By Usman Khan

The rainfall in Nepal during the monsoon this year was 10 percent lesser than the yearly average. The government regularly fails to acquire sufficient chemical fertilizer for farmers in time. Insufficient rain is likely to reduce the rice production and adversely impact the cultivation of pulses, oil seeds and vegetables, as winter rains are often unpredictable. The series of drought and floods in the plains the rice bowl and bread basket of the country is bad enough. The impact of climate change has begun to worsen the situation as heat waves during the summer and foggy haze during the winter negatively affect agriculture, animal husbandry and fish farming.

Small landholders and negligible farmers in Nepal need a lot of grit to maintain the tradition which once proclaimed that farming was the best occupation as it helped feed the world.  The sanctity of tilling the land for salvation has lost its social and religious overtones. When livelihood is at stake, economic considerations triumphs over family traditions. It is much more tempting these days to sell the land, get in touch with a manpower agent and fly away to the cities of the Gulf Cooperation Council such as Dubai, Doha or Dammam. It's the money they send home from their meagre earnings as remittances that has kept the Nepali economy afloat during difficult times.

The rhetoric of creating employment opportunities in Nepal through industrial development is all very well, but it flies in the face of ground realities. The supply of energy has stabilized to a certain extent, but the availability of hydroelectricity is highly vulnerable to natural calamities. The per unit cost of transportation in a landlocked country with largely rugged terrain makes the import of raw materials and the export of finished products highly uncompetitive.

In addition to transportation bottlenecks and volatility of energy availability, there are human resource restraints that dismay the productive investment in the industrial sector. Managerial talent is in short supply as opportunities in the development agencies and INGOs are more lucrative. Technical personnel prefer to work abroad due to higher prospects of career advancement in bigger markets. Skilled workers are hard to find and even more difficult to retain.

Perhaps the most frustrating element is the sense of entitlement among government officers, regulatory authorities and even unskilled workers that the jingoistic elites have nurtured over the years. While fly-by-night operators find the commercial environment extremely conducive for making a fast buck in cahoots with manipulative fixers, the condescending attitude of locals makes foreign investors, expatriate technocrats and skilled managers cringe as they feel unwanted and unwelcomed in a high-risk and low-return country.

The glamour of the tourism “industry” in Nepal notwithstanding, its contribution to the GDP was a miserable 6.7 percent recently, and is unlikely to go above 10 percent in the near future. Remittance has remained one of the largest contributors to the national economy for years, and will probably remain so for quite a while. The World Bank estimates that remittances accounted for 22 percent of the GDP this year. Informal inflows are considered to be at least 50 percent higher than official figures. The economic size of remittances is too high not to have a significant impact on the political economy of the country.

There is a growing fear amongst the general public whether Nepal will face a fate similar to that of Sri Lanka, given the escalating rate of inflation and high trade deficit. However, as the economic structure of Sri Lanka and that of Nepal are different, Nepal may escape the same fate. For example, Nepal has far less external debt compared to Sri Lanka. Besides, the contribution of tourism to the Nepalese economy is comparatively low. To be precise, Sri Lanka needs to repay the foreign debt worth US $4 billion this year whereas the debt service of Nepal for this year stands at only US $400 million only.

Likewise, while the contribution of tourism to the GDP of Nepal is around 3 percent, its contribution to the GDP of Sri Lanka is around 12 percent. As such, because of these two reasons, Nepal is less likely to be like that of Sri Lanka given the situation. Besides, the structure of loans Nepal has to service are different from that of Sri Lanka. In the case of Nepal, its debt comprises mainly the soft loan with lower interest rates whereas the foreign debt of Sri Lanka mostly comprises commercial loans.

Nepal’s current economic situation does ring alarm bells that it is time the country initiates appropriate steps towards increasing production and productivity. Poor governance, especially lack of transparency, accountability, effectiveness, and efficiency is of prime concern.  Formulating evidence-based economic policies that encourage transparency and accountability can save Nepal from an economic crisis similar to that of Sri Lanka with the help of highly skilled human resources and by implementing them effectively. Unfortunately, the prevailing political mechanism and bureaucracy appear reluctant to take such initiative. Nepal’s governance is characterized by corruption and nepotism. The country’s economy still hinges on remittance and traditional farming. Thus, Nepal’s economy may suffer a major setback if these issues are not resolved.

JAKARTA, 14 December 2022, (TON): The United States, South Korea and Japan vowed to consider all options against North Korea, including counterstrikes, in the wake of an unprecedented blitz of missile tests by Pyongyang that has sent regional tensions spiralling.

The flurry of North Korean launches include last month's test of its most advanced intercontinental ballistic missile and a missile that flew across the de facto maritime border and landed near South Korean waters for the first time since the Korean War.

US special representative for North Korea Sung Kim held talks with South Korean counterpart Kim Gunn and senior Japanese foreign ministry official Takehiro Funakoshi in Indonesia's capital Jakarta, where they warned of Pyongyang's threat to regional security.

