Higher wages only when more investment: Experts

Kathmandu, September 1:

Nepali labourers are the lowest paid in the world, say economic experts who feel these workers should get respectable wages.

“If Nepal wants to guarantee higher wages to its labour force, it should invite more investment,” said Dr Ram Sharan Mahat, former finance minister while addressing the Economic Summit-2008 here today that has sought a commitment for Rs 12,000 monthly income of every Nepali.

More investment, whether domestic or foreign, creates more competition in the market benefitting the labourers. “Competition among companies will help increase the wages of labourers,” he said, adding that double digit growth could be achieved even without discriminating against the investments. “Without double digit growth, Rs 12,000 monthly income per person cannot be achieved.”

As there are no differences among the political parties on developing the nation and achieving high growth, ideological differences won’t create problems, opined Dr Mahat. “We need capital more than capital needs us,” he said adding that in the present context throughout the world pragmatism has overtaken ideology.

Dr Shanker Sharma, former vice-chairman of the National Planning Commission (NPC), presenting his paper on ‘Nepal’s economic growth, its analysis and suggestions for a prosperous Nepal,’ said capital was the key to growth and Nepal lacks it. “Private investment should be encouraged,” he said.

Countries like China (9.8 per cent), Cambodia (9.4 per cent), Vietnam (7.6 per cent) and India (7.4 per cent) have achieved high growth due to more investment. He called for boosting the confidence of the private sector, a vibrant market, good governance, simplification of procedures regarding trade and investment and improvement in infrastructure for growth. “Nepal can benefit those sectors that have competitive advantages like high-value crops, more irrigation for more crop productivity and hydropower generation,” he added. “However, export is the dynamo for growth,” Sharma said, adding that export has been on a downslide over in the last decade due to various reasons.

Higher growth should match with equitable social justice for sustainability growth, otherwise there could be yet another revolution, said Radhesh Pant, president of Nepal Bankers’ Association (NBA).

Connectivity was the key to growth as it would help bridge rural-urban and rich-poor disparities, he said adding that the summit could be the first step towards it.

Disturbance in connectivity has hit the supply system. “Supply system should be improved,” Dr Tilak Rawal, former governor and Constituent Assembly (CA) member, said. The present inflation was supply-induced, he said. “Its not due to high demand, rather it is due to supply bottlenecks,” he said, adding that better water management for electricity generation and irrigation were vital for achieving growth.

“Agriculture subsidy is the crux of trade dispute at present between even the power nations,” Rawal added. “Government should subsidise fertilizers and electricity for farmers. By investing on farmers, government can bridge rural-urban disparity.”

“Development of water, land and forest also can bridge the rural-urban gap,” Top Bahadur Rayamajhi, Maoist CA member, said. However, CPN-UML CA member Dr Bishnu Poudel suggested a conducive industrial atmosphere for sustainable growth. Professor Madan Kumar Dahal stressed on operational and implementation-oriented policies.