Nepal Budget: A Few Numbers and Maoist Disagreement

Maoist cadre listening to the budget speech

Keshav Pradhan aka COMRADE BISHWASH, a party worker of CPN (Maoist) listens to the live bradcast of the budget speech at Maoists Dialogue Secretariat at Baneshwar on Wednesday. Finance Minister Dr. Ram Sharan Mahat presented Rs. 143.91 billion for the annual budget for the fiscal year 2006/07 in the parliament in four years after the House was reinstated in April. In previous years, in the absence of a people’s representative body, various governments including the royal cabinet had announced the annual budget through ordinances. . Pic by Bikas Rauniar via Kantipur

Total Budget: Rs 143.91 billion. (Rs 83.76 billion for regular expenditure, Rs 44.97 billion for capital investment and Rs 15.168 for payment of principal amounts of loans.)

Budget aims to raise Rs 85.37 billion from internal revenue, Rs 23.72 billion from foreign grants and Rs 16.90 billion from foreign loans. The deficit budget for the year 2006/07 stands at Rs 22.451 billion.

The government has also increased the annual budget granted to VDCs from Rs. 500,000 to Rs. 1 million.

The Talk of CA

Rs. 1.25 billion to conduct the constituent assembly elections, scheduled to be held by mid-April next year.

Addressing the House, Minister Mahat said that the dialogue between government of Nepal and Nepal Communist Party (Maoist) has commenced to end all forms of conflict prevalent in the country. “The need of the hour is to make institutional arrangement for constitution, policy and structure through national consensus so that Nepali peoples’ rights are never compromised. Therefore, the present government, in accordance with the House of Representatives’ historic Declaration and the consensus reached with Nepal Communist Party (Maoist), is fully determined to expedite the process of formulating interim constitution, managing weapons and forming interim government through the election of Constituent Assembly in an atmosphere free of violence and fear.”

Palace expenditure slashed by 45 pc

In the current fiscal year (2005/06), a total of Rs. 749.1 million was released to the Royal Palace. Of this amount, Rs.405 million was initially allocated in the different headings of the budget and additional Rs. 344.1 million was released during the year. A total of Rs. 219.7 million has been allocated to the Royal Palace for the next fiscal year (2006/07).

This allocation is lower by 70.7 per cent of the total expenditure and lower by 45.8 per cent of the initial allocation.

Budget Highlights

*Nearly Rs. 8 billion for road construction

* Rs.3.96 billion for agricultural development

*Rs. 100 million for women empowerment programmes

* Rs. 920 million for judicial administration

*Monthly allowances for elderly and helpless people increased from Rs. 175 to Rs. 200; widows increased from Rs. 125 to Rs. 150 and for women widowed due to conflict from Rs 125 to Rs 200

*10% dearness allowance to civil servants

*Rs. 1.1 billion for the reconstruction of the destroyed physical structures in the conflict and assistance to the families of those killed in the conflict

*Rs. 1.25 billion allocated to the Poverty Alleviation Fund to implement 667 income generating programmes, 379 community infrastructure development programmes, and 1,714 creative programmes in 1200 VDCs

*Rs 4 billion for expansion of irrigation facility and for control of water-induced disasters

*Rs 1.76 billion for programmes under rural electrification scheme

*VAT exemption for machinery, tools and construction materials used for micro hydropower projects and small hydropower projects up to 3 MW capacity

*Policy on bio-protection to be issued by mid-April 2007

*Restriction imposed on women willing to go for foreign employment as household workers lifted

This budget news report was originally prepared by reporters at eKantipur.

Maoists unhappy over budget presentation

Maoist leader Dev Gurung, who is also a member of the Maoist talks team, told eKantipur that his party would not accept the budget as it was being announced without any consultation with the rebel party.

“This budget is being presented without any consultation with us. There is no question of we agreeing with such a budget,” said Gurung, adding, “The budget presentation violates the eight-point SPA-Maoist agreement.”

Claiming that an interim government including the Maoists should have announced the budget, Gurung said it would be difficult to implement the budget programmes as it was being brought without political settlement. “You first need to settle the political issues to effectively implement the programmes mentioned in the budget,” he said.

