Bandh that never was

The last-hour decision to withdraw the two-day Nepal bandh call, after an agreement was reached between the government and the nine left parties, is a right decision taken at the wrong time. Had it been taken so a day in advance, the usual activities of educational institutions and private organisations would have, at least, been less affected. Neither would there have been sporadic incidents on the eve of Nepal bandh. Given the international events taking place in the capital, it did make
a difference. The decision also brought relief to the tourism sector and also business houses. However, the manner in which the government took an "offhand decision" to reduce the kerosene price in the open market appears to be a mockery.

Nine left parties had called a two-day Nepal bandh in protest against the recent price hike of petroleum products resulting from adjustment in India to international prices. No doubt, this set off an inflationary chain reaction that not only hit consumers— especially low income groups—hard, but also arrested economic growth. The rate of kerosene per litre went up so much that the government had to introduce a ration card system. Obviously, the spontaneous hike of petroleum products acted against the people. As a result, the nine left parties were firm about the bandh

The government, in an all-party meeting not only reduced the rate of kerosene by four rupees per litre but agreed to restructure the rates of petroleum products to avoid a nation wide bandh. This came only at the cost of international events taking place in the capital. Had the rate of kerosene price hike been justified, the government would not have succumbed to the demand of the nine left parties. Government policy has been to regulate the market for the benefit of those who are in power. This has to be blamed more than anything else. They have put the country on the brink of economic chaos and have often acted against the market price. The way the government rolled back kerosene price shows that it admits its mistakes whenever there is a strong protest.

The government must realise that the economic policy, it has introduced, has always reacted against the wishes of the people and invited regular bandhs. Therefore, the government would do well to think of people-friendly policies. It must really do a lot of homework before deciding on things that can have very telling effects on the lives of the people.

Why Nepal needs WTO

By Rebecca Harding

Almost exactly one year after thousands of protesters thronged the streets of the picturesque coastal city of Seattle angrily voicing their anti-globalization concerns, Nepal is poised to become the newest signatory of the 139-member World Trade Organization. Some worry that becoming a member of the WTO could compromise Nepal’s sovereignty and threaten domestic industries, others are convinced that this is a boat Nepal cannot afford to miss.

Nepal is one of the world’s poorest nations with a GNP per capita of US$ 210. Over half of its 22 million population exists on less than one dollar per day. Landlocked between two of the world’s great nations, Nepal needs the support of the WTO if it is to raise the living standards of its people. Membership would pave the way for Nepal to foster fairer more predictable trade relations with other members of the WTO and better defend its rights. Moreover, as new global trade rules are negotiated, Nepal will be at the table promoting its interests along with all other WTO members.

Nepal remained closed to foreigners up until 1951. A slow start to economic liberalization began in 1986-7. However, following the People’s Movement of 1991 and the creation of a democratic government in 1992, the pace of liberalization accelerated with governments making considerable efforts towards reforming important sectors of Nepal’s economy. In 1992, Nepal opted for the Enhanced Structural Adjustment Program which played a major role in speeding up the rate of liberalization.

Today, the Kingdom of Nepal has attained high levels of liberalization and openness, reducing restrictions and tariffs on imported goods. In fact, Nepal currently has the lowest average tariff regime of all the SAARC countries (in the region of 9 per cent). This easing of barriers has triggered a flood of foreign goods and capital into Nepal - which has led to a significant increase in the wealth and economic activity in Kathmandu Valley. It is certainly true, however, that the benefits of a more liberal trade regime have been of little comfort to Nepal’s labourers. The nation’s increased wealth has not trickled down to the poorer subsistence farmers.

The WTO is the only organization that deals with trade relations between nations. It is like an international trade watchdog, ensuring fairer, steadier and more predictable flow of imports and exports between its 139 members. It acts as the world arena for trade negotiations where delegates from its member states (around one hundred of which are developing countries) gather to thrash out trade-related issues. It settles trade disputes between countries, and monitors member governments’ trade policies, singling out those whose commercial practices infringe on the rights of other - often more vulnerable -countries.

The trading system around which the organization revolves is founded on concrete rules, meaning that all countries, rich or poor, developing or developed, have to adhere to the exact same principles so that no one country gets better treatment than another. Critics voice the concern that by joining WTO, Nepal would be forced to bow to the policies of more powerful countries. However, the idea that poorer countries lose out as a result of belonging to the WTO is entirely unfounded. On the contrary, without the support of the world trading system, developing countries would almost certainly be trampled over and sidelined by the wealthier, more powerful nations. The WTO wipes out inequality by empowering smaller countries with a louder voice and an equal footing with the big guys, since all decisions are taken on the basis of consensus.

The WTO’s Dispute Settlement Body (DSB) will offer Nepal a chance to protect its trading rights and complain if it feels that another member government is abusing its trade obligations. Many developing countries have already complained to WTO over abuses of universally-signed trade rules by rich countries - 25 per cent of the 201 disputes brought to the WTO’s awareness during its near 6 year life span have been raised by developing nations, including Thailand and Peru. Although they may face serious constraints, developing countries are realizing that they have just as much weight as wealthier members when it comes to defending their trading interests.

