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COVER STORY |
FNCCI GENERAL
CONVENTION With Dr. Gopal Prasad
Shrestha having announced his candidacy for the presidency of the Federation of Nepalese
Chambers of Commerce and Industries (FNCCI) in the forthcoming general convention,
elections seem inevitable for a post that has been held on consensus. This is the third
time in the FNCCI's history when two candidates are contesting for president. The
challenges ahead, including Nepal's accession to World Trade Organization and the
imperative of further economic reforms, are immense. At a time when the country has been
passing through a very critical economic phase, there are fears that the election might
create rifts in the business community. After all, the deep divisions that appeared eight
years ago persist. How the forthcoming election between acting president Binod Bahadur
Shrestha and Dr. Gopal Prasad Shrestha affect Nepal's business community remains to be
seen. By KESHAB POUDEL Till a few months ago, acting president
Binod Bahadur Shrestha seemed to be the unanimous choice for the president of the FNCCI.
The scenario, however, has changed suddenly. Shrestha, who is on a nation-wide tour to
lobby district committee members, is facing stiff challenge from another candidate. Soon
after Dr. Gopal Prasad Shrestha announced he was running for president, the acting
president's hopes of becoming full president by consensus - a tradition in the premier
private sector organization of the kingdom - have been dashed. Although the election campaign is yet to
pick up, the battle lines have already been drawn. Acting president Shrestha began
visiting remote areas like Humla and Jumla of far-western region a month ago, while Dr.
Gopal Prasad Shrestha has begun addressing district members in the central region. Unlike
the contest between Binod Chaudhary and Padma Jyoti a few years ago, the tempo of this
campaign is low key.
"I don't think there will be any
election like the one between Chaudhary and Jyoti, as both of them were highly qualified
persons in the FNCCI," said a businessman on condition of anonymity. "The
Shrestha duo's campaigns have already generated new feelings in the industrial
sector." Following the contest between Chaudhary and
Jyoti in 2052 BS, the harmonious and homogeneous relations in the FNCCI were broken.
Although the FNCCI's founder members and other leaders made every effort to avert the
elections, Chiranjibi Nidhi Tiwari and Ananda Raj Mulmi ended up battling for the top
later. Pradeep Kumar Shrestha and Rabi Bhakta
Shrestha did not have to face elections, as both were chosen on consensus under a
power-sharing formula that had been worked out. When a group refused to follow the
modality, which is based on automatic promotion for the executive members, the rival camp
picked Dr. Gopal Prasad Shrestha as their candidate this time around. As the election and general convention
approaches — the election is tentatively scheduled for the first week of August - the
two candidates are going from house to house and district to district to woo the voters. Binod Bahadur Shrestha is the son of former
president of the FNCCI and eminent industrialist late Juddha Bahadur Shrestha. Acting
president Shrestha, one of the promoters of the troubled Necon Air, is also involved in
the housing and carpet business. Interestingly, Ravi Bhakta Shrestha, former president of
FNCCI, was also a son of former FNCCI chief Indra Bhakta Shrestha. They were known as
princes of the FNCCI. A professor of management at Dharan, Dr.
Gopal Prasad Shrestha, who was appointed general manager of Janakpur Cigarette Factory in
an open competition in 1995, has been executive member of the FNCCI for the last six
years. He has a long experience of working in local chambers.
