Harvest of delusions in democracy

By MADHAV P KHANAL

Restoration of democracy in Nepal has now completed its twelfth year and various low-key functions marking its anniversary on the 26th of Chaitra were held in the country in a manner befitting its importance primarily to Nepali politicians for they were the principal beneficiaries of the historic political change of 1990. To what extent the general Nepalese benefitted from a change of this magnitude and how much more it could have brought about will remain a debatable issue for many years to come. Nevertheless one has to accept the fact that all through the last decade people of this country were simply left with no choice than to impassively withstand the clumsy political experiments carried out on their destiny by successive governments in the name of democratic exercises without any signs of comforting prospects whatsoever. Similarly, the modest popular expectations generated by such a historic political transformation were totally marginalized by none other than those who spearheaded the movement to topple the partyless system with the help of the same people and the promises of welfare schemes have always been relegated to the fringes of national priorities.

Though it looks like a somewhat conceited comparison, the plight of today’s common people in Nepal resembles that of the French serfs who were loaded with levies and taxes of different categories to support the corrupt establishment of the state to such an extent that they could barely manage to shoulder it before the onset of their sanguinary revolution that changed the political course of continental Europe until the rise of Napoleon. The ever spiraling prices of basic commodities in Nepal have now exceeded the affordable limits of even those belonging to the middle-income-bracket and maintaining a bare minimum subsistence level in one of the poorest countries in the world appears to be a wishful luxury for almost half of the country’s population.

The democratic bourgeoise and their subservient bureaucrats who rose from rags to riches in the intervening period by resorting to several foul means have enjoyed de facto immunity from corruption. Their income sources did not have to be declared once they deposited the amount prescribed by the Department of Internal Revenues, under a craftily devised scheme of the finance ministry. However, it is yet to be seen whether the corrupt politicians and other public figures blessed by them can get off scot-free if the recently constituted commission, whose responsibilities look sometimes blown out of proportion, carries out its responsibility with judicial honesty and submits its findings to the government before the anti-corruption euphoria dies a natural death. Having witnessed countless political and administrative anomalies right under their noses over the years, it is but natural for the people of Nepal to dismiss the so-called achievements of the janaandolan as absolutely meaningless rhetoric and an abstract political dividend that are likely to be confined only to the political history books.

As a result of the prolonged instability caused by interminable infighting within the major political parties especially the Nepali Congress, for the past several years Nepalese at large look totally fed up with listening to the same old trashy political sermons delivered by their respective pontiffs. However, due to fragmentation of civic society on the basis of ideological alignment, which happens to be a necessary evil under multi party democracy, staging an open revolt by the people against their own corrupt political demagogues may take a longer gestation period than what is generally presumed. It is a pity that due to increasing political dishonesty, an alarming rate of corruption and the growing tendency to enjoy power without accountability on the part of Nepalese statesmen the country looks like it is gradually moving towards a political cataclysm in which no one is sure to be a winner.

Democracy, if honestly practiced, is not a political delusion as a growing number of disillusioned people in Nepal tend to conclude today for several obvious reasons. It is, in fact, the only authentic and ultimate system that has undergone innumerable tests from the time of Aristotle to this date and which vouches for the enhancement of human dignity and welfare of the people at large. No other political system can claim to possess such attributes as providing maximum possible opportunity for the individual to develop what is unique in him and enrich society by his creative contribution of that uniqueness. People have reaped benefits from democracy wherever political honesty became the driving spirit behind its operators. However, in many countries like Nepal, participatory democracy has failed miserably to produce anything propitious for the people simply because their responsible leaders fell easy victims to the mundane avarice for wealth and power. History shows that democracy has always been the eventual scapegoat in every country for all the failures, inequities, corruption and debaucheries brought about not by the political system but by its own unscrupulous political leaders.

