in November. In the local elections, 81 per cent of candidates elected were new faces. It was a strong anti-incumbent vote. In Kathmandu, a young rapper running as an independent made headlines, and in Dharan in eastern Nepal, a lone campaigner won the mayoralty. Both occupied significant attention on social media.

This prompted more people to run as independent candidates in the subsequent federal election. These independents formed a new party and became the fourth-largest in Parliament. There was a strong #NoNotAgain campaign against the old, male politicians across established parties who have been dominant for the past three decades. Many of them lost re-election. There are new faces in Nepal’s Parliament, and many of them are educated and have global exposure. Out of the 23-member cabinet, 15 are new ministers, many of them first-time parliamentarians.

The federal election also saw political opportunism — parties that fought the election in one coalition promptly joined other coalitions in order to form government. When the prime minister sought a vote of confidence, only 2 of 270 parliamentarians opposed the motion — highlighting that the government is a cartel of parties with diverse ideological stances.

The election also saw Nepali Congress’s leader, former prime minister Sher Bahadur Deuba, challenged within the party, with 2022 probably being the last election he will stand in.

Nepal’s biggest challenge in 2023 will to be for its fragile coalition to last and not descend into intra-coalition fights for plump government appointments. Geopolitics — with war in Ukraine and a brewing Cold War between China and the United States — will remain complicated. The global economy will face challenges. All of this will impact Nepal. 2023 will be year of survival, hope and recovery.

06 Feb 2023
Kathmandu Post Permalink

The pandemic years

February 6, 2023

Covid-19 exposed a deep divide in how people perceive pandemics, science and vaccination.

I am looking forward to flying the same route again this week—Bangkok-Singapore- Bangkok. It was my last journey to this part of the world before the pandemic shut everything down. I want to trace back my steps and recall empty Changi Airport and Don Mueang Airport, where a few of us passengers were standing in a queue to buy a box of masks for $50. The experiences and memories of the pandemic are fading; it appears to be in the distant past, like the 10 years of the Maoist insurgency, the 2015 earthquake and the blockade and the floods.

It seems we have put the pandemic behind us as China has seen the great human movement of the year—the Lunar New Year travels. Contrary to front page predictions of millions dying, China managed its big festival with the least impact. Holiday travel rebounded to nearly 90 percent of normal levels, and the economy is surely opening up. South Asia, one of the world’s most populous regions, is practically back to normal. 

Anti-vax campaigners

Covid-19 exposed the deep divide in how people perceive pandemics, science and preventive care through vaccination. We saw educated people in the West become big anti-vax campaigners and disbelievers in civic discipline. Despite a fractured government machinery, Nepal achieved one of the highest vaccination rates in Asia. We saw how pharmaceutical companies made billions by charging for orders that countries cancelled. We saw the goodwill Nepal earned, with assistance flooding in from well-wishers, while so many countries were overlooked and how our leadership dealt with the situation. 

Tanzania is one of the few countries in the world that did not keep Covid-19 statistics, and then President John Magufuli succumbed to the virus. Rwanda, through the combination of a pro-active government and well-behaved citizens, ensured there was little impact. We saw how a country with a small population like Bhutan was challenged to manage the pandemic, and how the king led the fight against the pandemic from the front. City-states like Dubai managed the pandemic with a business mindset, attracting many new businesses, investors and people as people were moving away from Hong Kong and Singapore. 

The pandemic also saw new yardsticks being established. Last week on a flight from Dhangadhi to Kathmandu, I wondered how airlines have now made high fares and no in-flight service the new normal. Even without in-flight service, an airline is not referred to as a budget airline, making people wonder what the difference is between a full-service airline and a budget airline. The category of hotels that functioned during the pandemic were for people who needed them and came with a steep price; some of the prices are yet to drop. Companies that got away with closing down to get rid of their long-serving staff have reopened with a fresh set of people, questioning the value system they operate in. Financial service providers operated a seller’s market as people had few choices. Services that closed after they became short-staffed when infections reached a peak did not reopen. Cleaning services impacted the cleanliness of operational areas as places could not be cleaned at regular intervals, but this has become the new normal.

