Local Manufacturing and Double Digit Economic Growth

Gopal Humagai
After the emergence of democracy in Nepal, At the end of 2007 B.S, the
government led by Matrika Prasad Koirala approved Nepal's first budget of Rs.
52,529,000. That budget aimed to raise revenue equal to Rs.30,619,000. Most of
the revenue was concentrated on customs duties on goods imported from India.
Collecting revenue from the goods imported from India was included in the list of
important tasks of the budgets made after that it helped to shrink Nepal's
production capacity. If the governments had provided financial and technical
support in the budget since 2007 B.S to produce the raw materials and raw
materials available in Nepal, the country would have progressed towards a
production-oriented economy much earlier. Similarly, as a result of not
emphasizing the initial budget and policies and programs on mutual trade with
other countries of South Asia including China, Nepal has to deal with more than 60
percent commercial dependence on India. Thus, not emphasizing domestic
production and not being able to compete with foreign goods with the domestic
product is affecting Nepal's commerce. As long as Nepal does not have a domestic
product to export abroad, thus the country will not be able to achieve double-digit
economic growth which is the goal that Nepal is moving towards.
Nepal has made three-year and five-year plans at different times and is working
accordingly. Nepal has completed 14 periodic plans till date. Now the 15th Five-
Year Plan is going on which started from this financial year. Even though it has
been planned and acted for a long time. Nepal has nothing else to sell as Nepal's
products to the world and contribute significantly to the budget, except Nepali
workers, which is the failure of Nepali economy. The reason for this failure is that
the Nepali economy has neglected its own production.
In Nepal, while conducting economic planning and development programs, it is
seen that more emphasis is being placed on those areas or place which is already
developed. There is no parallel development in items with the same capacity. For
example, stakeholders pay more attention to Fewatal, but Begnastal, which has the
same potential, is neglected. In this way, we are not able to take advantage of such
places even if we ignore the places and things that have the same or more capacity.
local government and its own local products
There are 753 local governments in Nepal, each region has its own production
area, and capacity to produce a local authentic product. The local government
which has potential in tourism should focus on tourism. Those who can produce
vegetables should produce vegetables, those who can produce herbs should only
produce herbs. Looking at the Nepal Tourism Year 2020, it was seen that the
government tried to include all the local governments of Nepal, which was
completely wrong because Nepal is the best country in the world as a tourist
destination, but not all the local governments of Nepal are tourist destinations.
When planning and implementing the local government, it should be based on the
production capacity of each local government. For example, Rautahat district has
the capacity to do agriculture and animal husbandry, we should plan for Rautahat
district to support agriculture and animal husbandry. When calculating the gross
domestic product, the local government should also calculate its gross domestic
product. The local government should make it with the thought of double-digit
economic growth by emphasizing internal production. Each level should pay
attention to the production that makes an important contribution to their region and
also facilitate the access of products to the market. Agricultural production can
give an important contribution to the domestic product of the local government of
the Terai region, but none of the local governments have made a plan to increase
the agricultural producct. The government of Nepal should encourage the local
level of the Terai to make an annual program to contribute more and more to the
agricultural sector and also provide technical assistance. The contribution of paddy
to the total domestic production of Nepal is more than other crops. In the year of
good rains, the production of paddy is good, so the domestic production of the
country is also increased. But the governments do not provide paddy seeds that
give more production, disease-free pesticides, technical support to farmers, and
most important irrigation. The government does not pay much attention to the
production of other crops like paddy, wheat, maize, and lentils. Farmers are
equally suffering from the problem of non-harvest due to maize seeds imported
from abroad. The government does not take action to this. In this way, more than
70 percent of the people of the country are involved in agriculture. Without the
implementation of a program to address them and the concept of export-based
agriculture, double-digit economic growth is a daydream. When the government is
preparing the gross domestic product, it should also evaluate the gross domestic
product of every local government and the contribution of every sector. The local
government should also make its own plan in order to increase the total production
of each area while making its budget. As the climate of Nepal is suitable,
agriculture and animal husbandry should be linked to the school curriculum. In this
way, if each local level increases its capacity to produce specific products, it is not
impossible to achieve double-digit economic growth.
What is the federal government doing?
The federal government is now walking alone. It is advancing its plans without the
coordination of local and state governments. The existence of the local level was
not accepted in the central government, now the co-existence of union, state, and
local government is accepted as per the federal system of governance, so
coordination is necessary for all planning. As federalization is the initial stage of
implementation, local governments are not competent in all areas. They are the
weakest in terms of increasing economic activity. The local people's
representatives have seen that their work and development are to build a road,
build a school, and build a hospital from the budget allocated by the government.
The country cannot achieve high economic growth just by spending the budget
given by the government, and for that, the local government should bring a
product-oriented program. For this, federal and state governments should
coordinate from planning to implementation. Since a large part of the total budget
of the country is in the local government, there is a possibility of a dramatic
increase in the country's economic growth if the local government is the main
producer. In local production, emphasis should be placed on food production, herb
production, animal husbandry, animal products, and the mining of minerals. At the
same time, agriculture-based industries should be operated to produce high-quality
goods that can be exported abroad from the agricultural raw materials produced in
Nepal. There should be a plan for the provincial government to operate a
pharmaceutical industry to make medicine by processing herbs. In this way, the
country can achieve double-digit economic growth through agriculture if local
units work for raw material production and provincial government establish
industries based on local production and the federal government plays a facilitating
role in exporting to the international market.