Happy New Year, 2023!

The year 2022 began with a fresh wave of COVID-19 that wreaked havoc across all walks of life in the country for the previous two years. In between, there was a sudden spike of dengue infections, with the country confirming over 42,000 cases and 51 deaths. As we begin New Year 2023, the COVID-19 pandemic looks to be making a comeback again, instilling fear among all Nepalis. The government has already decided to take precautionary measures as the number of COVID-19 cases in neighboring China and India are increasing sharply. But if we forget these issues for a moment and recall last year’s events before making a fresh start, the year 2022 will be remembered as the year of elections. Nepal successfully held three-tier elections that contributed to institutionalizing the federal system of governance. While the local election across the 753 local units was held on May 13, the elections to the members of the House of Representatives (HoR) and provincial assemblies were held on November 20. The new governments at the local level have already begun working to deliver services to their citizens. And, it has been a week since a new federal government led by CPN (Maoist Center) Chairman Pushpa Kamal Dahal assumed office. All seven provinces are currently in the process of forming new governments. These elections mark important political achievements as the local, provincial and federal governments have successfully completed their first terms. Despite political wrangling among parties and the controversial decision to impeach the chief justice, the year 2022 can be termed as a relatively better year on the political front.

However, on the economic front, the year 2022 remained a mixed bag for Nepal. The country’s economy faced an unprecedented threat on the external sector equilibrium due to excessive imports followed by depleting foreign currency reserves in the first six months of 2022. Amid massive shortage of loanable funds, commercial banks raised interest rates more than double even as Nepal Rastra Bank intervened to ease the liquidity crisis. However, things improved significantly in the second half of the year. The external sector indicators posted a positive outlook, mainly due to restrictions imposed on certain imports and increased remittance inflow in the country to help improve the country’s foreign policy reserves. The impacts of the Russia-Ukraine war were evident in all sectors in Nepal with the rising inflation and record high prices of petroleum products. Amid all these gloomy things, the year 2022 also marked the beginning of the implementation of mega infrastructure projects funded by the US$500 million grant of the US government as a part of the MCC Nepal Compact. The decision to ratify the MCC compact agreement through parliament despite serious controversy and sharp political polarization was perhaps one of the best decisions Nepal took for the country’s economic health and improvement of the development infrastructure. As we are set to begin the new year, the country’s economic outlook does not still look encouraging. The private sector has warned that the country has already experienced economic slowdown with sharp decline in the overall economic activities and is likely to plunge into serious economic recession anytime soon if proper interventions are not made on time.

As we write this editorial on the eve of new year, there are a few wishes that we think we all Nepalis wish to see materialized in the new year. The first thing all Nepalis wish to see is political stability with a government that ensures good governance along with the improvement in public service delivery to the people. The people also wish to see the government effectively taming inflation, ensuring economic recovery, curbing imports and promoting entrepreneurship in the country so that they do not have to queue for hours just to get passports and fly abroad for work. People also wish to see broader national consensus among parties when it comes to development projects. Above all, political wranglings leading to changes of government and impeachment of the heads of constitutional bodies on trivial grounds to consolidate powers like the case involving Chief Justice Cholendra SJB Rana are probably the last things they wish to see in the New Year. As our immediate neighbors—India and China—experience a fresh outbreak of COVID-19 pandemic, there is also a common wish that it does not spread to Nepal and curb their freedom--- the freedom to decide for themselves-- even if they may need to be masked and socially and physically distanced for a while. Happy New Year, 2023!