Gurung also said that he did not expect the budget to be pro-people and as per the aspirations of the April movement. “I don’t think the budget will bring about any structural transformation. There may be some increase or reduction in certain things but, in essence, the budget is most likely to give continuity to the same old traditions.”

“They are saying this budget will have the palace expenditure reduced and the king’s income taxed but I don’t think this will be effectively implemented,” said Gurung, “Taxing the king’s income is not a big deal. The government should be able to nationalise late Birendra’s property.”

He also said budget presentation was “a side issue” in the present situation. “Programmes and policies, budget- these are side issues. If the government continues to engage in side issues ignoring the main political issue, it may ultimately affect the dialogue process,” he said.

UWB: eKantipur has more coverage on budget. Here is the finance ministry page for the full text of the budget.

Published by UWB

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67 thoughts on “Nepal Budget: A Few Numbers and Maoist Disagreement

  1. ________________________________________________
    “*10% dearness allowance to civil servants”
    ________________________________________________

    dearness– is this word originally published by Gov in budget report or just churned by the reporter? Anyways, what does it mean?

    is it people with nearness equals dearness?

    out of all the people who gets raise? ‘Civil Servants’. in my opinion they should be the last one to get raise–totally incompetent and mediocre bunch. period.

  2. Seeing the context in which it is used I believe it means a cost of living increase due to prices of everything going up.

  3. Bideshi
    Thank you for the clarification on ‘dearness’. English is a funny language and when non-english use it, it even becomes funnier.

    like Amita Bacchan in Namak Halal.

    cioa

  4. -this budget is just tinkering of past budgets. you dont have to know economics to add 5% and decrease 5%
    -maoists are unhappy with everything. the only thing that makes them happy is their gun so that they can continue their jungle raj
    -nobody seems to notice the whopping rise of government officer salaries and the financial burden of security + further financial burden for disarmament/ mainstreaming of maoists

  5. I am amazed how all communists have one language.When Mahesh acharya presented budget after 2046 jana aandolan,bharat mohan adhikari said “yo budget janamukhi bhayena”.Now after one and half decade,amik serchan says the same dialogue “Yo budjget janamukhi bhayena”.Talk in economic terms stupid.
    By the way his presence as a duplicate V.P.M is of course as a ‘sulsule’ of maoists so no wonder he is trying to please them.i guess it will come down very harsh with his own party workers who have suffered a lot from maoists!!

  6. it is futile to criticise the budget in vague ways.
    let every party in the government and maoist issue a white paper budget , had they been allowed to do so.

    birodh ko lagi birodh nai garnu parcha bhanney kehi chaina.
    kam sey kam sabai ley afno afno dam ma birodh garnu siknu paryo.
    haina ta mitra haru ???

  7. Maoist are the bunch of unhappy ppl. They are never happy and always hungry for power grab, for them life has no value.. and they are still rebels. When I say rebel I mean:

    The rebels like to think of themself as “independent:. They have in face merely adopted a knee-jerk reaction to whatever “law” is set before them. They are prime candidates for reverse psychology. They conform the nonconformity… if you havent thought “The best way to keep children from putting stone in theirs ears is to tell them they must put beabs in their ears”

    Their

    SLOGAN: “Authority, you tell us that we’re no good. Well, authority, you’re no good.”

    MOTTO: “………. and the donkey you came in on!”

    don’t forget “If the ones who tell you you’re no good are no good, then, somehow, that makes you good. Somehow.

  8. This budget can be described as a hodge podge budget, spread too thin trying to satisfy everybody who could create civil unrest. It is populist, and like any populist budget it will not do much for the economy. Again the entire responsibility of economic progress is on the shoulders of the private sector with little support from the government. Typical for Nepal.
    It relies far too heavily on donations, so there is no thought gone into it. If the FM was going to come up with a social welfare budget as opposed to an economic budget, then he should have consulted the maoists.
    Someone mentioned the allowance for civil servants – it’s really again a pampering device. Last year the royal government had also increased the civil servants salaries by over 10%. If I’m not mistaken it was closer to 20%!!! I think more than chumming up to the civil servants, a warning should have been sent to them regarding the execution of their duties with efficiency and honesty. In this same light,this was also a time where the review of civil servants was required with allocation for women and deprived groups.
    I always thought Mahat had very little imagination, and my presumptions have been realised.

