The National Development Council, in its first meeting after the country adopted the federal system of governance, finalised its concept paper of the 15th five-year plan (fiscals 2019-20 to 2023-24) last week. The plan, prepared by National Planning Commission, has set a target to achieve a minimum average economic growth of 9.4 per cent per annum over the next five years and up to 10.3 per cent per annum in the subsequent five years depending on different scenarios, as per the draft. In this context, Umesh Poudel of The Himalayan Times talked to Vice-Chairman of NPC Puspa Raj Kadel to discuss the details of the 15th periodic plan. Excerpts:
Nepal’s economy is basically import-oriented. Against this backdrop, don’t you think the annual growth target of 10.3 per cent by 2023-24 is far-fetched?
No. The target we have set is very much feasible. We should not be discouraged by the country’s past economic situation because the last two decades were very unfavourable. But with the new, stable government, we are confident that all goals, including economic, social and political, among others, will be achieved. Our job is to make a proper plan as per the government’s target. I believe that we should have faith in ourselves. If we do not dream big, we will be stuck with small achievements. I don’t want to reflect on plans and achievements of the past. The NPC at present is in the right path and I can guarantee that Nepal will achieve its economic target of double-digit growth after five years. We are in the preliminary phase of helping the government fulfil its goal of ‘Prosperous Nepal Happy Nepali’. In the last three fiscal years we have been able to achieve growth of six to seven per cent, so 10 per cent growth is not something that we cannot achieve. In fact, I think the government should be targeting double-digit growth for the next 25 years. In recent times, the government has been addressing the lapses on the political and administrative fronts that had been hindering both the economy and development agendas. As people have also started creating pressure on the government to fulfil its stated agendas, the government will be more aware of fulfilling those targets now.
Previous governments had also launched periodic plans. However, literally not a single government was able to achieve its targets. What could have been the reasons behind the failure and how do we need to move ahead?
There were some aspects that put a spanner in the government’s works in the past. The first obstacle to achieving higher growth was the civil war that started in 1996 and lasted for a decade. Even after that was over, we got stuck in transition for another decade with frequent changes in government. Prior to the civil war we were witnessing economic growth of around six per cent on an average. Now that we have a stable government and the situation has normalised, growth of seven to eight per cent is not a big issue. Even a double-digit target is achievable now if we are able to apply appropriate economic tools. For instance, the Nepal Investment Summit was one such tool to draw in foreign investment that can help spur growth. I believe the past periodic plans and projects were formulated without enough homework. That’s why we were unable to achieve much. Previously projects were included in the plans on the basis of recommendations of political leaders and power brokers without any study. But at present we have avoided such malpractices. After the 15th periodic plan is endorsed, we will do our best to stick with our stated objectives and also increase monitoring, evaluation and implementation of the selected projects. For this, we will coordinate with the line ministries and the Office of the Prime Minister and Council of Ministers.
However, stakeholders have been saying that the draft of the periodic plan is over-ambitious. What is your take on this?
I am not denying that the 15th periodic plan is ambitious. However, like I mentioned earlier, if we dream small, we will not be able to achieve much. The government needs to be ambitious if it wants to see a paradigm shift in the country’s economy and development goals. If you look at the plans of other developed nations, they too always set ambitious goals. If status quo is maintained, we will achieve the targeted economic growth of 10.3 per cent from 5.9 per cent, increase per capita income from $1,004 to $1,600, minimise the poverty ratio from 18.7 per cent to 13 per cent and decrease multidimensional poverty level from 28.6 per cent to 14 per cent, among others, by the next five years.
The economic growth target and industrial growth target in the 15th periodic plan seem a bit more ambitious than other goals. What do you have to say on this?
The 15th plan has been formulated with major focus on the economy and the industrial sector. In the past, industries were not able to fully utilise their production capacity due to lack of sufficient electricity. But now the scenario has totally changed and the government is ready to provide necessary power to the industrial and other service sectors that play a vital role in economic development. Last year, the industrial sector had 15 per cent contribution to the country’s gross domestic product, which now needs to be increased to 19 per cent. The 456-megawatt Upper Tamakoshi hydropower project is likely to commission power by next fiscal and a similar amount of energy is expected from projects being developed by private investors. The generation of nearly 1,000 megawatts of power by next fiscal will surely help raise the industry sector’s contribution to the GDP by two to three percentage points. NPC hopes to significantly increase investment in the agriculture, manufacturing, electricity generation, construction, education and health sectors to achieve the government’s double-digit growth target.
Some major projects initiated by the government have been frequently facing hurdles during construction from the administration, locals and contractors. This subsequently increases the construction time and cost. How do you plan to mitigate these problems?
The Upper Tamakoshi project did face some problems, but it is now almost complete. Meanwhile, the Melamchi Drinking Water Project is also about to be completed and was halted due to the contractor refusing to continue with construction works and we will resolve this problem soon. Other national pride projects, however, are progressing in a smooth manner. The government at present has set a target to complete the projects that have started construction works within the next five years. Some large projects faced hurdles due to the frequent change in government because with each change there was also a change in administrative personnel. However, change in personnel should not affect any project if we have a proper system in place. We will now focus more on such projects and monitor them even more closely. We are going to formulate a new act so as to control all the irregularities witnessed in the past. The act will help coordinate between different agencies and government authorities. Moreover, we will include provisions of strict punishment against wrongdoers. We will also make sure that there is transparency and accountability at the central, provincial and local levels.
Written by Sandeep Sen
This news first appeared on https://thehimalayantimes.com/business/if-we-do-not-dream-big-we-will-be-stuck-with-small-achievements/ under the title “‘If we do not dream big, we will be stuck with small achievements’”. Bolchha Nepal is not responsible or affiliated towards the opinion expressed in this news article.