Looking for problems

Nearly two months after king Gyanendra's 1 February 2005 coup, Nepal began to feel its economic impact: domestic production slowed down, budget for development programs was diverted to the security sector, and skittish international donors reduced foreign grants. 

Two decades later, the USAID cut has led to Nepal losing a significant chunk of foreign grants. But this has also spurred discussion on the need for Nepal to take greater responsibility for its own development. 

As Artha Beed wrote in the column Economic Sense 20 years ago this week, we should be finding solutions rather than look for problems. Excerpts from issue #240 25-31 March 2005:

Is the economy really stagnating? Has consumption gone down? Have people stopped buying goods and services? Is the remittance from Bipalis drying up? Is the World Bank ending aid? Will Nepal ever recover from the current crisis?.. Yet, it still feels like things aren't really as bad as people think. 

Though the off take by intermediaries have come down, retail consumption has remained the same. All manufacturers as well as intermediaries in the supply chain were working on their inventory to tide over potential blockades.

Remittances have not shrunk, as people who save $100 or $150 a month can only remit that money to Nepal. They can't buy apartments or houses in Malaysia or the Middle East with that kind of money. Fact is, there is a real estate boom that indicates remittances are healthy. 

The uncertainty of future assistance from bilateral agencies has perhaps made people believe that the economy has changed post-February First. It has also been made to sound like a major crisis as the future of 'hardship allowances' earning people in projects is unknown. But pragmatic Nepali analysis is best in times like these.

For archived material of Nepali Times of the past 20 years, site search: nepalitimes.com