Political parties are unveiling their election manifestos one after another. It’s not a surprise that they all have come up with commitments to do better, the selfsame commitments they made in the past.
For example, in the last CA election, UCPN (Maoist) had promised to work on achieving double-digit growth. Five years down the line, we do not even have the economic growth rate we had in the insurgency period. [break]
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There is nothing wrong in being ambitious, but we need to look at how consistent the underlying logic is. At this time, the manifestos will be judged based largely on their stance on different political issues like federalism, state restructuring and division of power. But this should not overshadow the importance of economic agenda. Economic development is driven by the political course. Hence we need to analyze how political parties connect their political agenda with economic ones.
We have set the target of graduating from the status of a Least Developed Country in the next ten years. To achieve that target, the economy needs huge investment, both from domestic and foreign investors. The infrastructure gap that we have now should be filled within the next few years. For that, we need to some exogenous shock such as massive investment. Investors want a corruption-free environment, efficient bureaucracy and consistent policies.
During the transition, political parties, private sector leaders and development activists have talked about developing consensus for common economic agendas. But they have not been able to reach an agreement. Successive governments failed to bring budgets on time, forget about building consensus for common minimum economic agendas.
Last April, almost all the political parties and Federation of Nepalese Chambers of Commerce and Industry (FNCCI) had signed a 19-point agreement on hydropower development.
The agreement was prepared by the FNCCI, in close coordination with political parties, big and small. The major thrust of the agreement was reforming the energy market by restructuring Nepal Electricity Authority (NEA). That can be done only by encouraging domestic private sector to develop small and medium level hydropower projects. The agreement urges political parties to encourage financing of hydropower on different modalities. Private investment, both domestic and foreign, public-private investment, and public investment are the need of the time.
No matter which party is in power, political parties should focus on these core areas if they are serious about economic development. Addressing the core problems of the country, such as corruption, red-tape and inefficiency in public enterprises, should be the political parties’ main goal and hydropower development their primary objective. Just working on new projects will not help the hydropower sector; it is also important to better manage institutions such as NEA and Department of Electricity Development (DoED). Reducing corruption in Ministry of Energy and the NEA is perhaps the most important.
Economic development is contingent upon political willingness to carry out reforms that might not always be popular. Reforming public enterprises that inflict huge losses on the state might not be easy. Leaders might have to face tremendous pressure from lobbyists and interest groups. The road expansion program in Kathmandu, launched by former Prime Minister Dr Baburam Bhattarai, was one such task. Hridayesh Tripathi, former minister in the Bhattarai government, shared his experience at an informal gathering in Kathmandu a few months ago. He recalled having to switch off his phone when a bulldozer started demolishing the front wall of Hotel Everest.
“I went for a long drive in the outskirt of Kathmandu to avoid some people,” Tripathi had said off the record. This indicates that there are influential interest groups working behind the scenes. The real challenge for politicians will be to adeptly tackle those lobbyists.
We don’t need big changes in policy framework. What we need are leaders who can get small things that can have multiple effects on our efficiency, productivity and economic growth right. The country’s future lies on our ability to make small changes, in all areas, from labor problem to hydropower development.
The last CA election gave us great hope, but little could be achieved in the last six years. The formation of Investment Board of Nepal (IBN) is the only good thing towards the development of large scale infrastructure and luring foreign investment that was done in that time. But unfortunately, the Board has not initiated a single project so far.
We had a healthy growth rate post 1991 election, after which Nepali Congress had formed a majority government. Since it is hard for any party to get a majority in the upcoming election, all the political parties will have to work together. The 19-point agreement prepared by FNCCI and signed by political parties last April can be a common starting platform.
The author is graduate student in Tsinghua University in Beijing
bhoju.poudel1@gmail.com
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