Absorptive capacity

Most Nepali people think that we do not have enough resources to support development activities. They believe that our bridges and roads are not being built because we do not have money. Surprisingly, Finance Minister Ram Sharan Mahat has been burdened with Rs 17 billion as reserves, having no clue as to how and where to spend that much money. The mid-term budget review by the Finance Ministry predicts that the country would be able to spend only Rs 97 billion out of appropriated Rs 143 billion, by the end of this fiscal year. The minister sought proposals from government agencies to utilize the swollen reserves, and altogether they showed capability to absorb a mere 2 billion rupees. Interestingly, our government is not in a position to be delighted to have achieved the revenue target set by the budget. This year it is kind of worried about overshooting revenue target because of lack of a capacity to spend it.

Why is Nepal's absorptive capacity so low? Obviously, the bureaucrats would be loathed for their lack of competence to spend money properly. More than competence, it is said that the lack of initiative among the concerned authorities is a bigger impediment. The absorptive capacity is also intrinsically related to infrastructure, skilled labor force, macroeconomic balance and other economic factors. The low absorptive capacity also repels the donors from providing financial assistance to Nepal. In fact, the donors calculate the absorptive capacity of a country and aid-effectiveness before sanctioning new support. As per international practice, absorptive capacity is the ability to use additional aid without pronounced inefficiency of public spending and without induced adverse effects. Unfortunately, in our case we have been losing installments of the sanctioned aid for failing to provide a report of the preceding work.

Lack of initiative on the part of the bureaucrats is definitely the crucial area to be improved to enhance our spending capacity. If any officer is worried that he might be penalized for the work he accomplishes, with the change of the minister or the party in the government, he/she would not take any initiative. Also the infrastructure and skilled labor force are pertinent issues. Our failure in the development of roads, bridges, energy, education etc. have severely hampered our capacity to spend more. Similarly, we do not have enough manpower to execute the projects. Moreover, due to the 11-year long insurgency, there are not even enough unskilled laborers to work in the projects, not to talk about skilled ones. So, the absorptive capacity is not only an economic problem, it is also a political issue. Until and unless our political parties agree on common minimum economic issues, we will always be facing these and other issues as impediments, always forcing us to remain under poverty and deprivation.

Source: The Kathmandu Post, April 27, 2007

US to Keep Treating Maoists as Terrorists: Moriarty

Rekha Shrestha

Kathmandu, April 25The United States ambassador to Nepal, James F Moriarty, whose tenure ends on July 15, still hopes that the Maoists will give up “violence and extortion” and he will get to shake hands with Prachanda.“I would very much like to shake hands with Pushpa Dahal but that will happen only when the Maoists give up violence and extortion,” Moriarty said in an exclusive interview.Moriarty, who admires the “courage of the Nepali people” and considers his three years in Nepal one of the highlights of his life and career, said he hoped to see “meaningful change in the behaviour by the Maoists.”The US sees no evidence of the Maoists stopping violence and extortion, said Moriarty.

“As long as the Maoists do not end these practices, they cannot be considered a normal political party and the US will continue to treat them as a terrorist organisation.”Moriarty added, “For free and fair constituent assembly elections the continuing Maoist violence and extortion must stop and the demands for inclusion by traditionally marginalised groups must be addressed.”On his recent visit to eastern Nepal, he said very few people felt confident that the constituent assembly elections would be free and fair if the Maoists continue their violent acts and if the concerns of marginalised groups were not addressed.He congratulated Nepali people for their successful and historic efforts on the first anniversary of Jana Andolan II.

“Their sacrifices and commitment for democracy were truly inspiring.” He reiterated that the future of the monarchy should be decided by the people of Nepal, and added, “The US respects and will honour the decision of the Nepali people.”The US provided nearly $50 million as development assistance in 2006 and anticipated giving a similar amount in 2007. “American aid supports peace building, democracy and governance, health programmes, rural road construction, agricultural services, and humanitarian aid. No ministries led by Maoists are receiving US funds directly.”“We urge all parties involved in Jana Andolan II to meet their commitment to peace and democracy,” stated a press release issued by the American Center.

Source: The Himalayan Times, April 25, 2007

Nepal says king must go as nation marks 'democracy' anniversary

KATHMANDU : Nepal's new government celebrated on Tuesday the first anniversary of the end of King Gyanendra's absolute rule as Maoist chief Prachanda called for an immediate end to monarchy. "We want the interim parliament to declare a republic immediately," Prachanda told thousands gathered at a ceremony marking last year's victory of the "people's movement" that forced the monarch to relinquish direct rule. Polls to elect a body to decide the future of the monarchy and rewrite the constitution are due to be held this June, but the former rebel leader called for scrapping the monarchy without staging an election. "If it (the declaration of a republic) doesn't happen, we will come to the people and launch protests to declare a republic," said the once elusive leftist whose nom de guerre means "the Fierce One."

Last month, the rebels joined the government under a peace deal with mainstream parties ending a decade-long insurgency. The crowd thronged Durbar Square, the historic heart of old Kathmandu, for a rally commemorating what has become known as the "People's Movement." The movement forced King Gyanendra to agree to restore parliament on April 24, 2006, 14 months after he seized power in what he said was a bid to crush a Maoist revolt. "On this day, Nepali people successfully fought for their rights," Prime Minister Girija Prasad Koirala said, as a helicopter showered flower petals over a flag-draped parade ground ceremony marking "Democracy Day" earlier on Tuesday. "This day has given us the responsibility to build a peaceful, prosperous and a new Nepal by ending all sorts of problems and conflicts," he said as an army band play lively martial music and children paraded past carrying banners. The army - once fiercely loyal to the monarch - played a central role in the celebrations, in what observers said was a signal aimed at dispelling talk about cracks in the peace process.

