Be transparent

The government’s decision to allow in principle a foreign insurance company to operate life insurance business in Nepal is a bold but controversial one. Bold, because it is for the first time that a foreign insurance company will be given permission to operate life insurance business. Controversial, because by choosing to give license to only one private insurance company, the government is in effect perpetuating monopoly regime. The competition now will be between the government owned Rastriya Beema Sansthan and the foreign insurance company. This, as everyone will be aware, is no competition at all.

The only regret in the decision initially taken by the Insurance Board is that a Nepali company which had also sought to operate life insurance business in Nepal has not been permitted to do so. This is really going against the vein of liberalism and open market policies which the government - and probably the Insurance Board - so loudly profess to follow. Depriving any company - moreover a Nepali company at that - leaves the Nepalese people with little or no choice when it comes to choosing their insurance company. The Insurance Board which had said there was no problem for a Nepali firm to obtain the permission if it met the "criteria" has only a lame excuse for not granting the Nepali firm the necessary clearance.

When were these criteria set and how does one measure management levels? Nepal Rastra Bank is said to have opposed the entry of fully owned foreign insurance companies operating in Nepal. Its stipulation is that fully Nepalese companies must first enter the field and then be followed by joint ventures and finally fully foreign owned operations. While we cannot agree with the central bank’s reservations, the criteria set by the Insurance Board are no different when compared in their respective areas. For both set of stipulations tend to exclude those who are willing to venture in the field of life insurance in Nepal.

The foreign company, American Life Insurance Company (ALICO), is said to be operating in 70 countries and has reserves exceeding 2.8 billion US dollars. Yet despite the sheer magnitude of the rival company, a Nepali firm did apply to compete and was summarily rejected by the Insurance Board. Knowing the way public sector enterprises in Nepal function, should ALICO be given the final okay, it will enjoy unchallenged sway over the life insurance business in the country. The government and Insurance Board’s regulations should be such that as many players not necessarily as big or as experienced as ALICO should be allowed. This is to ensure a fair deal for the people who must have a choice of not either a public sector or private sector insurance company but choice among different private sector companies. In addition, the Insurance Board has indicated that it has to "negotiate" with ALICO before the final go ahead is given. What are the negotiations about? It is during such "negotiations" that corruption can crop in and therefore, the Board must make all points transparent and ensure that there is no harassment of companies wanting to invest in Nepal. It is only then that there will be some element of truth in Finance Minister’s belief that permission to ALICO will help Nepal’s efforts to attract foreign investment.

Rights of disabled to be ensured

KATHMANDU - Prime Minister Manmohan Adhikari has said that the present government will protect the rights and wellbeing of the disabled by translating into practice the spirit of right to equality and the widely accepted principles of human rights guaranteed by the constitution.

Prime Minister Adhikari said this in a message on the occasion of the International Disabled Day on Saturday.

The International Disabled Day has always drawn the attention of the world community to the need for committed effort towards providing social justice to all those compelled to live a life full of struggles for
being disabled due to various
reasons and towards bringing their labour, skill and talent into the development mainstream, he said in the message.

Adhikari also called on all to love and help the disabled as members of their own families and help create an atmosphere where not even the slightest shadow of inferiority complex will hound them.

Privatization : South Asian experience

-By Narayan Manandhar

On November 24-26, 1999, resource persons from International Labour Organization (ILO), representatives from the government, employers and employees, totalling 32 participants, gathered in Kathmandu to deliberate on the social effects of privatization in five South Asian countries, namely, Bangladesh, India, Nepal, Pakistan and Sri Lanka. Resource persons drawn from each country presented their country experience on privatization to ILO social partners and the ILO experts presented their theme papers. This writing is based on the deliberations made in the three-day long sub-regional meeting.

The five countries listed above presented a wide range of experience with regard to privatization push pull factors in their respective countries, the modalities adopted, the institutional mechanisms to administer privatization, performance outcomes of privatization particularly with a focus on social effects and the requisite post privatization actions to mitigate the adverse effects of privatization.

