The economic growth of any country is neither achieved by chance nor is it a thunder-struck miracle. In fact it’s a combination of many contributing factors-both economic and socio-political. In a country like Nepal, where political uncertainty is nagging for decades, institutional set ups responsible for overall development are gradually being rendered dysfunctional. When government legitimacy comes under serious interrogation mark, economic growth hardly becomes a national agenda.
The current state of Nepali economy fits into exact definition of stagflation -- the stagnated growth and uncontained inflation. Average year-on-year growth rate of the economy for the last whole decade beginning 2002 (when growth rate, computed as Gross Domestic Product (GDP) had dipped to negative territory) has hardly crossed 3.5 percent mark.
Poor growth rate is not the only worst part of it, but even the lack of meaningful debate on the constraints and remedies is making the situation worst. But the inflation even in official figures is invariably in double digits.
If not from the government, tangible initiatives to this end had to come from the private sector. But nothing of that sort happened in the recent past. To fill this gap, the New Business Age (NBA) Pvt. Ltd from this year on, in partnership with some leading business entities of the nation, has taken a maiden initiative to take the growth debate to the centre stage of national economic policy parlance.
Nepal in the past did witness some debate over her growth concerns, but most of them were rather slanted or impractical. In different chapters of history, we were made to hear high-pitched rhetoric of double-digit growth, Swiss or Singaporean pace of growth, leap-frogging growth or a growth taking Nepal to a developing from an underdeveloped country status. These all were tall, very tall asks, to say the least.
The double digit growth or upliftment of the country’s status to a developing one are essentially the same concepts. For this, Nepal needs at least some Rs. 400 billion of capital expenditure annually, or at least 8.5 percent growth rate, for ten consecutive years. This indeed is unimaginable for several years to come. Other claims were bare political stunts, so had no scope of realizing them at all.
In view of these dogmatic misadventures of the past, the NBA wanted a meaningful debate to take off that is based on feasible goals against the existing ground realities. This led to the conclave on the theme 'Doubling of Growth of the Nepali Economy to 7 per cent GDP: The Roadmap Ahead.' Based on the 3.5 percent of growth rate of the past fiscal year, the idea of doubling was born, which looked fairly achievable if we could religiously pursue it.
Needless to say, growth in national GDP is a multi-sector endeavour. Among them too, it is important to identify and focus on key sectors that can either serve as prerequisite to long-run sustainable growth like hydropower or yield immediate growth results like agricultural productivity and tourism.
But, most important of all is quintessentially lead role of the private sector in investment, production and distribution of all goods and services. Of course, support of the state from the background is needed as security or ground for fair-play. Guided by this philosophy, the NBA coincided the conclave of growth debate, organized in Kathmandu on 24th August, with the opportunity to recognize the contribution of business sector to growth. This recognition came in the form of the 10 categories of business awards.
For the sustained prosperity of the nation, we should be able to make the growth not a flip-flop show but a habit. We need to start modest and all big dreams will fall in line with accomplishment of the starting ones. If we achieve 7 per cent growth first, then the double-digit can be followed soon. More important here: we needed a right beginning. And, with this successful conclave, we in NBA feel, the beginning has indeed been right.