  9. 10% Mahangee Bhatta for Civil servants. Civil servants or civil masters? For general public they are Civil Masters. May be Mr. Mahat is confused them with member of Civi Society. Thats why he wanted to please them by 10% extra.

  10. Though the budget couldn’t be as good as anticipated, it has many good sides…. The budget looks lke ambitious. The maoist would point out hurdles and try to make it nightmare for government to implement giving many void reasons. They want everything to nationalise which is not practical in today’s compititive world. Development budget (If environemnt allows to do fair) looks good and amount to be given to VDCs is good point. They will develop their own land. This budget has been pro-rural one. It could have been much better, but we need to appriciate the outcome. Karnali region is focused and share of educaton, health, raods etc is also looks yummy. Further more, agriculture gets protected which is good and local products are also protocted. So instead of pointing out mistakes, lets unite together to make it suceess adn nepal developed country.

  11. The way for Nepal to go is to privatise as many industries as possible. Anything the government touches dies a slow painful death-RNAC is a good example, NOC is a fantastic example-even in a monoploy they are losing money. Besides opportunities for corrpution and nepotism would be drastically reduced if most industries were privatised. Govt. should restrict it’s work to policy formulation and not run any companies/organisations.

    As regards taxation everyone knows that the tax laws are really screwed up. Tax laws should be simplified and a low flat tax should be implemented with focus on proper tax collection.

    Nepal has very few competitive advantages in manufacturing vis-a-vis India and China hence imposing large taxes on imports to protect domestic industries is protectionism at it’s most idiotic. Only Nepalis will suffer from such a move. Instead Nepal should move towards promoting trade by lowering taxes to a minimum and if they sufficiently reduce taxes on import of raw materials for manufacturing and capital equipment required for manufacturing hey we may even be competitive in manufacturing certain types of goods for export. However foreign capital is needed and clear laws must be established to protect foreign investors.

    Nepal’s only hope in short is very free market economics-should minimize corruption leading to better revenue collection.

    Ofcourse certain laws to protect the workers must also be established. Rampant captialism also has it’s negatives.

  12. well,

    at least there is a budget in the last four years and the government is doing at least the minimum. these guys seem to be working and trying at least though aspirations are high.

    guess we nepalese have not learnt to give credit and to praise.

  13. It is continues budgest with some changes only. It cannot address the situation what people are demanding drastic changes like government commitment toward basic livings and job opportunities. It will increase the burden of loan to each people due to maximum expectation of outer sources. That is why maoist are not happy.We also feel that mixed economy is very essential for country like ours instead of open economy. The survival of the industries will not be there in the free market economy due to unable to competen the two giant neighbours which having low scale rate and following mixed economy.

  14. The Maoists have refused to demobilise and decommission their armed elements while the Finance Minister has for all practical purposes started the demobilisation of the NA. The SPA cannot even use the NA as a bargaining factor in their negotiations with the Maoists. What foolish people!

  15. Because SPA always looked R(NA) as their enemy without developing alternative choice. Now the great grumbling is going internall in NA due to Mahat’s budget. NA are upset about their promotion and existance. Due lack of controlling factor revolt can be possible. If the SPA make drama like this both NA and PLA might revolt the government (probability only).

  16. Protectionism in any form is futile. If you’re worried that local industries cannot compete with Indian and Chinese Industries, then these Industries should either become competitive or close down. What is the use of protecting industries that produce goods that cannot compete in the regional market in terms of price and quality? Why should consumers pay higher prices for lower quality goods?
    I think Nepal and it’s industries should concentrate on items where we can not only compete but beat the region in terms of quality and prices. Without businesses investing in their quality through new technology, research, human resources etc., we will never be competitive in the long run. There are sectors like banking and tourism where we can if we try give anyone in the world a run for their money. And of course, hydro power is right in front of our noses, this is a god given gift, we don’t even have to compete that much to supply this essential service (think Delhi powercuts – imagine it’s the capital of a nation with massive economic growth!).
    The government should concentrate on proper and corrupt free administration and delivery of goods and services to it’s people and have taxation levels that are reasonable. Leave the business side of matters to the private sector please.

