Towards a Stronger Policy Landscape

– This article was originally published by Ayushma Maharjan in the Himalayan Times on the May 05, 2019.

As the budget day approaches, local teahouses are abuzz with speculations of new government programs that will create jobs and increase social welfare. In these same local joints, one can sense anxiety over newer taxes esp. following all the tax conundrum that federalism has brought for sub-national governments and their constituencies. While such has been a pattern over last several years, the fact that we still remain a low-income country and our people still have to scour countries all over the globe to find these very jobs hints that our age-old model has not been delivering results. Instead of promising direct interventions like employment programs or benefits for the unemployed or even women, it is time that we commit to and implement credible policy reforms that will secure a conducive entrepreneurial climate that all Nepalis can leverage alike. 

Promoting women entrepreneurship differently, for example    
Let’s look at farms. Women’s engagement in the fields have gone up from 30% some 20 years ago to over 50% today. These women are taking over the family fields and are in charge of everything that men (who are no more in the villages) were doing. Still, these women are unable to do perform certain back-breaking tasks that are a part and parcel of working in the fields. Here, one thing that the government could do now is to facilitate automation and mechanization in fields. The benefit of this ranges from enabling women to do these hard tasks themselves to opening up whole new prospects for commercial agriculture. A good policy response could thus be to prepare a legal framework that allows for such automation and contract farming and helping enhance the efficiency and productivity at fields.  

Then let’s look at the case of asset holdings in Nepal. By asset holding, we still primarily mean land holding in our case. Again, with most men gone, women are the in-charge of their respective families. Yet, few are ultimate decision makers and very few have titles to their property. In rural areas, only 18% of the land is under women ownership. With that, what happens is these women’s access to finance is severely limited. This puts a big constraint on entrepreneurship. Even if women come up with ideas, there is no capital to invest as a result of limited access to finance. Over the years, the government has tried to create this access through deprived sector lending, but that has not been very effective. 

The problem in case of accessing finance is largely due to lack of assets that can be put up as collateral. A sound policy response here then could be to enable these aspiring village women to use other movable assets like livestock as collateral to access finance. Secured Transactions Act was aimed at delivering just that, but our inability to create a central registry of assets has meant it is still just in paper even a decade later. If building a central registry has been a tough nut to crack, then we should probably think about building local registries by leveraging local governments and build up from there. If this can be done, it will be more effective in terms of enhancing women’s access to finance that maintaining a fund at the Ministry that many women in villages will never hear about.

Reviewing old programs and projects
It is also time now to take a stock of all existing government programs and projects aimed at creating jobs, go over what worked and what did not and actually go back to the drawing board in case of things that did not work, or have stopped working. 

One such thing is training programs of governments. All Ministries have a training wing. But the graduates of these training programs hardly find jobs in the market today because the training modules have been far outdated. There no more supply the labour that the current market demands. 

The same can be said about the CTEVT courses. Most CTEVT courses seem to have been designed keeping men in mind, but women need these training services now just as much as men do, if not more. 

Thus, another pragmatic intervention at this point would be working closely with the private sector to do a proper mapping of future market and labour demand, and redesigning the training programs that will create a supply of labour for the identified market instead of continuing old trainings just because they exist.

Every time we think of a government response to a pressing problem, we think of direct programs and rarely policy reforms. But these latter ones are the ones that are more important. Policy actions geared towards creating free markets is the definitely the way forward. That is actually what will create a win-win for all and that is a sustainable solution to many of our current problems. Therefore, here is hoping that with this budget the government rises above empty populist promises and entrepreneurship-stifling revenue measures and actually makes the big policy departure for a prosperous Nepal.