Indian support needed

It is very encouraging to note that prominent leaders of India are in favour of the democratic movement in Bhutan. Their speeches at the first convention of the Indo-Bhutan Friendship Society not only condemned the authoritarian Bhutanese regime but also castigated the Indian government’s Bhutan policy. It has once again come to the fore that the Bhutanese problem is not being resolved because of India’s non-involvement.

The root of the Bhutanese problem can be traced mainly to the absence of democracy and the presence of a monarch who cannot accept a pluralistic democracy. This was what persuaded King Jigme Synge Wangchuk to perpetrate a policy of ethnic cleansing against the Lhotsampa population. This eventually resulted in the eviction of one sixth of the country’s population. Through the early nineties, over a hundred thousand refugees swelled the camps of eastern Nepal after crossing over from India. There are Bhutanese refugees living in India also. As a result of this situation, Nepal has had to face many problems. Eight rounds of bilateral talks regarding the repatriation of refugees have hardly made any headway. India’s refusal to help resolve this issue has further encouraged repression in Bhutan, and the refugee problem continues to persist without any solution in sight. It is not that attempts have not been made to raise the refugee problem at international fora, but somehow, the Bhutanese regime had managed to hoodwink the west even though its actions were no less reprehensible as those that occurred in Kosovo or Bosnia,

It is indeed ironic that the largest democracy in the world should continue to support a despotic regime which has turned its own citizens into refugees. Indian leaders were right to point this out. Without democracy, the Bhutanese refugee problem will never be resolved. India can, and should play an important role in this regard by persuading King Jigme to talk to refugees.

It surely cannot be in India’s long term interest to continue propping up King Jigme Synge’s racist and autocratic regime. The sooner India realises this the better it will be. The presence of insurgents from northeast India inside Bhutan—whom King Jigme harboured and used, to evict one sixth of the country’s population — ought to have worked as an eye-opener, the Indian government, however, does not appear to have recognised this. What is needed is a policy shift in India and with Indian leaders speaking out against atrocities in Bhutan, it is to be hoped that public opinion in India will build up and this will eventually goad the government of India to respond appropriately, that is, to take a hand in the matter. It also to be hoped that other democracies, especially western democracies, will take note of the prevailing situation in Bhutan. The European Parliamentary delegation which will be visiting the refugee camps in a very short time should take note of this state of affairs.

Commercial approach needed in agriculture

By K D Mishra

Now a days, adopting commercialization approach in agriculture sector is widely discussed and recognized by planners and politicians. The issue is something which this writer had advocated as back as 1951 and the logic was mainly based on research works. Even now it is not too late to administer this approach and try to implement it effectively with full dedication and commitment both from politicians and planners (basically involved in the agriculture sector). Commercialization approach generally refers to the adoption of complex forms of social organization of the production and administration. Under the commercialization approach, the capacity of advanced technology is to be used to increase the productivity of land and labour. In Nepal, peasants suffer from cultural and technological barriers and lack initiative and innovation. So, they are unable to develop their farms and therefore need effective strategy which could suit to their soils for their overall progress.

There are two major strategies, ie, unimodel and bimodel (Johnston and Kilby) which are prevalent in most of developed and developing countries to boost the agricultural production. Taiwan, Japan and South Korea are practising unimodel approach whereas Mexico, Colombia, Russia and Brazil are practising bimodel approach. Under the unimodel approach lands are fragmented, land holdings are small where intensive agricultural cultivation is done whereas under the bimodel approach land holdings are large, more hectares of land consist one plot where extensive agricultural cultivation is done.

Nepal as a developing country has recently made announcement to alleviate property and solve unemployment problem. In line with it, there is an explicit way to commercialize the agriculture sector. The country suffers from the rampant rural poverty where about 8 percent income of the rural poor is spent on food alone (UNDP, World Bank) and inequality of the income distribution is a conspicuous feature. To a great extent, rural poverty and inequality can be reduced by massive mobilization of rural labour at the farms, which can also be useful for developing other infrastructure sectors such as irrigation, rural roads, drinking water, schools building and health post under the VDCs.