Skeptics also worry that the WTO dictates trade policy to its members. However, the WTO is not empowered with a decision-making role. It exists solely to carry out the instructions of its members. It is a member-driven organization, all agreements being reached in a democratic and accountable manner. The WTO is no more than a provider of administrative support for its members. In joining the WTO, Nepal would have a voice in the various committees, a say in matters so important to its continued development - a seat on the Trade and Environment Committee and the Committee for Trade Related Aspects of Intellectual Property Rights (TRIPS). Nepal houses over 6,800 species of plants and 700 species of medicinal herbs. There is widespread concern that once Nepal becomes a member, multinationals will try to patent this vast biodiversity. However, the WTO’s TRIPS Agreement prohibits basic life forms from being patented.

Consumers will ultimately reap the rewards of a fair trading system, as freer trade will lower the cost of living. The prices of goods are directly affected by different countries’ trade policies. As a result of WTO negotiations, trade barriers are lowered, contributing to cheaper production costs and reduced prices of everyday items.

Lowering trade barriers contributes significantly to increased imports which means an increased choice of products and services. The past few years have borne testament to this. As trade barriers have eroded there has been a remarkable increase in products available in Kathmandu, from Gillette razors to cars from South Korea, from bottles of Sauvignon Blanc to the latest Pentium IIIs imported from Singapore. This encourages producers to compete for customers, automatically upping the range and quality of goods on offer - giving us the option to take our custom elsewhere. No one forces us to buy these products, but their mere availability does improve our quality of life.

In turn, markets worldwide will be opened up to Nepal’s wide range of ready-made garments and woollen carpets, which account for around 40 per cent of Nepal’s exports. Since measures to liberalize markets improved, Nepalese exports have become more stable. Export figures have doubled over the last three years, from 27 billion Nepalese rupees in 1997/8 to 52 billion NRs in 1999.

Nepal has already witnessed the benefits of liberalization in both the manufacturing and the financial sectors. In the mid-eighties there were just two state-owned banks in Nepal, the Rastriya Banijya Bank and Nepal Bank Limited. Now there are eleven - mostly joint ventures with foreign banks, e.g. Nepal Indosuez Bank. It is not only the quantity of banks which has increased - the quality of their services has also improved. The ratio of savings to GDP rose from 12.8 in 1976-86 to 19.6 in 1995-6. There has also been a marked increase in domestic savings.

Without the WTO, trade really would be a case of survival of the fittest - the more vulnerable economies steamrolled by the big guys. Joining the WTO will facilitate Nepal’s commitment to economic liberalization, which is fundamental for Nepal’s long-term economic development, poverty alleviation, and improved living standards. To be left out in the cold would be a tragedy for the people of Nepal at this stage of its economic development.

Question unanswered

By Pragya Karki

Iwas still inside my quilt feeling cozy when the warm sunrays peeped through my curtain and wished me good morning (they always do). I woke up lazily. Another brand new day for me with fresh hopes and promises. "Awake, arise or be forever fallen". With this quotation of John Milton in my mind, as I was about to go out from the room my eyes fell upon my basketball. It was lying at the corner of my room. For a moment, I stood quite still, scrutinizing it closely. When I was in school it was my best friend. All of a sudden a flood of nostalgia seemed to fill every fibre of my being. I started going down memory lane.

I still remember the days as vividly as though it was yesterday. When I was in primary level, I enjoyed going to the school merely for fun. I used to get carried away to supernatural lands while reading fairy tales. Those characters like Cindrella, Snow white, etc... always mesmerized me.

‘Time and tide waits for no man’. I reached higher classes and stepped into my teenage years. A new perception to grasp the meaning of life developed in me. My taste in library shifted to Nancy Drew and Agatha Christie leaving fairy tales behind. I, along with my friends, were most talkative, carefree and jolly. Rumours and gossips were our favourite pastimes. Our ears were always wide open to hear about hot topics and nose ever ready for smelling out facts.

How can I forget the grand basketball tournaments? Wow! (I still have the same spirit of sportsmanship but in dormant state). We use to shout on top of our voice as if we were the sole occupants of this earth. "Do or Die", (our motto) whenever we played any matches. Our heads always held high in assembly for bringing trophies and shields to school.

I regret bunking French language classes (I wish it was undone). All I can say is "Jem’ appelle Pragya Karki" (fie on me). I lost the golden opportunity of being a multilingual.

Whenever I look at distant stars I still remember my science teacher who wanted us to enjoy the night sky and twinkling stars. Today, I am prudent enough to apprehend why he told so. The truth is, we do not see the stars. We look at the reflections of lights that were there perhaps a million years ago. (How amazing!)

I heaved a sigh of reminiscence, I lost yesterday somewhere between sunrise and sunset. Time is like a flowing river-once gone, gone forever. The old memories bring joy to our heart, still it is a kind of painful joy because we cannot fly back to past. Time is a mystery. Where has yesterday gone? Where did today come from? And, where is tomorrow hiding? It is a question that remains unanswered.