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If we have a better set of folks managing the country, better governance would help accelerate growth.

The year 2021 is best forgotten for Nepal if you look at politics. Parliament did no business, and inter-party squabbles kept the parties going. With the conventions of the major political parties over, the trailer for the mess coming up in elections 2022-23 is already out. There will be lots of money exchanged for party tickets as corruption, power and money seem to become synonymous with politics. Of course, the judiciary has also got into its own set of controversies. So, 2021 came and went, but Nepalis moved on. So, what could be some perspectives of hope for the coming year? I just thought of looking at a few. 

When you take a plane after sunset flying in different parts of Nepal, one can see villages, towns and cities glittering in the dark. This is a stark contrast to five-six years ago when Nepal reeled under up to 16 hours of power cuts daily. Night flights are becoming popular, and it is nice to see a passenger from Bhadrapur transit in Kathmandu for a bit and then take off to Bhairahawa, something we could not have thought about a decade back. At highway eateries, not only refrigerators, but we see multiple electric appliances and the big coffee making machines becoming something one can spot in even remote places. Electricity has also ensured towns and villages stay open longer, which means more economic activities. Night classes for working people are becoming a reality, albeit private institutions are raking it in. 

Global icons

One film can uplift a nation. 14 Peaks: Nothing is Impossible, chronicling the ascent of peaks by Nirmal Purja and the team has created ripples around the world, and perhaps given hope to many young Nepalis. It has helped to change how Western climbers get all the spotlight, but people make their climbs happen. The Sherpas who build the trekking trails in Norway to the Nepalis who go to Goa and Uttarakhand to manage and guide adventure sports activities are setting global aspirations. Similarly, a Nepali chef in the United Kingdom, Santosh Shah, has lifted the spirits of many Nepalis working in kitchens worldwide. His book will help introduce the diversity of Nepali cuisine to the world, and perhaps we may see some Nepali fusion restaurants and Nepali chefs winning Michelin stars. 

When people ask me about the transformation of Bangladesh in the last decade, I talk about how the introduction of ride-hailing services changed freedom of movement, especially for women. Women were sitting on bikes behind strangers; something people could not have comprehended just a decade back. Similarly, Instagram and TikTok have changed what it means to express oneself. As a friend said, look at these young people who express themselves, and the older generation which imposed a lot of taboos cannot do anything but smile. At friends’ weddings, I remember how daughters-in-law could not dance in front of their father and mothers-in-law, and now videos of all kinds fill internet space. Restaurants are changing to take care of people who want to see better décor, better presentation of food and one Instagrammer can make or break one’s business. Of course, everything can have a dark side, but if we can focus on the positive transformations and the changes, we can appreciate how society is transforming.

We cannot tire talking about the resilient nature of Nepalis who have little hope in their government and take things into their own hands to move ahead. We saw through 10 years of the insurgency, earthquake, natural disasters and now the pandemic. Nepalis push on; they find their solutions to their problems. Youth support groups emerge from somewhere to help, and social media has played a significant role in connecting the people with issues and people willing to help. It is beautiful to see organisations coming out to feed the hungry, take care of street animals and ensure people get hospital beds and oxygen supplies during difficult times. This nature of resilience continues to give hope to Nepal, unleashing its potential.

Economy moves on

The Nepali economy has nothing to do with income, it has to do with assets; and as long as asset prices rise, there is enough money in the system. Every Nepali household has someone outside Nepal, and the money they send back keeps the Nepali economy going. We have seen remittances continue to grow, and the only change could be that the mix of formal and informal remittances have changed. Imports surged, which means people have money to spend, and consumption did not take a hit like in other countries. Nepalis will never compromise on what they eat and drink and how they will hold their social functions like weddings, birthdays and endless festivities. This ensures that the economy moves. If the formal economy goes through challenges like liquidity crunch, then the informal economy starts to take dominance. Further, Nepalis learning to discover their own country and telling the world about their country has pushed domestic tourism during the pandemic and this will only grow. 

So, looking ahead to 2022, we will see many such societal transformations increase, and the economy will keep moving. If we have a better set of folks managing the country, then perhaps the process of reforms and better governance would help accelerate economic growth.