Backed by powerful industrial and
business groups, the Shrestha duo have been leading their nation-wide campaign
highlighting their policies and programs for the future. Although Binod Shrestha has some
advantages over his rival, there seems to be tough competition among the two. "There will be tough competition and
the members will be polarized as they were in the elections between Padma Jyoti and Binod
Chaudhary's time," said Rajendra Kumar Khetan, second vice-president of FNCCI, who
backs Dr. Gopal Prasad Shrestha. "I know about only one candidate and he has an
academic background and is business leader and he wants to maintain harmony." The FNCCI has certain agreed modalities on
choosing consensus candidates. Based on automatic promotion system, they help ensure a
progressive rise on the ladder. One group is accusing acting president Shrestha's camp of
violating the agreed modalities and forwarding its own agenda. "As far as the elections are
concerned, that is not in itself a major issue. The elections may bring positive signs
also. If elections are held in a competitive manner, it will help to bring new
leadership," said Banbari Lal Mittal, a former president of Nepal Chamber of
Commerce. "All the factions should give up their differences as soon as the elections
are over." Role of the FNCCI As an umbrella organization dedicated to
uniting the industrial and business sector, the FNCCI has played an important role in the
last four decades to serve the interests of the business community and to promote the
private sector. Established in 2022 BS, the organization has gone through many difficult
phases. With an aim to work as an apex body of industrial and business groups, the FNCCI
has established a nation-wide network with district-level chambers.
With member organizations totaling
585, the FNCCI's area has expanded over the years. It has established bilateral relations
with different business organizations. Along with working under a partnership approach
with the government, the FNCCI has been launching many projects with support from many
donor countries. To increase bilateral and multilateral trade, the FNCCI has formed a
joint forum with business federations of different countries of the region. As India is Nepal's largest trade partner,
the FNCCI has made several attempts to sort out problems between the two countries. The
FNCCI-Confederation of Indian Industries (CII) joint economic council represents a
landmark in economic relations. Nepal and the Tibet Autonomous Region of China have
centuries-long trade relations. To strengthen those relations, the FNCCI has been working
with Nepal-China Non-Governmental Cooperation Forum. The FNCCI has also set up
Nepal-Bhutan Economic Group, Nepal-Pakistan Economic Group, Nepal- Sri Lanka Economic
Group, Nepal-Japan Economic Group and Nepal-European Union Economic Forum. "There are many new opportunities
opening up in Nepal's two neighbors. After joining the WTO, the business sector will have
to face new challenges as well as new opportunities. The vision of the apex body like the
FNCCI will be critical," said Mittal. In the last four decades, the FNCCI has
transformed from a small homogeneous national organization to the largest trade
organization of the kingdom. ìIt has signed several agreements with various multilateral
organizations to exchange information on opportunities for foreign investment in Nepal. In
the changing competitive scenario, the FNCCI's leadership does not have an easy task
ahead,î said Rameshwore Acharya, who looks after publicity department of the FNCCI. As the sphere of activities of the FNCCI is
ever-expanding, some experts feel that it needs to clearly define its role. "The time
has come to evaluate the role of the FNCCI since its organizational structure has widened.
The FNCCI must recognize the role of other organizations," said Binod Kumar
Chaudhary, president of Confederation of Nepalese Industries (CNI). "It cannot do all
the jobs alone." Others, too, agree that the organization
requires to change its priority to meet the challenges of the changing context. "One
of the challenges of the FNCCI is how to accommodate and the protect the interest of
business and industrial community. We need to be creative and imaginative," said
Mittal. Other Organizations Nepal Chamber of Commerce is the oldest
organization of the Nepalese business community, working to promote interest of the sector
as well as the wider economic realm. In the last two decades, other organizations have
also come up. The CNI, headed by Chaudhary, is the latest entrant. The Nepal Small
Industries Association and Federation of Nepalese Industries are also working in the areas
of promoting the interest of industrialists and business groups. That quest depends on the quality of the
leadership such organization gets. "I announced the candidature to activate the
FNCCI. If we are unable to accommodate all business groups and industrialists, one cannot
stop the break-up of the FNCCI," said Dr. Gopal Prasad Shrestha. "Once I an
elected president, I will take steps to listen to the grievances of various business
groups." Elections Procedures According to the FNCCI's constitution, the
central executive consists of 62 members. The elections will be held for one president,
four vice-presidents, 14 members from zones, 13 from districts, 8 commodity associations,
15 leading companies, 1 bi-national chamber. There are also one reservation each for the
tourism and transport sector, while four members, including a woman, are nominated by the
president. There will be direct elections for the
president and four vice-presidents while the other executive members are indirectly
elected. Since the organization is based on the federal structure, almost all of its units
are autonomous. The district and town units of federation hold 50 percent of the votes.
