Forum (Spotlight Weekly)

‘Peace And Security Vital For Industrial Growth’

By Ravi Bhakta Shrestha

Since last three years back, we have started celebrating the Industry and Commerce Day (Chaitra 28) to mark the glorious history of private sector in the Nepali economy. We have been emphasizing on the cordial relationship with the government. We are committed to avoid anomalies in the economy and to provide further motivation and impetus to the private sector entrepreneurs so that they can engage in respectful ventures.

However, I feel sad and unfortunate to tell you that we have been experiencing day by day, the state of ambiguity, insecurity and instability. We have arrived at a situation where not only political rights have been curtailed, even the rights of the business entrepreneurs, residing throughout the country, to conduct their business in a free and fearless atmosphere, are put to a question.

Today, we are facing an ironical situation of being proud men amid dependency; of honest and hardworking people amid poverty; of being peace-loving people amid internal conflicts. At present, the country's basic problem is political and not economic; unless there is an improvement in the political scenario, I do not think there will be an early improvement in the economic freedom. This explains this year's theme of "Peace and Security for Development."

Economic prosperity and development is impossible without peace and security. The absence of economic prosperity has further distributed the situation of peace and stability in the country thereby pushing the country in a kind of vicious circle: " poverty-instability-poverty". In order to get out of this despairing situation, there is an equal need, as there is of a farsighted and capable leader, of good followers that keep up with the leader in the every hour of crisis. Whether it is in the field of politics, business or social, success cannot be achieved in the absence of compatibility between the leaders and the followers. In order to achieve this compatibility, there is an urgent need to replace individualistic feelings of "me" and "mine" with unselfish and group feelings of "we" and "ours".

Peace and security is the nation's primary concern. In the absence of peace and security, not only foreign investments, even national investments are discouraged and dissipated. The growing international and national terrorism have increased business risks thereby increasing the costs of doing business. During the time of terror, patience is the best medicine. We, the businessmen, can contribute a lot in the process of government's effort to create law and order situation, in this time of crisis, if only we can maintain patience.

During the time of terror it is equally important to have mutual understanding and cooperation. If we cannot protest today on the forced closing or opening of our business, or on the extortion and donations at any pretext or on misguidance of our workers and employees then the future consequences of these actions would be more grave and complex. For the unity, understanding and cooperation, the business community should rise above its short-term business interests and take a national vision. FNCCI welcomes the belated efforts from the political level to solve the grave situation in the country. At a time when everyone is ready to cooperate, the political parties should take initiative to rescue the country from the brink of collapse.

Apart from the need to have a condition of peace and security, poverty, inequality and rising youth unemployment have been the major problems of the country. The government has mentioned about these problems in its Tenth Five-Year plan document and Poverty Reduction Strategy Paper. The private

sector is said to be the engine of growth. Probably, this is the reason why the government has accorded nearly 69 percent of the total fixed capital investment in the Tenth Plan to b made by the private sector. The government has initiated a good program by designating the top ten taxpayers in the country as Commercially Important Persons (CIP).

In the absence of effective implementation system, however good the policies may be, they will turn out to be incomplete and also lack trustworthiness. The implementation issue has been elaborately discussed in the recently concluded meetings of the Nepal Development Forum. I would like to emphasize here that there is a need for good governance for effective policy implementation.

If we cannot clearly delineate the roles and responsibilities of the private sector in the economy, the investments expected in the Tenth Plan will remain only in the paper. Therefore, at this juncture, with the joint initiative of the government and the private sector, I would like to make a call for a blueprint on the overall development of the private sector. The government is involved in poverty alleviation. For this purpose, all District Development Committees and Village Development Committees have been mobilized. I would like to affirm that 85 District and Municipality level chambers, 50 commodity associations, nine bilateral chambers and 423 associated members affiliated with the FNCCI are committed to assist the government in its good wok on alleviating poverty.

I would like to posit some ideas on employment generation in the country basically for three reasons. First, the private sector has a big and extensive role to play on employment generation. Second, a large part of the country's problem is related directly or indirectly to unemployment situation. Third, human resource has been the primary resource available in the country. Nepal is said to be the nation of youths. However, youths face the problems of unemployment while industries suffer from lack of skilled manpower.

Cheap labor alone does not attract foreign investment. Labor productivity does. While preparing the blue print on private sector development attention needs to be paid to the possible employment opportunities in the private sector, and incentives, training programs and legal frameworks required. In order to increase employment opportunities, flexibility in the labor market is needed. In this regard, I would like to invite social dialogue and cooperation with the trade unions.

(Excerpts of the address by FNCCI President Mr. Shrestha at the Industry-Commerce Day organized by the apex private sector chamber on April 10)