Sunday, May 8, 2016

Please-all Policy and Programme lacks teeth

The government today unveiled a 'please all' Policy and Programme for the next fiscal year.
President Bidhya Devi Bhandari presented the government's Policy and Programme at the Parliament – the first since the promulgation of the new Constitution – with 'something for everyone' but it is said to lack the willpower and also structural and institutional capacity for implementation.
Economists and the business fraternity have expressed doubts about the implementation of the 'ambitious' Policy and Programmes, also in view of the short lifespan of the incumbent government coupled with eroding governance capacity, among other things.
The government's policy is populist, according to senior economist Prof Dr Madan Kumar Dahal. He opined that the government should have focused on the next one fiscal year instead of the next decade, which is somewhat populist and impractical. "The policy also lacks specific strategy for accelerating capital budget spending that could fuel economic growth, if indeed the government wants to spur economic growth," he added.
Likewise, another senior economist Prof Dr Bishwhambher Pyakuryal, said the 'ambitious policy' has failed to strike a balance between the incentives it has announced and the present bureaucratic and structural deficiencies. "The policy has something for everyone but no teeth to bite," he added. "It also fails to give continuity to the policies of earlier governments, which could lead to a policy void."
The earlier government had started second generation reform programme and was preparing to amend and bring new laws that could help create investment climate in Nepal. But the Policy and Programme presented by the incumbent government is silent on the second generation reform programme that was supposed to attract more domestic and foreign investment to kick start stalled industralisation and employment generation in the country.
"Though the policy has everything in its contents, the government lacks the basic infrastructure to meet the ambitious targets," said former member of the National Planning Commission (NPC) Dr Chandramani Adhikari. This 'ambitious policy' at a time of political transition could bring more frustration to the people, he said, adding that the government might have come up with a long policy document that includes something for everyone so as to win the confidence of the people as it has failed to deliver so far. "However, due to eroding bureaucratic capability and low political willpower, people will lose confidence in the government."
"There could be therefore more trust deficit between the government and the people," he added.
Adhikari also opined that there is policy ambiguity. The planning commission is coming out with a three-year plan, other institutions have their own periodic plans, and the Policy and Programme speaks of achieving everything in the next five years. "It is going to add more challenge to the government," he said, adding that "going by the historical trend, the implementation part is the most challenging aspect for all successive governments, though they all had something or the other for the people."
Likewise, another challenge is how the budget will help allocate resources on a structural and institutional basis to meet those targets," according to Adhikari. The Policy and Programme has to be supported with resources through the budget to meet the targets. The success or failure of the Policy and Programme will also be gauged by the budget that will either announce qualitative or quantitative projects to support it, he said.
The government is going to announce budget for the next fiscal year on May 28 to support the Policy and Programme presented today at the parliament.
Economist Dr Dilli Raj Khanal seconded Adhikari's views. "The current structural and systemic problems, including bad governance, is a key challenge in implementing the ambitious Policy and Programme," he said, hoping that the budget would bring some clarity how the Policy and Programme is going to be implemented.
Implementation is key as usual, according to president of the Federation of Nepalese Chambers of Commerce and Industries (FNCCI) Pashupati Murarka. 'Though the language is pleasing to the business community, the implementation part is doubtful as usual," he said, adding that the private sector's involvement in infrastructure projects, industrial zones and fines for calling bandhs and strikes is, however, encouraging.
The Policy and Programme has many populist slogans like loans against educational certificates or citizenships, which could mean gross misuse of people's deposits in banks and financial institutions.
Likewise, the Policy and Programme is in itself a 'confusing' document. The Policy claims that the new Constitution will be implemented and it also claims that the local elections will be held in January. The election of local bodies according to the old Constitution is the waste of time and resources, if the government is committed to federalism. The Policy raises serious concern on whether the government is implementing federalism according to new Constitution or back tracking the political course.
Though the Policy paper says that a new era of national independence and dignity, democracy, durable peace, good governance, development and prosperity has begun, the letter and spirit of the document have failed to provide any concrete basis for people to live the change as it has announced the election of the local bodies, according to the old structure.
The government has also reiterated its commitment to the reconstruction of damaged private houses and archeological heritage, to providing energy for all and employment to all, competitive and sustainable industrial development, and to a socialism-oriented economy.
The country has now moved in the direction of prosperity by means of equitable and sustainable economic growth, the Policy reads, but lacks any evidence of that or any programmes to achieve economic growth, except some earful populist slogans.
The Policy has also mentioned that reconstruction work has now been intensified although it took some time to prepare the necessary institutional and legal foundation due to the unfavorable situation created in the country.
The government is going to provide soft loans of Rs. 300,000 without collateral to owners of private houses, under their collective guarantee, it reads, adding that it is in addition to the grants of Rs 200,000 and soft loans of Rs 1.5 million in rural areas and Rs. 2.5 million in Kathmandu Valley, which was announced almost a year ago but not implemented yet.
The Policy also claims that it is going to bring about a self reliance-oriented, multi-interdependent economic system – realising the challenges that excessive dependence on one foreign country in trade, investment and supplies may generate – but in practice the people are still suffering due to the shortage of essential products since last half year.
Similarly, the Policy has greater focus on the agriculture sector and claims that the government will increase investment in agriculture so that the country will basically become self-reliant within two years in major food items and attain food security. However, going by the trends, the country has become more dependent on agricultural imports in recent years, despite successive government promises.
Likewise, the Policy document – that has no sense of accountability – has promised to supply electricity at a basic level within a year and to meet the actual demand within two years through implementation of the National Energy Crisis Reduction and Electricity Development Decade Action Plan- 2072, which is meant to produce an estimated 10,000-MW in a decade. In reality, the country is still reeling under 12 hours of load shedding that has handicapped economic activities and industries have been running in the 50 per cent capacity hitting employment generation, and pushing Nepal to import economy instead of self-reliant economy as claimed by the Policy and Programme. The best part is that mega hydropower projects that could help reduce load shedding hours are not anywhere near to completion within one year, as claimed by the Policy.
Last but not the least, the Policy document reads as if the incumbent coalition government is staying in power for decades, which is going to be purely a election propaganda as the government is going to be changed – according to the 9-point deal between the key stakeholders of the government CPN-UML and UCPN-Maoist – in a month.


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