The attitude of civil servants must also change for the industry sector to foster
Despite the tall talk by the government about how keen it is to industrialise Nepal, its laws, rules and regulations have proved to be a damp squib. This has discouraged young entrepreneurs from venturing into manufacturing in the country for fear of losing their investment. It has come to light that the production of an electric two-wheeler has come to a halt since September last year in the absence of regulations for registering vehicles manufactured in the country. Yatri Motorcycles had developed the fancy P-1 model after much investment and research and produced about 80 units, which have passed the roadworthiness test along with the certificate to be able to register and operate them in Nepal. However, lack of policies for registering the Nepal-made vehicle has shut down the industry. While Nepal's laws allow for the production and driving of Nepal-made vehicles, the absence of laws relating to ownership has made people hesitant to buy them for fear of friction with the traffic police now and then.
Nepal's economy is import-based, which is paid for by remittance money sent home by millions of Nepali workers toiling abroad. Successive governments have not only been unable to improve exports but have also failed to substitute imports, even in agro-based goods. This situation cannot be reversed until the country has a strong manufacturing base.
Nepal's merchandise exports today are less than a tenth of its imports, with processed cooking oil accounting for the lion's share. Unfortunately, even this dismal export figure has seen a slump by 26 per cent in the first nine months of this fiscal compared to the corresponding period last year.
Nepal's total exports of Rs 118.27 billion during the nine-month period could pay for just 45 per cent of its fuel imports, not to speak of other imports. Entrepreneurs cannot be expected to invest in manufacturing when there are obstacles at every step, and things cannot be done without greasing the palm of political leaders. Even when the laws are in place, the negative attitude of the civil servants towards investors is a major factor hindering the growth of industries and start-ups in the country. The constant delay seen in approving projects, for instance, pushes up their cost considerably, as is often seen in hydropower projects.
Yatri is not the first motorcycle company to manufacture vehicles in Nepal, although it is the first to produce an electric one. Both two and four-wheelers have been assembled in Nepal in the past, only to close after their production of a few units, apparently for quality reasons and laws unfavourable for their production and distribution. However, the transport sector in recent years is turning out to be a very lucrative one in Nepal, which so far has a monopoly of imported vehicles. If favourable laws are made, Nepal could see quite a few companies spring up to manufacture vehicles here, both two and four-wheelers. True, laws related to transport management were made when there were no domestic vehicle manufacturers. But times have changed, and there is no reason why the government should dillydally in giving the go-ahead to the Department of Transport Management to register domestically-manufactured vehicles.
Good initiative
Nepal Tourism Board (NTB) has held discussion with Myanmar's officials about the possibility of conducting direct flights from Yangon, the capital city of Myanmar, to Gautam Buddha International Airport (GBIA), which came into operation from last year. The NTB officials are hopeful that direct flights from Yangon would help promote religious tourism. A small number of Myanmar's Buddhists visit Lumbini, the birthplace of Lord Buddha, at an individual level. But the number could grow if there is direct air connectivity between the two countries.
During the discussion, Myanmar's Ambassador to Nepal Sen O stated that they were positive about the direct flights between Yangon and the GBIA. He said he would inform the NTB officials after studying the technical aspect and business plan. Not only Myanmar, the NTB and other government agencies should send their emissaries to Buddhist countries, such as Thailand, Sri Lanka, Vietnam, Laos, Cambodia, China, Korea and Japan to hold talks about conducting direct flights to and from GBIA for the promotion of religious tourism. No country will show interest in operating flights to GBIA unless the NTB launches a promotional campaign in this regard.
A version of this article appears in the print on April 21, 2023, of The Himalayan Times.