View Point (Spotlight Weekly)

Remittance: Changing the Face of Nepalese People

By Kapil P. Lohani

Until a few years back, the term "Remittance" was such an alien word that even a good English speaking Nepali gentleman would be confused as to what it meant. But today, even a common worker going abroad for employment is aware that this is the transfer of his hard earned money that can change the face of not only his family but the whole nation. There is no such term in Nepali, which can really translate remittance. All one can say is ìBidesh Ko Kamai Swadesh Ma Pathauneî (sending money earned overseas to your homeland)

There are many forms of remittance. Inward remittance is inflow of personal remittance, pension, export proceeds, NGO/INGO fund transfers, development fund transfers and all other inward transfers. Likewise, outward remittance includes outflow of personal remittance, import payments, fund transfer by expatriates and joint venture companies, money transfer for health and education purposes and all other outward money transfers. Remittance can also be the fund transfer from one part of the country to another. However, in this article we shall concentrate mainly on the inward personal remittance.

After the terrorist incident of September 11 in the United States, the practice of sending money through traditional Hundi system of transferring money has been drastically reduced. This has channelized the remittance to banking and financial sector, thus increasing the foreign exchange reserve of the country by many folds. During the past six months, the inward remittance coming through banking sector has increased by 20 percent and is expected to increase further in the coming days as the tendency of sending money through banking sector is catching up day by day. At a time when the nation is facing economic hardship in all quarters (as industrial, trading, agricultural, tourism and all commercial activities are suffering massively), remittance received from Nepalese nationals working in different parts of the world has, in fact, played a role of life saving drug for the Nepalese economy. The money transferred by the workers directly goes to the villages thus injecting a degree of prosperity in rural areas. People who go abroad for employment are exposed to different cultures, societies and gain experience about the modern development. Hence they bring back with them some expertise as well, through which they can start income-generating activities in their native land.

Nepal started bringing in personal remittance mainly after the Sugauli Treaty between the Nepalese and the British India government. Thousands of Nepalese were recruited in British Army after this pact, who, out of their earnings, regularly sent money and goods to their family from India and other parts of the world. Till the end of Second World War, the remittance used to come in through the armies themselves or through their friends coming home on holidays.

After the fall of Rana regime in 1950 and the establishment of democracy, Nepal also began to be known in the international arena. The United Nations, which was established after the World War II recruited experts from all over the world for its development activities, and few Nepalese experts joined the UN as the first batch of employees followed by hundreds more in the consecutive decades. Today, the Nepalese experts also occupy several key positions at the UN service. The Royal Nepalese Army and Nepal Police are the integral part of UN peace-keeping force. That apart, Nepalese nationals work all over the world as experts. All of them work hard in foreign lands, earn both fame and money, and send them to their beloved ones to be used for the construction of a dream home, add some more agricultural land and cattle, buy a TV, refrigerator, send their off-springs to good schools and take the elderly ones to good hospitals and of-course a good music system to listen to their favorite songs.

The oil rich countries of the Gulf, industrialized countries like Japan and Korea and the emerging economies of the far-east have a great demand for labor force. And the demand of Nepalese workers is increasing day by day due to their hard work and innocent characteristics. The Nepalese are even working in trans-continental ships ferrying tourists from one part of the globe to another.

If we happen to visit countries like Combodia, Laos, Kosovo, and East Timor, we will find hundreds of Nepalese consultants and advisors working for the fast economic growth of these countries. They say their voices and advises are heard there and are paid handsomely for their contribution. But even though they are working abroad, they are helping their motherland by sending precious foreign exchange.

Let us hope that the volume of remittance will further increase, more unemployed Nepalese nationals will be able to accommodate themselves in countries where they can work and earn, and their hard earned money reaches safely to the final destination where it is properly utilized for better economic condition of their families.

(The author is the Head of Bills & Remittance Department of the Main Branch of Himalayan Bank Limited)