Econ-ity on Facilitating Innovative Business Practices in Nepal

In a bid to enhance the economic freedom of the Nepalese diaspora, Samriddhi Foundation organized an Eco-nity on the theme ‘Facilitating Innovative Business Practices in Nepal’ on the 23rd of December, 2019 at Hotel Annapurna, Kathmandu.

The fact that innovation in entrepreneurial ventures ultimately helps the economy, cannot be denied. However, Nepal’s arcane laws either prohibit innovative practices such as mobile businesses or ride sharing businesses or to a certain degree fail to create an environment for such businesses to prosper. Through the multiplicity of compliances and vast number of fines imposed, smooth and efficient operation of an enterprise is a distant dream in Nepal. In the wake of such inadequacies and bottlenecks pertinent to innovative businesses, Samriddhi Foundation hosted a public deliberation between the regulators and the regulated to find out possible future steps that can be helpful to both the parties.

The program was attended by the Members of Parliament, experts from the private sector and business houses, journalists, like-minded think tanks, startup champions, and economists. The session began with a presentation by Mr. Yatindra K.C, a Researcher at Samriddhi Foundation, where he gave a brief overview on the areas that require considerable scrutiny so as to propel entrepreneurial growth in Nepal.

Following the presentation, the event moved to a panel discussion. The panel consisted of Mr. Bishal Dhakal (CEO, Health at Home), Mr. Semanta Dahal (Advocate and Partner, Abhinawa Law Chambers), Mr. Sixit Bhatta (Founder, Tootle), Ms. Nivita Pradhan (National Governing Council Member, NYEF). The program was moderated by Mr. Nabin Bhandari (Managing Partner, Imperial Law Associates). The event also witnessed the presence of Mr. Dinesh Bhattarai (Joint Secretary, Ministry of Industry Commerce and Supplies) who attended as the commentator from the Government of Nepal.

Ms. Nivita Pradhan voiced finance as one of the major challenges that Nepalese start-ups face. She went on to explain how potential entrepreneurs lack assets for collateral to acquire loan at banks. Ms. Pradhan also stressed on lack of substantial research, policy irregularities, and lack of a one-stop mechanism for ecosystem players as few among the many reasons why the failure rate of startups is so high in Nepal.

‘Start-up is a word that has been used, misused and abused as it is subject to one’s individual approach; hence, it is important that the government, legislature and the judiciary understand its definition and potential’ said Sixit Bhatta as he addressed the audience. He also stated how Tootle has protected the country and its people from economic shocks as everyone, ranging from professionals, students to homemakers, can become riders and use the platform as a transitional job involvement.

Mr. Semanta Dahal used a rather philosophical and a thought-provoking approach to explain the need for innovation in the country. He stated that law can never catch up with the pace of technology, therefore, it is for us to ponder up if law should choke or cope with such changes.

Questions floored in from the audience where the participants were curious to know the imposed challenges and the support mechanisms in part of the government. In response to the queries, it was cited that that the country’s ever-changing laws and lack of awareness to make deliverables poses a recurring challenge. To tackle this gap of knowledge, an up to date research must be done and data reservoir created so that the government can keep track of the pace of the innovative industries and the entrepreneurs can keep themselves updated.

“When you have paternalistic policies, the government’s role is going to be controlling. But we need policies nudge people towards desirable outcome, rather than punish undesirable outcome. Our policies need to be libertarian paternalistic,” Mr. Bhattta remarked, pointing out the need to change the pattern of the existing notion of policy making and implementation and strongly believes that libertarian policies will better guide the society.

The incisive discussion came to end with the agreement that the laws exist in order to facilitate the young and vibrant ideas, but as Mr. Dhakal mentioned “Apart from what the government is doing to facilitate the startup ecosystem, private individuals also need to be professional. We as individuals also need to be proactive,” it is agreeable that changes are conceivable when everyone is liable to their duty; as policy makers or as policy drivers.