Endogenising Development Policy in Nepal

-Dr. Meena Acharya, Kathmandu

1.Bandwagonism: A major problem in development policy making in Nepal is bandwagonism. This is

true among the politicians, bureaucrats, professionals and the elite. It is evident in: Overnight

reproduction of international fads, be it economic, political or cultural-generation of radical slogans by

the political parties, government, NGOs  etc. without working out the full implications of the same or

even any intention of implementing them. Failure to think about the ground realities before accepting

the fads, e,g., quick yielding projects where

there are no roads, accepting 20/20 and emphasis on large hydro-projects within the same plan

framework etc..

Adoption of contradictory policies in an attempt to satisfy the local constituency and the donors, thus

neutralising the impact of the policies, e.g., financial sector reform and expansion of the subsidised

credit programs. Such political contradictions include multi-party democracy and centralised civil

administration, one language policy and acceptance of mother tongue in primary education etc.; the

list can be elongated to any length. Non implementation of policies because there was no intention of implementing them anyway or because it is unimplementable, e.g., pricing policies for major crops

which are unimplementable because of the open border with India, primary education in mother Tongue

etc.

2.The Political Scenario: Before 1990, particularly during the later half of the seventies and the

eighties,in the centralised autocratic system of Panchayati Governance, the bureaucracy had to fulfil the

directive emanating from the palace, no matter how irrational they were. These, however, were fed to

the monarch by the ministers or bureaucrats to advance their own interest, who were quick to pick up

the fads to please the donors.After 1990, crisis of left political ideology has led to a theoretical vacuum

in the left political parties and  move to the right of the main social-democratic party-the NC. NC’s

economic agenda is completely governed by the neo-classical economics as advocated by the major

donors while their socio-political  base is constituted by a combine of progressively impoverishing feudal

middle class, petty-commodity  producers and rising bourgeoisie still with the feudal mentality and

trappings but global aspirations with or without Indian tutelage. Hence the contradictions within the NC,

its declarations and policies and programs. Foreign policy not excluded.

The major leftist political parties UML and ML have been unable to demonstrate how their economic and
political agenda are different from that of NC except in initiating some populist programs. Even their
opposition to the hegemony of the Indian capital disappears while in power. This may be explained in
terms of the fact that they share the same socio-political base as NC and have a similar dependent
mentality as also failure of the communist path of development on the world scale.

This is reflected in the complete inability of the political leaders, both on the left and the right, to make
decisions in vital matters of interest to the people and their contradictory behaviour to what they preach
publicly, leading to the crisis of confidence in the democratic political process itself.

Nepal’s historical dependence on India and dependence of the political parties for their existence on
India for survival during the Panchayat era and current political disarray in the country has given India
free scope to intervene in Nepal’s political and administrative processes to an unprecedented scale and
intensity. At times this interventions impinge on Nepal to an extent not allowed to the Centre even by
the Indian states. Interventions of other foreign, primarily our donors, in the political process is less
transparent but also widespread.

3.Socio-cultural and Political Consequences: Major features that characterises the present

socio-cultural and political scenario may be summarise as:

1. Crisis of old morality, irrelevance of older values of compassion and a fear of god to worship of money

and power, progressive collapse of older institutions of family and community, rising aspirations for

equality with higher ups but without a willingness to accept the same for those below, growth of

individualism without internalising the requisite ethics of hard work and risk so necessary for capitalist development.

2. Crisis of confidence on the leaders, the political institutions and the political parties, and loss of

legitimacy;

3. Dependency on donors for meeting even the minimum resource needs of the state, community

including NGOs, and the private sector (minimum investment needs) leading to donor intervention in all

aspects of policy making as well as the political process.

4. Why it is happening?: Is it a mere consequence of the behaviour of the leadership, the donors and

the people?Why do they behave as they do? Is the situation similar to those in other countries? Are we

unique in this failed development?

While modernisation theories may have no convincing answers to such behavioural problems, an
analysis in the tradition of dialectical materialism rooted in its own history may provide some answers.
Nepal has developed as a dependent economy throughout the last 200 years. Historically this
dependency has been characterised by both import for (Terai agriculture) and export of labour (in the
service of Indo-British capitalism, Regmi 1976), and extractive capital inflows in commodity trading
(Blakie et all, 1980). Moreover historically Nepal had to use one or other of our neighbouring powers,
British or the Chinese for consolidation of its national identity. This has promoted a psychology of
dependency on India for material advancement. When the country opened up in 1950s it tried to take
the opportunity to get out of this dependency on our giant neighbours by inviting other countries to
assist Nepal in its development efforts. Trade diversification was also promoted since early 1960s.
Substantial aid flows have been realised since. Trade has been diversified to certain extent. But it has
intensified our dependency on Indian market as well as Indian capital. Moreover dependency on donors
has increased manifold in recent years encompassing the state, civil society (including press) and the
individuals for ideas, education and investment. There is a real fear of donor withdrawal at all levels and
hence no attempt for endogenization of policies. All national parties cry hoarse about foreign debt
when out of power but proudly announce and sign new debts when in power.

Donors (all multinationals, bi-laterals and INGOs) inspite of their prefaced declaration for Nepal’s
developments are guided by the interest of the globalizing advanced capitalism. This is evident, for
example, in advancing (in the name of SAP) the interest of the Transnational companies inspite of its
harmful or uselessness for the people (e.g. Tobacco companies, useless Drugs and Medicine,
Communication media which are anti-cultural an propagate violence, products like Coca-Cola in the
Nepalese village), coopting the slogan of sustainable development for imposing the pricing mechanism
on the resources of the poor countries (thus putting their use out of the reach of the poor people in the
periphery and semi-periphery) marginalizing the state in the name of globalisation, etc, etc..

