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VOL. 28, NO. 03, Sept 05 , 2008 (Bhadra 20 2065 B.S.)
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CNI SUMMIT
Lofty Goal
The Confederation of Nepalese Industries (CNI) takes the initiative in kick-starting debate on attaining high growth economy
By SANJAYA DHAKAL
The CNI's economic summit on "Double Digit Growth: A National Commitment," had to be postponed twice in the past due to political instability.
It finally took place this week – appropriately as the new elected government led by Maoists has also took charge.
A dream child of CNI president and Constituent Assembly (CA) member Binod Chaudhary, the summit has been successful in generating much-needed debate on how to accelerate the economic growth and pull the millions of Nepalese out of the morass of poverty.
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PM Dahal Inaugurates CNI Summit: Backing private sector cause |
With the catchword of attaining Rs 12,000 monthly income for average Nepalese – up from existing Rs 3500, the summit has brought together experts, economists, politicians and business community under one roof to debate about the various opportunities and challenges facing the nation.
At its inaugural function on Sunday (Aug 31), Prime Minister Pushpa Kamal Dahal 'Prachanda' laid the groundwork by making statements aimed at allaying fears and apprehensions among the business and international community regarding what the Maoists have in store vis-à-vis economic policies.
PM Prachanda gave full backing to the liberal economic policies provided what he called they are in national interest.
"We are in the first decade of the 21st century. There is a wave of globalization, liberalization and privatization all over the world. We cannot turn blind eye to them," he said.
Prachanda also promised to work in close cooperation with the private business sector to attain high growth in economy.
"Currently, we are facing three key issues concurrently. One is to take the peace process to logical end, another is to write new constitution and third is the economic transformation. All three are interlinked, one cannot segregate them," he said. The three-day seminar is being organized by Confederation of Nepali Industries (CNI).
Giving his solid backing to the organizers and their cause, PM Dahal said that the seminar will help his government at a time when it is preparing national plans and policies and new budget.
PM Dahal said that he will work to allay suspicions among national and international community in taking the government forward.
"Without the participation of private and public sector, no country's economy can prosper," he said.
Delivering his keynote address, CNI President Binod Chaudhary called on everyone to focus on economy to realize the double digit growth and ensure the average monthly income of Rs 12,000 from the current level of Rs 3500.
"We are facing both challenges and opportunities. The state must run like a corporate body to realize the huge potential and deliver economic prosperity to the people," he said.
In his keynote address, Chaudhary not only presented the picture of economic situation but also spoke at length about the opportunities.
"In the past twelve years of conflict and in the subsequent two years of peace process, the economic issues could never come to center-stage. Due to lack of enough job opportunities, two million youths have left the country in search of work. Over 80 percent of country's population engage in agriculture. Unfortunately, 35 percent of the population face food shortage," he said.
He also rued the poor foreign trade situation. "The foreign trade deficit has surged to Rs 130 billion a year, which is 18 percent of GDP. We only export Rs 40 billion worth of goods and services to India whereas we import Rs 33 billion worth of petroleum alone from that country. Consequently, the country has been forced to purchase Indian currency worth $ 2 billion," he said.
Comparing the high growth attained by Nepal's two neighbors India and China, Chaudhary said conflict alone is not responsible for low growth in the country.
"In order to raise the monthly income from the current level of Rs 3500 to Rs 12000 (by attaining double digit growth), the current level of annual investment of Rs 176 billion should be increased to Rs 400 billion for the next ten years," he said.
And there is no problem of resources, according to Chaudhary. "When a bank shares worth Rs 300 million is floated in the public, they get applications worth Rs 10 billion. There are a number of banks opening up in a series with Rs 2 billion investment. Three billion dollar worth liquidity received from overseas has not been used in productive sector. There is also no problem regarding entrepreneurship and management. Nepali entrepreneurs and managers have earned reputation abroad as well. If there is any problem, the problem is in the creation of environment to let the investment come without any obstruction," he noted.
He also recalled how the Japanese worked with single minded determination after the second world war to rebuild their nation. We need similar national passion, he said.
"The state must now start thinking and working like an entrepreneur to raise our economic standard. An entrepreneur is a visionary who does not stop working by looking at lack of resources. He creates necessary resources."
Lofty Goals
The goal of double digit growth is a lofty one but not impossible, according to experts.
"It is definitely a very hard goal to attain at this time. The major problem will be to attract the necessary investment," said Dr. Shankar Sharma, renowned economist, who presented a lead working paper at the three-day economic summit.
"At policy level, there should first be efforts to earn confidence of private sector, then there should be effective market for goods and services along with improvement in public administration and improvement in infrastructure standard," Dr. Sharma said.
Another economist Dr. Bhuwan Bajra Bajracharya, in his paper, noted the need to reduce poverty and attain broad-based growth by investing in infrastructures such as energy, road and communication.
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Binod Chaudhary: Businesman with vision |
Tek Chandra Pokharel, founder vice president of CNI and leading tourism entrepreneur, called for constitutional provisions on economic visions. "We should have a provision in the constitution which states that within 2015, we will attain average monthly income of Rs 12,000 by achieving 7 to 10 percent economic growth," he said.
Pokharel called for huge investment in agriculture, road infrastructure, creation of Special Economic Zone, east-west electric railway network, international airport in Nijgadh, investment of Rs 210 billion in tourism infrastructure, among others, in the coming days.
"It is like if we set our eyes on sky, at least we could reach up to the top of the tree," said banker Anil Shah, who said that the ambitious target is not unattainable though.
Chaudhary himself gives example of progress made by Japan and, more recently, by Dubai. "A country with nothing but desert, look how Dubai has made progress in tourism. They have attained goal of bringing in 13 million tourists. For a naturally gifted country like Nepal, it should not be a big deal in attracting two million tourists a year," he said.
At the three-day summit, various experts presented working papers and held discussions on 18 different specific sectors.
After the summit the ball has started rolling. It is now up to the political and business leaders to realize the dream.
