Expectations from the New Government

Continued from Dec 26…

Another big challenge to be faced by the new government is the analysis of some people that there is an obstacle in the institutionalization and implementation of federalism. According to their opinion, they consider the rise of anti-federalism or anti-provincial forces in parliament as the reason for this. From this election, the Rastriya Swatantra Party (RSP) has emerged as a national party, while the Rastriya Prajatantra Party has also made a powerful presence in parliament. These two parties are against the provincial structure of the federal set up in the country. So, the new government may face obstacles to passing laws to further strengthen federalism.

Several economists have been saying that the Nepali economy is facing a crisis for the last few years. There are many who believe that there are some signs of improvement, but there are still complex problems in some economic sectors. It seems that the new government should keep economic matters as its main priority. The new government faces high inflation rate, high interest rates, unemployment and the burden of unnecessary administrative expenditure. So, if the government does not act immediately, the country can fall into a major crisis. Reducing the growing economic uncertainty and crisis in Nepal seems possible only if we earn enough through the main sources of foreign currency earnings - exports, tourism, foreign investment, foreign aid and remittances. The government should think about what to do in these areas and abolish unnecessary institutions and reduce the burden of unnecessary expenses at the central, provincial and local levels.

Nepal's weak presence in foreign affairs has been seen and some people are saying that Nepal will become a center of conflict between the powerful nations. Some people believe that the challenge of keeping it in "balance" will be too much for the new government. The new government should waste no time in setting both short-term and long-term economic goals and removing the red tape to attract foreign investment, without which Nepal's development dream will be difficult to achieve.

Since the local governments have been formed in all 753 local units in Nepal, the process of forming the provincial governments in all the seven provinces has started. Not only that, the country has also got a new prime minister. Also, while the process for the formation of the new government is underway, the sector has started putting pressure on the new government to bring a supplementary budget.

They are of the opinion that the priorities of the new government will be different and a supplementary budget will be helpful in addressing the economic crisis in the country that has been deepening. At present, when five months of the current year 2022/23 have been completed, the current expenditure of the government is less than the revenue, which means that it is difficult to pay the salaries and allowances to the employees with the income.

It is necessary and mandatory for the new government to carry out a completely austere policy and strictly proceed with the implementation of the same. When it comes to government efficiency, it seems that the government's current expenditure can be greatly reduced through measures such as reducing the expenditure on vehicle purchase, fuel, and vehicle maintenance, as suggested by the Expenditure Review Commission, removing duplication of government agencies, and reducing the incentive and allowances given to the employees.

Due to the deep crisis in the country's economy for a few years, there is a harsh reality that the government has to open the import of some goods in the greed of revenue. Also, the government has decided to open up the import of banned items to destabilize the financial system. Representatives of the private sector say that when the budget implementation is weak, it has an impact on the economy as a whole. The private sector says that here has been a decline of 70 percent in the construction sector, 80 percent in auto business, 55 percent in electrical equipment business, 50 percent in electrical business, 30 percent in insurance business, 45 percent in real estate business, 30 percent in stock market, 25 percent in diesel consumption, 60 percent in shipping business, 30/40 percent in hotel business, and 25/30 percent in fuel consumption of industries.

Leaders and workers of political parties are more experienced in agitation, violent activities, conspiracy and various strategies of power change and in the current situation where governance is weak, they need training and orientation about the country's policies and rules and governance. For that, a training center should be arranged to conduct training from the national level to the local level. Similarly, when the prime minister, chief ministers and ministers of the government appoint their advisers, they should choose experts or knowledgeable persons in the relevant subject, improving the current trend of choosing their own cadres and appointing experienced persons in the relevant subject. People who have deep knowledge in the related matters should be chosen and appointed as the executives in the management and board of directors of various public institutions and agencies. In order to control the conflict of interest, it would be better not to have employees' organizations or employees' representatives in the board of directors of public institutions.

The new government is expected to establish the rule of law and end impunity. To do that, the major political parties, especially those in the government, must instruct their workers and leaders at the local level to create an environment that allows the various organs of the state to exercise their duties and rights freely. There should be a mechanism in place to check and control brokers and middlemen. The government ministers and secretaries should be asked to discourage brokers and middlemen who go beyond the policy and run in ministries and departments to fulfill their personal and group interests. Similarly, political parties are expected to warn their workers not to interfere unnecessarily in the contract leasing and purchase of goods for various development construction works.

Corruption has become one of those meaningless “buzzwords” that politicians use in their manifestos and do nothing about. It is high time that the cases pending at the courts against government employees and the people's representatives are at least expeditiously disposed of. At least 35 percent of the promises made by the political parties should be fulfilled, if every MP did their part and got at least a passing grade.

The decrease in the demand for goods and services in the market and the decrease in economic transactions and leakages have not raised the government revenue as per the target. Compared to revenue collection, the government's current expenditure including salaries, allowances, benefits and subsidies is more. The revenue collected by the government is not enough even to cover the current expenditure. In the coming months, if the current situation in revenue collection continues, it may be difficult for the government to manage current expenditure resources including salaries and allowances.

If such a situation occurs, the new government that has emerged from the election will fall into a serious crisis. The government's targeted foreign grants, too, have not come as expected. This year, the target is to receive Rs 55.46 billion in foreign grants, but only Rs 3.42 billion has been received till mid-December. Along with revenue collection, there has also been a decrease in the government's development-targeted capital expenditure. Only about Rs 34 billion has been spent as capital expenditure till November. The main challenge for the new government is to raise the sunken economy. At present, large private sector investments have collapsed. The gap between government income and expenditure is widening. This is affecting the overall economy. The new government should also think deeply about the protection of private sector assets as well

(concluded).