People across the country are suffering and hard-workers are finding it more difficult to support their dreams.
--BY AR BHATTARAI
In the euphoria surrounding sustainable high growth, we generally tend to overlook the mistakes committed by policy makers during the period of liberalisation. We should never forget the economy is not something that is beyond our control. The market has to be our servant not the master. The outlook for the economy is shaped by a number of factors other than the fundamental ones.
First, the malaise gripping policy formulation. Our policy makers seem to be a confused lot. Second, due to lack of proper storage facilities, there is a sizable wastage of farm produce. No effort has been made to commercialise farming.
Third, high reliance on import for government revenue without adequate attention to industrialisation.
Fourth, inability to attract foreign direct investment in infrastructure sectors. We create lots of noise when FDI is coming to infrastructure projects.
Fifth, excessive reliance on local resources. We talk a lot about channelising remittances into industrialisation without noticing the utilisation pattern and purpose.
Throughout every transformation the Nepali economy has made– from agriculture to services, local to international and war to peace– there has been one constraint: there is no guarantee of success. But we believe that if we work hard, our work will be rewarded.
Traditionally, economists have focused on aggregate money stock measures such as M1 and M2 as indicators of future economic activities. However, the relationship between these aggregates and real GDP has deteriorated in the past several months. When the GDP takes a downturn, the wise market player usually responds by changing their financial behaviour. In difficult times, there's less room for ambiguity in defining financial goals. Are market players planning for sustainable growth? Trying to trade off with the current requirements? Or both? Different goals dictate different strategies. It is often said that in the business world, the rear-view mirror is always clearer than the windshield.
No nation can aspire to be modern and develop without the availability of quality infrastructure for all. No modern machinery can run without power systems. Now imagine a situation where we create a national climate to think big and praise every small success which contributes towards the big goal and where any sector which attempts improvements and succeeds should be recognised nationally. Instead, we celebrate suffering, talking about the success of this or that frequent political unrest.
People across the country are suffering and hard-workers are finding it more difficult to support their dreams. There are a number of complex political and legal issues which need to be solved to ensure economic development. Our dream of converting challenge into opportunity will require a re-engineering of the complex economic situation and changing the mind set of planners, integrating and implementing result oriented action plans to shape our country into a developing one.
Leaving all these issues aside, we still feel optimistic about our country. Now the time has come to say, "We have had enough" and “We have learned a costly lesson.” And, "There is no such thing as a free lunch."
Chartered Accountant Bhattarai is a former banker.