Companies have 30 and commodity associations hold the remaining 20 votes. Since the districts and town federations
play a decisive role in the election for the president and other members, all leadership
aspirants must have their full backing. In case of competition in the district levels, the
companies and commodity associations have a decisive role. Election Vs Selection In its 38-year history, the FNCCI has opted
for a consensus approach to choose its executive members. Despite the provision of
elections, the FNCCI's leaders were chosen only twice on the basis of elections. The
business community avoided elections to avert the clashes between commercial interests,
ideology, ethnicity and community. Consensus, however, has not been able to
preclude controversy. The breaking of the previous understanding reached between business
groups is said to be behind the present problems. Acting president Shrestha's group is blamed
for breaking the consensus in choosing the rank of three vice-presidents. Although both
the candidates are from similar community, they represent different geographical zones.
Acting president Shrestha represents an old business house of Kathmandu. Gopal Shrestha,
who is from Dharan, does not have backing of traditional business houses centered here. In the history of the FNCCI, Padma Jyoti
was the first elected president, having edged out Chaudhary for the 2052-2054 tenure. The
division in the FNCCI appeared when Chaudhary decided to contest for second consecutive
period. Otherwise, the FNCCI's executive committee was chosen unanimously. From the first president Loknath Joshi to
last president Rabi Bhakta Shrestha, all of them were lucky enough to secure the president
position on the basis of consensus. Pashupati Giri is one of the longest serving president
of the federation. In his two tenure, Giri served 4 years in first term and six years in
the second term. "I am always ready for negotiations on
many issues. Since I am the first vice-president, it is my turn to be president. I am
contesting the elections with the support from my colleagues from the district to the
national level," said Binod Shrestha. Mahesh Lal Pradhan is the second longest
serving president of the FNCCI. Before being replaced by Chaudhary in 2050, Pradhan served
for six years in the top job. After Chaudhary's term, all presidents stepped down after
completing their two-year tenure. Pradeep Kumar Shrestha and Rabi Bhakta Shrestha
completed their tenure as consensus candidates. Mulmi was elected to the president
defeating Chiranjibi Nidhi Tiwari. "The elections will create certain
misunderstanding and division in the FNCCI. So, I am requesting other colleagues to pave
the way for consensus. In case elections are held, I will certainly win," said Binod
Shrestha. Others have different opinions. "Why
do we need consensus? Consensus is just for division and making organization more
inactive?" asked Dr. Gopal Prasad Shrestha. "I don't think the elections will
widen the differences in the FNCCI. As far as I know, consensus was reached just between
Pradeep Kumar Shrestha and Rabi Bhakta Shrestha - not among everybody." Another group, too, sees no harm in holding
the elections for the president. "If elections are held in healthy manner, I don't
think it will harm the interest of the FNCCI. In democracy, the election is the basis to
choose the leadership. This is the way to make the organization more efficient and
effective. Elections should not be held on the basis of community, caste and region,"
said Mittal. Conflict in the FNCCI Being the largest apex body of the business
community, there are conflicts among many interest groups within the FNCCI. There is
conflict between manufacturer vs. traders, small vs. big business houses, sectoral
interests like garment, carpet and tourism, export vs. protection for the domestic base
industries. There is ideological clashes between the
free market vis-a-vis protectionists. In the scenario of various conflicting groups, both
the candidates have to prepare plan on how to strike a balance. Challenges for the FNCCI Industrialists and business organizations
have been facing many challenges as the seven-year-long Maoist violence has turned the
situation from bad to worse. The law-and-order situation is deteriorating as the
industrial production continues to decline. The export of garment and carpet is too facing