5. Ke Garne? What to do?

This is the question all of us ask. The issues involved are complex, but for focussed discussions,
following agenda is suggested.

a) How to deal with the crisis of all morality at personal and institutional levels?

b)What are the institutional reforms that might help?

c)Given the dependent nature of the Nepal’s integration in the world economy, onslaught of globalizing

capital, and ruthless march of individualism at the cost of religion, culture and social value system

general- can we absolve ourselves from this social Darwinism in this age of the greed? Most

professionals, industrialists and educated people in general think we can not, so in their opinion the

best way out is to ride the wave. Accordingly, political leaders are expected.

Ø       To raise above their personal and party interest.

Ø       To introduce in-party democracy and accountability

Ø       Establish a new style of frugality

Ø       Be consistence between preaching and action.

I have no idea whether the present generation of leaders can show such personal sacrifice. They have
too little time to wait for reaping the fruits of such endeavour. Looking at the behaviour so far, whether
they can sacrifice present for their legacy to prosperity is really doubtful. Assuming that the political
leaders show determination to change themselves, some institutional reforms are suggested in following paragraphs.

Agenda for Institutional Reform

a)Political Parties

v. Promoting value based politics; Laying down rules for the relation between the party and the

government;Installing a respect for loyal opposition; Transparency and accountability in party finances;

Honest support for constitutional bodies, not subverting them for personal or party interest.

b)Election Process: Since incumbency in government is sought for misuse of power and authority in

elections,thought may be given to following suggestions.

v A machinery and mechanism for implementing the code of conduct in elections; A non-party

government during three to six months before the election a la Bangladesh; Solution of the citizenship

problem once for all and introduction of Voter Identity card on a war scale; Start of a debate on viability

of a mix of proportional and current system of election.

c)Reducing corruption: A limit on number of minister to 21; Conversion of CCIA to an executing

agency and a system of special courts for investigating complaints of corruption including misuse of

authority

v A system to investigate corruption and misuse of authority in Judiciary; A system for fixation of the

facilities and eolumants of the constitutional bodies as well as for the parliamentarians. End to Afain

Jankri-Afain Boxi

d)Deepening Democracy: Redesign upper House to represent the interest of the disadvantaged

groups  and ethnicity, including women; Introduction of Local-Self Governance in the constitution itself.

vStart of a debate on unitary vs. federal state structure. Practical and enforceable laws for transparency

and accountability of civil society institutions-NGOs, Community groups and the Press. The purpose

of such laws should be to promote civil society institutions in accordance with the principles of

democracy and plural culture and not to control and stifle their activities and spirit in accordance with

the whims of the bureaucrats, party interest and personal aggrandisement or for promoting individuals

in politics.

e) Ways to Enforce Distributive Dimensions Embodied in the Directive Principles of the

Constitution

v National consensus for the Human Values but not politics and programs.

v State can not absolve itself of responsibilities for social development. It is being recognised

progressively that the East Asian countries could accelerate their rate of development not because of non-government intervention but because of government intervention for human development, provision of infrastructure, easy capital to industries, advocacy for market in developed countries, and above all a

tight control on labour movement so as to facilitate FDI. Promotion of stability by political parties by

remaining within a democratic framework.

v Effective consensus to punish the culprits and the corrupt. No change took place in the polity with the

change in regime in 1990. The victimised because quickly a part of the victimisers. Criminals have

become stalwarts of party politics depending on whether they are in opposition or one’s own camp.

Abuse of authority and influence on behalf of criminals and their use in elections must stop outright, no

matter in which party they belong to.

f) Over haul of the whole education system to suit Nepal’s current needs of raising morally

responsible, culturally rooted, socially democratic generation.

Donors : Donors must be defined to include Multilateral, Bilateral and INGOs. INGOs can not form a
part of our civil society, they can only support accepted civil society activities and provide moral
support. Similarly donors should not be running their own programs, no matter how inefficient we are.
This is our country, we have to shape up or perish. Donors should also shape up.

q Corruption is as much a part if the obliqueness in donor operations as much as our own behaviour.

q Multiplicity of donor agenda, approaches and procedures make policy making very difficult in Nepal.

q Globalisation of the Nepalese economy must serve the Nepalese people:

v Generate employment and  income; Improve their living conditions; Employment and income needs of

the poor can not be dispensed in the name of efficiency; Preserve the social solidarity and capacity to

cope with the risk involved in the globalizing economy; Preserve our national identity together with

deepening democracy to include the disadvantaged; Preserve social control over our natural resources,

q Entrance to SAFTA and WTO must serve interest of the people in Nepal and not the globalizing

capital (e.g. the debate at Seattle; donors not willing to tread on India’s interest or their collusion with

Indian capital to the detriment of Nepal’s interest as is happening in the energy sector, opening up our

economy indiscriminately to global capital meaning thereby to Indian capital and labour).

q  INGOs can not replace our civil society either. They should refrain from competing for donor funding

already allocated to Nepal. They should rather support us on in our fight with excesses of Indian and

multinational capital by linking up with such movements in their own country rather than subverting our

own institutions in global capital’s interest.

( Paper presented by the author at a Seminar organised in Kathmandu in October, 1999-Chief editor).

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