The strategy of agricultural development in the country can be stressed by the combination of the following ingredients; programmes for institutional building related to activities like agricultural research (dry farming system approach and lab to land programme). Rural education and training programme are needed to be emphasised. Irrigation, drainage facilities, rural roads, distribution of inputs, proper marketing system of the agricultural products, policies related to prices, taxation and land tenure are the realised sectors where government has to give major emphasis to achieve the objectives of the commercialization approach. Apart from this, major emphasis should also be given on action to bring the additional production possibilities for the farmers by modifying the existing institutional, technical, socio-cultural and economic environment of the farmers.

It is generally argued that unimodel agricultural strategy aims at the progressive modernization of the bulk of a nation’s cultivators as contrasted to a bimodel crash modernization effort concentrated upon small sub-sector of large scale mechanised farms. Both agricultural strategies should be assessed in terms of their contributions. The process of structural transformation, growth in national products, enhancing the welfare of the farm population and promoting changes in attitudes and behaviour of the development actors and farmers are basic criteria to be assessed in commercialization approach.

The population both in urban and rural areas is ever increasing, lands are fragmenting due to separation of the joint family members and agricultural production is declining in comparison to population. So, at this stage, unimodel strategy at the farms level might be appropriate to increase the agricultural production for the medium, marginal and small farmers whereas bimodel strategy may be applied for the large farmers with technical change. The commercialization approach for the agricultural development will have favourable impact when the social modernization takes place in relation to bring changes in the existing rural attitudes, behaviour and institutions through massive adult literacy programmes at the farm level. Because, existing institutions for strengthening agricultural experiment stations, extension facilities, training programmers to the farmers, credit and input facilities are not satisfactorily fulfilling the objectives of the rural farmers. So, under this critical situation cooperative endeavour (people’s initiative, people based and people managed) may be feasible and sustainable channel to deliver the credit and inputs as well as to provide marketing facilities of the farm products.

The budget provided to each VDC and managed with a technical assistant needs to be appropriately invested and further managed on the rural programmes which may be helpful to the commercialization approach and to provide supplementary employment and income for the rural poor. The indirect contributions of such programmes to the expansion of farm output and income through the construction of rural roads, irrigation works, school buildings, health posts and other infrastructures may bring substantial changes at the farm level.

At the farm level where agriculture is characterised by larger seasonal variations, farmers are underemployed and due to lack of irrigation facilities and other support services lands are not fully utilized. Under such situations, technical change with associated investment in infrastructure are likely to utilize of the farm labour and land, if inputs such as, credit, seeds, fertilizer and irrigation facilities are given timely to the farmers. There is an explicit example from the Taiwan experience where focus on more productive seed-fertilizer combinations and investments in infrastructure increased the returns to additional labour inputs. Investment in irrigation and drainage not only raised yields directly but they also facilitated multiple cropping system approach which resulted in the year round utilisation of both land and labour. These two strategies can thus be instrumental in bringing social and economic changes at the farm level. Generally, social scientists support unimodel strategy for a country where lands are fragmented, small land holdings are prevalent and rainfed agricultural cultivation is practised at the farm level.

Policy makers and politicians of Nepal should therefore assess available alternatives and weigh their pros and cons and consciously select unimodel approach for the medium, marginal and small farmers whereas bimodel approach for the large farmers. There may be equal chance for conflicting interests while choosing these alternatives. But, the decisions should be shaped for the common interest of the people as a whole.

Let’s go to Kathmandu

By Razen

Those were the days, when people used to dream that they would at least once in lifetime tread over the pious valley called "Nepal". They knew there are the temples of Lord Pashupatinath, Guheshwari, Dakshinkali and Budhanilkantha. The gigantic stupas of Swayambhunath and Boudhanath are also there. And, how can one visit and do not take a holy dip in the sacred river of the Bagmati?