We were lucky

Some countries suffered a lot and recovered slowly, while others did not. However, we have been lucky. Our government functioned and did not come to a standstill. Of course, buildings were built in the city with “pandemic earnings” as procurement graft and corruption peaked. People did not stop consuming. There was social security in terms of people sending money from abroad and farmland to grow the basics. When we see extravagant social functions like weddings and religious functions, we can bet that the pandemic has had little impact on earnings. We have accumulated many stories of near and dear ones lost, the near-death ordeals of people, and the innovative ways of keeping oneself going—by walking in the small alley outside your house or learning to cook or attending to your hobby or making endless group calls. They are memories that we will share with future generations. 

For me, the pandemic has also been about continuing to write. Of course, I could manage an audio and e-book in Nepali, but I also found ways to keep reflections going. The ordeal of writing “The Other View” column in this newspaper every second Tuesday continued. So as we wish to get to the end of this pandemic, the columns have been packed into a compendium with the title The Pandemic Years. I thought it was an apt way to put the pandemic behind us and look forward.

Read the full article on The Kathmandu Post: https://tkpo.st/3Rzu4BS

23 Jan 2023
Kathmandu Post Permalink

Corruption as usual

January 23, 2023

The Yeti Airlines crash has again brought Nepal into the global limelight for the wrong reasons.

The first challenge you encounter upon arrival at Tribhuvan International Airport (TIA) is taking the escalator down one level. When I first tweeted about the inconveniently small elevator, the media was going gaga about the new facility, and I took down the post after being warned by a friend. Now with multiple videos about the dud escalator going viral, it is evident there is something wrong here. The design specifications were created to ensure that a particular party won the contract. Every political leader has something to do in ensuring that TIA was designed the way it is, as they can’t go against the businesses that fund them. In Nepal, tenders are never structured to attract reputed international companies as they refuse to pay political parties or their leaders. Further, it appears that institutions like the Asian Development Bank, which support TIA upgradation plans, either have no advisory say or are not bothered.

The recent Yeti Airlines crash has again brought Nepal into the global limelight for the wrong reasons. The country is on the European Union blacklist, and for the past 10 years, Nepali airlines have not been able to fly to Europe. Further, when VIP visits occur, getting safety clearance is very challenging. A study abroad programme we planned with Babson College of Wellesley in Massachusetts, United States has been cancelled citing air safety. Many other such cancellations of visits have taken place. Corruption has led to air disasters, and despite international agencies like Accountability Lab bringing these issues to global policy forums, Nepal has little interest.

Similarly, rampant incidents of projects being stalled and contractors getting away with delays are visible in Kathmandu, like the inoperational bridge at Kalimati which has lain forgotten for years or the Parliament building that is forever under construction. Instead, people in these businesses are cajoled by political parties and provided plum positions, including ministerial berths. 

Corporate responsibility

Corruption has proliferated in Nepal also because many businesses have evolved based on the cardinal rule that if others can do it, why can’t we? Ethical practices and integrity are not integrated into business strategies and policies; rather, they are seen as something that can be ignored. Due to prodding by some development programmes, there is an emphasis on corporate social responsibility (CSR) without the necessity of discussing corporate responsibility. Little due diligence has been done when partnering with corporations; therefore, companies have got away with bad products or services, but they still get international programmes to work with them. Bad governance breeds corruption, and the nexus of business and politicians has made Nepal a fertile ground. 