In terms of time sequence, Bangladesh was the first country to embark on the privatization programme. Although, privatization as a global concept became popular in the eighties, Bangladesh had its privatization programme since the beginning of the seventies. One noted feature of Bangladesh's privatization was re-privatization or the return of jute and textile mills to its original owners. After Bangladesh, Sri Lanka probably comes second with the initiation of economic reforms in 1977. Nepal attempted privatization in the mid-eighties but it was mired in controversy. The real effort to privatize happened only in 1991. Pakistan also initiated privatization in the nineties. Although India has opened up its economy considerably, its experience with privatization is very limited. They are basically confined to de-reservation, deregulation, divestment and contracting out. Wholesale block transfer of public ownership is still rare in India. Divestment programmes in terms of sale of shares, which is again less than 51 percent, is confined to financial institutions taking up the issues.

The motive and objective of privatization is almost common to all the five South Asian countries. Donor pressure, particularly, the ones coming from IMF and World Bank is the dominating theme for privatization and this is marked by gross inefficiencies and financial losses of public enterprises. There is also commonality in the privatization objectives, namely, reduction of budgetary deficits, broad basing equity capital, bringing in private sector management in public enterprises, increasing operational efficiency, satisfying international lobbies and raising funds for social investments.

The other significant feature of privatization in five South Asian neighbours is that, of late, the privatization movement has receded considerably. For example, in Nepal, although 30 enterprises are enlisted for privatization in the current Ninth Plan (1997-2002), so far, not a single unit has been privatized. Those enlisted for privatization, namely, a tea estate and a power company are mired in deep controversy. Similarly, in Bangladesh out of 105 public enterprises proposed for privatization in 1994-95 only 13 enterprises were privatized from 1992-1996. In India, out of 240 central public sector enterprises, equity dilution was effected only in 39 enterprises. Of the total receipt of Rs 126 billion for 1991-1999, the receipt from divestment was only Rs 21 billion in 1997-1999.

It is interesting to note the effect of privatization in South Asia. The Bangladesh case presents "mixed results" hence it is inconclusive with a large number of privatized units being closed after privatization. India has not yet launched full-scale privatization. Its divestment programme is entrenched in controversy as it has failed to raise the targeted proceeds. The divestment programme did help the government of India to mobilize one-time funds, but privatization has in no way caused any change in the management of public enterprises. Nepal’s case is also no better as many privatized units have either closed, under a sick status or are struggling to survive. In the case of Pakistan, although the impact of privatization is expected to be minimal, (out of Rs 2500 billion investment in public enterprises, only 59 billion has been divested), output and employment has decreased in these enterprises after privatization. Corruption is a recurring theme in Pakistani privatization. The only respite for Pakistani privatization comes from the efficiency gains in finance sector privatization. However, the case of Sri Lanka presents a different story. The divestiture programme generated Rs 47.3 billion to the government. It attracted foreign investment worth about US $ 465 million, easing domestic liquidity conditions and strengthening the country’s external assets. The proceeds also helped reduce government borrowing, reduced interest costs and generated permanent revenue sources by way of lease rent income tax and dividends while reducing government transfers to loss making enterprises. Privatization also helped development of Colombo Stock Exchange. Ironically, privatization is also looked upon as a fertile source of finance for the ongoing ethnic conflict in the North and East of Sri Lanka.

