Haphazard planningThe federal government’s organisation for economic revival has been lacking.
Nepal, much like most economies of the world, is in a state of crisis. The lack of proven treatment methods and a viable vaccine has made social distancing and lockdowns the only effective solutions to contain the spread of the novel coronavirus. However, the lockdowns have created problems of their own. Demand has been hit hard; the lockdowns essentially reduced the ability to purchase services and goods as before. Many people have become redundant, necessitating a reduction in purchases. Supply has been constrained due to the inability to work as usual. All of this has forced governments to relax some lockdown measures. The key to coming out of this crisis relatively unscathed, it seems, relies on a mixture of enforced distancing, a partial return to normalcy and continued testing and isolation of outbreak hotspots.
It was in this context that Nepal, too, as of May 10 had to push for an opening of at least 40 types of businesses. Yet, even in this crucial stage, where the needs of containing the virus have to be balanced with a push for economic activity, the government has shown planning failure.
A major frustration has been in the planning for labour mobilisation. Reflecting lower than expected remittances, tourism and trade, not to mention other economic disruptions, the World Bank has estimated Nepal’s economic growth rate to fall to between 1.5 and 2.8 percent in the fiscal year 2020. Moreover, the country was already set to experience unemployment much higher than the last estimated 11.4 percent, and 35,000 migrant workers are expected to be repatriated soon. Over 60,000 have already returned, scrambling to get back before Nepal closed its borders on March 22. This would mean, in an economy struggling to revive itself after being shuttered for over a month, there will be over a million additional job-seeking individuals to cater to.
Although the government has talked of grand schemes to accommodate for the labour glut, hardly anything has been forthcoming. The much-touted Prime Minister’s Employment Programme has been a failure since its inception; not much is expected from it in practice. While the upcoming budget is expected to go at lengths about enabling local governments to find locals work in repairs, existing infrastructure projects and agriculture, the lack of employment currently should have necessitated expedited plans. Yet, only a few municipalities in the entire country seem to have begun a food for work programme.
Further, even as the government allows for the reopening of industries, many complain of a major shortage in available labour. This too has been because of the government’s incompetence. The lockdown orders were confusing in the beginning. Moreover, municipalities were reluctant, given the lack of support from the federal government, to provide much-needed relief to transplanted workers living in their area. This forced many domestic migrant workers to find a way home, instead of sheltering where they were. Now, even as a million or more need the work to sustain themselves and their families, the businesses and industries near population centres struggle to find the labour to restart the economy.
In a final blow to plans for a revival, the government has even botched the relaunch of vehicles on urban streets. A ‘time card’ system that prioritises government vehicles over small businesses has made it difficult for these enterprises to function. Ironically, the businesses that innovated to thrive during the lockdown, such as grocery delivery services—which essentially ensured business as usual while providing safe access to foodstuffs—now complain of harsh time schedules that have forced them out of service.
The government seems to be trying out measures and accordingly changing its plans based on the outcome. But people’s lives are at stake here. Caught between a deadly disease, which has taken nearly 300,000 lives and debilitated many more, and a floundering economy and joblessness, which affects their ability to survive, the people cannot afford to be experimented with. The federal government must immediately rethink how it plans to open up the economy, and how it plans to mobilise all labour without endangering them.