Excerpts[break]
How do you analyze the entire discourse that is taking place with regard to state restructuring?
It may be fair to say that the discourse on state restructuring in Nepal is focused on two perspectives or models: One is the ethnic perspective, and the other is what might be called the socio-economic development perspective. The ethnic model advocates for the formation of states or provinces covering territories historically inhabited by some major ethnic communities. History is the starting point. The argument is that it is the lack of recognition of territorial ethnic identities, their language, traditions, culture and aspirations that has resulted in the rise of a partisan state, where Hindu caste groups such as the Chhetris and Bahuns have exercised the monopoly of power and received the open patronage of the state.
The socio-economic development model looks at federalization as an essential process of expediting the process of inclusive and devolutionary development. The argument is that the problem of ethnic identity is at heart a problem of the content, direction, pace and democratization of development. History is important because it gives a sense of perspective, but the vantage point of appreciating history is the present. The preliminary draft prepared by the Constituent Assembly (CA)´s Committee on State Restructuring and Distribution of Powers mainly proposes the ethnic model. Though the report states that ethnic identity and economic viability have been taken as the basis for federalization, it has completely ignored the aspect of economic viability. In this sense the CA Committee report is not honest to its own prescriptions.
Those who advocate for the "pure" ethnic model hold ethnic identity as a universally valid and relevant world view. The right to self-determination, prior-rights for ethnic groups and other rights including those advocated by ILO 169 all are seen as emanating from ethnic identity. There are different shades of opinion regarding the socio-economic development model. While some dismiss the ethnic question all together, others argue that ethnicity cannot be so easily dismissed in a society where ethnic origins have implications for what one is, and what one can become. Ethnicity and its implications are a harsh fact of life and those who aspire to create a just, equitable and humane society have to squarely address the facts.
I believe that federalization is just a means to an end. The end is the creation of a prosperous Nepal where prosperity is shared by all irrespective of ethnicity, caste or class. The rational for federalism in Nepal has to rest on three premises. The first is the recognition of the ethnic, linguistic, cultural and regional identity and aspirations of the diverse population groups that inhabit Nepal. Shared ownership of the state requires that progressive ethnic, cultural and regional identities are given due recognition. The second is to facilitate rapid, equitable and inclusive development so that livelihoods of all, and particularly of the vulnerable, marginalized and disadvantaged groups, can be rapidly improved. This requires that adequate attention is paid to natural and human resources that can provide the basis for equitable and inclusive development. The third is to decentralize and devolve power to the lowest possible level so that the roots of a truly participatory and accountable democracy are strengthened.

Do you mean that the 14-province model, which is largely based on ethnicity, proposed by the CA´s state restructuring committee (CASRC) can´t be an appropriate one?
The 14-province model is now on the table. It can provide the initial basis for discussion. Prima facie, I see no logic for four of the proposed provinces – Sherpa, Jadan, Narayani and Sunkoshi. Jadan has a population of 50,000 while Bhotes comprise only 1.2 per cent of Nepal’s population, and only 3.1 percent of Bhotes live in Jadan. Sherpas total only 90,000 people and a mere 21 percent of Nepal’s total Sherpa population live in the proposed state. Additionally, Sunkoshi and Narayani have as mixed a population as any other ethnic state. If one considers broad ethnic domains, Sunkoshi falls in the Rai and Tamang domains, and Narayani falls in the Magar, and Tamang domains. One of the major problems with the CASRC report is that it does not lay down any principles for state formation. For example, when does an ethnic group merit the status of a state as opposed to an autonomous region within a state? The report does not provide answers to these kinds of questions.
Why are the proposed four provinces completely irrelevant? Are you arguing from the point of view of economic viability or something else?
If you look at the proposed model from a purely economic viability perspective, there are only four provinces that can economically sustain themselves. These are the two provinces in the Tarai region (Tharuwan and Mithila), Newa (Kathmandu) and Narayani. This is based on present reality. One may argue that even Karnali can be prosperous within 10-15 years if its hydro-potential is realized. But that would require enormous investments which would be beyond the capacity of the province.
Besides the problem of economic viability, what are other shortcomings in the 14-province model?
