The Covid-19 pandemic has hit Nepal’s economy hard. By all indications, the lockdown will have profound long-term impacts that are difficult to fully determine now. As we take stock of our losses, reassess our economic vulnerabilities, and contemplate the future, perhaps this crisis also gives us an opportunity to pivot to a more resilient, sustainable growth path. Perhaps we need to re-evaluate the importance we place on the growth agenda. And perhaps it is time to address the real frailties that disasters, pandemics, and economic shocks merely expose: Our systemic failings, our failure to tackle inequalities, and our unchecked plundering of earth’s resources.

At the heart of our frailties lies climate change. Nepali communities have become more vulnerable to disasters, biodiversity and habitat loss, resource degradation, and rising temperatures and pollution, all induced or compounded by climate change. This vulnerability will only be exacerbated by the pandemic, with livelihoods already disrupted across the region, remittances slashed, vital sectors closed down, food security compromised, and the healthcare sector possibly overburdened if cases continue to rise. So what path can Nepal carve to address its climatic and economic vulnerabilities? The time has come for us to reimagine and restructure our economic priorities—putting people and the environment above profits. Maybe it is time for Nepal’s own Green New Deal.

What is the Green New Deal?

Recognising that climate change and economic inequality have to be addressed in tandem, countries across the world have proposed a form of the Green New Deal to guide their domestic administration. With a great economic recession—some predicting it to be the largest since the Great Depression—on the cards following the outbreak of the pandemic, it fits the bill for building a resilient, sustainable future. Nepal can do well to look at interpretations of such programmes across the world, but it will ultimately need to draft its own green deal to address its unique needs.

Nepal’s 15th Five-Year Plan aims to achieve significant economic growth, graduate from a least developed country to a developing country by 2022 and achieve the Sustainable Development Goals by 2030. Worryingly, the country is expected to experience very negligible growth in the post-pandemic setting.

A green deal for Nepal needs to look past short-term economic growth and instead make vital sectors and systems resilient. It would need to channel investments in expanding renewable energy sources, promoting green transport and infrastructure, investing in creating green jobs, widening its social security net, and strengthening its agricultural and healthcare systems. The focus should be on adopting a green approach to reduce vulnerabilities and promote inclusive growth.

Subsidising low-emission transportation systems insulates from unpredictable price shocks and supply of fossil fuel. Promisingly, Nepal already has relatively low carbon emissions, and our energy needs (excluding for cooking) are largely met through hydropower, which is a major component for a green approach and has vast untapped potential. Our Green New Deal should continue promoting renewable energy by implementing suitable subsidy mechanisms while also pushing clean cooking alternatives. Enhancing and replicating existing mechanisms such as ropeway transport for rural mountain communities can significantly decrease costs and could revolutionise new-age transport.

Widely promoted and well-crafted provisions can help bring in more investments in sustainable and upgraded green industries to provide green jobs in sectors like transportation, waste management, and manufacturing to ease future out-migration trends. Branding of green produce through certifications can potentially reorient consumer behaviour and create additional demand for locally grown and manufactured green products. At the same time, resource exploitation and emissions can be reduced through measures such as cap and trade, the polluter pays principle, carbon tax, and payment for ecosystem services. The last of these measures is a government of Nepal strategy and there are already case studies showcasing success on a micro scale in watershed management. Careful formulation of this scheme can also help reduce deforestation and emissions.

Around 99 percent of the businesses in Nepal are micro, small and medium enterprises (MSMEs). Nepal’s version of the Green New Deal would need to regulate MSMEs’ heavy dependence on natural resources, especially non-timber forest products, while also improving their health and creating green jobs, thereby reducing dependency on remittances. Further, a significant number of MSMEs are led by women entrepreneurs, so there is immense scope for improving gender and social equity through targeted investments in businesses. This would need facilitated investments (national and foreign), capacity building for sustainable business practices, and incentives and subsidies to support existing and new enterprises.

Focus should be shifted towards promoting green infrastructure and technology, which in the long run will help better absorb abrupt shocks such as the Covid-19 pandemic and ultimately climate change. Evolving social security nets must be designed to protect the most vulnerable population on the basis of viable mechanisms such as vulnerability-targeted insurance and low regret investments. Similarly, the current situation demands a better healthcare system; new health infrastructure must be designed to promote green health care development and create additional green jobs. Ensuring sustainable, diverse food production and supply systems through mechanisation and subsidies based on the principles of agroecology and climate-smart agriculture will contribute towards addressing prevailing food security issues.

The road to a Green New Deal

There is no single standard pathway or framework to implement a green deal. Each country’s planned measures will depend on its own environmental and socioeconomic realities. We can draw lessons from and build on existing national and local programmes such as Local Adaptation Plans for Action and National Adaptation Plans, which focus on an integrated approach to leave no one behind in climate change adaptation.

We need a groundswell of public support and mobilisation (particularly an energised youth base) for a Green New Deal to gather steam in Nepal in the post-pandemic setting. The development and implementation of a comprehensive programme must be a consultative process, with the inclusion of various levels of government, local to regional organisations, business and scientific communities, and the public.

Macroeconomic transformations are always challenging. A green deal would entail extensive government spending and public works to decarbonise the economy while addressing key social and economic concerns. And legislation will be plagued by political impediments and industrial lobbies. But the fact of the matter is that we need to fundamentally redefine development, sustainability and wellbeing. And with proper advocacy and political manoeuvring, the Covid-19 pandemic could be used as a platform to implement transformative strategies towards a sustainable, green economy resilient to future shocks. The path towards a Green New Deal will undoubtedly be fraught with roadblocks, but returning to business as usual will certainly lead us towards more unmitigated economic hardships and climate disasters. The cost of inaction is too high.

Pandey is a livelihoods and climate analyst at the International Centre for Integrated Mountain Development (ICIMOD).