ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter

Nepal harnesses politics of inclusion

Political and economic transformation on horizon after years of malaise

Visitors shocked by Kathmandu's squalid urban sprawl, decrepit roads and chaotic traffic may be surprised to hear that Nepal is on the cusp of a major political and economic transformation.

Judging by headlines in the media, Nepal does not seem to have much to show for itself. In the decade after the end of a brutal Maoist insurgency, the country has been mired in chronic instability with 10 prime ministers in 10 years.

The April 2015 earthquakes devastated central Nepal, killing 9,000 people and setting back development. Soon after, a five-month border blockade by India hindered relief supplies, and badly damaged the country's economy.

Nepal had hit rock bottom by then, leaving the Himalayan nation with nowhere to go but up. Indeed, a deeper look suggests things are taking a turn for the better for Nepal's 28 million long-suffering people.

Three of the country's seven provinces held local elections in May, and three more go to the polls on June 28. Elections in the remaining province, bordering India, have been postponed because of a dispute with a local coalition of political parties over amendments to the new constitution.

There was nearly 70% turnout from among 5 million eligible voters in the first phase of polls for mayors and members of municipal and village councils. The same voter numbers are expected for the second phase of Nepal's first local elections in 20 years.

The reason Nepal's capital and the countryside look so disorderly is because there was no grassroots accountability, at a time when national governments were also in disarray following the political transition after the conflict.

Nepal's president, parliamentary speaker and until recently the chief justice were all women. Now, the "feminization" of politics is trickling down in local elections because the new constitution mandates that a woman must fill the role either of town mayor or deputy mayor, and there must be at least one member of the marginalized Dalit caste in local councils.

Given these moves, results from the first phase of local polls show an unprecedented number of women and Dalits elected to local governments. Remote Jumla, one of the most patriarchal and conservative parts of Nepal, elected women social activists from different parties as both mayor and deputy mayor.

The second phase of the election will also bring yet hundreds more women into village, town and city governments. Previous local bodies were administrative units, but this first election under the new constitution gives municipalities and village councils much more power to craft laws and raise revenue.

New hope

The enthusiasm with which people have turned out to vote means Nepalis hold out the hope that decision-making will now be truly decentralized and leaders more accountable. This could allow Nepal to improve on the dramatic strides it has taken in the past two decades in health, education and poverty-reduction.

The other silver lining has been that Nepal exceeded economic targets by achieving 6.95% growth in the last fiscal year -- the highest in 20 years. True, the country was starting from a near-zero growth base in 2015-16, but it does mean that the economy may finally be turning the corner after the earthquake and blockade.

With another expected healthy monsoon, better electricity management, and resumption of trade with India, Nepal is hoping that this growth rate can be sustained to double the GDP in the next decade. For this, the government in Kathmandu will need to expedite the completion of existing infrastructure and invest in new hydropower plants, highways, airports and other infrastructure.

New optimism

Nepal's Harvard-educated former World Bank economist Swarnim Wagle is now at the National Planning Commission in Kathmandu, and was brimming with optimism about Nepal's future in a recent conversation.

"Our priority now is on job-creation [and] economic growth through large investments in energy, connectivity, tourism and agriculture," he told me.

Three large-scale irrigation projects in Nepal's rice-basket in the country's plains are being commissioned this year, and this will be a boon for a country that still depends so much on rain-fed farming. About 1,700 megawatts of electricity is expected to be added to the national grid in the next two years. Two new international airports are under construction and Kathmandu's over-burdened airport is being upgraded.

To be sure, all this needs better governance to implement policy goals. After local elections, Nepal needs to conduct provincial and parliamentary elections before a constitutionally-stipulated January 2018 deadline. Given the fecklessness of the rulers in Kathmandu, holding those elections will be a challenge in the limited timeframe.

Nepal also needs to ensure that its gains in development and poverty reduction translate into economic growth through sustained investment and job creation at home. Nepali workers in India, the Persian Gulf and Malaysia send home more than $6 billion every year, and although this props up the economy it is not plowed back into productive sectors.

Nepal's location between India and China is probably its greatest asset for sourcing investment, trade and tourism. It can also take advantage of the demographic dividend as half the population is under 22.

But perhaps Nepal's strongest point is that it is sorting out its formerly turbulent politics through a new constitution, and once the series of elections during 2017 are concluded, its vibrant, inclusive democracy will push the country's economy forward as well.

Kunda Dixit is the editor and co-publisher of the Nepali Times newspaper in Kathmandu.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends June 30th

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media