critical phase. There are differences on duty draw back, VAT, Labor law and sick
industries. Since Nepal is making efforts to join the
WTO, Nepal's private sector has to face another shift in the international trade and
business. After joining the WTO, Nepalese industrial sector will have both challenges as
well as opportunities. As many crucial challenges are lying in
front of business and industrial sector, the FNCCI's new leadership has difficult times
ahead. At a time when the country has been passing through a critical phase, two
candidates must not rake up personal and other matters during the elections campaign. If
they contest the elections on the basis of issues and agenda, the industrial sector will
benefit from their debate and the elections will flourish the personality of the incoming
leaders. "The FNCCI has been facing many
challenges like division within business community, competition with other organizations,
political weaknesses, corruption, law and order, governance, investment climate and
institutional and leadership capabilities," said vice-president Khetan. Election Issues The two candidates are raising issues like
Nepal's accession to the WTO, the deteriorating law-and-order situation, labor issues and
accommodation of all business groups and protections and promotion of private sector. The
candidates are talking about regional industrial disparities, rehabilitation of sick
industries, economic reforms and protection of small business groups and industries. One cannot see radical differences in their
approach in dealing with the present scenario. One of the important aspects of the
elections campaign is that both candidates are raising corruption and good governance in
the industrial sector as their priority. The past experiences have shown that foreign
investment requires more transparency in the business sector also. In the last couple of years, some foreign
investors have expressed reservation over the legal practices followed in the country and
complained bad governance in the areas of private sector. They are also equally concerned
on the VAT, protections and duty draw back. Interestingly, both candidates have yet to
produce their vision for their two-year tenure. "If they don't contest the elections
on the basis of agenda, they will ask the vote on the basis of communal, caste and
regional line," said an industrialist. "If they want to democratize the
organization, they must contest the elections on the basis of agenda." In democratic
set up, the elections is a way to choose the leaders. If conducted prudently, the
forthcoming elections would help democratize the FNCCI. 'I Will Not Escape From The FNCCI's Challenges' — BINOD BAHADUR SHRESTHA
Acting president of
the Federation of Nepalese Chamber of Commerce and Industries (FNCCI) BINOD BAHADUR
SHRESTHA is contesting the elections for president in the forthcoming general convention.
If things remain unchanged, elections seem inevitable for a post that had begun to be
agreed on consensus. Shrestha spoke to KESHAB POUDEL on various issues regarding the
elections and other challenges. Excerpts: With the FNCCI's general convention
approaching, what difference will you make if you are elected as president? I will make major changes in the FNCCI and
work out a plan to accommodate all the business community under its umbrella. I will make
the FNCCI more effective and efficient in dealing with the problems related to the
business and industrial community. As a person having long experiences in working with
FNCCI, I know the problems and challenges in front of the organization. I will definitely
prove my efficiency and capabilities. In the last seven months, I have made some important
progress. My seven-month record is open to all. Since you have already held the
party presidentship for seven months, why do you want to continue for another two years? I was nominated not because of anyone's
favor but because of constitutional provisions, According to the FNCCI's constitution, the
first vice-president is natural choice for acting president in case of resignation of the
president. I was nominated as acting president seven months ago when our president Rabi
Bhakta Shrestha was appointed as an assistant minister. How important is the present
convention? Our convention is important in the sense
that it will elect a new executive committee and president. This is a general convention.