  17. If guys can for once be truthful the (R)NA has never liked the transition of Nepal to democracy. They have always stayed loyal to the Palace. If the (R)NA had been more professional and had followed the orders of the Parliament the Maoists would not have become such a big problem. Remember Holleri? Remember (R)NA’s betryal again in Doramba?

    Look before you guys jump your guns I am not calling for a disbanding of the (R)NA. All I am saying is that the (R)NA must be brought under the control of the Parliament and it must be made into a professional army so that they can deal with the Maoist threat-if the need arises once again to engage with them militarily-effectively. No butchering of innocents, no torture and no barracks being so embarrassingly overrun by the rebels. For this a reform of the (R)NA is necessary. Face the truth guys instead of sticking to your selfish view points.

  18. st,

    the sound of free and market driven economy looks like miracle to us looking at the international propoganda, but still I insist for mixed economy at present. No developed countries are actually adopting the free economy. They are protecting their potential industries in the name of custom and others. For example India and China still have high custom duty for finished goods like paper, sugar and many of the products which are directly linked with their job-opportunities. If they make similar custom in the case like paper, all their paper industries will be collapsed, so they prefer to buy pulp at low rate and keeping custom duty for finished paper products rate of 60%. This is the one case only but there are many.

    Yes, private sector involvement is neccessary. Illegal trade needs to be controlled and bribery and corruption needs to be checked very effectively. How long our country can sustain with large amount of balance of trade deficit until and unless another options are identified. This make our country more dependent to international communities.

  19. Before we jump the gun here I think Nepal’s single most important reform agenda should be land/agarian reform. Currently 80% of Nepal’s population is dependent on agriculture. Yet we are not self-sufficient in the production of rice and wheat. Our markets are flooded by Indian products (which by the way are subsidized).
    Now st, please don’t give some neo-liberal economic BS about comparitive advantage here. The fact of the matter remains that the majority of our people live there and we need to work towards improving their lives so that our future demographic makeup will be less dependant on agriculture.
    The government’s key proirity should be to increase/improve rural infrastruture, perhaps some kind of subsidies etc. to farmers.
    The government should really try and direct donor assistance to these areas.

  20. And I could not agree more with fanta. Just see how much agriculture is subsidized in Europe and America.

  21. Bhudai, our govt. can’t afford subsidies. Don’t forget that. Modernizing agriculture is one thing subsidies that we can’t afford is another.

  22. it’s feels mighty good to see nepali youth debating on various issues, not just debating but with gumption and oomph and yes with shit load knowledge and wisdom (no pun intended).

    being right and wrong is not the point, but what’s important is everyone seems to have opinion and independent thoughts and that’s the need of the hour– a thinking mass.

    i personally think of UWB as an epitome of ‘yellow journalism’ but that’s beside the point, credit should be given where it is due, UWB has created a forum where you can render your thoughts (stupid or intelligent) and have other discuss with the same spirit.

    So kudos to all the nepali youths and happy to see them engage in fine art of polemic.

    Note: since i am not trained in economics, i don’t have anything to say.

  23. Yahoo:
    That’s about the only thing good about UWB. The discussion forum is very easy to navigate condusive to discussion. The articles, with one or two exceptions, are crap and we all know where Wagle can shove his moderation feature.

    Kirat:
    Perhaps subsidies might not be the best solution but I think there should be some protection. Otherwise I don’t see how to urbanize 80% of our population…
    Either way rural insfrstuture must be on the top on the agenda. Education should be next. 46% passed the SLC – that is pathetic. Consider that is not even high school…

  24. Bhudai, sure agriculture is important. It needs ot be modernisef and focus must be put on crops that give better yield in terms of good markets for it. Take tea for example. Dabur Nepal was doing good work before the Maoists made it impossible for them to continue.