South Asian privatization presents a far darker side on social fronts than on economic fronts. Labour retrenchment and redundancies featured in all countries. Commenting on the labour issue in privatization in India, Dr S K Goyal writes, "There has been total non-existence of efforts to take labour into confidence." This ranges from 25 percent to 50 percent. In order to mitigate labour problems various schemes like cash compensation, voluntary retirement scheme (VRS), training and retraining, redeployment of workforce, provision for unemployment benefits and social security have been designed. Some countries like India (National Renewal Fund), Sri Lanka (Skill Development Fund) and Bangladesh (Special Workers’ Fund) have provisions to mitigate labour issues. Apart from the inadequacy of VRS, participants opined that it is better to go for some form of pension scheme rather than immediate cash payment to retrenched employees. Due to excessive trade union power in Sri Lanka, the compensation package has been used to squeeze out the money from the government. A large number of employees opted for retirement before privatization and were again rehired after privatization. The one shot victory of the trade unions provided a dangerous precedence for future privatization.

On recent popular price hike

-By Rajoo

Dear Nepalis, we extend sincere gratitude for accepting the hike bonanza that shot up transportation fares. Your participation in this national event was just superb. Before launching this ambitious programme we were apprehensive about whether you would accept it. Now, we believe that Nepalis have become fully acclimatised with the democratic environment.

Please don’t ever get confused that we have lost our sovereignty. All these timely changes have proceeded from the need of the time and not a single external hand was responsible in this connection. Please don’t suspect any foreign prescriptions here. Who else can understand the situation of Nepal and Nepalis better than we do?

When the price of diesel rose in India, we assured that it would not happen in this country but we did it again because we had to. You see, we should do it every week but for the sake of your happiness, we preferred to face the mammoth loss (please don’t blame the election either). It’s because we need not go and buy diesel for our vehicles, neither do we use kerosene oil in our kitchens. Sorry guys, we did it — late but it was not the least.

We, in our cabinet, don't travel by bus these days. So we don’t know the taste the bus fare leaves you with (is it just like buff momo?). Then how can we recognise the effect of the fare
hike? The problem (if it is so) of increasing bus fare will be solved by the cabinet. Be optimist. You will see better days.

You need more tact in the dangerous art of giving presents than in any other social action.

Likewise, electricity tariff has also been upgraded for your convenience. Then how about sharing a coin or two of your labour for paying the price of our government offices which turn on heaters in June and fans in December? See, the responsibility to build up a handsome nation falls upon you all. Municipalities, Trolley Buses need not pay their dues. And outside the valley, one has every right to hook a direct line and consume limitless electricity without paying a single penny. You can also do it if you dare — we will send some technicians if you need them. But please pay some more rupees and don’t blame ADB or other donors. They have been very nice to us.

And postage tariff too. When the whole world is running after the virtually free of cost E-mail communication, we have our world famous snail-paced mail services and it has also begun changing more. Actually we did not want to do it but we had to. If we don’t hike it, there is a big possibility that the Indians will smuggle Nepali postage stamps over there.

Don’t be exhausted, we have many more to offer. The naturally vitaminized drinking water, telephone that connects people arbitrarily, the roads with volcano craters, the hawker squatting footpaths, the temples without idols and many more. We will increase the tariff of service continuously in the days to come. Don’t be in a hurry, remember what Shakespeare said — they stumble that run fast.

We anticipate similar cooperation, like you have shown by being silent till now, for our future hike programmes. Thank you very much.

Sincerely yours,

The most democratic ruling party Nepal has ever had.

The politics of knowledge

-By Pratyoush Onta

Like many others in Kathmandu, I watched an impressive Bhintuna rally on the first day of the new Nepal Sambat 1120. During the month that has almost passed since that day, I have often wondered how one should best ‘read’ that event. Should the show of Newar presence in such an impressive manner be read as a once-a-year pageantry put up by a people who really care about promoting their culture, both material and intangible? Or should it be read as a sign of our times when visible display is both the medium and the message, no matter how vacuous the contents of the latter might be?