"It's a long way for a country to come after 10 years of bitter armed conflict," said Ian Martin, the head of the UN mission in Nepal. "The Maoists have come from the countryside into the political process, the Maoist army has placed its weapons under storage and UN monitoring and we now have the interim parliament and government that the Maoists have entered." As the former rebel leader called for an immediate end to the monarchy, King Gyanendra and his wife visited a temple on the outskirts of Kathmandu to sacrifice animals and offer prayers. The trip to the temple is an annual ritual for the monarch revered by devout Hindus as a reincarnation of the god Vishnu. King Gyanendra dismissed the government in February 2005 and seized absolute power, claiming that the country was headed for anarchy. But his heavy-handed crackdown on free speech - including mass arrests of protesters and tight media controls - led to a surge in anti-royal sentiment. The king has already lost his title as head of state and no longer is army chief.

"The king has been the biggest loser and he has nobody to blame but himself. He gambled the institution of monarchy for his own benefit," said Kapil Shrestha, who teaches politics at Tribhuvan University. At least 19 people died and 5,000 were injured in last year's protests, which forced the king to abandon direct rule. But a range of problems threaten to make the road ahead a rocky one. "The future looks bright and promising but greater challenges lie ahead," said Shrestha. The Maoists, who still feature on Washington's list of foreign "terrorist" groups, are facing continued allegations of mafia-like conduct including extortion, kidnappings and beatings. The government is also wrestling with fallout from deadly clashes between Maoists and Mahadhesis - a major ethnic group in the southern plains - with the leftists accusing the king of provoking the violence. - AFP/de

Source: Asia Pacific News, April 25, 2007

Maoists' protest rocks Nepal Parliament

Kathmandu, April 25 (PTI): Agitated Maoists lawmakers, pressing for immediate announcement of the Constituent Assembly polls, disrupted Parliament proceedings for the fourth day today, prompting the Speaker to adjourn the session for two weeks. The slogan-shouting CPN-Maoists MPs surrounded Speaker Subhash Nemwang's rostrum and demanded that the government announce the election date soon. They also asked the Home Minister to apologise for the last month's police raid on the offices of the Young Communist League, the youth wing of the Maoists, here. There are 83 Maoist MPs in the 330 member House.

The Maoists were joined by Madhesi lawmakers who demanded that the government form a high-level probe commission to inquire into the killings during the violent agitations in Terai region in January-February that killed at least 60 people. They were also demanding that the government reconstitute the constituency delineation commission to give "proper" representation of the Terai region. The stand-off has been continuing for four days. The Speaker adjourned the Parliament session for the next two week today. The Parliament will now meet on May 9, the Parliament Secretariat said in a notice today. The government could not pass a number of bills including those related to the Constituent Assembly due to the 0disruption of the Parliament proceedings.

Source: The Hindu, April 25, 2007

Maoists seizing Gyanendra's land

KATHMANDU: Blaming the government for failing to fulfill its commitment to nationalise the properties of Gyanendra, Nepal Maoists have begun seizing 'royal properties' in Kathmandu, even as four political parties led by loyalists of Gyanendra have applied for official recognition with the election commission that would allow them to take part in the constituent assembly polls. "The parliament has failed to formulate laws on capturing land belonging to the king, as such the Young Communist League (YCL) will now capture all such land and use it for the public," central committee member of the CPN-Maoist Hitman Shakya said.

Already under fire for engaging in extra-constitutional activities like holding courts, policing and abductions, the Maoist-affiliated YCL has now announced a fresh campaign of seizing 'royal properties.' The YCL cadres announced that they had "nationalised" 99 ropanis of royal land in Bhaktapur's Sallaghari area on Saturday. Shakya, Coordinator of 'New Kathmandu Valley Campaign', announced the launch of their drive by planting a tree-sapling on the land, said to be in the name of late prince Nirajan. Shakya said they were taking the initiative since the government has been unable to fulfill its commitment to nationalise the royal properties. It is the first time the Maoists have declared the seizure of a royal property in the Kathmandu valley, the Nepal News online said on Sunday.

Meanwhile the Rastriya Prajatantra Party of Nepal led by Rabindra Nath Sharma, Nepal Sadbhavana Party (Mandal) led by Badri Prasad Mandal, Samajbadi Party led by Salim Miyan Ansari and Janamukti Party led by MS Thapa submitted their applications with 10 thousand signatures that are required for registration of a new political party. Mandal and Ansari, who were ministers in the erstwhile royal cabinet, have been charged with brutal suppression of last year's mass protests against the 14-month absolute rule of the monarch by the high-level probe commission. RPP (Nepal) chairman Sharma and Kamal Thapa, who held the home portfolio in the royal cabinet, were accompanied by dozens of party supporters who chanted slogans in favour of Gyanendra. Members of Sharma's party, which advocates a constitutional monarchy, have been attacked several times by the activists of the eight parties during party meetings.

Source: The Times of India, April 22, 2007