In Unleashing Nepal, I have written about the “two laddoo” syndrome: In a culture where we compete to bribe the gods, we do not find bribing mortals an issue. (Laddoo is a sweet ball generally offered to the gods, especially the elephant-headed god Ganesha.) Culturally, it is acceptable to be corrupt and embrace bad governance. If we look at the organisations where people are supposed to volunteer, we see a high level of corruption. People do not complain about land grabs around temples and guthis (social organisations). You grow up thinking it is okay to make money through unfair means or taking advantage of your position. So when you look for bridegrooms for your daughter, you do not mind that the potential guy has made money through corruption and built the house you are yearning for your daughter to live in. Corrupt people are not ostracised by society; therefore, it proliferates. 

I have been writing about this over the last two decades, and the emphasis is to stop this virus through individual changes that will push society to change, and thereby, the country to change. The biggest change that we see when it comes to corruption is that it seems the international community has accepted this side of Nepali culture to a large extent. Therefore, unlike during the heyday of the human rights business, we do not see statements from the international community regarding tainted ministers being appointed or corruption scandals being exposed. Discussions on transitional justice have become more cocktail-time chat. They now tend to say it is Nepal’s internal affair. 

International endorsement

This is seen as an international endorsement of the corrupt. When former finance minister Janardan Sharma fired Nepal Rastra Bank governor Maha Prasad Adhikari to protect people engaged in money laundering, or when investigations were launched into alleged tampering of the government budget, nobody waited for the court verdict or the investigation report. It is business as usual. This is perhaps the scariest transformation. 

The recent general elections were seen as a referendum against corrupt old Nepali political leaders. The Rastriya Swatantra Party (RSP) bagged a lot of votes because of their pledge to fight corruption; but as they say, political compulsion is to be in the same government with peers that have excelled in corruption. The RSP as a political party has a lot to prove—to walk the talk as they navigate the thin line of “we are different” or “we are the same”. The Rastriya Prajatantra Party has shown its true colours by appointing tainted ministers, and we should never forget that the rule of the Shahs and Ranas was riddled with corruption. The only difference is that corruption has been democratised and percolated to the lowest level of governance structures. Let us see who will bring some changes to stem this rot.

Read the full article on The Kathmandu Post: https://kathmandupost.com/columns/2023/01/23/corruption-as-usual

09 Jan 2023
Kathmandu Post Permalink

Things for Nepal to consider in 2023

January 9, 2023

We hope for better debates on all important issues, both in and outside the Parliament.

When you begin a fresh year, hopefully putting the pandemic behind you and transitioning to pre-pandemic normalcy, it is important to look at what lies ahead. It is also essential to have a sense of hope and positivity as the clock starts ticking. Here are 10 things to look out for in 2023.

We enter the year with the Russian invasion of Ukraine looking like becoming a long-drawn affair. Geo-politics is always led by the West; but this year, India and China will challenge this dominance. In the early days of the G20 leadership, India has already shown it wants to create a new order: Getting developing countries together or being very assertive. Prof Bibek Debroy, chair of the Economic Advisory Council of India, explained what the new India looks like in his keynote speech at the Nepal Economic Forum NEFMeet 2022. So it’s for Nepal to consider how it fits into the emerging world order. 

Global/regional economy

Every country in the world is facing some economic challenges as it recovers from the pandemic and bears the brunt of both the war in Ukraine and the cold war between China and the United States. Interestingly, India is one of the few countries that seems to show hope of growth, and we are right next door to it. This means lesser migration of Indian workers to Nepal and more Indian tourists. Stabilisation of oil prices is good for a landlocked country. Trade with China has resumed as the borders reopen. It should surely be better than 2022. 

Nepalis live in 180 countries; in the US, the population is close to half a million. Statistics from the United Kingdom, Canada and Australia show a sharp increase in the Nepali population in the last two decades. The UK is taking in seasonal workers, South Korea will start giving out 10-year work permits, and workers will start to go to Japan officially. If people have the means, the United Arab Emirates and Thailand are issuing long-term visas. It will be a year of migration, which means an increase in formal and informal remittances. 