A lot of water has flown under the bridge since then. Along the changing time, the purpose of visiting Kathamndu has also changed. Now, the educated, intelligent and up-to-date people of Nepal do not have time to think about those outmoded constructions that can give you no jagir, no promotion. Then? Is it that the importance of Kathmandu is withering out? Absolutely not. There are many more reasons for visiting Kathmandu than thronging around the temple of Pashupatinath for a pint of chandan.

Last week, CPN-UML organised an unprecedented programme — ‘Let’s go to Kathmandu’. First, I was shocked why the always-on-fire party is promoting domestic tourism. After a single call from their revered leaders, tens of thousands of people came here. It was just like an avalanche, an ocean or a Siberian grassland. I was happy that this old city still retained the charm of Manisha Koirala, which could attract that bold extravaganza at a wink.

All of a sudden, I saw uncountable mass of political activists moving to and fro, countless buses being parked around Ring Road and the streets were more reddish (with spittings of paan) than usual. The population of the capital is ever soaring but it had not tickled my eyes as it did on that day. Actually they were here with a great mission.

They stayed here for a couple of days — doing nothing. I thought, didn’t they have anything to do — for example, agriculture, factory, business, government service, etc — in their hometowns? Anyway, mouth-watering dishes were waiting for them without having to toil their fingers like in the village. Bottles of imported whiskey and local specialities like buff momo (a rare thing for their villages) had added to the charm. Where else could they enjoy Kantipur FM and shake their hips? Enjoy yourself as much as you can for time and tide waits for nobody.

I thought that this event would certainly boost tourism industry of Kathmandu. They would stay in five-star hotels, eat in executive restaurants and buy some souvenirs from this city of artists. But you see, they had neither money, time nor interest to do anything more than they were supposed to perform. Still, I heard that some tried to meet the lawmakers of their constituency and told hal-khabar of their villages.

On the Judgement Day, all the people were taken to Khulla Manch--the ground that welcomes all, regardless of their parties, qualifications and intentions. The flocks were happy because they saw their sansad leaders for the first time after the election campaign, almost a year ago.

And when the leader saw that the ground was fully occupied, he raised his hand. I was curious what would be his next step. Oh! he then declared that all the leaders, except those belonging to his party, were corrupt.

It was a good idea. Collect some thousands of pseudo-supporters on hire and declare what is the most uncommon. Here goes a Hindi saying — jiski lathi uski bhais (the buffalo belongs to him who possesses a baton)".

Financial crisis in Nepalese municipalities

By Ram Prasad Dahal

The total 58 municipalities, which are the members of Municipality Association of Nepal (MuAN), in the country consist of 15 percent (some three million) of the total population. About 73.53 percent of the total revenue in the these municipalities was collected from octroi. This is a kind of tax collected by the municipality on the basis of 1 percent of the total invoice/bill of the goods entering the cities. The amount came to some one billion rupees out of the total revenue of all the municipalities which was some 1125 million rupees. It is to be noted that the Local Self-governance Act (LSA), 1999 has abolished the octroi system with effect from April, 1999, with the rational that it is the burden on consumers. The government also admitted that the octroi tax is a regressive and undesirable tax on the ground that it obstructs the free flow of traffic, trade and commerce. Moreover, the government acknowledged that the wastage of time and fuel by the transport fleets at the municipal checkposts, and rampant corruption in tax collection are the common frailties of the octroi tax. Despite these weaknesses, octroi tax did provide a regular, sustainable and uniform flow of income being collected on a daily basis while other taxes generally payable once a year have an uneven and unpredictable flow. Practically, it was the only flexible and sustainable source of income for municipalities to meet the fastest growing expenses of urban sectors at the fag end of 21st century.