One of the major works of the new executive committee will be to accommodate all the
members and push the FNCCI effectively. How do you see the possibility of
your winning the party presidentship? I hope that my colleagues and members of
the FNCCI will overwhelmingly support me. I am visiting different parts of the country to
discuss my candidature with our members from district federation, bilateral chambers and
commodity associations, bi-national and leading companies. They have to decide what kinds
of leadership they want. The job of the president is to work in the interest of small and
big industrialists and other business group throughout the country. Why are your members supporting
you? The FNCCI will flourish under a dedicated
and well-experienced leadership. Keeping this in mind, businessmen and traders from
various districts are urging me to take the leadership through consensus. They are urging
me to file nomination for the party president since they know my long experiences and
contribution in the FNCCI. Since I have overwhelming support at different levels, I will
decently win the elections of president. As the country has been passing
through a very critical economic situation, what will be your priority? We are receiving complains from various
quarters. Some groups accuse the FNCCI of being too ceremonial and formal. The FNCCI has
gone through many ups and downs. The founder of the FNCCI played important role in early
days to turn it into an umbrella organization of business community and industrialists. We
have made enormous changes in the FNCCI. We have made some miracles in the last 12 years.
The role of the private sector has expanded. The private sector has played an active role
in the service, industrial, civil aviation and tourism sectors. What important contributions has
the FNCCI made in the national economy? The FNCCI has made significant
contributions in signing favorable bilateral trade agreement with India and other
countries. Our contributions to the revenue has also increased by many folds. The private
sector has generated enormous employment opportunities. How do you see the criticism
against the FNCCI's leadership? There are some genuine points in the
criticism of our colleagues. We can still manage them. One of the major tasks of the new
leadership will be to tackle all these issues and to make the FNCCI more effective and
transparent. We also receive threats in the last seven years but we have to be proud of
having been able to retain our prestige. We want to go through the concept of
public-private partnership. We want to play an important role to minimize the corruption.
We will introduce a major anti-corruption program within the FNCCI. What programs will you implement to
benefit small entrepreneurs? We are implementing micro-industrial
programs in 20 districts. We are also trying to commercialize the agriculture sector.
Since agriculture contributes over 80 percent in GDP, the private sector needs to support
the sector. The investment in the agriculture sector still depends upon the non-banking
sector. If we provide the investment through the formal banking sector, the situation will
change. Since Nepal is joining the World Trade Organization, Nepalese industrialists have
to face new kinds of situation. The rehabilitation of sick industries is another major
challenge. We have many programs to continue. The coming leadership has another role to
fulfill: the corporate social responsibility. We are opening the South-East Asian Office
in the FNCCI. We are also working to provide concessional loans to small industries. We
are also trying to establish the industries in the regional basis. Since the far-western
city of Kanchanpur is very close to the Indian capital New Delhi and other northern
cities, we should encourage industries there. Since businessmen argue that
consensus should guide FNCCI, wouldn't the election's divide the organization? There is always a possibility for
consensus. We have seen many bad implications of the elections. The division of the last
elections benefited no one. The FNCCI was divided badly and we are yet to recover
from it. The majority of our members and well-wishers are still trying to find a
consensus. At a time when the country has been passing through a very critical phase, we
must prevent any kinds of unhealthy competitions and division in the FNCCI. We have
increased our area and scope and playing important role. We need a strong and united
leadership. If we create the divisions in the leadership level, it will not benefit
anyone. If we divide ourselves, our enemy will be happy. Being the leader of the largest
industrial organization, what role do you expect to play? My foremost priority will be to protect the
interest of all kinds of industrialists and business people. There are some weaknesses in
the country's policy making. Despite many difficulties in the economic sector, we continue
to survive as industry. Though we reduced our production, we are still running our
industries. We are surviving by selling low volume of goods. I will take all these issues
to the Finance Ministry and National Planning Commission and work through a partnership
approach. In the last three terms, the
FNCCI's president was chosen on the basis of consensus. Is this trend broken now? The FNCCI is a big family and there is
space for everyone. The FNCCI has certain weaknesses and lapses. One must be given chances
to correct the weaknesses. Being the acting president, I will invite all businessmen, who
are not happy with the FNCCI, to discuss controversial matter. If some things are wrong,
we can correct them. We have constituted a committee to evaluate what needs to be done.