  25. Fanta,

    The problem with you comparing large economies like the US and even India and China to ours is just that. US is the world economic leader and India and China are large and ever growing economy, they can afford to subsidise and keep pressure off from other nations. This is a war of the large nations. India tells the US to drop subsidies then they will follow suite, then the US tells India likewise. Unfortunately, we cannot afford to play these subsidy games either in economic terms or in political terms with respect to other nations. We are neither a developed country nor are we powerful in any sense of the word, except the power of our people to work hard towards progress. Let’s not talk high level politics and economics of subsidies vis a vis other developed power houses when we are spreading out our arms in pursuit of aid. The only way for us is a free market, where the bulk of our population should be involved in service industries where we can have our comparative advantage over other nations, which includes hydropower.
    You may call it “international propoganda”, but unfortunately this is the “propoganda” that has proven most successful compared to all other “propoganda”. And even more unfortunately, our market is this very international arena that you speak of. Call it what you may, but I call it practical.

  26. Pundit,

    It astonishes me how people like you fail to think out of the box. The difference between you and me is you work with the given set of parameters like saying 80% of the population is dependent on agriculture, while people like me think – let’s make 80% of the people dependent and prosperous on other areas of income generation. Please note that out of the 80% as you state dependednt on agriculture, you also include a large proportion who farm to feed themselves and their family, that is all. By this token all of us are dependent on agriculture whether locally or otherwise because we have got to eat. These people do not farm to sell their products and create a better life for themselves. They are subsistence farmers.
    What I propose is that we do not need 80% of our population involved in farming, we need an agricultural sector where less of the population are involved and the productivity is higher thorugh introduction of coorperatives and new technology, and the current bulk of the farmers have to be involved in sectors where they progress in terms of personal wealth.
    And here is where my “neo-liberal economic BS about comparitive advantage” (as you put it) comes in.
    By the way what is “neo-liberal economics”? I only refer to two kinds of economics with respect to the economy in question – the one that works and the one that does not.

  27. One way to look at the current debate is whether we should be food-independent (no imports)… We have porous borders and if we grow large amounts and India does not, then food is smuggled out with a view to make higher profits…If India does have good crop, then our agriculture produce cannot compete because Indian food grain becomes dirt cheap due to economies of scale…The choice is between devil and the deep sea…One way, perhaps, is value-addition in agriculture produce such as production of ready-to-eat products for exports

  28. Food dependent? Do you know we have so little arable land? That’s the kind of thinking that will drag you back to the old ages. st is right on free market economics. We are sitting between two of the biggest economies of the world who produce the cheapest goods in the world. Protecting our markets will be a waste of time. We have to look at the Hong Kong, Singapore models and see how we can adapt them to our country. India and China still have large taxes and tariffs on imports but for Nepal they have special waivers we should take advantage of this. FDI is essential for this though.

  29. Take tea for example. We could produce high quality tea, brand it properly and export to China/India-two of the biggest tea markets in the world. Sounds easy talking about it but it can be done. There’s apples and oranges, himalayan herbs etc too. Tourism if a big, big prospect. I am sure in certain manufacturing and packaging industries we could have a competitive advantage if the duties on imports of raw materials were reduced.

  30. 80% of population on agriculture, thats a huge waste of nation’s human resource, what percent of land these guys plough on.

  31. st:
    its very nice and all to say the rest of the population should be involved in other progressive areas. But tell me where to put these people? 80% are also living in rural areas! how are you going to realistically create employment and utilize manpower? Give me some concrete ideas.

  32. FDI? Who is going to invest in Nepal? Previous investors are leaving the country by hordes and you are talking about new ones? Even existing businessmen have shut down shops. FDI does not come without political stability and that’s exactly what we do not have.

    As for amount of arable land that’s about 16.07% of Nepal’s land (or 22,658 sq. km. out of 141,000 sq. km.) which is about size of Israel. By the way, Israel has only 15% of arable land. However, Israel is one of the leading exporters of vegetables and fruits. If Israel can do it with so less land, why cannot we?