The abolition of the octroi tax has taken away the major source of municipal revenue directly aggravating their dismal financial position. Though Local Development Tax (LDT) is collected to provide a proper replacement of the octroi tax to be distributed to municipalities through assessment of their income not less than the amount they collected in the Fiscal Year 1998-99 from octroi tax. LDT which is being collected by the government from April 29, 1999, has not succeeded to meet 70 percent of the amount collected from the octroi tax by the municipalities before the new Act called LSA came into effect. Moreover, the new act has decided to allocate the collected LDT on time to the municipalities without any difficulty. But the government has not been allocating the promised nominal amount to the municipalities rather depriving from the financial and other rights provided in the Act.

At present, the municipalities are borrowing money from the upper local entities like District Development Committees (DDC) to pay the salary for the municipalities’ staff. The participants of the Third General Assembly of MuAN, which was held on July 22 last year in Dharan, felt pity by saying that the present LSA has made the municipalities as big VDCs. The municipalities have become bankrupt at present and are crying for a life before their respective entities, like a fish out of water. Almost all the development activities are aborted due to the lack of budget. The donor agencies and international governmental and non-governmental sectors are suspecting whether the bankrupt municipalities utilise the grants in the proposed development fields or spend for their internal affairs. The municipalities are crying for the sustainable sources of income to run the ongoing process of urbanisation but the government is ignoring rather than resolving the problems of municipalities which are nearly hundred percent dependent on others after the new Act came into effect.

Though LSA 1999 has given municipalities a broader(?) scope of tax collection as building size based tax, rent tax, tax on business means, vehicle tax, prosperity tax, entertainment tax, advertisement tax and so on. But these sources of revenue to the municipalities covered less than five percent of the revenue of municipalities before the new Act came into effect. The aforementioned areas of revenue collection for municipalities are nominal for them who cannot afford even the nominal municipal expenditure (staff salary, vehicle, and other internal expenses). It cannot afford the needs of the urban people longing for a drastic change in urban facilities as a conjurer’s stick, which may turn unattainable into attainable immediately. There is a provision of taking loan from banks and any other financial institutions at the guarantee of the government in LSA. There is no rational base line that the urban sectors could believe this provision as the government is doing hardly anything to keep municipalities out of their financial crises. LDT is directly dependent upon the overall national capacity and efficiency to raise taxes and there are apprehensions that the actual mobilization and collection of the tax shall be less than that has been projected by the ministry.

All the aforementioned terms and conditions regarding LSA and LDT, and actual condition of municipalities show that the present condition cannot sustain urban development as expected by most.

At this scenario of dismal municipal financial condition, Nepalese municipalities should lobby to compel the government to reconsider the provision of LSA so as either to restore the rights of municipalities to collect octroi tax or guarantee sustainable sources of income because the financial crunch that has affected them might have severe implications in the urban development functions and in civic amenities. Moreover, accountability of the urban sectors is to be borne by the municipalities whereas the central governing pattern is checking the financial (major) sources of the municipality, ie, the government has maimed the urban sector in a way. It is ridiculous that the government should be shouting slogans of decentralization--which it is doing since the restoration of democracy in 1990--when actually it has centralized the financial autonomy of the urban sectors. If the government does not take any initiative to provide a viable and sustainable revenue sources to the urban local government, the urban dwellers may denounce the sweet and delicious slogans like "Nationalism, Democracy and Socialism" and "People's Multiparty Democracy" said to be the dear principles of the late BP Koirala and Madan Bhandari, respectively.

The responsible people in the municipal authorities should be alert and take the fact into consideration that the octroi tax should not stay permanently as a source of their income because it is actually not based on the modern system of taxation and tax collections, as the government alleged. The important aspect is the transparency and accountability in the municipal governance affairs. People respond positively to the call of tax paying only when they get quality urban services in return. The municipalities should pay attention to educate the people in the importance and need for tax paying and strive towards giving quality services to the people in the areas of their competencies.

The octroi tax, as it seems, has been abolished in favour of the people who conduct illegal trade in the country unless the government shall provide a viable sources of revenue to the urban sectors. The urban managers should also be bold to say, "Give me taxes I will give you good urban services."