Economic Liberalisation & Globalisation
How Suitable In Nepal ?

By Tanka Raj Niraula

GLOBALISATION privatisation, and liberalisation are the terns, which are being discussed frequently since 1990s after the political turmoil of the socialist system. These three are interrelated and also in some way similar phenomena. Though the global discussion about these terms took place after the 90s, their roots go back to the classical setting.

Key Features

Globalisation is taken as internationalisation of the production, distribution and marketing of goods and services. There are some key features of globalisation, which may categorise into economic and non-economic groups. Growth in trade, growth in foreign direct investment (FDI) and capital flows, global production and consumption, global competition, trade and investment liberalisation policies are the economic features. Loss of national sovereignty and standardisation of values and cultures are non-economic features. At present globalisation is being dictated by idea and technology. The concept of Global Village has already developed. It will be pragmatic to analyse impact of globalisation on growth and productivity, poverty and inequality, and employment. In many countries growth objective has overshadowed social welfare issues like poverty and income distribution. The influence of globalisation is generally deemed to be positive as it permits competition, which will improve market efficiency and accelerate economic growth that will ultimately be a source of funding which can be channelised in the social services. In the case of Nepal, globalisation or diversification of dependency has been used by policy makers to counter the depedency-orientation towards the Indian economy. But because of underdeveloped nature of the country, globalisation may intensify existing uneven development particularly between low-wage earners and high-skill producers of the country.

Privatisation is the system in which the material instruments of prodution are owned and hired by private sector and are operated at their order with the view of selling at a profit. While private sector may be defined as constituting profit-making organisations run by an individual or a group of individuals usually not associated with the government. Private sector thus operates under the guideline of profit that is determined mainly by a single equation of demand and supply. But government has to reconcile various factors like cost, resource allocation, equity and other socio-eco-political obligations.

Liberalisation means openness or no restriction and it may be defined as liberating people from the fetters of control imposed by the tangible force of the state or the abstract force of tradition. Liberalism has consequences for economic, social, political thought. Its economic application is the most obvious and remains the most familiar. Liberalisim and market capitalism are inseparable. The current phase of globalisation is no doubt is driven by the liberalisation of trade and investment policies. particularly by the developing countries. It is not always clear whether such liberalisation is the cause or effect of globalisation.

In the Nepalese perspective private sector is yet to be matured and identified properly. Take the case of Information Technology (IT) sector, the driving force for price determination is the market itself due to government’s liberalised policy. The competition among Internet Service Providers (ISPs) has created to cut the charge on Internet service. But, now, they have made cartel like atmosphere and price is fixed and the end result is that the charge does not come down from a specified level. If government has adopted liberalised policy, then there must be competition and among INPs so that consumers can enjoy the fruit of this policy. In this case, government must monitor properly and if necessary, it has to curb this monopolistic exercise. But in the Aviation sector, the effect of liberalisation policy is quite fruitful, as competition among the Airlines has lowered the raveling fare. Similarly, whether education sector has shown such situation or not, it must be made a matter of discussion. In ten plus two programme run by private sector the poorer are deprived of having higher education after SLC, due to high fees.

This is the case of developed and organised sector. But in the case of subsistence and unorganised sector, which cannot compete, state has to give due protection and incentive. Recently, the decision taken by government in the case of import and export regulation of paddy must be rightly welcomed. About ninety per cent people of Nepal are engaged in the agricultural sector but import of cheaper agricultural products from abroad, mainly from India has made a great hue and cry among the Nepalese farmers. The decision of imposing restriction on import and releasing restriction on export of paddy is the need of the time. But factors like open border and SAFTA and WTO regulation should be considered, as there may be certain provision for the agricultural products.

Privatisation does not necessarily mean, that government has no role. It has to perform many basic functions. But the role or functions must be well defined. Basic problems facing any economy are: how to allocate or manage its resources and what to produce, how to produce, how much to produce, whom to produce.

Traditionally, two alternative systems are operating (as state versus market dichotomy). A state-led growth strategy is defined as one in which the state sets a correct direction to the economy and plays a leading role as a catalyst or active participant in the growth process so as to attain a high growth rate, with distributive justice, in terms of reducing poverty, underemployment, low productivity and improving the quality of the people in general.

