National The Telegraph - Weekly (Nepal)

N A T I O N A L

Nepali business community falsely accused by one side of favoring other

Mr. Binod Bahadur Shrestha, President FNCCI

Since last year, the world economy on the whole has been improving and our neighboring countries have also been moving rapidly towards development. However, Nepal's journey towards development has been dismal. The national economy along with the entire nation has been caught in a whirlpool of problems. Nepalese entrepreneurs are threatened by the possibility of being faced with even worse conditions.

Today, entrepreneurs from not only the VDCs but also from main cities like Birgunj, Biratnagar and Pokhara, are being kidnapped almost serially. It is unsafe to use even the main highways after the sun set. Business enterprises are prone to theft, robbery and even bomb attacks. The terror of forceful donations has defied all boundaries. So unfortunate is the general environment that while asking for security from the concerned organization, one has to face threats from that organization itself. The ones who have taken up or are trying to take up the responsibility of running the nation have not taken adequate measures to resolve the crisis. This is indeed an unfortunate situation for the citizens and the entire nation.

The internal conflict prevalent in the economic, social and political front for more than half a decade has not been taken care of, which has shaken the development future of our country. While millions of Nepalese have been displaced and, migrated to foreign countries in search of security and employment, thousands have lost their lives inside the country.

Today, it has become a challenge for everyone to rescue our nation and its citizens from this dangerous tornado. Mere one sole organization or one sole individual cannot shoulder this onerous responsibility.

The economy has taken a downturn as a result of the conflict. There is a widespread panic in the society. Even amidst this scenario, entrepreneurs are working tirelessly with determination to carry on their business and provide necessities to the public. This determination has to be taken positively by everyone. I would like to offer my sincere appreciation to all the entrepreneurs for responsibly fulfilling their duties.

FNCCI has been time and again requesting the political parties who have taken or are trying to take up the responsibility of running the nation to forego their petty self-interest and work sincerely towards ending the conflict and giving each Nepali a bright future to look forward to. We consider it unfortunate that the conflict has not been resolved, peace has not been restored, parties are trying to shift the blame to each other, and we have not been able to sit for the talks seriously and to reach an agreement. However, we are ready to extend our help and cooperation whenever required no matter who attempts to resolve the crisis and bring peace back to the nation.

Entrepreneurs are most seriously affected by the conflict. "Bandhs" and transportation halts unfortunately have become the first means to protest anything, which have a direct negative impact on business and industries. Those involved in conflict need resources and for that they target the business community. We have become the victims of both the sides of the conflict. To top that we are also being falsely accused by one side of favoring the other. However, we have not lost our patience and hope even in a situation like this. We are trying our best to conduct our business and minimize the blows of the conflict. We have been providing the basic necessities to the public and coordinating with the civil society to reduce the impact of the conflict.

The present conflict may have numerous reasons and sources and it is not the need of the hour to dig them out and simply blame each other in the process. We can perhaps leave that task for the historians and social experts of the future for judgment. The challenges for the leaders of today are to restore peace and while reducing conflict, develop the Nepalese economy and bring about a significant improvement in the standard of living of the Nepalese people.

Entrepreneurs strongly believe that the present crisis can be resolved through a peaceful process that requires constructive bilateral talks. The existing problem may not have an immediate solution but if both the parties understand each other's expectations and problems in an optimistic manner, it will pave way for the solution. While searching for the solution, the fact of the current geo-political scenario and hard socio-economic facts cannot be overlooked. We feel that forces driven by multi-dimensional expectations of the nation and the general public alone can pave the way for over all development of Nepal.

Nepal's economic and social development is vital for the long-term solution of the problem. The benefits of development have to reach the masses. Ours is a multi-caste, multi-lingual and multi-cultural nation and all the citizens have to feel that this is their country and their betterment is directly associated with the betterment of the country as a whole. It is today's challenge to create a situation wherein no Nepali dies untimely, nobody has to tolerate violence, the culprit has to be punished and those who do well amply rewarded. All of us have to strive for this.

