Review

Remedying the Ills of the Past
Aditya Adhikari

Nepal is a country where for much of its history—particularly the past two decades—the business and analysis of politics has dominated everything else, including the economy. This has significantly hindered not only the process of economic growth and the major task of lifting the population out of poverty, but also the production of well-informed and accessible accounts of how and why Nepal's economy has performed dismally and what can be done to remedy the existing state of affairs. Sujeev Shakya's new book Unleashing Nepal: Past, Present and Future of the Economy has been written to remedy the gap.

Written in simple, non-technical prose accessible even to those with no knowledge of economics, the book encompasses, in 12 chapters, all aspects of Nepal's economy from the time the nation-state originated till the present day. It begins with a description of the nature of the pre-1950 state, which was isolationist and preoccupied solely with raising revenue for the spending of the state elite. Shakya then goes on to trace the legacies of this period into the modern day.

Much of the book is devoted to examining various aspects of the political and economic systems that emerged after the opening of democratic space in 1990. There are reflections on the crisis of governance and its impact on the economy, the business sector, the role of the development industry, the growth of the remittance economy and the impact of the Conflict. This is then followed by four chapters laying out the writer's vision of the changes that need to be undertaken if Nepal is to witness a period of sustained economic growth and be integrated with the global economy.

Sujeev Shakya is an established figure in Kathmandu circles. A business executive who has spent two decades working and closely observing Nepal's business sector and economy, he worked for a long period of time at Tara management (earlier Soaltee Group Private Limited) and for a shorter period, as President of the Bhote Koshi Power Company. In 2008, he started his own management consulting and advisory firm, Beed management, which, in the short time since its formation, has already, in contrast to almost all business houses in the country, developed a reputation for adoption of cutting edge management techniques in line with international standards.

In addition, Shakya has for the past eight years been writing a popular column on business and the economy in the Nepali Times. It is from all these experiences that Shakya draws his inspiration and his insight.

The finest sections of the book, then, draw directly from these experiences. Among the chapters of the book that reflect on the past of Nepal's economy, the most original and insightful is the one that deals with the private sector.

There is a common conception that the private sector in Nepal has not been able to flourish primarily because of bad governance. Rectify the politics, it is argued, and the economy, led by the private sector, will soar. Shakya demonstrates that, while it is indeed the case that Nepal's governance has been poor and inhibitive of entrepreneurial activity, the mindset of much of Nepal's entrepreneurial class is also to blame.

Shakya claims that Nepal's business class is still afflicted with a rent-seeking mentality, perhaps a legacy from the days when the ruling classes predominant function was to extract as much resources as they could from the peasantry. Nepal's entrepreneurs, Shakya argues, continue to believe that taking advantage of differential customs duties and transporting third-country goods in directions that will enable them to make a profit is the most superior way of making a quick buck. This limited mindset has meant that truly visionary business leaders, those with the ambition and drive to create large enterprises that produce goods for a global market, have been few and far between. In addition, as Shakya claims, the business sector has been afflicted with the same ills of politicisation as the government and bureaucracy. This, too, has dampened entrepreneurial vision and drive.

It is perhaps a consequence of having to tackle too many themes within a limited number of pages, that a few of the chapters—like the one on the impact of the conflict on Nepal's economy, for instance—consist more of a summary and synthesis of already existing work than original research and critical reflection. But these flaws are forgiven by the time the reader gets to the stimulating concluding sections of the book, where Shakya ambitiously tackles the issue of what structural changes in both institutions and mindset are required if Nepal is to break away from its past inheritance and enter a period of sustained economic growth.

As is the case in most "visionary" writing, the remedies proposed may often seem utopian and unattainable from the vantage point of current-day Nepal. But what distinguishes Shakya's writing from other such work is that on each specific issue—ranging from transforming agriculture to redefining Nepal's economic boundaries and thus its place in the world—specific and tangible remedies, that will likely provide general reader and policy maker alike with food for thought, are offered.

Visit Website
Beed Management Nepal Economic Forum Arthabeed Sujeev Shakya