The Power-economy Trade-off
After 78 days of nation-wide lockdown, Nepalis are finally beginning to find some semblance of normalcy in their lives, albeit on phase-wise basis. As of June 21, 2020, 23 people have succumbed to COVID-19. The Government of Nepal has so far conducted 437,320 tests (175,173 Polymerase Chain Reaction tests and 262,174 Rapid Diagnostic Tests) out of which 9,027 people have tested positive and 166,147 have tested negative. Results are yet to come for many of these tests. 1,772 people have recovered and gone home, 94,928 are quarantined across the country and 7,231 are in isolation.
A recent study commissioned by the UNDP has found that three in every five employees in Micro, Small and Medium Enterprises (MSMEs) have lost their jobs due to COVID-19. Tourism receipts are expected to fall by 60 % and remittances—which represent roughly a third of the GDP—are set to fall by 20 % in the fiscal year 2020 that is, until mid-July 2020 on a year-on-year basis. Agriculture is another major economic sector, where the nationwide lockdown severely affected the harvest season and is set to have a similar effect on the plantation season as well. All in all, people are losing jobs at home and abroad, economy is taking a nose-dive with growth for the year forecast to be around 1.8 %, and many have or rather had expectations from the government in the form of a broad relief package.
On 28 May, 2020, the government presented its budget for the upcoming fiscal year (mid-July 2020 – mid-July 2021). From the private sector, to the opposition, to the lawmakers within the ruling government, have expressed deep dissatisfaction with the budget. With jobless migrant returnees and new unemployed in the score of millions, the government seems to have taken the role of creating economic opportunities for them and explicitly expressed its distrust towards the private sector in creating meaningful jobs and leading the economic transformation of the country. With no real policy reform commitment from the government that might improve the business environment in the country post the pandemic, there is little hope that the few commitments of job opportunities that the government has expressed will see light of the day.
Understandably, new voices are emerging from grassroot level. On social media, topics of defying the state-called nationwide lockdown are trending. Number of amateur videos of small entrepreneurs facing-off the police is rising by the day. A positive way to look at this is that if these petty face-offs really turn into a nationwide demonstration, it would be the first time in the history of Nepal that people demand their economic freedom be handed back to them.
At this point, it would be worth noting that Nepal has seen one major political revolution every decade for the last seven decades for political and civil rights. In none of these instances have people been able to feel tangible changes accruing to their lives in the aftermath of political revolutions and changes. A fight for economic freedom is the one that holds the capacity to deliver those tangible changes for the largely poor Nepali populace that earns a meagre USD 1000 per capita a year. Having said that, like every other major political movement, the ensuing transition period also threatens to push back progress a few years. The real trade off is whether the government will acknowledge its failure to prepare and implement a COVID-19 response plan and enable citizens to go about earning their livelihoods as usual and expect some cases of health emergencies, or continue to suppress the livelihoods of the millions in the garb of the greater good and hold on to its power which will likely see its biggest political threat as soon as current emergency regulations are relaxed.
Akash Shrestha is Research Manager at Samriddhi Foundation. He also engages with the politicians, policy-makers, bureaucrats and sectorial experts of Samriddhi’s research areas as part of Samriddhi’s advocacy efforts. He contributes to building networks with key stakeholders and identifying new research areas. His concentration is also on promoting ideas of liberty through media platforms via different public consumption materials.
He studied Political Economy at the University of Hong Kong. He was a finalist in the Think Tank Shark Tank Competition held in Malaysia in 2016 and was the winner of the John Blundell Elevator Pitch Competition in Ney York in 2017. He has authored (and co-authored) books, policy papers and articles dissecting Nepalese economic policies.
Akash holds a Master’s Degree in Political Science. Prior to joining Samriddhi in 2013, he was a founding member of Youth for Nepal.