    There has been hue and cry about free market economics because of the ills it brings world over with protests turning violent and ugly. I don’t think those millions were stupid to protest if it is that wonderful to cure all the malaise of the economy. Thus, without strong domestic economy whatever market economics we follow is useless. And when “agriculture is the mainstay of the economy, providing a livelihood for three-fourths of the population and accounting for 38% of GDP”, focusing on agriculture by diversifying the product set looks like a key. Bhudai rightly pointed out what to do with 80% rural population who are by large employed in agriculture sector. Just by saying employ them in other sectors is not feasible because they do not have requisite skill-set or education to undertake activities in other areas. And to impart skill-set and develop human resource is lengthy process as well as time-consuming. Hence, it is better to focus on something they already know and build on that area.

  33. we need to change our ways. we need to learn new skills. if we are to stick to our old ways then we will remain as poor.

    we are talking about a new nepal that will be politically stable. otherwise we wouldn’t be talking about this issue at all.

  34. Shaman:

    You articulated what I was trying to say very well. You see its all nice and dandy to sit around and “think outside the box” but these rogue thinkers seem to kick practicality out the window. They regurgitate a few slick sentences from an economics text book but fail to consider Nepal’s reality.

    No one is saying the government should completly subsidies agriculture. I agree Kirat that’s a bad idea and we defiently cannot afford it. But I firmly believe the government’s number one agenda should be rural development. And I think we have alot of agricultural potential. Like Kirat there is tea, fruits and natural herbs! It saddens me that we are not even self-sufficient in the production of rice.

  35. Pundit,

    Here is a list:

    Short/medium term:

    1. Hydro power projects.

    2. Electric railway project, beginning with the link up of China, Kathmandu, Birgunj and India.

    The above two projects will employ lakhs and lakhs and will take up to a decade to complete. While this is happening in the short/medium term, we should invest in rural vocational education and general education.
    At the same time creating cooperative farms, whereby the farmers do not lose out on their income but have the time to do other income generating activities. Their farms are merged together so that it becomes less labour intensive and more productive, along with the introduction of high yield crops.

    Long term:
    In the long term we will end up with a multi- skilled work force, where they can work in the completed hydro projects, railways, and our tourism industry. Our tourism potential has not at all been fully realised, the potential for new job creation especially at the lower and middle levels is immense.
    Further, since we will be concentrating on multi skill devlopments our work force will also be desirable for higher paying jobs abroad.

    When we have set up our infrastructure (hydro, railways, roads) we will be really well set to be a service related economy and a transit economy between China and India. Imagine all the jobs created when goods are moved through Nepal into India and vice versa.

    We will need more people for jobs in hydro, railways, transport, ware houses, customs, hotels and travel agencies, infrastrucrure maintenance, banks, this will also benefit the demand for the small cottage industries. Thereby, also increasing consumption through increased purchasing power. Boost the economy here, the ripple effect will reach all other sectors.
    And let us not forget the mightiest of all- Entrepreneurship. A boost to the economy in this scale will encourage creative minds, and who knows where their thoughts and actions can lead us? Anyone heard of Bill Gates?

    The obvious question is resources:

    First we need the master of all resources, the will to do it. The financing will not be a problem if the government shows commitment towards these projects with the least amount of red tape and politcisation. Many investors are actually itching to invest in large hydro projects, hotels and banks and would link it to invest in infrastructure as well, but their only qualm is not that the projects won’t be viable, but the politics in our country is volatile. Solve the political riddle,have sensible tax structuring, less red tape and investment will flow in.
    If this can be achieved who knows what else?

  36. Pundit,

    One question? Who says we are not self sufficient in the production of rice? People like you see only black and white – no grey areas and no colour at all.

    We are very much self sufficient in rice. The problem is the quality of our rice is very good, so much of it is exported and we end up importing lower quality of rice for our consumption from other nations. I’m sure you had no idea regarding this.

    By the way my reply to your earlier question is awaiting moderation.

  37. Pundit,

    Sorry to address everything to you, but it is exactly people like you that is an enigma. You contribute to the dumbing down of a nation. We are a country with so much potential and so much creativity, the obstacles to these are people who are in power who think exactly like you.

    I am sure it will surprise you that there are investors who get perplexed that Nepal asks for so much tied aid, when there are private investors who are willing to invest billions of dollars into our economy. Yes billions of dollars!!!! Fix our politics, fix our regressive way of thinking at the top, the money is not a problem. Even a medium size (for India that is) private Indian investor told me that he has 400 crores of rupees (100 million dollars!) that he would love to invest in Nepal, but the politics is too volatile. Investors are looking for good returns, and the best returns are there in new open economies. Open ours, we will be selecting the investors.

