Size of remittance has ballooned and the country has become more dependent on India than ever before
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
Nepal as a landlocked country has access to
sea only via India. So Nepal imports worth nearly nine times more than
it exports to the southern neighbor. In FY 2014/15, Nepal imported goods
worth Rs 774.68 billion while export was Rs 85.31 billion. Import from
India was worth Rs 491.65 billion while export to the southern neighbor
was only Rs 55.86 billion; in other words, 64 percent of our trade is
with India.
Government has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
- See more at: http://www.myrepublica.com/opinion/story/28862/here-we-go-again.html#sthash.U1CxQ351.dpufGovernment has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
Size of remittance has ballooned and the country has become more dependent on India than ever before
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
Nepal as a landlocked country has access to
sea only via India. So Nepal imports worth nearly nine times more than
it exports to the southern neighbor. In FY 2014/15, Nepal imported goods
worth Rs 774.68 billion while export was Rs 85.31 billion. Import from
India was worth Rs 491.65 billion while export to the southern neighbor
was only Rs 55.86 billion; in other words, 64 percent of our trade is
with India.
Government has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
- See more at: http://www.myrepublica.com/opinion/story/28862/here-we-go-again.html#sthash.U1CxQ351.dpufGovernment has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
Size of remittance has ballooned and the country has become more dependent on India than ever before
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
Nepal as a landlocked country has access to
sea only via India. So Nepal imports worth nearly nine times more than
it exports to the southern neighbor. In FY 2014/15, Nepal imported goods
worth Rs 774.68 billion while export was Rs 85.31 billion. Import from
India was worth Rs 491.65 billion while export to the southern neighbor
was only Rs 55.86 billion; in other words, 64 percent of our trade is
with India.
Government has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
- See more at: http://www.myrepublica.com/opinion/story/28862/here-we-go-again.html#sthash.U1CxQ351.dpufGovernment has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
Size of remittance has ballooned and the country has become more dependent on India than ever before
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
People in Kathmandu may not have truly felt the effects of 40-day protest in Tarai until Tuesday. News reports indicating blockade by India was making rounds then. It has made people of Kathmandu panic. Sons ran to hoard petrol at gas stations while mothers crowded the grocery stores for foods and other essentials. This shows that the effects of blockade can be pervasive. This is because of Nepal's lopsided trade balance with India.
Nepal as a landlocked country has access to
sea only via India. So Nepal imports worth nearly nine times more than
it exports to the southern neighbor. In FY 2014/15, Nepal imported goods
worth Rs 774.68 billion while export was Rs 85.31 billion. Import from
India was worth Rs 491.65 billion while export to the southern neighbor
was only Rs 55.86 billion; in other words, 64 percent of our trade is
with India.
Government has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
- See more at: http://www.myrepublica.com/opinion/story/28862/here-we-go-again.html#sthash.U1CxQ351.dpufGovernment has cushioned itself on remittance, which also has driven consumerism but the national import-based economy has not benefited in real terms. Almost all entrepreneurs and business people have import portfolios as earning is fast and banks provide an easy finance. The more the size of remittance, the more the country became dependent on India. Nepal depends on petroleum imported and refined by India. The country's total earning by export is not enough to pay even the import bill of petroleum. Average import of petroleum in the past three fiscals is Rs 122 billion.
Bilateral relation with India is at its lowest in history and the real picture of our fragile situation is clearly visible. We are already in hot water. But these problems didn't develop in a single day, a single month or a year. Agenda of the fragile economy never came to fore as political leaders either knew little of it or were busy with their petty affairs and no one cared.
The Ministry of Industry and Commerce and Supplies is these days among the least preferred ministries for leaders. Barring few, most commerce and supply ministers were Madhesh-based leaders and now the same leaders are protesting to cripple Nepali trade.
The country must realize the importance of self-dependence for ours is a landlocked country. Our strength is agricultural products. There is also an opportunity for earning foreign currency after value addition. Government could not retain youth in agriculture in the absence of appropriate technology. Nor is there market connectivity for agriculture produce and competitive supply chain. Due to various factors including energy, manufacturing industries have lost competiveness and agriculture output has declined. Youths migrated for jobs and dependence gradually increased and we became progressively weaker.
Tuesday's rumors should be taken as a wake-up call and policies and strategies devised to increase exports, but such endeavors should not be similar to those followed by Nepal Trade Integration Strategy (NTIS) 2010, which has had little impact even with its identification of products with competitive advantage. We expected at least a minor rise in export of NTIS-listed 19 products, but to no avail. Export of silver jewelry, ginger, lentil and medicinal herbs have declined.
India blockaded Nepal in 1989. Recent events have refreshed those bad memories. It is high time we devised strategies to tackle the issue as well as employed the youth population. Nepal was net exporter of dozens of agro-products and finished goods but now we are importing the same items from India and other countries. Everything ranging from agro products to spare parts and from petroleum products to garments are imported from India. Government should look for more sustainable measures to keep the economy humming.
Back in 1989, India blockaded Nepal for over a year over the issue of Nepal purchasing arms from China without first consulting it. The relations became strained and the culmination was fall of Panchayat system; the King had to, eventually, accept multiparty parliamentary system. Nepal as a landlocked country had sought privileges of transit rights as UN charter and India's demand of a single treaty was rejected.
Soon after India's economic sanctions, our country experienced serious deficiencies of goods such as coal, fuel, oil, medicine, spare parts and other essentials. Although immediate effect in rural life was only reflected in shortage of salt and kerosene, I can now only imagine the impact on cities. The country's growth rate plummeted from 9.7 percent in 1988 to 1.5 percent in 1989, largely due to the blockade.
Following blockade rumors on Tuesday UCPN Maoist Pushpa Kamal Dahal made a farcical remark that Nepalis should ride bicycles if India stops petroleum. Nepali leaders use their heart more than their minds. Had Prachanda said that his party has decided to have a cycle lane in all the new roads, it would have made strategic sense. But the effect of a weeklong blockade today would be tantamount to the impact of over a year's blockade in 1989; our dependence on India has spiked multifold because Nepal has become net importer of rice, livestock and fruits from India. Dependence on petroleum, motor and machinery are unavoidable but we have never bothered to do anything even about the commodities we could produce in our own country. Without economic independence, political independence is meaningless.
The bill of import of agro products run to over Rs 100 billion a year, while school children still study that Nepal is an agricultural country. We imported toothpicks, a non-essential item, worth Rs 21.1 million in the fiscal year 2013/14. Rice worth Rs 55 billion were imported in the last three fiscal years. We produce and sell goods worth Rs 9 but import goods worth Rs 91 for every 100 rupees spent on foreign trade.
Had the youth not become migrant workers, our country would have witnessed a severe food shortage. But they would be toiling to produce food for self-sustainability. A sharp increase in imports but lack of progress in exports is our reality. Worse, exports have for the first time posted negative year-to-year growth.
Trade expert Krishna Raj Bajgain has written that Nepal's trade gap has widened after the introduction of each new trade policy. The phrase 'replace imports' has been coined, plans, and programs are prepared and budget is also spent every year. Small-scale enterprises and entrepreneurs offer the silver lining. There are opportunities for devising long-term planning, for example by downsizing import of petroleum products through greater harnessing of hydropower. But, hydropower, alas, is another failure story in Nepal.
The author is with Republica's business bureau
Twitter: @rudrapangeni
