Hard to swallow
National Planning Commission (NPC) vice chairman Dr Shankar Sharma has claimed that Nepal has emerged as a model of “result-based management” for other countries. In making this tall claim, he referred, among other things, to Nepal’s economic reform process and the Poverty Reduction Strategy Paper (PRSP), which forms an integral part of the current Tenth Five Year Plan. He recently presented a paper on “Result-Based Planning in Nepal” at a seminar in Manila organised by the Asian Development Bank. Top policy-makers of the country have made such claims since the planned development process started half a century ago. The problem with all these and Sharma’s claims has been that they are not reflected in the results that the people can feel in some way.
Anybody with a very ordinary knowledge of Nepal’s economic governance knows that most of its economic ‘reforms’ originate in the minds of donors, particularly multilateral ones, and then are transmitted to our policy-makers for incorporation into official documents. Foreign aid depends mainly on the fulfilment of such conditionalities. Our current development plan and national budget amply reflect this stark reality. The PRSP and the economic reform package that Sharma makes so much of owe largely to the donors, with whose money and under whose supervision, they were drawn up. Not surprisingly, the multilateral donors lauded the PRSP as a ‘sound basis’ for continued economic aid to Nepal. The recent suspension of about Rs.5.5 billion committed by the World Bank as budgetary support for the PRSP during the current year throws sufficient light on the government’s reform process, as the Bank cited the failure to fulfil certain important reforms as the reason for the suspension.
If Sharma’s claim about the macro management system had been close to reality, the country would certainly not be in the sorry state of today. To subject the NPC itself to the test, one current example would be enough. Under the present internal conditions and the unpromising scenario for foreign aid, which is estimated to fall short of the original estimate by Rs.12 billion this year, the goals and targets of the national budget and the Tenth Plan look too ambitious, making it necessary to reorder them. But the NPC does not seem to have started any serious work on this. Another pillar of the country’s current macro-economic management, the present finance minister, recently called the Tenth Plan ‘irrelevant.’ This statement and the NPC’s silence on this speak volumes for the quality of our macro-management. The NPC, supposed to have completed the mid-term review of the Tenth Plan last year, has not even started work on it. Sharma’s claims, therefore, are hard to swallow.