Like in many countries of the Third World, Nepalese democracy today stands at a crossroads. In order to achieve their romanticised objectives of a revolution that would possibly be reminiscent of Pol Pot, the Maoist anarchists are bent upon destroying the entire economic infrastructure and network of public utility services throughout the country that were built over several decades either by donor countries or with multilateral loans. But on the other hand the politically rabid octogenarian president of the ruling party has been advocating a vague political hotchpotch called "broad national democratic alliance’ outside the constitutional mandate for no other reason than toppling his own successor and grabbing once more the seat of power. Similarly the opposition politicians are becoming equally frustrated at not getting any share of power under the provisions of the existing constitution which they too were a party to during its concoction. And hence the clamour for amendment, Nepalese democracy has thus been bungled by a series of leaderships whose uncorroborated claims to popular dedication and their reckless adventurism have been progressively pushing the country towards a cul-de-sac without any light at the end.

Security, in all aspects, is an essential condition for the unhampered growth of a democratic society. But all through these years of political transition the country’s vicious political caucuses which have taken Nepalese democracy hostage cynically ignored its importance and their own electorates were denied the minimum material security. If any one needs security in this country it is the political leaders who are afraid of reprisals from the people for their misdeeds. The promises of security, economic equality, development, opportunity, etc that formed the core plank during electoral exercises now appear like mocking shadows.

If we recollect how the official media and Prime Minister Deuba’s ingratiating diplomatic envoys contrived to delude the nation on the eve of his lacklustre political pilgrimage to India recently and how they rationalised the miscarried trip afterwards one is reminded of George Orwell’s fifty year old observation that "political language is designed to make lies sound truthful and murder respectful, and give appearance of solidity to pure wind" Yes, this is exactly what every sane Nepali feels at heart about the conduct of our politicians today.

Ruled by cigarettes

By TILAK POKHAREL

Three weeks ago, one of my friends working in Gorkha  district for the Surya Tobacco Company proudly said, "After the imposition of the state of emergency, the overall sale of cigarettes in the whole district has gone up by 3 per cent."

I was surprised to hear this especially because he also went on saying that total sale of cigarettes could be slightly higher than the total sale of rice grains in the district. He was proud at the increment of the sale, as he was soon to be promoted. According to him, the monthly sale of cigarettes manufactured by the Surya Tobacco Company amounted to almost 3.6 million rupees in Gorkha. Forget the sale of the products of Janakpur Cigarettes Factory – Deurali, Gaida and Yak- which has dominant market among the rural folks in the hills. On the other hand, the foreign brands such as 555 and Marlboro are ruling the towns.

If accumulating all, the total monthly sale of cigarettes comes to over Rs. 6 million in a district that has been hit hard by the Maoist insurgency and has been lagging behind in every development endeavour. The friend also added, "The people can stay hungry for days, but they cannot give up the habit of smoking cigarettes."

Also last week, the Surya Tobacco bagged the Commercially Important Person (CIP) Award for paying the highest amount of tax to the government from the manufacturing sector. From one angle, the Surya Tobacco was further encouraged to produce more cigarettes while from other side, the country was on the road of the ruin. Interesting fact is that the Janakpur Cigarette Factory is the only state-owned corporation that is in profit (virtually not in loss). But the plight of other manufacturing factories is very pathetic. Take for instance, the Hetauda Textiles Mill and Bhrikuti Paper Industries which had to be closed after they could not bear the loss. What could be the outcome of taking cigarettes? Nothing more than loss – be it a financial or bodily. However, in other way, it could be useful in checking the current trend of population outburst.

But, which fool would be ready to buy the aforementioned advantage of smoking?

Many poors in the villages stroll around to get a meal. And of course, this might have resulted in many crimes as well. But they don’t stop smoking. That’s why once its market is established, it will continues forever until and unless the government puts a ban on it. But why does our government dares to put a ban on the highest taxpayer even if it is killing the ever-irritating people. So far for the sake of the people and as per their wish, the government has been liberal towards them.

The general people are not the only cigarette consumers. In the Maoist-hit district like Gorkha, the Maoist "comrades" ruling the jungles must also have come in this category. So the "comrades" are not only destroying the development infrastructures but also contributing to the national economy in some ways. Hahaha…What a joke!

Hope the day will not come when the country has to solely depend upon cigarettes and the white sticks will spread like wildfire in the rural terrains.

