Prime Minister KP Sharma Oli was discharged from the hospital Friday following a kidney transplant for the second time. Instead of resting as advised, he was eager to promote an optics of good health and political control. But he stumbled. While he was admitted at the hospital, the Covid-19 pandemic shifted its locus from China and Iran to the US and Europe, exposing the weaknesses and strengths of many countries, including Nepal.

Although China initially fumbled, it wasted no time in tackling the virus, which was first seen in Wuhan, allowing countries around the world several weeks to prepare. While countries like South Korea and Singapore displayed an ability to control the disease, many western countries failed, allowing the outbreak of Covid-19 to turn into a pandemic.

The contrast in the response of developed countries to the pandemic has once again exposed the critical linkages between capitalism, democracy and politics. It has also re-emphasised what is common knowledge—that the state matters. The characteristic features of a state matter even more.

The US is one of the most developed countries in the world and has the largest economy, but it has so far failed to put people first. Its response has been shackled by the needs of the capitalist economy and the interests of political leaders.

The case of US shows that prosperity, and capitalism, can be unwieldy and may not always serve its people when a crisis hits. Besides, growing inequality and the rise of big capitalist enterprises have pushed out a large number of people from accessing essential services and social protection.

On the contrary, China's image after the coronavirus scare has been mixed. While its initial response was secretive and was criticised for limiting people's freedom, its ability to tackle the pandemic and serve people has earned praise.

For a helpless Nepal, China's capacity and a friendly neighbourhood policy offer hope, which in turn can permanently alter public perceptions about the US and China, two of the world's superpowers. The US, in particular, is gradually losing its image as a model of democracy and development.

Such a shift in public perception can have significant impacts on Nepal's political course. While the US has been providing sustained assistance to Nepal, especially in the health sector, such support has not been visible on a national scale. Now its fall from grace, amidst a great tragedy, could harm its international standing as well.

The pandemic could generate a regional response, particularly at the initiation of India's prime minister, Narendra Modi. Such regional cooperation is based on the perception of immediate needs and interdependence of the countries in South Asia.

Covid-19 tests the ability of globalism and international cooperation. What’s more, they also highlight the trends of anti-globalism and the role of states in managing capitalism.

One of the reasons for the tension between nationalism and globalism in the US is the gradual shift in the locus of the base of production from the US to other places in the world. As capitalism's movement across the globe generates insecurities among people, they turn to the state for protection and, sometimes, adopt narrow ideals of nationalism.

Such trends are already appearing in Nepal. For example, some parties and people are placing themselves on the wrong side of history by trying to cling to constructed identities like a unitary Hindu state. While a secular and federal state is inclusionary—the idea of a unitary Hindu state fails to include all communities and identities.

Capitalism, the rise of technology, and pandemics like Covid-19 will test the ability of Nepal to represent the interests of the people vis-a-vis capitalist or vested interests. The pandemic and its impact on the global economy is likely to be felt in Nepal, especially as it will affect remittance, tourism, foreign investments, and availability of jobs.

Although major political parties have championed the idea of democratic socialism, the state is consistently unable to represent the interests of citizens. We have a fascination for big and visible infrastructure development like the railway link between Kathmandu and Tibet. The government finds ideas of big banks and commercial ventures exciting but has fixed minimum threshold for FDI at nearly half-million US dollar.

Nepal needs to think small if it is to be sustainable. To create a sustainable economy, it should promote small and medium enterprises that are based on productivity. This is primarily because the rule of law processes are largely absent in big commercial sectors like trading, where profit is largely derived from extractive practices and corruption. These sectors weaken Nepal's economic security and fail to generate employment.

But this idea of promoting small and medium enterprises is directly linked to the ability of the state to adopt new technologies (e.g., ridesharing, Facebook and technological integration) that will weaken the power of the state to control the power of the citizens.

In such a situation, as PM Oli tries to go back to work and maintain political control over the political and social process that is increasingly going out of control, Nepal will have to debate and talk about our ideas about the nation-state. Do we want the state to cater to capitalist interests or do we want to put the interests of the people? Do we want to be open to foreign direct investment and technology or do we want to protect the crony capitalists? Do we want to promote productivity-based growth or corruption-based profit?

These are some of the questions that the pandemic and growth of technology have raised in recent days.

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