Water Power
Exploitation Essential

By Gandhi Raj Kafle

THE region of South Asia, which boasts of abundant natural resources, is equally rich in human resources. It has already been accepted as the market centre of the world. But, the problem is that this potential was felt lately and addressed slowly in the vision of regional scope for economic cooperation. This situation needs to be changed, for which common policy for development has to be found out. The practical way out needs to be explored for sharing benefit. In fact, this is the policy, which the region requires to reform the market of energy.

Potential

Nepal in its modern economic history is increasingly known for possessing abundant water resources as the country shares nearly 2.27 per cent of the total estimated hydro-power potentiality. The country is remarkably endowed with more than 6,000 rivers, which fall into nine main rivers stretching from north to south. These rivers have strong currents because of the position of geographical altitude. These rivers have potentiality of producing 83,000 M.W. of electricity, out of which the country has been able to generate only 373.2 M.W. until Fiscal Year 2000-2001.

Nepal's river resources flowed untapped for long because there had been no national policy to direct this natural asset for greater utility. The country remained isolated politically and economically till 1951. The newly opened Nepal was infrastructurally weak. Yet, the rays of awareness for speedy development were visible everywhere. Nepal, like other nations in the world, began to make efforts to address national problems spreaded stubbornly in each sector of the nation's traditional economy. In this backdrop, the water resources, also got its policy level priority.

Categorically, the country's planning gets the credit for prioritising water resource mobilisation. It would be relevant to note the strategy of cost- effective production of electricity mentioned in the eighth five year plan. According to the Plan document, due attention will be given on consumers' demand for power while designing and implementing power projects. Similarly, the Ninth Plan too promised to incorporate private sector's participation in the development of water resources. Now, the period of the Ninth Plan has already been over and there is a time lag in the process of formally launching the tenth plan. The country's future plans and programmes about hydro-power development can be seen in the base paper unveiled for officially launching the tenth plan. The paper has its renewed emphasis to utilise this valuable product, for which the tenth plan wants to make electricity an exportable product for Nepal.

Some points mentioned to develop hydro-power in the base paper of the tenth plan are worth mentioning.

Firstly, the river basin, which is the fundamental part for any power project, will be accepted as the basis of hydro-power development. Furthermore, international, national and local needs for power will be carefully analysed while implementing such projects.

Secondly, realising the potential of electricity export from some of the mega-projects, the nation will pursue a harmounious policy to encourage national and international investors in water resource development.

Finally, Nepal's potential to generate electricity is not limited to meet internal demand, it has the scope to contribute to the regional economy too. In this backdrop, the country's power development policy will be harmonised in context of regional cooperation in this sector.

The above points from the tenth plan's base paper explain the national and regional importance of Nepal's water resources.

Applicable

Though Nepal has harnessed only a little of its total hydro-power potential, the country holds huge inner strength to meet energy demand in the days to come. But, this potential needs to be converted into reality for which there needs a true spirit of cooperation within South Asia itself. What are also important for this purpose are the country's own development mindset, cooperation between neighbours and a congenial regional atmosphere for peace and prosperity. So, relevantly these preconditions are applicable to Nepal's hydro-power development also.

Monopoly, Competition In Economic Markets

By Devendra Raj Purbeli

MONOPOLY and competition are basic factors in the structure of economic markets, which have certain complex relations among firms in an industry. For the economy as a whole, an industry would include all sellers having this relation.

Market Structures

Different industries have different market structures i.e., different market characteristics that determine the relations of sellers to one another, of sellers to buyers, and so forth. Probably the most important aspects of market structure are: the degree of concentration of sellers in an industry, the degree of product differentiation, and the ease or difficulty with which new sellers can enter the industry.

The structure of a market is also affected by the extent to which those who buy from it prefer some products to others. In some industries the products are regarded as identical by their buyers-as, for example, basic farm crops. In others, the products are differentiated in some way so that buyers prefer various products. Notably, the criterion is a subjective one; the buyers' preferences may have little to do with tangible differences in the products but are related to advertising, brand names, and distinctive designs. The degree of product differentiation as registered in the strength of buyer preferences ranges from slight to fairly large, tending to be greatest among infrequently purchased consumer goods and "prestige goods," particularly those purchased as gifts.

Industries vary in the ease with which new sellers can enter them. The barriers to entry consist of the advantages that sellers already established in an industry have over the potential entrant. Such a barrier is generally measurable by the extent to which established sellers can persistently elevate their selling prices above minimal average costs without attracting new sellers. The barriers may exist because costs for established sellers are lower than they would be for new entrants, or because the established sellers can command higher prices from buyers who prefer their products to those of potential entrants. The economics of the industry also may be such that new entrants would have to be able to command a substantial share of the market before they could operate profitably.