UNITED NATIONS, 14 December 2022, (TON): United Nations Secretary-General Antonio Guterres called for the de-escalation in tensions along the India-China border, days after troops of the two countries clashed in the Tawang sector of Arunachal Pradesh, resulting in minor injuries to some soldiers on both sides.

Defence Minister Rajnath Singh said in Parliament that Chinese troops tried to unilaterally change the status quo along the Line of Actual Control in the Yangtse area of Arunachal Pradesh's Tawang sector, but the Indian Army compelled them to retreat by its "firm and resolute" response.

When Stéphane Dujarric, Spokesperson to the UN Secretary-General was asked to comment on this issue, he said "Yeah, we've seen these reports. We call for de-escalation and to ensure that the tensions along in that area do not grow."

KUWAIT, 14 December 2022, (TON): The UN Economic and Social Commission for Western Asia and the Arab Competition Network have congratulated Kuwaiti authorities on their efforts to protect consumers against commercial fraud.

The Kuwait News Agency reported “the organizations said the measures they introduced have helped to create effective and beneficial competition.”

Kuwait’s Competition Protection Agency has made significant progress in the past decade in its efforts to regulate the local market, Natalya Khaled, ESCWA’s economic affairs chief, said during a two-day conference.

KYIV, 14 December 2022, (TON): Ukraine’s prime minister has appealed for Patriot missile batteries and other high-tech air defense systems to counter Russian attacks that knocked out electricity and water supplies for millions of Ukrainians, putting Europe on alert to brace for more refugees.

Prime Minister Denys Shmyhal told French broadcaster LCI that in addition to making Ukrainians suffer, Russia wants to swamp Europe with a new wave of Ukrainian refugees by continuing to strike power stations and other infrastructure.

Poland’s president said “his nation already has seen an increased demand to shelter refugees due to the combination of such attacks coupled with the freezing weather in Ukraine.”

UNITED NATIONS, 14 December 2022, (TON): The UN chief warned in a new report that the already dire humanitarian situation in Syria is worsening and if aid deliveries from Turkiye to the rebel-held northwest aren’t renewed next month millions of Syrians may not survive the winter.

Secretary-General Antonio Guterres said in the report to the UN Security Council obtained Monday by The Associated Press that cross-border aid to the northwest remains an indispensable part of humanitarian operations to reach all people in need.

Deliveries across conflict lines within the country, which Syria’s close ally Russia has pressed for, have increased but Guterres said they cannot substitute for the size or scope of the massive cross-border United Nations operation.

DUBAI, 14 December 2022, (TON): Emirates News Agency reported “Hu Chunhua, China’s vice premier, visited the Museum of the Future, where he was greeted by Dubai Future Foundation CEO Khalfan Belhoul.”

Representatives from the museum and the foundation met the delegation to discuss enhancing cooperation on the development of innovative ideas.

The tour was part of an official visit from Hu, who is in the UAE this week to strengthen relations between the two countries.

The delegation included Zhang Yiming, Chinese ambassador to the UAE; Guo Wei, deputy secretary-general of the Chinese State Council and Wu Jianghao, China’s assistant minister of foreign affairs.

NEW DELHI, 14 December 2022, (TON): Union Minister Gajendra Singh Shekhawat accused the Ashok Gehlot-led Congress government in Rajasthan of harassing Hindus and boosting the morale of separatist forces.

Referring to the incidents of communal violence in Karauli, followed by Jodhpur and Bhilwara earlier this year, the Jodhpur MP said there is huge anger among people against the state government.

He claimed that because of the appeasement by the Congress government, the "morale of separatist forces is high" and they are trying to divide the society on the basis of religion.

Communal violence took place on April 2 in Karauli on the occasion of Nav Samvatsar or Hindu New Year.

KOSTIANTYNIVKA, 14 December 2022, (TON): Russia and Ukraine pounded each other’s forces in heavy fighting in the eastern region of Donetsk as Kyiv’s allies meeting in Paris pledged just over 1 billion euros to help Ukrainians survive the freezing winter.

Russian forces are battling to take control of the Donetsk and Luhansk regions, two of four territories the Kremlin claims to have annexed in votes rejected by most countries as illegal.

Moscow is also attacking Ukraine’s energy infrastructure with waves of missile and drone strikes, at times cutting off electricity for millions of civilians enduring Europe’s deadliest conflict since World War Two.

ROME, 14 December 2022, (TON): Italy’s Prime Minister Giorgia Meloni has condemned Iran for suppressing dissent and pledged that her administration would continue to defend the fundamental rights and freedoms of that country’s people.

In a speech in the Chamber of Deputies, Meloni recalled that on Monday Iran executed a second man — in defiance of an international outcry over the use of capital punishment in connection with protests that have shaken the regime for months.

She said “I say this clearly. The use of force against peaceful demonstrators, against women is unjustifiable and above all unacceptable.”