Dying
Industries
ONE of the reasons why Nepalese economy has not
had a robust growth lies in the underdeveloped state of the industrial sector. Nepal is
just too heavily dependent on agriculture, which in turn is greatly dependent on the
vagaries of weather. If rains are good, agriculture output increases and that is reflected
in the economic growth. Otherwise, economy records messly growth figures. Our economy
would not be so tied to the agriculture if adequate attention was paid to the industrial
sector over the past decades. But that did not happen and thus the situation. What is
alarming is that what few industries Nepal has also run into deep troubles over the recent
years. The small and cottage industries, the backbone of the Nepal’s industrial
sector, are also severely affected. Mirroring this general decline in industries is the
case of Rupandehi a western Terai district. A news piece has it that most of the small and
cottage industries in Butwal and Siddharthanagar, the two towns of the district, are on
the verge of closure. According to the small and cottage industries office in the
district, even the industries that are somehow operating are not running in their full
capacity. An indication of the seriousness is the fact that out of the total 1442
industries registered in Butwal, 760 are in operation while 682 have already been closed
down. What brought this about? The litany of woes is long and grim. Lack of working
capital and regular supply of raw materials, dearth of competitive edge of products due to
the lack of technical know how, and establishment of industries without market research
are some of the factors that are responsible for industries not functioning in their full
capacity. But industrialists also point to lack of adequate facilities and incentives from
the government as being a major lacuna. It goes without saying that incentives, at least
in the beginning, are needed for industries to get off the ground. The responsibility for
coming up with incentives package rests with the government. In Rupandehi, lack of
governmental interventions have meant that small industries are at a disadvantage in
competing with Indian goods. With correct policy interventions and incentive offers, there
is no reason why units like processing industries—which are presently conspicuous by
their absence despite the region being rich in some agriculture products— would not
come up. Learning from the sombre situation in Rupandehi, the government has to take up
the challenge of resuscitating the dying industries across the country.
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