Read in Kathmandu Post – https://bit.ly/32xlSwF

We have seen the lives of people who became close to politicians transform dramatically.

One of the most significant economic activities post-Dashain and Tihar festivities have been the individual, business and party spending of annual conventions held by different political parties. Muscle power and money power, nexus of business and politics, politicians becoming businessmen, and businesswomen and business people becoming politicians have been a hallmark of Nepali politics after 2006. Still, the conventions of the two major political parties have indicated what is to come in the elections 2022-23. Here are the three big things that we see happening.

It isn’t about ideology

If you see the campaigns of the different leaders of the different parties at the various conventions, it was clear–it’s all about the personalities and cronies around you. So, you are either with me or against me and do not care for what. Apart from a document released by a Nepali Congress leader on economic transformation, it was nothing else. Like for any other association, chamber, Rotary, Lions, or other social organisation elections–it’s about wining and dining, promising posts, and favours in return. In politics post-2017 federalism, people have realised that money does trickle down, though little. Therefore, local leaders unheard of in Kathmandu can contest critical positions as they know what can be on the right side of a $35 billion economy. 

However, people are glued to the elections. The media is giving it liberal coverage—it’s so easy to report what people say and gossip rather than write something that requires deep research and analysis. So, Nepalis are getting what they love—talking about people, nothing to do with ideologies, what he or she will deliver or how that impacts Nepal’s future in a society and culture that is getting more individualistic with the proliferation of individual devices and social media.

Proliferating graft

In West Bengal, India since 1977, when a communist coalition started ruling the state, people have found that hanging around with politicians gives a better chance for a better education than doing something productive. Therefore, the state and Kolkata, once the capital of the British Empire, have seen widespread migration into different parts of India and the world. I continue to draw parallels with Bengal as our communism also originated there. Institutionalised graft kept the communists going, and now the people who overthrew them have not deviated from the graft rule book. 

In Nepal, the annual graft potential with a $10 billion government spending is conservatively $1 to $1.5 billion. People have seen the lives of people who became close to politicians transform dramatically in just a decade and a half. If the source of funds was to be a key check when purchasing land, houses, gold or jewellery or spending for children’s education, then perhaps the markets would crash. The stakes become bigger, and graft legitimises as a rarely political person wants to take this on as everyone is involved in it. Further, the international community not really caring about who they are working with has given politicians much courage. 

Bad governance is not limited to the legislature or the executive; it extends to the judiciary. Regulations do not matter. The job of a peon or guard at a government office or affiliated institution is worth paying hundreds of thousands for as it allows one to have a little outlet as a tea shop for their relatives that can, with the right connections, become a property they can own in the long run. Similarly, Nepali citizens do not even care that eateries or shops should be regulated, businesses should function as per government regulation, or traffic should move in a certain way. If everyone is milking through political connections, why not me, and why should governance matter to me? In Kul Chandra Gautam’s words, the impact of the pandemic of lousy governance will be far worse than the impact of the Covid-19 pandemic.

Business and politics

The mega trends at these conventions have been the number of business people who are taking on becoming politicians also. While this is not new, the scale and magnitude are different. People have seen how one can influence legislation and institutional functioning as a politician, demonstrated by some of the business people in politics; now they want to cut out the middlemen’s (yes, generally men) fees by getting a seat on the gravy train. They have also figured out that if one is directly not in politics, then no one is there to help you in times of difficulties, so it is essential to protect your business to get into politics. 

A study done by the Nepal Economic Forum has shown that out of the significant business houses that have emerged in the past decade and a half, a substantial number have appeared through political connections. Further, by restricting foreign direct investment and international companies from doing business in Nepal, the interactions done directly or through the political groups they support have protected their business. In the last local elections, more than one-third of the people were people in business who got into politics. 

They say one cannot be a president in the United States if you do not have a war chest of funds to fight elections. It is true for many other positions also. Still, Donald Trump, a business person, has shown one can recalibrate politics to suit oneself. This has inspired thousands of business people worldwide to really explore, why not get into politics to get what you want. It’s not only money, but the combination of power and money.

The conventions were a trailer to the movie to come. Tonnes of plastic flex wasted, and billions spent on wining, dining, and entertainment that crossed lines. But perhaps, it just reflects the society we live in. 