We have already seen tourism bouncing back with vehicles bearing Indian licence plates dotting the highways. Bookings for the spring and fall seasons are looking good. Once the Chinese start to arrive, it will be a different story. More diaspora Nepalis are exploring the home country. Domestic tourism is at new highs because of religious tourism, travel for social functions and social media-driven travel. More hotels and eateries are coming up across the country, making travel more predictable. In-person events are coming back, and as a neutral venue in South Asia, it is only predictable that 2023 will see tourism bounce back stronger. 

Financial services, stock markets and investments took a hit during the pandemic. We will see a revival as liquidity eases with more international players joining in. Private equity will provide much-needed capital to match debt. Firms will seek professional help and corporatise. With banks and insurance companies being integrated into large monoliths, the focus will be on service and innovation for comparative advantage. Bigger balance sheets don’t mean greater profits.

We saw many firms perish during the pandemic. Many people who got away by using political clout and taking shortcuts have faced big problems; some are languishing in jail. Nepali firms will have to reform to take on international players and make forays outside Nepal. This will be a year of reform for many firms, especially family businesses that have been relying on the old ways to survive. We have seen many international consulting firms becoming active in Nepal, and are always happy when the size of the pie increases. 

One of the biggest beneficiaries of the pandemic has been firms involved in digital products and services as well as information, communication and technology (ICT). They have found new markets in and outside Nepal. This year should see many international firms setting up shop in Nepal, and many Nepali firms going global. Policy constraint remains a challenge in many areas, but entrepreneurship is all about survival and growth.

A lacklustre COP 27 marked the end of the UK trying to take leadership in global issues. Nepal can take a leadership position in areas relating to the world such as climate change. The Green Resilient Inclusive Development (GRID) Action Plan, has laid the foundation; now it is up to us to see how we can build on this. The Nepal Economic Forum will convene the Himalayan Future Forum in September this year to get non-state actors together and pick up where the Himalayan Consensus Summit left off. 

Political uncertainty

I write ad nauseam on how political uncertainty has become the only constant in Nepal in the past 73 years. Even 30 years of single-party Panchayat rule could not give political stability. Also, stability does not mean growth as we saw in Zimbabwe under Robert Gabriel Mugabe for 37 years! The political drama will continue in 2023 with a fragile coalition—the ruling one or any other that will be in power will walk a political tightrope.

We have fresh faces in Parliament who will question the status quo, this means stronger parliamentary committees and probably capable people getting political appointments. We hope to see better parliamentary debates on issues raised by parliamentarians inside and outside Parliament. This will surely pressurise the insular section of the sycophancy-oriented bureaucracy that has got away with non-performance so far. 

It will surely be interesting to review this list each quarter; and hopefully, by the end of 2023, we will have a good scorecard. 

Read the full article on The Kathmandu Post: https://tkpo.st/3Gk8BI4

26 Dec 2022
Kathmandu Post Permalink

Finding leaders in 2023

December 26, 2022

It is important to leverage the enthusiasm of the youths besides the experience of the elders.

During my leadership sessions in Nepal, when I ask people the names of prominent leaders, they give a handful of names. Most of them are political leaders with a chequered track record when it comes to integrity or a set of values that one can be proud of. Some business leaders are names that people share, but again, like political leaders, only some can be role models for others due to the way they conduct business. Across civil society, academia and professions, there could be a few more. However, many question their leadership style for being very self-centred, poor in mentoring the next generation of leaders, and never thinking of succession plans for the institutions they have built. 

When travelling to Dubai, I asked a friend to give me the names of 10-15 Nepali leaders in business, professional or corporate sectors. But it was tough to come up with a list, even though more than half a million of our citizens work there. In international organisations, where many Nepalis work, I keep questioning why we do not have Nepalis as vice presidents, director-generals, regional heads or in other leadership positions. In academia outside Nepal, where the number of Nepali professors has crossed the thousand mark, why don’t we see Nepali provosts in universities or those taking senior leadership positions in academic institutions? As someone groomed to lead an organisation as part of the Nepalisation process at the Soaltee group, I also reflect on these questions. Here are a few thoughts that come to my mind. 

