Recently,  the US congratulated the people of Nepal on the historic  Constituent Assembly's first step in defining a new, democratic Nepal with the declaration of a  federal democratic republic on May 28.  This was followed by similar felicitation notes from Nepal’s  good neighbors such as  India, China, and traditional friends such as  Japan,  EU and  the UN on behalf of the global community.  The US  press release stated it pretty well, namely, that  after another exciting milestone in Nepal's democratic development,  it  would be considered  ‘encouraging’  if  representatives of the Constituent Assembly  continued their work to fulfill the peoples' desire for peace, democracy and development in Nepal.  This is precisely how Nepalis feel at the moment. They want  to see the CPN-M, NC,  UML,  Madhes parties and the remaining groups within the  25 party  Constituent Assembly  reach  a democratic consensus, form  a national unity oriented Nepal Government,  and start  initiating development and reconstruction  efforts.  Prachanda recently stated  that by June 14  an agreement  hopefully will be in place to usher the new democratic  government.  

The main harbinger  at the moment is the election to  the country’s first president,  which in truth  is a superficial challenge if  one considers the more mounting economic challenges for  Nepalis living below the poverty line.  The Maoists  have just recently retracted their  earlier claims to  Office of  the Nepal President,  PM, and Head  of the CA Assembly, which is a result of their  political exuberance given their  first taste of active democratic mainstream  Nepali  politics.  Now, with their decision to accept a civilian president,  preferably  one from national civil society with an apolitical background,  things look more neat.  But how quickly will this happen? The UML, a prospective coalition partner, believes the criteria for selecting Nepal’s president is election from among the political parties.  

Seriously, it is  time the Nepali political parties sat down  and discussed the issues  impending  formation of a  democratic  government.  As much as CPN-Maoists have won the CA polls with a  simple majority on April 10,  it  is important the other political parties be included in the dialogue.  Those who wish to oppose a government coalition have every right to stay in the opposition, in fact this is the true spirit of  a  working democracy.  The current  moral divisibility and political mistrust among  Nepali leaders must be reduced, perhaps they could break away in some  team spirit building session in Nagarkot or Pokhara for a few days and sort out their  problems with some internationally recognized crisis mitigation specialists. 

The other national concern is  the Nepali economy, which appears to be moving sluggishly despite good migrant remittance and tourism revenue.  It is necessary that the CA also devote time to fit the country’s  ethnic  and  Janjatiya(earlier called the marginalized communities of Nepal)  participation in economic  development at the national level.   This way, the Nepali democratic growth  could be hinged to the country’s  future  economic progress.

Nepal Rastra Bank’s recent report states that the  year-on-year consumer inflation stood at 8.9 percent in mid-April 2008  which was 5.6 per cent  last year.   India subsidizes all major food export  and supplies to Nepal,  which it seldom does  with any  SAARC economy, so such a high inflation rate should not exist in Nepal.    Finance Minister Ram Sharan Mahat had even alerted on rising inflation while  attending an interaction with Nepali private sector earlier this year.  The  Nepali inflation this time is mainly due to increasing  global food price, according to government economic advisers,  but since in India food prices are  considerably  stable,  this does not prove to be a good alibi.   Similarly, inflation was only around  6%  last year,  but now it is  projected to double, which is unacceptable to Nepalis  living below the US$2 a day income. The deficit was also  Rs 5.29 billion in the third quarter compared to a  surplus of  Rs. 4.2 billion last year.  Government expenditures are again  going up, while fuel prices are being regulated below the global market price, which has now hit an all time high of  US$ 132 a  barrel.  This has led to the near bankruptcy of the Nepal Oil Corporation.  

 Nepali politicians do  have a whole lot of work to do on the national economy in the months ahead.  While Nepal does  have an overall balance of  payment of Rs. 13.68 billion this is largely due to accumulated  migrant labor savings and is being viewed passively.  Rather, the Maoists and whoever form the next government must urgently put together an economic team to include businessmen and the private sector,  so that  a stable, medium term growth  can be charted.  The Nepal Government must sincerely work for the people’s prosperity and happiness, and  the Maoists, NC, UML  must jointly discuss these issues on  a regular basis in future.  The overriding issue right now is  concluding the peace process,  hatching  a sound economic policy, unfurling a viable development plan giving continuation to the three year  interim plan already in place at the National Planning Commission, and  letting the Nepali private  sector  operate freely so that entrepreneurial skills are well utilized at the national level.     The Maoists have promised all  of  these. But they must now exhibit the  collective political leadership  with  all the other parties  to revive the Nepali economy which will ultimately keep the Nepali people very happy.

(Surya B. Prasai is an independent global strategic communications, media, and international development  resource consultant who writes frequently for this and other global media)

(Note from the Nepal Horizons Editorial Team: The views and opinion expressed in this article are that of the author and not of NHC. We request individuals with interest in Nepal to submit their views on contemporary Nepalese issues to the following e-mail address: editor@nepalhorizons.com.  Pictures of contributors or images that relate to submissions are welcome)