Nepali Times Asian Paints
POOJA TANDON
Economy Stupid
Reinventing brand Nepal


POOJA TANDON


NT ARCHIVE

Nepal's abysmal economic performance is often linked to its geography: 'India-locked' on three sides with China on its north. However, being landlocked does not necessarily destine countries to poverty. While not having direct access to the sea does have its disadvantages, there are plenty of opportunities as well. Take Switzerland or Dubai for example.

Often compared to Nepal for its size, natural beauty, and geography, Switzerland with a population of about eight million ranks 19th in terms of GDP. It has exploited its comparative advantages by exporting high value goods like watches and specialised goods and services like dairy products and banking.

Dubai, on the other hand, has transformed itself from a desert city into a microcosm of globalisation and markets itself with this unique tagline: bring your money to Dubai, no questions asked. With its modest oil reserves (expected to dry up within the next decade), which account for only 15 per cent of the state's income, Dubai adopted a blue ocean strategy of resurrecting its trading links and has quickly become one of the most sought after destinations for immigrant labour from South Asia and Africa.

The latest national census released by the Central Bureau of Statistics last week shows that around two million Nepalis migrate abroad for employment each year. And if figures, including unofficial ones, are to be believed these workers, constituting 10 per cent of the population, contribute about a quarter of the national economy. Over time, export of human resources has unconsciously become the single biggest revenue earner for the country.

However, there has been very little effort to understand the migration sector and develop it systematically. Why not export developed human resources with the target of drawing them back in the future? Global HR trends have changed and traditional staffing has given way to temporary staffing called 'temping'. Organisations are hiring knowledge workers for projects lasting from two to 15 months.

The Indian temping industry alone stands at IRs 172 billion and there is a growing demand in the IT and engineering sectors, FMCG (fast-moving consumer goods), retail, banking, and finance. If Nepal can value add and methodically feed its professional and general workers as temps in such international firms in India and other South Asian countries, not only will it be a revenue spinner, but this exposed labour force will have increased employability and will be more likely to turn into small entrepreneurs when transitioned back to Nepal.

This could be a good way to enhance entrepreneurship in a country where small time aspirants line up to various social venture funds for seed capital. However, all this requires a change in our mindset, an increased willingness to take risks, and trade off job security for international exposure and a better future.

We might not have mass production potential as China, but we have some homemade high-end products like Pashminas, rugs, khukri knives, speciality cheese and now adventure gears and wristwatches to flaunt. Despite the political chaos, tourism still remains our biggest selling point and Nepali hospitably still defines our brand equity.

We lack well-linked, economically viable value and supply chains in Nepal, but the country can certainly become a value chain partner for various high-end international brands. For instance, niche high-end products like Sherpa Adventure Gear and Kobold watches have exploited the Himalayan charm very well. Kobold, a renowned US watch company has set up a workshop in Nepal, assembling Himalayan Everest edition watches, the dial of which is made up of a piece of rock collected from the summit of Mount Everest (each watch sells for around $ 15,000).

Nepal has also been a popular MICE (meetings, incentives, conferences, and exhibitions) destination for our Indian neighbours especially for weddings. The first tier Indian cities might have lost interest in Nepal, but we still have the attention of the second tier cities.

Like Switzerland, Dubai and various African countries, Nepal needs to find alternative revenue sources as a means of lessening its dependence on foreign aid, which will eventually dry up. From being landlocked it should move towards creating a blue ocean and stop competing in areas where it has no comparative advantage. It can overcome its poor economic track record by identifying a viable 'brand' that is not determined by political manipulation. With its natural charm, Nepal has the potential to shape trends and become a key business partner for many advanced economies. However, this requires determined leadership and direction.



1. Sheila Pradhan
This is the reality of 21st Century, BUT, guess what, leaders in Nepal come from the 18th century mind set. They are good at complaining and playing the blame game. They are also beggars for they are dependent on measly aids instead of using the resources God Himself has given in abundance. If only the hydro power and other energy was exploited like gas and minerals, if only Tourism was thriving at 1000 percent capacity like it could, we would be sitting pretty and comfortable. One thing is clear, we need a new breed of leaders in Nepal, the old men should just get out of the way and allow a new generation to take the lead. Lets pray that we can accomplish this change soon. Times and lives are wasting.      

2. Armugam

Pooja Tandon's this piece was basically a theoretical exercise. The approach ended being very simplistic in trying to negate Nepal's land locked impediment. Comparing ours situation with landlocked Switzerland and "sealocked" Dubai was childish at best. While we may be at fault in not finding ways to make best of what we have but dealing with India at two levels is something that possibly neither of the above two face. We are compelled to deal with Delhi as a sovereign country, while Indian states are not duty bound to follow most of Delhi's "half-hearted" directives. There are plenty of examples where by state governments have successfully thrown spanner into the works.  

Armuagm



3. yam gurung

Rich MPs of poor nation Nepal.If you look back to the Gurkhas recruitment in the foreign armies.

The rulers of Nepal has used the citizens for there vested interest and used them,as a diplomacy currency in the international markets and collected a huge revenue.

And it is very unfortunate and sad to say that our beautiful "Himalayan Kingdom of Nepal"is not govern by the will of the puppet leaders of Nepal.

And main obstacle is 1950 inadequate treaty with India.If Nepal wants to compete with the other develop countries like India and China and others.

Nepal need to observe universal calender and timetable,like first working day as Monday instead of Sunday,where all the international markets are closed.

Like one country.I could not recall the name near Australia and Newzealand did adopt to the universal time recently,to enhance the development of its country without the reservation.

The puppet leaders of Nepal.Only talk big to change the face of Nepal compare to Singapore etc.

But the lawmakers dreams are still in the ground zero.

 



4. RamB.Chhetri

Pooja has done a good job by pointing out the potentials of Nepal in avery positive way.It should be heeded by all concerned.High time too.Thanks a lot,Pooja for showing light at the end of the dark tunnel.

Ram B. Chhetri

VA,USA



5. prasanna

i agree with Armuagm. i think we all know the geography of nepal, its pros and cons. but it is very easy to say "it should be done like this, it should be done like that, branch should be identified, human resources to be exported n bla bla bla....", but what is difficult is to give a concrete way out, to find a long lasting prudent soluction.....which is severly lacking in this article....moreover the idea of exporting professional human resources is an absurd one....consider this: even if the present exodus of unskilled/semi skilled workers of villages are replaced by so called developed human resources, then one thing is sure....that the return in the form of remmitance that we are getting will be not even half....secondly suppose if we do not replace the semi skilled once, and if we just send both unskilled and so called developed human resources, then who will run the country? sweepers n cleaners?? when the basic premise of the idea is itself wrong then whats the use of global HR trends or so called temping...whatever it be, it better be damed...so on and so forth....100 arguments and questions can be build up here...no point writing all, im getting back to work.....really a simple article but no worries, it can be used as reference for high school kids for their essays...

 



6. Shree ram ghimire
Exactly now we must think about internal capital management through our native methods adopted in society. I think well managed cooperative system in rural area along with good women participation will contribute our economy with sustainability.

LATEST ISSUE
638
(11 JAN 2013 - 17 JAN 2013)


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