  38. The key that opens the first door for economic recovery which everyone will agree to is – political stability.

    But to keep on having a mind set and saying most of our people are in agriculture and where to place them etc. is a static way of thinking. Skill training etc. are required. I don’t think anybody is talking about taking a huge percentage of farmers tomorrow and placing them in jobs created that they have no idea about overnight. Time ladies and gentlemen is also a factor, but more importantly it is time to begin all these economic revival and skill generation processes.

    Just by sitting back and saying but our people do not have the skills, but we don’t have the infrastructure, but we don’t have this that and the other is not going to deliver these essentials just by wishing for it. We have to start the process which will take time, but the longer we wait the more time it will take and we cannot afford to sit still and play around with the current set of norms which have proved to be fruitless and a complete failure. It is time to change these norms within a reasonable time frame.

    When Premier Deng of China visited Singapore in the late 70’s, PM Lee told the premier who was so impressed by what Singapore had become, that if a bunch of farmers from the coasts of the mainland could come to Singapore and make it so, why was it difficult for the people from the centre who are the great thinkers, artists, poets, craftsmen and intellectuals of the nation?

    Heeding these words and clearly impressed with Singapore which was previously thought of by the Chinese govt. as imperialistic, Premier Deng cast his outdated Mao thinking aside and adapted a policy that was to shape China as we know it today.

  39. “Emancipate yourselves from mental slavery none but ourselves can free our mind” -Bob Marley

    The only people stopping us from making progress is our own regressive thinking.

  40. st
    it amazes me how people like you – with all your walking in the couds, ambigious fluff can go around and think you know it all. I really don’t understand where all this arrogance is coming from. You can get excited and wet your pants but just don’t get too carried away and shit yourself just yet.

    We have heard the whole Nepal can being a center for India China trade story. In fact Gyanendra himself gave a long speech in Doha about Nepal being a financial center like Switzerland. Frankly, Nepal being a transit country has many problems and flaws which has recently been pointed out by many analysts.
    If you look at the map and consider that China’s main production center is in the eastern region, it makes little sense to build a railway through Tibet and Nepal into India. Why the hell won’t China build a railway system through the Assam region dirctly into India? It’s a great idea for the Indians because it gives them an opportunity for development in Assam and its a lot cheaper for both countries. Take a long hard look at an atlas before you start oozing foam from your mouth!
    Let’s not even get into the enviromental damages, problems that comes with migrant workers etc.

    I agree that the development of hydro power is also very important for our energy needs but this whole thing about beign an exporter of energy to India is unpredictible. The investments are so huge and plus India is trying develop nuclear energy. There needs to be much more analysis before jumping the gun here.

    Yes our potential is really tourism – religious, eco, casinos etc. That’s where we have to really develop our potential. Also I think we could also develop our financial/banking sector. Many Indians would invest their money outside (for tax evasion purposes etc.)
    But simutantously we need to develop our rural insfrustuture. That’s where the heart Nepal lies and to ignore that because it is not hip or outside the box would be just foolish

  41. Pundit,

    It is no use trying to convince you of anything. It is like Mr. Mahat trying to convince Deb Gurung.

    But since you bring up the railway issue, let me fill you in with a few fine prints. Why it is more beneficial for China and India to work through Nepal and not directly accross Assam or Sikkim from the North East of India?

    Well pundit, besides just drawing a few lines across borders and saying yes this is where we will place the transit point, there are three factors which you seem to have overlooked which comes into play –

    1. Geographical and environmental reason – Our transit point via the proposed route is open for business 12 months a year, the route in Sikkim which is open for business is only functional for 3-4 months, and the proposed by you routes in Assam face the same problem (they caanot be open for more than a couple of months due to environmental factors) not to mention the difficulty in building the transit point in the first place.

    2. Political and Strategical – India and China have always been nervous regarding allowing direct access although they have decided to open up, it is no secret that preferably they would want to move their goods via a buffer zone like Nepal.