Technology and banks

By L D MAHAT

Banks have always been an important part of the financial system. They have introduced various kinds of financial instruments from time to time to suit the needs of various categories of their customers. The emergence of internet and e-commerce have resulted in a paradigm shift in the manner in which the banks offer their services, by drastically reducing the cost of rendering these services.

In 1999, the banking industry was preparing itself for the next millennium. The foremost concern for the banks was Y2K compliance. Banks spent heavily on making their system Y2K compliant. They successfully rolled over to the next millennium. In order to improve customer service, increase volumes, reduce costs and justify their existence in the market, banks are spending on information technology according to their capacities and future growth plans.

In Nepal, only 38% of the bank branches are located in urban area. The ratio of fully computerised branch is also low. This shows that here is a lot of scope for the automation in the banking industry. While in case of private sector banks, the question is not of automation but of further improvement.

With the introduction of internet, the changes in the field of banking started with banks hosting their websites. These websites used to provide details about the products being offered by the bank and other information about the bank such as the interest rate, board of directors, financial highlights, etc. The website used to act like promotional channel for the banks.

As telephone banking gained popularity, banks realised that their websites could be used for things other than dissemination of information. This gave rise to internet banking. Internet banking started with the basic banking transactions being conducted on the internet. Checking of account balance, ordering a chequebook, etc. were few of the basic transactions that got digitalised.

Banks have now realised that offering the basic services on the internet is not enough. The customers are becoming more and more amenable to transacting their business on the net. Grabbing this opportunity, many banks have started offering a number of unique services to their clients. For example, some banks offer the facility of making loan applications on the internet. Bills can now be paid on-line, accounts can be opened, fund transfers made, etc.

The effect of all these changes is that transparency in banking transactions has increased tremendously. It is tedious and time consuming for a borrower to find out and compare the rate at which different banks are ready to lend money to him, for which he is required to visit the banks personally or call the banks. Often, the banks take such a long time in deciding on a particular loan application that the whole exercise becomes futile. All these problems are almost eliminated when a potential borrower uses the internet. The process of collecting the information and comparing the costs to arrive at the best rate offered becomes very simple and quick. Thus, it becomes impossible for banks to overprice their services.

The internet, thus, poses a major challenge to the banks. They have to gear up to increased competition and adapt themselves to a world of transparency. This factor forces the banks to concentrate on the cost side rather than the revenue side for increasing their profits. Besides, a bank operating only through its branches and not having the required degree of presence on the internet faces the possibility of going out of business, due to the emerging shift in customer preferences.

Not all the services of a bank are amenable to being transacted on the internet. It is only those services that can be commoditized that can be web-enabled. Generally these will be the kind of services which either do not require decision making by the bank, e.g., opening of an account, withdrawing cash, making transfers, etc. or where the decision can be made automatically on the basis of certain pre-defined parameters. For example, when a consumer makes a loan applications the bank can decide on the application on the basis of certain parameters like the person’s annual income other loans outstanding against his name, his repayment history, etc. Such decisions can be standardized and executed on the internet, as has already been done by a number of banks.

On the other hand, there are products or areas which require intellectual inputs. These kind of activities cannot be commoditized, and will not be drastically affected by the emergence of internet. While most of these activities are related to the institutional segment of a bank’s business, some activities are also related to the retail segment. An example is origination which entails designing and structuring innovative financial products, processes and services. Another example is the core investment banking function which can not be done on the internet. As these activities require intellectual inputs, some banks will continue to have an edge in these areas over other banks.

The advantage to a bank will depend upon how innovative it can be in designing new instruments which attract people with specific requirements, or new instruments which suit the changing trends. The advantage in the retail segment, though, would be short-lived, as other banks would be likely to come out with similar products. In order to enjoy a continuous advantage over its rivals, a bank would need to be continuously innovative. The activities/products related to a bank’s institutional business will continue to provide it with long-term advantage over other banks as it not easy to copy a product in this segment

In this internet era, a bank will not be able to survive without providing internet as an alternate service to the customers. The application of latest technology on a continuous basis is going to mark the difference between a successful bank and a failure.