Read it in Kathmandu Post – https://bit.ly/3rXM5zb

The money we earn goes to the government as taxes and is spent without accountability.

Videos of people running amok to get to a driving test or complaints about filling up a form online only to have to print it out and submit it after queuing up for hours are doing the rounds. Earlier, the inefficient ways of managing vaccination forms where one had to disclose everything apart from the colour of one’s underwear had created havoc. Whenever it comes to Nepalis receiving services from the government, it is always a mess. The chaos at the passport office where Nepalis pay one of the highest prices for a thin passport book has become the norm. Maybe our practice of queuing haphazardly at religious shrines has given us the tenacity to go through all this without ever complaining.

Folks in government service and political parties will give you a “ho ra” (is that so) look. The government earns billions each year from airport taxes, vehicle registration taxes, driving license fees, passport fees, no objection certificates and lots of other sources of revenue; but the officials and the leaders do not think they are providing a service that people are paying for. People have learnt to just cope with it. So where does all this stem from?

The extreme influence from the democracy model from the south, where government programmes are given fancy names tied up with politicians or their ancestors, is one reason. When those programmes are announced and big functions are organised, it is projected as if generally the person is giving out money from what he had earned. People get excited to get money that one earned and that the government took away as taxes. But one never feels that you were just made a fool! The money we earn goes to the government and is spent without accountability. Auditor General reports are the biggest joke books that people seem to read and laugh it off.

The democratic system in terms of financial accountability is designed to ensure that, through the process of voting, one can choose a leader that will be spending your money and demand accountability from him or her. Never do we think that in an election, the people we are electing are basically the folks that will be spending the money you have earned and paid as taxes. But do elections work that way? Of course not because the people who are paying the least taxes generally work very hard to ensure that people who can ensure he or she is not taxed are elected, and they can get to spend through the leaders the money other people have earned.

Working for the government

When people ask me what I do, I say I work for the Government of Nepal. Many people in Nepal work for the Government of Nepal or some work for banks. Since the government takes more money than I get to take away from the revenues, you can only say this is the case. There is 13 percent value added tax (VAT), and if one employs people, they pay taxes and you basically are a tax collector for the government. Then there are different statutory taxes to be paid. Then, of course, the big chunk of income tax. So, if you are engaged in a business with a 15 percent margin, the government is taking off at least 30 percent of your revenues! So, you basically work for the government.

You do not mind working for the government if one can also get rich and make the government richer; but the issue is that there is complete lack of accountability on how the government spends that money and how it decides to distribute it—at times as doles to parliamentarians, or as payment for medical expenses of politicians and their family members, or as payment for projects that are not completed.

Therefore, it is important that we start thinking from this perspective of how we work for the Government of Nepal; and, in turn, how we can make the people spending our hard-earned money accountable.

Demanding better services

There are two services the government provides—one as a profit centre like airports, passport services, driving licence services, issuance of no-objection certificates and so forth where they make more money than they spend. With development partners and agencies supporting these sectors, the government actually makes super-profits. In these types of services, it will be important to take a corporate approach and make them fully digital. If the government is earning money on this, it can afford this. Also, this will ensure that the staff stay longer at these agencies and they can be well paid.

The second is services that the government is supposed to provide people for free, be it vaccination or basic government documents like citizenship documents, birth certificates and so forth. These are apart from bigger services like infrastructure, healthcare, education, security and other responsibilities it needs to take care of. The approach has to change from the government doing the public a favour to the government spending someone else’s money, therefore it needs to be accountable to the public. Like at times we have to remind civil servants that they work for us as we pay their salaries through the taxes, the government needs constant reminders.

Finally, we have seen how digitisation has helped to bring about accountability the world over; and in these days when every keyboard warrior is a journalist, it is easier to develop pressure and make institutions accountable. The key is to eliminate the middleman. Our religious practices always insist on having a middleman; that needs to be eliminated. Like by downloading religious scripts and chants one can do rituals without a middleman, we need to extend that to government services also. If one can apply for renewal of the driving licence online and it can be sent by Nepal Post to the digital address one has provided, we will eliminate all the middlemen (generally men!) who thrive on other people’s problems. It does not require money to bring transformations, but it requires change in the mindset!

https://kathmandupost.com/columns/2021/11/29/ensuring-government-service-delivery

We need to stop involving ‘cartelpreneurs’ in policy discourses around reforms.

