Understanding On Minimum Economic Issues:

More than a decade has passed since the popular political change of 1990, which led to the expectation in terms of rapid growth in the socio economic life of the people. This expectation has, however, been belied. Why ? The policy- makers of the country have yet to understand that such a situation is the outcome of the fact that the political clouds continued to cover up the socio economic problems of the country at a time of intense expectations from the political change .

It is common knowledge that the country remains badly entangled in political conflicts for some time past. If all the political forces are not in favor of seeing the destruction of the country even while raising the political problems from their respective places, they must reach to an understanding in the minimum socio economic agenda.

Indeed, the political forces need to finalize a common agenda and to reach on a minimum understanding on socio economic issues. They must then publish the understanding so reached in the form of a white paper, and carry on their respective activities by making that white paper the basis of a consensus. Indeed, the best course of action for the political forces of the country is to seek a long-term solution to the problem through mutual dialogue and consensus.

The failure of the two rounds of the government-Maoist talks and the growing gulf between the government and the parliamentary parties have further complicated the political crisis. Industries and trade are detoriating & is on the verge of collapse. It is urgent for all forces to find out right track on the basis of a minimum understanding which can stop expected crisis due to the current fragile situation.

The fact is that our country ranks the lowest in the list of the poorest countries of the world. That a citizen of this country does not even earn 240 US dollars a year could be a matter of great surprise for the developed countries of the world. Eighty percent of the country's population is involved in the agricultural sector, but the standard of living of this population is quite pitiable. We cannot even produce foodgrains enough to meet our annual requirements, even though ours is a pre-dominantly agricultural country. Youths who had gone aborad with
the dream of avoiding the problem of making their both ends meet are extremely exploited at the cost of there life. The country's politics needs to address serious problems of this type.

Indeed, the government, the bureaucracy,the political forces, the private sector, the stakeholders and the civil
society at large must come to a point of understanding.

As a result of the state of civil war through which the country is currently passing, the country's economic indicators may fall negative to a disappointing level. These indicators are pointing toward the possibility of the starting of an economic crises. We wonder if this will ultimately render us towards financial bankrupcy as in the case of Argentina and Africa. It is, therefore, essential for us to sustain the economy on the basis of a minimum understanding even in the present state of civil war. All need to have a positive attitude toward all aspects of economic development while continuing to follow the positive path toward the settlement of the political problem.

Since this a "sensitive time", we need to check & balance inflation, employment and revenue and stabilize industrial production. Efforts are needed to inject capital, technology and develop human resources and thus keep the process of industrialization in a positive state.A situation would already have emerged had not there been two cease-fires between the government and the Maoists. Bad debts of commercial banks are growing, and the market is heated with the talk about the failure of debtors to repay their bank loans. Depositors may get panic if they don't get back there money.

Industries are turning into "non-performing assets". This increases the volume of "dead money", while reducing its
circulation, and the people face a state of severe economic crisis, and banks begin to suffer liquidity crises. We are on the verge of the first stage of such a situation.

We need to urgently pump money if we are to protect ourselves from such a situation. To raise investments, we need to win the confidence of donors,private sector, financial & development agencies.They must be given condusive environment to make investments in the competitive fields of the country.The relevant policies and laws should be improved .

It is easy for everybody to understand that no water will come out of the tap if the very source of the tap-water goes dry. The situation today is such that the country's industrial, commercial, tourism, financial and other sectors, which constitute the sources of revenue to be raised by the government to run the country are getting sick, and every sector is expecting some relief . But the government is not in a position to provide any relief, as it has no money. How much water can we expect to get from the tap if the very source of the tap water is in need of water ? This is the situation that the country's economy is facing at the moment.


- Rajendra Khetan
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(translated from Kantipur of September 25, 2003).