Under atomistic competition, in which entry is generally easy, there are no barriers to entry. By the same token, product differentiation among sellers is obviously inconsistent with single-firm monopoly.
Market conduct and performance in atomistic industries provide good standards against which to measure behaviour in other types of industry. The category includes both pure competition and monopolistic competition. In pure competition, a large number of small sellers supply a homogeneous product to a common buying market. In this situation, no individual seller can perceptibly influence the market price at which he sells but must accept a market price that is impersonally determined by the total supply of the product offered by all sellers and the total demand for the product of all buyers. The large number of sellers precludes the possibility of a common agreement among them, and each must therefore act independently. At any going market price, each seller tends to adjust his output to that quantity that will yield him the largest aggregate profit, assuming that the market price will not change as a result. But the collective effect of such adjustments by all sellers will cause the total supply in the market to change significantly so that the market price falls or rises. Theoretically, the process will go on until a market price is reached at which the total output that sellers wish to produce is equal to the total output that all buyers wish to purchase.

If the provisional equilibrium price is high enough to allow the established sellers profits in excess of a normal interest return on investment, then added sellers will be drawn to enter the industry, and supply will increase until a final equilibrium price is reached that is equal to the minimal average cost of production (including an interest return) of all sellers. Conversely, if the provisional equilibrium price is so low that established sellers incur losses, some will tend to withdraw from the industry, and supply will decline until the same sort of long-run equilibrium price is reached. The long-run performance of a purely competitive industry therefore embodies these features: industry output is at a feasible maximum and industry selling price at a feasible minimum; all production is undertaken at minimum attainable average costs, since competition forces them down; and income distribution is not influenced by the receipt of any excess profits by sellers. This performance has often been applauded as ideal from the standpoint of general economic welfare.

Ideal

But the applause, for several reasons, should not be unqualified. Pure competition is truly ideal only if all or most industries in the economy are purely competitive and if in addition there is free and easy mobility of productive factors among industries. Otherwise, the relative outputs of different industries will not be such as to maximize consumer satisfaction. There is also some question whether producers in purely competitive industries will generally earn enough to plough back some of their earnings into improved equipment and thus maintain a satisfactory rate of technological progress.

Territorial Expansion Of Nepal (1775-1814 A.D.)

By Guna Dev Bhattarai

UNDER the regency of Bahadur Shah Nepal is territory was expansed. Damodar Pande and Abhi Mansimha Basnet had played a major role in extending the boundaries of Nepal.

Gulmi became the next target of the Nepalese. The ruler of Gulmi became friendly with Nepal hoping that the former would get some slices of the grabbed territories. In 1790 A.D. Dailekh was merged with Nepal.

The rulers of Sallyan and Jajarkot were allies of Nepal during the expansion of Nepal's territories. In course of time Doti and Achham were annexed to Nepal. Bajhang had already accepted the soveignty of Nepal. During Nepal's military expedition Dullu had rendered a meritorious service for the cause of Nepal. Arghakhanchi, Parbat, Pyuthan were occupied one by one by the heroes, Damodar Pande and Jagatjung Pande in particular.

As Sallyan had matrimonial relation with Nepal the former (Rani Vilaskumari) had rendered ample help during the military expedition against other Chaubisi. In course of time Jumla was captured. The Nepalese having crossed the Karnali and the Seti entered the Doti region. The ruler of Doti though a hard nut to crack came under Nepal. Jumla, Humla and some territories were occupied by Nepal to the effect the hilly regions east of the Kali was annexed to Nepal.

Syllyan and Jajarkot were treated as independent states and their internal affairs could not be intervened by Nepal in any way. In the meantime Bahadur Shah was aiming to extend the boundaries of Nepal beyond the Kali. Neverthless, the vanquished rulers of Lamjung, Parbat and the like tried to recover their principalities but their efforts went in vein.

Bahadur Shah had courted matreimonial relation with Mahadutta Sen of Palpa by marrying the latter's daughter. Palpa had rendered a meritorious service to Nepal in extending Nepal's boundaries. That is why Palpa was given Arghakhanchi and Gulmi as a reward. Then in the south all the areas in the Terai that formerly belonged to Doti, Pyuthan, Mackwanpur, Chaudandi and Vijayapur were annexed to Nepal.

With Almora as the capital of Kumaon it had became a state of great importance. In the courses of time its glory began to wane because of inefficient rulers. Besides different persons having different aims began fighting among themselves to the effect its glory faded. For sometimes peace had prevailed between Kumaoun and Nepal. So much so Kumaoun pledged good will and respect with Nepal but with the changed rulers, the good and friendship disappeared like anything. In the meantime Doti and Achham wanted to take undue advantage of the prevailing situations in Nepal and thereby they revolted against Nepal but the timely assistance of Sallyan and Jajarkot the revolt was quelled. By that time Kuwaon had been in grip of internal disorder for some time. That is why the Nepalese captured Almora in 1791 A.D. and Kumaoun also was occupied. Srinagar also was surrounded by the Nepalese. After some time the Raja of Garhwal became the vassal of Nepal.

After the Sino-Nepalese war Nepal breathed a sigh of relief to the effect it could consolidate the conquered territories. In 1792 Garhwal pledged to remain a true friend of Nepal. The river Alakhananda remained the last line where the Nepalese had halted. By that time Garhwal accepted the protection of Nepal by means of an agreement. Kumaoun had been annexed to Nepal. Nepal could not chalk out any plan to push further west became of internal troubles in Garhwal. Nepal having consolidated the conquered territories in the Himalayan region coveted their eyes else where. Assam and Sikkim also were coveted by Nepal but the prevailing conditions in the sub-continent of India were not in favour of Nepal.