    3. Growth – With the expected volume in trade in a decade and more rising frantically, a couple of transit points will not nearly be enough to cater to the trade between the two giants. Think ahead Pundit.

    Hydropower, ask the experts – all this argument of expense blah blah is negligible compared to the income for the nation and the source of power to power our economy as well. It’s not only about exporting the power, it is also about providing energy in the country for progress given the price of oil. We cannot run an economy with candles and hot air.
    As for India and their nuclear power, I guess I will again have to point out to you, that even if it is approved for them, the proposed nuclear plants will only fulfill 1% of their nations demand.
    Pundit, I had to resort to insults earlier because you did it to me. But, I hope for you common sense is a better tool than insults.
    Also, I again stress – think out of the box, plan ahead, and definitely read the fine print.

  42. And oh yes Pundit,
    I see you agree to the other “little things” I had mentioned. I had also mentioned infrastructure, and this can only be developed well if you allow the hydro projects in, as all the potential areas are located in these same rural areas you keep talking about.

  43. Well st,few months back Ashutosh Tiwari,who writes on business issues in Nepalitimes wrote that China is more keen to open Nathu La,the old trading route to India than make Nepal a transit.And he proved to be right.

    The argument is simple.If there is a route to export ur goods through ur own country why would u want to use another country? Secondly the volatile political senario makes any such big strategic plans almost impossible.We also are only in the planning phase of the necessary infrastructure.

    As we see our side of the story and say that Oh ya we sure can benifit from being a transit point,India and china would ofcourse think from their sides and would want to avoid our narrow highways which of course was consistently being blocked by the maoists until few months back.I read today that now madhesis have threatened to block it.

    Right now its futile to actually think that the transit point theory holds any water.With opening of the Nathu La thru sikkim,this dream has ended for us rather painfully.

  44. Well Mr. Parewa,

    More so than Mr. Tiwari, Mr. Lama who is an economist from Sikkim and an advisor to their government has been successfully pressing the opening of Nathu La pass. It has been reopened after 30 years I think. But like I mentioned this pass is only functional for 3-4 months in a year due to natural factors. Ours is functional for 12 months. Nathu La and ours both do not have railway links, and therefore my suggestion that we should be the first to link ours with a railway link. I think Dr. Lohani, wrote about this just a couple of days back, but this idea has been around since the 70’s believe or not!
    Further, I don’t know if you went through my entire comments, Nathu La and even our transit point will not be enough to handle the volumes of trade that will be coming through in the years to come, when both these large economies will increase their bilateral trade volumes.
    India and China need many more trading points along their borders. We should be planning ahead. Please go through my earlier comments as I have adressed all these concerns with a variety of reasons.

  45. Parewa,

    Yes the one thing you are correct about is the political (in)stability of Nepal. It seems all this is in the hands now of the maoists and the government. We can only make suggestions and hope things stabilise here. Without it it’s pointless planning on prosperity, and we rather change the topic to crisis management, humanitarian relief work and just plain old survival. I think people who have given suggestions here for a prosperous New Nepal, all hope that political stability will prevail. This is stating the obvious.

  46. I think ur point is pertinent but it will only hold if we can plan ahead and enable our transportation infrastructure but IFs and BUTs are really big issues in our country.Hope things move quickly.
    But there is one more glitch,that is India,why would India want us to benifit when one of its states is staring at a bright future.When the two giants are trying to mend their relationships i guess both would like to pad eachother do business without involving a third party,that being us.
    The only hope that i can forsee is if Indians fear for their security from China then they would want to close down the Nathu La pass,actually it was the sole reason why it was closed till now.Since the chance for this looks remote.We being the benefactor of business between the two giants too looks bleak to me.Please correct me if i am wrong.

  47. Exactly,all our hopes of a New prosperous nation rests on political stability.Maoists have a great responsiblity and with it a historic oppertunity to drive us to it.Hope we would be able to realise our dream of a prosperous peaceful nation very soon.

  48. Parewa,

    I have no idea what the hidden intentions of the Indian government is. All I know is what they have said, and what they say is very positive towards our country.

    All I can add is that I believe it is beneficial for both China and India to have all nations within the region sharing in their prosperity. Correct me if I am wrong.

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