First, Nepalis, whether in Nepal or elsewhere, as they move up the ladder, generally become good managers but not necessarily great leaders. They are reluctant to hire more competent or qualified people than themselves, either out of fear that their mistakes will be exposed or because of a lack of competence to manage star performers. This also stems from their willingness to hire non-Nepalis rather than competent Nepalis. 

Even those who have become general managers of hotels in good international brand properties are happy to come back to start a small hotel of their own rather than advancing in the brand they were working for. Similarly, people working in multinational organisations are happy to invest and be a part of cooperatives that work on principles and value systems which are completely opposite to the organisations they work for. 

Second, perhaps we lack a learning mindset. We are reluctant to learn about our own culture, food, history or geography. Besides work, politics and gossiping about other people, we do not engage in much conversation. Therefore, many Nepalis abroad, rather than exploring the culture of the city or country one has made their home, prefer getting together with friends and family—eating, drinking or playing cards as they did back in Nepal. The activities of newer generations have changed in some ways. They take up outdoor travel and exploration, but these are limited to friends and families whom they feel comfortable with. I wonder why Nepalis travelling to lands where they have to adapt so much from food to language to culture do not have the curiosity to learn.

Third, there is a lack of a global mindset. When people ask me to name a global Nepali who can inspire us, the first name that comes to my mind is Kul Chandra Gautam, who not only took one of the highest positions as a Nepali in the United Nations, but also continued to engage in the leadership of global organisations. His aspiration for a leadership position, combined with the hard work required to get there, is depicted in his memoirs. People who have taken up senior positions in international organisations are generally happier to return to Nepal after retirement and preach fellow Nepalis than take up roles in international institutions. It could be that they want to spend time in Nepal, where they have accumulated assets and investments from which they can earn good rents. Could it be because Nepalis cannot have dual citizenship that they have to pile up assets in Nepal and live here? 

We hope this will change with the younger generation. I keep telling bright young Nepalis who have just started taking up good positions across the world to be mindful of the issues mentioned above. They need to get out of being insular and learn about one’s own country and the country they are living in. They need to set eyes on the top leadership positions in the field of their work and make career moves that will enable them to lead global organisations in a decade or two. I advise young entrepreneurs to build teams that know more than themselves and help to bridge the knowledge and exposure gap. It is important to leverage the enthusiasm of the youths besides the experience of the elders. They need to build businesses that will not only lead in Nepal but also in the region and the world. Connectivity has become a great enabler, and a few hurdles in regulations will also go away in the days to come. We will see more women taking leadership roles and being able to fight patriarchal traditions that act as impediments to their moves. There is always hope, and let us hope that in 2023 we will find many of them. 

Read the full article on The Kathmandu Post: https://kathmandupost.com/columns/2022/12/26/finding-leaders-in-2023

12 Dec 2022
Kathmandu Post Permalink

Of passports and driving licences

December 12, 2022

The new folks in Parliament should work at making services easily accessible to win the next elections.

The story that we hear most often in Nepal now is of people travelling to Kathmandu from different parts of the country and outside to get their passports made. People queue up at government offices to get a National ID, correct their date of birth, or simply figure out how to apply for an appointment at the passport office. My niece from Dharan has been trying for months just to find a slot and get her passport made. Touts have approached her with offers to expedite the process for a fee of Rs5,000 to Rs6,000. Many people find it cheaper to pay them rather than lose money taking a leave of absence from work and spending on hotel bills. 

In Nepal, when we say that services are online, it surely means that we have to stay “on line” for hours, if not days. This has benefited hundreds of touts who give hope of expedited services for exorbitant fees, people who run shops to fill out application forms, and hotels that are super happy that people are coming and staying for days while they wait for their passports. 