Nepalese entrepreneurs believe in a market economy, multi-party democracy, pluralistic society and constitutional monarchy. We believe that those who stand up for their rights have to respect others' right as well. Paralyzing businesses in the name of protests closely resembles attempting to commit suicide. No matter which party assumes power, it needs a strong and stable economy and it is sustainable economic development that paves way for the political party's future.

Nepal has now become a member of the World Trade Organization. SAFTA and BIMSTEC have already adopted the principle of free market economy. It is a wrong thinking that globalization means everything is determined by the market forces, the Government need not do anything and that entrepreneurs can sit back after producing what the consumers want. Globalization has increased the awareness and expectations level of the society. Others have started watching our working procedures closely and thus a need is felt to improve our conduct and working procedure.

Although a lot of governance issues have been raised, entrepreneurs and the public have not truly felt them. Laws and rules have been formulated but have not been practiced. Decisions are delayed, victims do not receive justice. If quick decision-making process and the legal system of the country are not developed, it is ironic for the governing party claiming to be a supporter and believer of democracy.

The Transparency International has for the first time included Nepal in its Corruption Perception Index - 2004 and it ranks 90th among 146 countries surveyed. Although the survey has categorized Nepal as being comparatively lesser corrupt, it should not be a matter of satisfaction for us. If corruption prevails in a small market with limited purchasing power like ours, it will discourage both domestic and foreign investments in our economy. This will not raise the standard of living of the people and will instill feelings of violence and protest in the youth of the nation.

Improvement in governance does not only mean accountability and transparency in the Governmental working procedure. It also means answerability and transparency in the working procedure of the private sector, political parties, non-governmental organizations and the civil society. With the view of implementing the principle of accountability and transparency, FNCCI has launched a project against anti corruption- FACP (FNCCI Anti Corruption Project) since last year in association with DFID. We believe that the drive against business corruption needs to be enforced in a planned manner. Those who question others' behavior should keep in mind their answerability too.

Our ardent plea to the Government's side is merely not to make the existing business working conditions more difficult. Let the revenue authorities collect revenues as per the provisions laid down in the law. Let there be no harassment while doing honest business.

Recently entrepreneurs have been blacklisted in the name of improving the financial sector and this has posed difficulties in the running of their businesses. We believe that loans taken should be repaid and that loans should not be misused. But it is at the same time necessary to create a conducive environment that makes it easier for financially distressed entrepreneurs to repay their loans. Strict action needs to be taken on those who use the funds for other purposes rather than repaying their loan. Entrepreneurs are not the only ones responsible for the increase in the non-performing assets of banks. This makes us question what the banks and their management were doing when they were supposed to carefully study the business proposals for loan purposes. These questions need to be answered before action to be taken on the defaulters. It is our pointing view that law should be applicable to all and one party cannot be used as a scapegoat.

It is not a crime to run one's business with money taken as loan. Not paying custom duty and excise and other charges is a crime. From our perspective, the consequences of a bad investment should be borne by the private sector as well as the financial institutions. However, to blame only the private sector for a bad investment is simply unjust and lopsided. If this practice continues, a time may come sooner or later when the entrepreneurs may have to close down their entire economic activities.

Nepalese entrepreneurs have been pointing towards the slipping economy, the increasing sickening of industries, declining tourism and mounting business losses. The facts and figures show the increasing dependence of Nepalese economy on remittances from Nepalese working abroad. The temporary nature of a Remittance Economy has been highlighted by the sad incident brought about when 12 Nepalese citizens were ruthlessly killed in Iraq. There cannot be a disagreement in saying that Nepal should make efforts to improve the environment in which Nepalis work abroad and in improving their pay scales. However, Nepal's internal economy should also have a solid foundation.

I have not dealt here much on the problems faced by we the entrepreneurs and the steps that the Government needs to take to solve them. Since we believe that entrepreneurs have to play an important role in solving the nation's problems, we have not passed on the burden of entrepreneurs' problems to the government. We wish and pray that nation be put first, followed by parties, groups and individuals.