From the amendment of the constitution to the involvement of more members in the FNCCI's
activities, there are challenges galore. We are also discussing the structural changes of
the FNCCI and the Chamber Act. I don't want to escape from these challenges. ‘My Aim Is To Restore Confidence In The FNCCI’ — Dr. GOPAL PRASAD SHRESTHA
Dr. Gopal Prasad
Shrestha has a long experience in the business sector of the country. He has been in the
central committee of the Federation of Nepalese Chamber of Commerce and Industry (FNCCI)
for the last 25 years. Dr. Shrestha is currently working as a consultant with Himalayan
Distillery Limited. A professor of management, Dr. Shrestha has forwarded his candidature
for the post of president of the federation. He spoke to KESHAB POUDEL and SANJAYA DHAKAL
last week. Excerpts: Why did you decide to contest the
election for the post of FNCCI president? The reason why I decided to contest the
election is because at present we do not find the federation raising issues close to it in
an effective manner. The federation has failed in raising the issues brought to its notice
by various commodity associations, district chambers, bi-national chambers and so on. The
leadership of the federation has restricted itself within a limited sphere of activities.
It has only engaged in formal activities. This has led to such a situation that not only
the members of business community but even the government bureaucrats have started raising
doubts over the federation's efficacy. Likewise, some quarters even allege that the
leadership is guided by some interests. My aim is to restore confidence in the federation. For the last couple of years, the
FNCCI has been choosing its leadership on the basis of consensus. What prompted you to
challenge the leadership now? In fact, it is us who had earlier called
for consensus within the federation. But that consensus idea was floated and achieved only
for that specific time and only in relation to the election of Pradeep Kumar Shrestha and
Ravi Bhakta Shrestha. Everybody knows this. The whole world is for the democratic exercise
in competitive environment. Of course, I do not oppose consensus or unanimity. But
consensus for what? The consensus must be for the betterment not for electing one
candidate or the other. How would you accommodate differing
voices and factions within the federation if elected? I have a clear vision that this is
democracy and we are tasting the fruits of democracy. So, the emergence of associations
and institutions is not necessarily bad. There are organizations like CNI also. I believe
we need to forge supportive alliance with such organizations. Look how the two parties
that are ideologically poles apart are joining hands for their common cause. Why can't
that happen in business community? I think it can and it should. What is your agenda? How will you
make any difference to the sector? I want to develop FNCCI not only as some
formal organization but as a force that clearly puts forth its views to the government. I
will address the issues surrounding the election system in the district chambers,
commodity associations and bi-national chambers. The process about the amending the
statute will be carried forward after convincing all. On the other hand, there are a lot
of things that need to be changed vis-a-vis Nepal's accession to WTO. Recently, two former presidents of
FNCCI were appointed ministers. Did it make any positive impact on issues that the
federation raised? One thing that I am clear about is that
while the FNCCI can make demands, it is up to the government to make decisions after
taking various factors into considerations. Therefore, the federation had no high
expectations when Ravi Bhakta Shrestha and Mahesh Lal Pradhan became ministers. How do you assess the financial
situation of the country? It is indeed very bad. Media has been
reporting about the economic turmoil quite a lot. The economic situation is moving on a
downward motion. How can the private sector help in
the generation of employment opportunities? In fact, it is the private sector that
generates employment opportunities. This sector has great responsibility toward the
country. By investing in areas like agriculture, tourism, hydropower and so on, the
private sector can generate employment opportunities. The bottom-line is that it is the
private sector and not the government that can generate such opportunities. Is Nepalese private sector ready to
act within the WTO regime? I have taken the WTO regime as a part of
the concept of global village. Since we are a part of the village, we have to associate
with it. There may be things that one may not like, but they cannot be wished away. It is
true we do not have many items where we can boast of competitive advantage. But we cannot
remain outside the WTO. Gladly, there are efforts being made to make some concessions to
LDCs like Nepal in the WTO regime. I hope these efforts will be able to address our
problems. |
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editor: spotligh@mos.com.np |
