 |
||
|
||
PRIVATIZATION |
|
||
|
||
PRIVATIZATION |
Steady And Slow Differences between two
senior ministers stalls the privatization process By A CORRESSPONDENT As soon as Lokendra Bahadur Chand was
appointed prime minister, his finance minister, Dr. Badri Prasad Shrestha, declared the
government's plan to privatize eight state enterprises in the ongoing fiscal year. The
announcement sent positive signals across the moribund economy. The government privatized the Butwal Power
Company and initiated the process to hand over a few other government undertakings, but it
is yet to open bids for public enterprises.
Interestingly, instead of moving
toward privatizing sick public enterprises, the government has opted for selling monopoly
industries. If the present policy is implemented, the government will have to pay the
money for all sick industries and will lose control over profit-making undertakings. The country has many government
undertakings that need to be privatized, including Resin and Turpentine Industry, Nepal
Cotton Development Company, Bhaktapur Brick Factory, Birgunj Sugar Factory, Udayapur
Cement, Hetauda Cement, Nepal Ropeway, Trolley Bus, Agriculture Lime Industry and
industrial estates. However, the government also is said to be
considering the privatization of two monopoly government undertakings - Nepal Oil
Corporation and Royal Nepal Airline Corporation, a proposition that has baffled many. Differences within the government over the
process have complicated matters. While the Finance Ministry is preparing to privatize
some undertakings under the Ministry of Industry, Industry, Commerce and Supply, which
holds more than 80 percent total government undertakings, the departmental minister,
Mahesh Lal Pradhan, has stood firmly against the proposal. Moreover, Pradhan has demanded
funds to reopen industries that had been closed. The ministry has requested funds to open
cement industries and sugar mills, arguing that it wants to privatize them in running
condition. "We are not opposing the privatization process per se. But we just want to
privatize the industries in running condition so that the government can acquire more
money from them," said a senior official at the ministry. The ministry has also raised objections to
the privatization of some undertakings without taking necessary legal provisions.
"The government can sell government monopolies at any time and there would be no
problem to find possible buyers for RNAC and Nepal Oil Corporation," said former
secretary Dr. Bholanath Chalise. "I don't understand why the government cannot
privatize sick and money-losing undertakings first." Once government monopolies are privatized
without amending the existing acts, a vital sector of the state will go in the hands of
the private sector straight away. This could result in a dangerous situation, especially
where the firms have been playing a vital social function. There are legal implications as well.
"The acts need to be amended before the privatization of some public-sector units.
When parliament does not exist and there is no sign of early elections, the life of an
ordinance is just for six months," said a lawyer. The government is said to be preparing to
announce the list of eight public sector undertakings to be privatized soon. As Nepal Oil
Corporation is making huge losses, the government may find a good reason to invite the
private sector to join the lucrative business. "The government is financially no
longer in a position to provide subsidy to government undertakings. We must privatize
ailing as well as other public sector enterprises," said a senior official at the
Finance Ministry. "There is no sense in holding on to white elephants." As the two key ministers involved in the
privatization process have their own priorities, the country will first have to find out
whose ideas prevail. |
Send your feedback to the
editor: spotligh@mos.com.np |