Interactions between citizens and the government are minimal, and there are very few services that the citizens seek from it. Citizenship certificates, driving licences, National IDs and passports are the basic documents issued by the state. There are birth and death certificates, registration of property, and of course, tax or foreign exchange-related matters. For corporates and organisations, there are compliances to fulfil and certificates to get. So, it is not very complicated. However, political parties colluding with bureaucrats and business people have made getting services a big nightmare. The system and processes have enough loopholes for people to make some quick bucks. They are also used as a mechanism for people with protection or agents of political parties or government staff to work as touts. While there are good Samaritans in the various offices that go out of their way to help people, citizens complain against most of them. 

Where is the problem?

The problem begins in the design and procurement processes of the system. There are business people, generally commission agents connected to political parties, who suggest to the government what software or system to get. Then the procurement system is designed to ensure that these companies qualify to design and deliver. Quality is not a priority, nor good service. The priority is to get low quality stuff supplied at the highest cost. If Nepalis were to be judged from the mugshots on their driving licences or passports, Nepal would seem like a country filled with ugly convicts. This stems from the low quality cameras which would have been supplied at a high cost. 

The system is also designed with nationalism in mind, so it has to be a home-grown solution and not some tried and tested international solution. Even if international solutions are used, they are always tweaked to make them mato suhaundo (in other words, converted to create loopholes). This happens despite grants for these projects coming from international multilaterals like the Asian Development Bank (ADB). Interestingly, when one reads the ADB reports, it seems the projects have been implemented successfully. 

Many countries have moved to deliver government services digitally and provide an enabling environment. In Rwanda, the Irembo platform has been used as a central platform to pay taxes and obtain paperwork ranging from passports and visas to driving licences. Some kiosks can help with the services for those who find it difficult to use computers, and they charge a nominal fee. 

For Nepal, it will be good to explore how the local ward offices can be used efficiently to deliver services to those who have challenges to get online or need help. The active involvement of ward-level local governments allowed Nepal to conduct one of the best Covid-19 vaccination drives in the world, and we have to see how we can replicate this success.

Top priority

Leaders of political parties and parliamentarians have spent enough time in the past decades fighting internal political battles and talking about big things. In the last five years, the Oli government tweaked the map of Nepal, and promised trains and waterways. The Deuba government does not even remember what they promised to deliver. If these governments had spent time understanding citizen grievances and addressing them, they would have fared better in the election. 

For the new faces in Parliament, especially from the new parties, it will be good to start thinking about how to make our government accountable to deliver better services to the citizens. They can form shadow committees. If parties or leaders can work on this, and make simple tasks like getting a passport or driving licence more accessible, they have a better chance of doing well in the next elections. So, it is time for the new Parliament to consider its priorities. 

If the new folks in Parliament really think they care about these issues, then it will be good to form a group to study what went wrong in past government projects relating to citizen service. We are always there to help and volunteer.

Read the full article on The Kathmandu Post: https://tkpo.st/3Hu7CHr

28 Nov 2022
Kathmandu Post Permalink
Photo credit: Keshav Thapa
Photo credit: Keshav Thapa

Message from Nepali voters

November 28, 2022

This time, there were thousands who joined the fray with little resources or connections.

In my August 8 column, I had asked the question, “Will Nepal vote for change?” I had written that “given an obvious hung Parliament, the key would be to elect 15-20 people from across the spectrum, which would elevate the level of discourse in Parliament, and enable healthy discussions on legislation and significant reforms”. 

Nepal has elected 50 percent new faces and shown the door to some of the established leaders across parties. Completely new faces beat some big names, and some of them had a tough time. The fact that Sagar Dhakal, a young man who was irked by the way Prime Minister Sher Bahadur Deuba had responded to him, went to his constituency Dadeldhura and got half the number of votes that the prime minister had received with all the resources at his disposal. In a country where democracy is relegated to being a five-yearly festival, there is lot to be done to improve governance, strengthen institutions and break the political-business nexus. Here are some of the key messages the voters have given.

