Foreign aid: Need to streamline donor packages

When it rains, it pours,” so goes the proverb. However, so much of rain will inevitably have an adverse impact on the lives of people. Similarly, while the funds and grants that have poured into Nepal in the last five decades and are reportedly ready to pour in from the donors and friendly countries, it is not difficult to draw an analogy to the above proverb.

We have seen large sums of funds not being managed properly for reaping maximum benefit in developmental activities. We have seen large overlaps in the programmes that these funds were to support. These competing programmes counteracted and repressed the intended positive impacts. Difficulty in managing so much financial resources encouraged unethical behaviour at all levels. Corruption became rampant at the bureaucratic and political levels. Even private sector had to bear the brunt and endure the worst kind of irregularities. Fund misappropriation became the order of the day. The ‘white paper’ presented in the parliament by Finance Minister Dr Ram Sharan Mahat on Monday has revealed a sad story of doling out money in unproductive activities by the then royal government. Hence, it is high time the country seriously pondered over how and when to accept aid packages that come her way.

There is a dire need for right mixture of policy at this crucial juncture when the entire polity and social fabric is in the process of a sea change. Nepal needs to straighten out, start prioritising areas of development most critical for the country, and accordingly welcome relevant donor contributions. Simply put, we need to say more ‘no’ and less ‘yes’ in order to ensure that the kind gestures of the donor communities are utilised to reap maximum benefits for the intended beneficiaries. The international community has been very kind to Nepal in giving grants and funds in the past and have shown their readiness to help our country even after the political change brought about by the Jan Andolan. Streamlining their sincere efforts to lift the country out of the doldrums should be reciprocated by defining our wants? And when we want it? Time has come to analyse why we couldn’t develop in spite of billions and trillions of funds flowing into the country.

No country in the world has prospered from donor’s money alone. In Nepal, these resources are seen to primarily enhance corruption and greed on the one hand, and significant portion of the fund is spent on engaging foreign experts on the other. Thus, it is not difficult to see why the funds rarely reached the real beneficiaries. Post-1990 saw tremendous increase in the number of INGOs and NGOs, mostly with foreign funding. Majority of the employees in these organisations are considered development workers. It is through these individuals that one expects the available resources to reach the beneficiaries and contribute to sustainable development. It is also well known that there is a limited qualified human resource pool in the development sector in Nepal, which acts as a barrier to growth. However, considering the fact that many development workers in Nepal are becoming richer by the day as compared to their equally educated colleagues working in other sectors, it is no surprise why many enter this field. But why such profitable occupation fails to attract a greater pool of qualified individuals defies logic.

It is not difficult to understand why we are so obsessed with donors’ funds, either. In fact, we have transcended to a level where the success or failure of the government is measured in terms of amount of fund brought into the country. Such measure only adds to compound the development paradigm rather than identify path-breaking avenues for socio-economic development of the society.

We need to thus start saying more “no” and less “yes” with the aim of facilitating the attainment of goals in the prioritised development areas. More substantive help would be obtained if we balance the aid for prioritised areas, technology transfer, infrastructure development and identification of easy access of Nepali products in their markets. For example, our two giant neighbours are experiencing rapid development and instead of requesting funds from these countries, we should identify what exportable products are available or can be made available, determine what our comparative advantages are and develop economic package for seeking mechanisms to open their markets for our indigenous products. One such case may be the negotiation on mutually beneficial terms in harnessing Nepal’s huge hydropower potential.

Finally, let’s hope peace will prevail in the country. Peace is inevitable if Maoists join the mainstream politics. There is a great opportunity for the leaders to do away with their petty fighting and bring economic revolution in the country. The country should come first before our petty self. That in itself can be the first step towards self-reliance, sustainable growth and self-respect.

Shrestha is consultant, FNCCI think tank