I have thought about these questions in my capacity as a student of Nepali society who devotes not an insignificant amount of time generating narrowcast and broadcast (ie, radio) variety of discussions regarding various aspects of the politics of cultural identity in Nepal. However, when thinking about these questions, I cannot also escape the fact that I am a Newar who grew up in Kathmandu, speaking Nepali at home and learning English at a Jesuit school. My bilingual fluency in those two languages is always juxtaposed with my lack of fluency in Nepal Bhasa. My inability to use Nepal Bhasa as a medium of fluent oral communication immediately disqualifies me as a Newar in the eyes of hard-line Newar activists (cum politicians) like Malla K Sundar.

As Malla put it to me in a program over Radio Sagarmatha on 10 November 1999, since Newars do not constitute a single race or are not contained within a geographical territory, their language is the only key cultural component around which Newar identity can be constructed. By defining Newars as those who can speak Nepal Bhasa, Malla and his coterie immediately exclude the likes of me from what could be called ‘core Newar culture’ (readers must note that when Nepali language activists use the same definition to defend the Panchayati argument that Nepali language is the basis of Nepali identity, Malla rejects it). Since such an attitude remains dominant within other rungs of Newar society as well, my relationship with the Bhintuna celebration is really that of an outsider (leaving aside the debate about whether or not Nepal Sambat belongs to all Nepalis, now that Sankadhar Shakwa has been declared a national hero).

Searching for answers to the above questions, I have discussed this subject with quite a few of my friends, both Newar and non-Newar alike. These discussions have led me to think that categorical answers to my own questions are difficult to propose. There are many Newars who participate (and who do not participate) in Bhintuna rallies who are doing many interesting things, in their own small ways, to promote various aspects of Newar culture. And I suppose that there are many other Newars who participate in that rally for an annual dose of fun. For them it might very well be the case that
participating in the merry-making itself is the means and end of Newar culture promotion!

Moving away from the questions I posed initially, I have now begun to think if the Newars have a socially viable community agenda that can be the driving force for activities that really promote Newar culture. During much of the Panchayat era and most of the years since the Jana Andolan, the rhetoric of having lost the control of a once majestic civilization in the Kathmandu Valley to, as the likes of Malla put it, Khas (or alternatively ‘Baje’) rulers has caught the fancy of an influential group of Newar leaders. However, it is my preliminary conclusion that this rhetoric has had its day and it is no longer sufficient to overcome the many internal differences that divide Newar society along lines of caste, class, gender, language (can or can’t speak Nepal Bhasa as described above) and territorial location.

Caste (as understood traditionally) differences within Newar society and its practical consequences for those belonging to castes in the ‘lower’ end are well-known and hence do not need any elaboration here. Class difference within Newars, it seems from a casual observation, is now increasingly becoming an important factor for the production of individual Newar identities across and within various castes. As feminism-driven analysis of Newar past would recognize, Newar guthis were the primary social technologies through which gender discrimination was reproduced in Newar society.

As far as territory is concerned, as long as Katmandu is considered the standard against which ones Newarness has to be measured, large numbers of Newars will be excluded from any Newar agenda, however pan-Nepal a shell it might show. This would be a fair conclusion to draw from the deliberations held in Biratnagar on Newar culture in Eastern Nepal a little over a year ago (as reported to me by several participants.

Hence unless newer ways to create an all inclusive Newar culture is found, a community agenda for Newars is almost hopeless. A debate on how to understand the history of Khas oppression must be held as the beginning point of a new thinking about such an agenda. While it is true that Nepal Bhasa was suppressed from around the turn of the nineteenth century, Newars can not claim for a full-fledged history of oppression like some other janajatis as prominent Newar families have been complicit in the sustenance of Shah, Rana and Panchayat rule in Nepal. This debate will also have to recognize the many faceted differences that exist within Newar society and create the social forums where open discussions on them might be held. This effort will also have to find ways to attract a new generation of Newar students to become researchers of their own culture and society. It will also have to build upon possibilities made possible by FM radio programming in Nepal Bhasa. It will also have to create institutions that can financially support culture promotion activities on a large scale.

What do other Newars think about my argument?