Last week, at multiple discussions organized around Nepal and the world by the Nepal Economic Forum and the National University of Singapore (ISAS), we discussed the perspective of investments in Nepal as part of Nepal connects better with the world and reaping economic benefits besides pushing economic growth and job creation. 

Former Indian ambassador to Nepal Ranjit Rae emphasised the need to look at issues concerning intellectual property, labour laws and other regulatory frameworks that will provide a favourable environment for investors. United Kingdom Ambassador to Nepal Nicola Pollitt hit the nail on the head in terms of all the money being lined up, but the necessity of Nepal to reform for investors to feel confident. One pertinent point she indicated and that is least considered is that economic diplomacy is not only about Nepali embassies in foreign countries promoting Nepal, but Nepal taking care of the people and institutions these embassies identify and assist. These issues are continuously raised, but then this time, I thought of taking a slightly different approach by identifying the people who are behind stalling reforms. We generally blame the government, but is it the government or some others who are stalling reforms?

The issue is attitude

In 1990 when Nepal’s economy was worth $3.5 billion, may be money was an issue; but now it is not the issue when the GDP is valued at $34 billion and stock market capitalisation is at a similar amount with companies at $1 billion plus market capitalisation. But why is it that we are not seeing foreign investors rushing into Nepal? First of all, we need people, who have made money out of collaborating in the 1990s when foreign firms came in, speak up. For instance, the local promoter group that invested about Rs3.7 million (less than $100,000) in Unilever Nepal’s capital of Rs73.6 million in 1992 today have their investment worth Rs900 million–25 times their initial investment. Similarly, local company Butwal Power Company, a company promoted by a consortium of then large private sector groups, today has a market capitalisation of Rs15 billion! They all need to be ambassadors for reform and talk about why reform in Nepal is ready. We need to hear their success stories that we find few people talking about or in the media. They need to really come out and talk about their stories and tell they are not rent-seekers of the investments that they got in those times either as local agents or investors. 

Similarly, we have seen how the entry of the Oberois and the Sheratons, changed the way hotels operated in Nepal. The advent of KFC changed how restaurants managed operations and back office. Nabil and Standard Chartered changed how banking is done in Nepal. Restaurants like Chez Caroline and Fire and Ice changed customer expectations that led to many great Nepali restaurants to emerge. In the banking sector, FMO is emerging as the largest shareholder in NMB Bank, and is challenging the status quo of many established banks. Sherpa Adventure Gear changed the way apparel manufacturing and marketing is done. Thompson Nepal (now J Walter Thompson) changed the world of advertising. The list goes on. Many of these businesses were not investment heavy, but it brought about global practices to Nepal. People who worked in these different establishments became global workers who can be seen in 180 countries that Nepalis work and live in. 

Money is not the constraint. Development finance institutions (DFIs) have more than $2.5 billion in investment-ready money lined up. Development partners are willing to put in a fresh $4.2 billion in Green Resilient Inclusive Development (GRID) Action Plan. The Nepali investor base now comprises of millions of people who can invest with the tap of a button from a smart phone. We just need people with the right attitude, and exclusion of people with the wrong attitude. 

Push and alienate

We all need to push reform, including pushing opening up of Nepalis to invest abroad that will force Nepali companies to adopt global practices. Words need go-get action—it is now or never.People who are working towards getting foreign investment understand very clearly that it is not the officials at the Department of Industry or the ministry; clearly, it is the cartels who grease the system to tire off foreign investors. After all, the cartels allegedly get to raise money to pay political parties and appoint ministers of their choice. 