Notes to buy votes

Harka Sampang, the mayor of Dharan who won the elections on a shoestring budget, inspired many to jump into the fray. Contrary to past practices of vote buying in many urban centres, you do not need to treat people to masu-bhat and alcohol. If you have an agenda, leverage the disdain against the existing people and order, and be a beacon of hope if you win. Toshima Karki, Sobita Gautam, Shishir Khanal and many others who jumped in proved that money does not decide the elections, at least in urban centres. 

Four to 5 million Nepalis eligible to vote, or 25 to 30 percent of the electorate, cannot vote because they live outside Nepal. They are ineligible as the cartel of established political parties and leaders have worked together not to allow postal ballots or other means for these people to participate as they know they would be a big threat to them. However, it is very clear, be it in the case of Balen Shah being elected mayor of Kathmandu or the Rastriya Swatantra Party garnering a large number of parliamentary seats and votes, that the diaspora exerted an influence. The expatriate children told their parents back home whom to vote for, and they followed the advice. 

When Arnico Panday, an atmospheric scientist, announced his candidature for Lalitpur-3, the key message people got was that educated people who could be working anywhere in the world have decided to give a shot at Nepali politics. He later joined the central committee of the Rastriya Swatantra Party and encouraged many others to join. One of the biggest challenges the Nepali Parliament and politics faced was lack of thinkers who could transcend global boundaries and contextualise Nepal’s future. Just being in jail for sometime or being able to raise money for the party through illicit means will not be the necessary parameter to be a successful leader. The quality of the discourse will be raised, and some of these parliamentarians joining house committees will raise the legislative process. We can never forgive the parliamentarians and their leaders in the previous Parliament who did not legislate for over three years. 

It was always believed that to win elections, one had to either spend money or pay for a ticket of a major political party. It was about getting campaigners to campaign for you. It was thought that the grassroots workers of the political parties delivered wins. So feed them, get them swimming in booze, dispense money for gasoline and meet their demands, and you win! This time, there were thousands who joined the fray with little resources or connections. They won with a decent number of votes. This will ensure that more people become encouraged to contest the next elections. 

In a country where a quarter of the population lives in urban centres, people do not have time to spend days following political leaders. The pandemic has disrupted how people receive and process information. It’s all about social media platforms and connecting with people of all ages. Smartphones are not limited to being tools for the young. Middle-aged people spend more time scrolling Facebook or watching videos on YouTube. If you know how to use the platform well, that is it. You have nailed it. You have to be presentable, you must know your stuff. You do not need to be great at making speeches to millions, but you must be a good communicator. Even established leaders were forced to go for popular audio podcasts and events. It is not about creating a “cyber army” to win social media but having well-crafted strategies. 

Back to basics

Democracy is about good governance, and building institutions that are led by able people who help in policymaking and statecraft. It is about having the right set of people in the right places that helps to build a strong brand for one’s country. It is about tackling corruption and nepotism. It is about challenging a privilege-oriented society where some people have to be way above the rest and like to display opulence along with the power they wield. The established parties had used them to engage in rent-seeking through a mechanism known as bhagbanda (political oligopoly). They purely perpetuated the Rana and Shah rule mindset of amassing wealth, partnering with businesses, and controlling key government positions through the use of power. This fundamental flaw in Nepali democracy will be questioned and put to the test. 

In Unleashing the Vajra, I had written about such a thing happening in the 2027 elections, five years from now. But I am super elated that it happened five years earlier. The journey of change has begun, and we hope this time we will not squander this “open moment” like we squandered many in the past. 

Read the full article on The Kathmandu Post: https://kathmandupost.com/columns/2022/11/28/message-from-nepali-voters