In the Sherpa province, the size of population is very small. How can you constitute a Sherpa province where 80 percent of the population is non-Sherpas? The other instance is Jadan, which is named after the Bhote community, but the largest community in that area is Chhetri and Bhotes are only in the hundreds. I hope the CASRC members realize the arduous trek of nearly 200 km from Phoksundo in Dolpa to get to the roadless Jadan headquarters of Simkot in Humla, that too only during the summer. When otherwise knowledgeable academics and learned politicians attempt to justify the absurdity as sound logic, I am amazed. Tamsaling, Khaptad and Karnali have relatively high Tamang, and Chhetri populations respectively, but all other proposed provinces have highly mixed communities.
What type of autonomy should be adopted in our context?
It should be autonomy for development – economic, social, cultural including ethnic, linguistic etc. The people will set their development priority themselves. But in today’s world there can be no such thing as absolute autonomy.
What about the right to secede?
The relevant CASRC committee has already agreed for the right to self-determination without infringing the territorial integrity and sovereignty of the country. Even the United Nations doesn´t accept the right to secede as part of the right to self-determination. In Nepal ILO 169 has been interpreted narrowly by certain groups and not much discussion has taken place on this important issue. ILO 169 refers also to the rights of local communities residing in the areas who can stake claim on local resources.
You earlier mentioned that discrimination in the country is based on ethnic and regional lines. Should restructuring be based on that?
Other than gender based discrimination, the discussion on discrimination and exclusion in Nepal has been with respect to four major groups: The privileged Bahun-Chhetri-Sanyasi-Thakuri or the so-called upper caste groups from the hills, Dalits, Adibasi-Janajati, and Madhesi. Madhes is a regional category, not an ethnic category per se. It is worth remembering that there are 59 ethnic/caste groups in Tarai and the extent of discrimination and exclusion within the Madhesi groups in intense. The problem at present is that the discourse that started with the issue of exclusion among these four categories has now been diluted to a large extent. Dalits, for example, comprise the third largest population group in Nepal, after the Chhetri and Bahun, but there is no mention of the Dalits on the entire discourse on federalization. We need to ensure inclusive participation of these four groups, and sub-groups within them, in the system of governance.
How can the problems be solved?
There are two compelling facts in Nepal. The first is the geographical reality of major watersheds and the resource advantages of major ecological regions. The second is major ethnic domains of major ethnic/caste and linguistic groups. The north-south division of the country following the major watershed would, in an ideal world, be the best way for the federalization of Nepal. But we do not live in an ideal world. The ethnic/political aspirations that have prominently emerged in the Nepali landscape over the past decade cannot be ignored either. Most of the provinces that have been proposed on ethnic lines by the CASRC are not economically viable.
Two concepts, I believe, can help us move toward a federalization that takes identity, inclusive development and devolution as the point of departure.
The first is the concept of ethnic/caste groups that have suffered from historic discrimination and have historically had a dominant presence in geographically adjacent and contiguous areas. The second is the concept of special autonomous areas. Following the first concept, federal units can be formed around a few major ethnic/caste/language group habitats that have historically remained in adjacent or contiguous areas, and have developed a sense of ethnic affinity over time. Such federal units can incorporate areas with existing or potentially sustainable natural resource as well as economic base. Following the second concept, special autonomous areas can be designated within federal units incorporating areas with particular ethnic/caste dominance.
Following the first concept there can be five federal units in the hills – Rai-Limbu domains of the eastern hills; Tamang domain around the Kathmandu Valley; the capital region of the Kathmandu Valley, also a Newar domain; Magar-Gurung domain of the western hills, and the Chhetri domain encompassing the greater Karnali and the far-west. In the Tarai one can envisage two domains, the Tharuwan domain west of Chitwan, and the Mithila domain east of Parsa. This would yield a total of 7 provinces. Chitwan, would be incorporated in the Magar-Gurung domain. Areas with particular ethnic/caste concentration, or particular development problems, within the provinces can be given the status of special autonomous areas. Incidentally, the integrity of the major watersheds in the hill region can be maintained through this process of federalization.
Is the idea of proposed two provinces in the Tarai region okay?
Yes, that should be largely acceptable.

What about the CA committee´s proposal to give privilege to the largest ethnic community for the top post in the province?
First of all, this provision in itself is discriminatory and is not in line with the tenets of democracy. But we can go for a referendum in the respective provinces to take decision on such provisions. Prior rights, if desired, have to be popularly endorsed.
Do we need a centrally-controlled model or some other type with more autonomy to the provinces?
