Government downplaying private sector's role

The Policy and Programme presented by President Dr Ram Baran Yadav in the Parliament today has limited the role of private sector, in a major policy shift.
“Private sector will be a vehicle of economic growth," the Policy paper read, without elaborating it.However, the Policy paper said that Cooperative will contribute in generating employment and boost production.
Envisioned in Three-Year Interim Plan, the three-Pillar Economic Model -- a major policy shift from the country's liberal economic policy adopted after 1990 movement -- Cooperative, Private Sector and Government have been envisioned as the three pillars of economy.
The private sector is also confused by the government's Policy paper. “Government should clarify how it is taking private sector," Federation of Nepalese Chambers of Commerce and Industry president Suraj Vaidya, said, adding that downplaying the role of private sector will not help investment friendly environment in the country.
According to the Policy paper, said the government will play a role of regulator and invest on basic infrastructure. But government's regulatory role has also been under question due to lack of governance and policy stability in recent years.
On one hand the government's regulatory role has come under scrutiny due to its ineffectiveness in addressing current financial woes, on the other limiting role of private sector and promoting cooperatives – a grossly unregulated sector that has drained banks and financial institutions and invested on unproductive sectors like plotting of lands – at an equal footing to private sector will be a major policy flaw, according to the private sector players – the largest employment generator.
"Cooperatives can play more effective role in community development rather than generating employment and increasing production," said Constituent Assembly member and industrialist Rajendra Khetan.
Agreed former finance minister Dr Ram Sharan Mahat. "Cooperatives can be effective in increasing production in certain sectors only like agriculture especially commercial crops but it could not generate employment equal to the private sector," he added.
“The government is a confused lot and is taking market distorting decisions leading to loss of confidence of people," Mahat said, adding that private sector that has around 90 per cent of contribution to gross domestic product (GDP) has been compared with cooperative that has less than one per cent contribution to the GDP.
The government is a prisoner of its own ideological baggage, according to Mahat.