The experiences of Nepal about liberalisation seen to be urban-biased, anti-rural, anti-poor, anti-agricultural and anti-traditional sectors due to various economic, social, political, geographical and demographic causes. The state-led growth srategy too did not perform well. This is the reason for a judicious mixture of market system and necessary state intervention emerging as a third alternative which is being adopted by the most of the developing countries. And Nepal too is not an exception. World Bank, the champion of market-led liberal economic policy has changed its development orthodoxy citing that has strong role in keeping the "fundamental rights", which can be stated as: macro economic stability, human resource development, secure and effetive financial system, adequate infrastructure, seeking foreign technology, enchancing productivity through research and development and technological improvement, and correcting rural-urban disparity. In Nepal’s case one more point can be added which is: appropriate agricultural and industrial policies.

Third Alternative

In conclusion, due to mass and chronic poverty, illiteracy, fragmented market structure and many other unspecified reasons, appropriate policy for Nepal in this age of globalisation, privatisation and liberalisation is the third alternative itself as mentioned about.

Social Life Under The Ranas-5

By Guna Dev Bhattarai

A SOCIETY of contrast was clearly discernible between the Ranas and the commoners. The high ranking Ranas specially the Prime Minister and the four commanding generals resided in palatial buildings furnished with every kind of facility. They would lead a life of ease and extravagance whereas the commoners had to toil hard to maintain their lives. They were deprived of even the basic facilities of life.

The position and prestige of each and every Rana was geater than that of any civil servant whether the latter might be a Kazi or a Sardar. That is why a Rana of the rank of life tenant in the army should be respected with due honour even by the highest ranking civil servants.

The high ranking Ranas and Prime Minister and commanding geneals in particular had many male and female servants like there Baithake, Bhandari, Hukke were some of the male servants while Adini, Bubu, Dhai, Susare, Bhanche Bahuni resided in the residences of the above said Ranas. The Bagaiche, Hazam, Chipa, Sikarmi, Dakarmi, and the like would reside outside their residences. Besides, the Aathpahariyas (body guards) provided internal security for the high ranking Ranas.

The minor Rana was looked after by an experienced man better known as Dada. The latter would accompany the minor wherever he went and prevent him from doing anything detrimental to the norms of life. If the minor misbehaved in any way the Dada would refer the matter to the formers’ guarding and the latter would punish him according to the gravity of offence committed by the minor. Strict discipline was adhered to so that the minor might not indulge in unwanted activities.

The Ranas would not tolerate even the well-to-do businessman residing in a palatial building. Once a rich businessman had built a huge building akin to Rana’s building. The Rana Prime Minister, Juddha Shum Shere, ordered the concerned authority to dismantle some portions of the building.

Although the Ranas suppressed the growth of political awakening in the country, they never interfered in the prevailing social and religious life of the people. Preservation of law and order control of prices of necessary commodities, maintenance of strict discipline and the like contributed much to the peace in the country.

Juddha Shum Shere was the first Prime Minister who wanted to bring in some changes in the prevailing society. According, the mourning period was fixed to thirteen days but the Brahmins opposed it and later they were allowed to put on white dress for forty five days. He advised the Newar community not to lavishly spend money on the occasions of marriage and other social functions.

The Purbiya Brahmins would not take rice form the hands of the Kumain Brahmins. Generally, there was no nuptial relation between these two Brahmin communities. Juddha Shum Shere tried his best to bring parity between them in every respect, but all in vain.

During the Rana regime though the king was a nominal head of the country, he was respected, honoured and revered by all the Ranas. The commoners used to show great respect on king whom they regarded as the incarnation of Lord Vishnu.

The Ranas adopted a policy that would not hamper their vested interests and wanted the people to live in peace. They were dead against the changes initiated from abroad.

Some of the enlightened people of the Valley indirectly wanted to make the people politically aware by means of social organisations and the Paropakar Samsthan in particular.

The British Government of India did not want to see Nepalese people opposing the Rana regime. For the Ranas were dependable allies of the English. If the people were made socially consicous, they might naturally oppose the pro-British policy of the Ranas. For their survival the Ranas would not or did not try to bring about changes in the country. Their survival depended on the goodwill of the English.

In short, the Ranas and the English were equally responsible for their apathetic attitude towards social development of the country. That is why the Nepalese were bound to be backward as long as the British remained in India.