What we have to understand is that state restructuring process is not going to be done at one go. It will take a long time to institutionalize the system. In our context, it may be necessary for the center to be powerful for some time. It shouldn´t be too powerful but the center should be capable enough to hold the country. It is crucial for revenue assignment, expenditure assignment and inter-state transfer. It should be remembered that only nine of the total 75 districts of Nepal can generate the revenue needed to meet their own regular expenditures. Inter-governmental transfer is therefore going to be crucial. If inter-governmental transfer is going to play a major role then the center has to be powerful enough to have resources so that it can allocate resources to the regions. Otherwise, the rich provinces will be richer and poor ones will become poorer. For instance, in Karnali, the government has to make heavy investment in sectors like infrastructure development, hydropower, tourism and biodiversity for the next 12-15 years to make the region self-dependent. In want of central investment, regions like Karnali will continue to remain poorer.
What model should we adopt in view of the fact that one region of the country is dependent on the other. For instance, the Tarai has tremendous potential for agriculture whereas the hills are rich in other resources?
Tarai has potential in agriculture, agro-based industrialization, and in wildlife and religious tourism. The region too has a strong potential for international trade of agricultural products. The comparative advantage of the hill region is in hydropower, tourism and niche agricultural products such as organic coffee, tea, citrus, ginger, cardamom, off-season agricultural products, among others. Similarly, mountaineering and tourism are the potential in the high hills. Against this backdrop, a situation has to be created where complementary development of resources with comparative and competitive advantages takes place in each region. No model will work if we don´t create a proper system to facilitate this. Whatever model we adopt, there must be good inter-regional complementarities among the Tarai, Hills and Himalayan regions.
Do these facts support the idea of delineating vertical provinces?
The regional framework that was initially proposed by Dr Harka Gurung is still relevant. If you look at Nepal´s topography, natural resources and the hydrological, demographic and economic inter-relations between ecological regions, the north-south model is the most scientific and best suited for our country. The north-south model is appropriate in view of development perspective but it is not apt to address the political aspirations that have emerged. We can´t stick to north-south model because we can´t move ahead by neglecting present-day political realities.
What are the aspects that are being ignored in the present discourse?
Four important issues have more or less been ignored. First is the whole question of decentralization and devolution of power to the lowest level. Political leaders of all colors and shades seem to be satisfied with the powers devolved to the provinces. In the process, the most important aspect of a participatory democracy, devolution of power to the level from which power evolves, i.e., the local level has not received the attention it deserves. Second is impact of climate change. To deal with climate change, conservation and protected areas in the hills have to be increased, connectivity conservation along major watershed have to be expanded. The potential of productivity in the Tarai region depends on the ecology of the hills. Once the ecology in the hills deteriorates, the productivity in the Tarai will suffer. The degradation of the Churia and its impact on the Tarai is there for all to see. There is also the question of the payment for environmental services among ecological region, among provinces. These issues have not even been touched, much less discussed. The third issue that remains ignored is this aspect of a broad regional strategy for economic development, which has been alluded to above. The idea that provinces should also be conceived as planning units has not entered the discourse on federalization.
The fourth issue that has been completely ignored is the "external" factor. Shouldn´t we be assessing, evaluating our exercise in federalization from the perspective of our neighbors? Nepal is not so much land-locked as India-locked. Indian perception, manifest in so many ways, has always considered the Himalayan region as an integral part of its strategy for regional dominance. On the other hand, Nepal shares a long border with Tibet, which is the most sensitive part, some might say, even the Achilles´ heel of China. How does the federalization exercise bear on these perceptions and vice-versa.
How many tiers of restructuring do you propose?
I was earlier in favor of creating a four tier set-up - center, provinces, districts and local bodies. But we can also go for creating three tiers – centre, province, local – with large village or local level units. Local units can be larger because the problem of access has been addressed to a large extent mainly in the mid-hills. The process of economic integration among various parts of the country is taking place at a quick pace and trade and commercial areas too are expanding fast. In the mid-hills, we can increase the size of population of a local body unit from about 3,000 now to about 6,000-7,000. In the Tarai also local bodies can also be larger because of greater ease of access. The problem may not be the size of the units but the type, kind and level of services that are expected to be provided by local bodies. But serious thought has to be given for the productive utilization of the infrastructure of the present district headquarters so that the investments made over many decades does not go to waste. The power to be devolved to the local level has to take congnizance of the new realities of inclusive development.
Police investigation report prepared