For international development partners, it is time to also do some introspection and look upon all the past literature published on cartels and nexus—and really start to alienate them. On the one hand, harping on investment and getting the same people who have been working behind the scenes to vigorously obstruct reform in the room will not work. Perpetrators against reforms cannot be part of efforts to push reforms. We know who the “cartelpreneurs” are; and we need to stop involving them in policy discourses around reforms. Internally, one also needs to see within one’s own organisation, who have been indirectly supporting these cartelpreneurs and why. Unprecedented transformations would require unprecedented action. Having been working to push reforms relentlessly for 30 years, I will not tire off despite threats when I tweet on a certain cartel or cartelpreneur. We just need to combine our efforts and continue our crusade to unleash Nepal’s potential.

https://kathmandupost.com/columns/2021/11/15/who-is-stalling-reforms 

After landing at JFK Airport, as I was getting through US Customs and Border Protection, I was asked where I had travelled in the past 14 days. When I said I had travelled to India, I was told I could not enter the USA as India is still in the restricted country list. I spent 10 hours alone in a room and then boarded a flight back to Doha on my way back to Nepal. 

In times like these, when travel advisories change frequently, the onus is on the airlines to ask the key questions. I was never asked in Kathmandu or Doha about my previous travels. In the USA, of course, they are doing their job as they say. They lectured me on the Presidential proclamation of restrictions and the way one was treated; it was not different from the others who had issues entering the USA. They told me they were being generous and not cancelling my visa. I was left pondering: Who do you rely for information as the scenario changes each time? 

Last week, in New Delhi, when I went to get a new sim card for my phone as the old one had expired since it had not been used since the pandemic, I was surprisingly told that you needed to have a visa to be able to get it. I saw the electronic form used by the vendor on his mobile, and there was a provision that could not be over-ridden. So, I was stuck with no sim card. Then I realised that data while roaming was not working, and I could not use the free wifi at New Delhi airport as the one-time password was not working through a Nepal number. 

I was with electronic tickets, all forms stored in the cloud. But I could not enter the airport as I had no printed ticket, and I could not access anything online. We may be used to so much digital stuff during the pandemic, but it seems keeping printouts for backup is still essential. 

New travel environment

Airports are just getting back to normal; and people whose jobs are secure, pandemic or no pandemic, are upset they are getting back to normal. Government staff, people in security and other fixed tenure job holders, who kept their jobs during the pandemic and will not lose them if there are subsequent waves, are unhappy things are getting back to normal. I have been shuttling the past couple of weeks, and they are complaining things are getting back to normal. They have not changed their ways and do not want to adhere to the new normal. For instance, one would show one’s boarding pass across the glass partition, but they want to touch and feel it. When I told them that you should avoid touching hundreds of boarding passes and smart phones, he sternly told me that “corona is gone”! 

It would be best to get ready for airports that can be super hot like the one in Bhadrapur and have no air-conditioning and dilapidated ceiling fans. Mosquitoes improve your travel experience as per the airport regulators of Nepal, so do not forget to carry repellent sprays. There are generally no good places to eat at airports in Nepal, so be prepared with food and drinks. You are not sure how many hours your flight can be delayed, and it is not easy to travel in and out of airports unless you are one of the VIPs. Of course, do not drink too much water or get to try the local fare; the toilets at the domestic airports are sinus treatment centres that you would like to avoid!

There are QR codes and bar codes on everything; but in Nepal, they are never scanned or used by anyone. They go back to writing by hand or not checking at all. There is the great Covid-19 Crisis Management Centre (CCMC) form we all have to fill up when departing, but it never seems to be limited. It takes a while to fill the form. It has a wonderful section where you are asked your last 30-day travel history, and there are no options for flights, though there are options for “walking”. In Nepal, people have very little expectation from the government, and they will only complain when things go down the drain, as happened in the case of vaccine certification. 

In a country with the highest per capita VIPs, people don’t care as they are above the rules, so they can get away without bothering to do anything. Exactly two years ago, I volunteered to manage crowds at the airport, which I wrote about. I was assured of improvements, but they never seemed to have happened. We could read the frustrations of entrepreneur and author Jiba Lamichhane on his Facebook wall, and he also responded to authorities who got back to him, but it’s just temporary. So one has to be ready for queues, delays and challenges one can only meditate through.

Of course, some companies have been able to transform. At the Oberoi Grand in Kolkata, the entire experience was made contactless apart from getting the key! 

Memorable experiences

In my column a month ago, we had discussed reviving tourism and focusing on experience; but for this one, the key issue we need to address is having a competition and pushing collusion out. At Kathmandu’s international airport, you have a new option with the opening of a lounge by the Soaltee Hotel. Hopefully, domestic airlines will also give competitive differential services for their frequent fliers. 

Travelling is back, but so are newer sets of problems. It seems you will never know about the problems until you land in one.

https://kathmandupost.com/columns/2021/10/18/travelling-is-not-the-same

One of the sectors to take the biggest hit around the world has been tourism, on which one out of every 10 people depends as a source of livelihood. Travel restrictions have hit the sector hard, but we can now see a silver lining as countries are learning from experiments. Singapore finally decided to open even if it is just for people from Germany and Brunei. Thailand’s experimentation with “sandbox” has gone well, and they definitely would not like to miss the new year rush.

During my last quick trip across the border in eastern Nepal, we saw people moving across the borders following the travel protocols of PCR test to get to India, and full vaccination to get to Nepal. United States citizens are now being allowed to enter Canada after 17 months. The Maldives took advantage of its location, and its arrivals in August 2021 were higher than those in 2019. Every country is looking at ways to open up for tourism. For Nepal, it will be essential to look at how it can build a good strategy and execute it.

The Right Protocols

Every country should establish protocols that are centred around the visitor to make the person feel safe and welcome. The Nepal Tourism Board can initiate live chatbots to ensure people’s queries are answered and create a dedicated call centre to answer calls. In the days of calls over the internet, this is the cheapest and most cost-effective medium. Yes, we can start opening up for people who are fully vaccinated and ensure mandatory PCR reports are taken before departure.

We need to be mindful of the requirements of the countries that people will be returning to. Our travel protocols have been developed keeping in mind the mass market labour, but we need to understand that Nepali outbound tourism will also bounce back as countries open their borders. Our airport, now managed by a private firm, competes with the bus park on aesthetics and services. Similarly, there will be more Nepalis travelling for meetings and work. And let’s not forget, there is already a million-strong Nepali diaspora settled in different countries around the world, who will be travelling on non-Nepali passports but would like to seek better treatment at the airport.

Nepal’s track record of its airport, protocols and government action has been very poor, only compensated by the hospitable Nepalis who make people’s trips memorable. We need the government and tourism trade industry to learn how to convert goodwill into government actions.

Given the way Nepal has been able to implement the control measures and non-regulation of hotels, restaurants and bars in terms of crowds or protocol, we have to be clear: No big conferences will happen in Nepal till we pull up our socks. Similarly, people who have the money and fly in private jets don’t find Nepal ready to cater to this group. Therefore, it will be back to mass-market tourism, especially from China and India, and that is what it should be. Overland tourism from India will start gaining momentum, and the key is to ensure that the folks at the border treat you as a person whose business we need rather than treating everyone as a criminal trying to smuggle something or the other. Definitely, the folks at the border have to go through some massive “customer service” training, and there could be a Tourism Help Desk manned by personnel who can speak the local language to make people feel they are welcome.

We are, after all, connected to a market of 400 million-plus people within a few hours’ driving distance. From China, it will be about flights, and as it decides to open up its skies cautiously, it will be time for Chinese tourists to travel again. For one of the Southeast Asian markets, there were support schemes under which Chinese travellers could avail of state support worth $1,500 provided they fly a Chinese airline and spend a week outside China. Given the mental health challenges the pandemic has brought about around the world, going out for many people can be the only way to bring about a change in their daily rut.

Long-term strategies

While much of the blame is put on the government, the Nepali private sector working in tourism also must introspect and see what they need to do. The associations that have converted themselves into political cartels have not helped as the focus is never on looking at the industry but at personal gains. A few champions are trying, but many are giving up. Hotels are a priority area for lending, whereas for banks they are a real estate business, and only a few are really in the business of hospitality. Further, family feuds and feuds with workers have not helped either. The business is still owner-driven, and even the largest conglomerates have decided to run the business themselves rather than bring in professional management. For someone who has spent two decades in a hotel group as a professional, this is really saddening.

We have messed up our exclusive products like mountain climbing by selling them cheap; we have not cared about trekking routes; places like Sauraha have been converted into an urban ghetto; and everyone is in a hurry to finish Pokhara and replicate that destruction in Lumbini. The pandemic, hopefully, has taught us some important lessons as we reflect on our mistakes; it is time to set things right as we open Nepal to the world again. 

https://tkpo.st/3E21KBh