Nepali Times Asian Paints
Guest Column
We know what works



At first glance, Nepal's numbers don't look good. The country remains one of the poorest in the world. Even though 70 per cent of the workforce is in farming, agriculture has stagnated, accounting for only about half that proportion in its contribution to the country's GDP. Since most rural families do not have sufficient work on their own farms, they migrate to do dirty, dangerous and difficult jobs abroad. This is tragic because our demographic dividend is being enjoyed by other countries that had no hand in nurturing our youth.

But there is a brighter side. Where authority has been entrusted to the people themselves, Nepalis have come up with world-class success stories. In the last couple of decades, Nepal's forests were not just restored from the brink of desertification, but were made more productive than in the past. This is so despite the recent plunder of selected Tarai forests, reportedly with the minister and officials colluding with smugglers and local politicians. The most disturbing thing about this looting is that none of the so-called major parties, the NC, UML or the Maoists, and not even the Prime Minister, have raised any objections against what seems like the officially sanctioned daylight robbery of the people's wealth in post-Jana Andolan II loktantrik Nepal.

Forestry is not the only area where Nepal has excelled. Of the 72 developing countries, Nepal is one among the seven countries projected to meet the Millennium Development Goal in child survival, and the only country to do so before 2015. In maternal mortality too, Nepal has earned international laurels and is projected to successfully bring the rate down to the MDG threshold of 134 deaths per 100,000 live births by 2015.

Then, there is the nationwide network of mostly self-managed microfinance institutions that promote income generating activities among the poor. The Small Farmer Cooperatives, built upon the then faltering (now terminated) Small Farmer Development Project of the Agricultural Development Bank, are outstanding examples in this respect. In its three-tiered structure, these groups at the grassroots perform basic saving and lending functions and exercise surveillance over members' use of credit to prevent possible delinquency. The existing evidence suggests that the members of these coops Ė who now number around 150,000 Ė are doing much better economically and socially. These coops have been highly regarded by external evaluators too.

With these internationally applauded feats on the one hand, and acute, chronic and widespread poverty, massive under- and unemployment, undernourished children (half of under-5 children designated as such), and the continuing departure of the labour force on the other, Nepal clearly stands out as a strange exercise in contrasts. However, a closer examination will tell us that the problem is basically political in its character. Given the massive poverty and pervasive lack of education among the people, 'democratic' elections in Nepal have generally been swayed by money, thus creating a perfect justification for greedy politicians to engage in corruption, and in the process, plunge the country into a vicious cycle with political corruptibility and widespread deprivation of the people reinforcing each other.

The above successes, however, show that sustainable and inclusive development remains an attainable proposition even under these adverse conditions, that local economies can still generate jobs and produce more, and that deficiency in education and poverty are no obstacle to the proper exercise of authority devolved to the users themselves.

The catalyst for our achievements in forestry was the institution of user groups of forest users themselves, which derived from the Decentralization Act of 1982. Today, there are over 15,000 forest user groups across the country managing their own commons. The concept of the 'user group' itself is indigenous to Nepal. In 1969/70 during my anthropological research for the then Royal Nepal Academy I ran into and studied a centuries-old traditional irrigation system in a Jumla village that was being efficiently managed by their own user institution, the Kumthi. As a civil servant, I was able to build the finding into government policy on user groups in the mid-70s and later, as the centrepiece of the Decentralization Act in 1982 that made the institution legally mandatory. It should however be noted that 'user groups' meant vesting the people themselves with power to govern, without limiting power to DDCs and VDCs, which too often have failed to deliver tangible results.

In the successes in child survival and maternal mortality too, it was the same devolution of authority that has been at work. Here the catalysts have been the nationwide network of mothers' groups and Female Community Health Volunteers (FCHV), which were created in 1988 under the Ministry of Health, primarily to meet the WHO's call for 'Health for All by Year 2000'. In this system, all women above 15 in a ward are organised into mothers' groups and they choose one among themselves as the FCHV, who is trained by the government but remains accountable to the group and the community. Assistance from eight different donors were mobilised for the programme that was conceived, planned and implemented exclusively by the ministry itself.

Good governance has been at work in all these success stories. The direct users of a given service or infrastructure participate in a form of decision-making that assures transparency of management and accountability of leaders. Despite society being stratified along caste and class lines, the user groups remain inclusive institutions. All users, rich or poor, high caste or low, men or women, participate in the decision-making and receive their share of the benefits, often equitably. These achievements underscore the fact that the rural communities can take care of their own development in a sustained and inclusive manner. This could also unleash forces to eventually rein in the wayward politicians and bureaucrats at higher levels.

Ironically, all these innovations come from the much vilified Panchayat days. Post-1990 elected politicians and the Maoists have done little to transfer this rather simple, devolution-based methodology to other sectors of development. While King Birendra overrode the objections of self-serving politicians at the time to get on with the decentralisation initiative, the so-called representative system of the last two decades has singularly failed to elect anybody with the wisdom and courage to act as a statesman.

The donors could have made a big difference in this regard. For instance, the World Bank mission on the $50 million Structural Adjustment loan to Nepal in 1987, having been briefed on the crucial role of user groups for forest restoration, made it a precondition for loan effectiveness. This compelled the Finance Ministry to pressurise the initially reluctant Forestry Ministry to introduce forest user groups. Similarly, it was GTZ that piloted small farmer cooperatives in 1988. Despite these examples, donor effectiveness remains a rare phenomenon in Nepal. While the system in which they work assures them total immunity from accountability, given Nepal's chronic dependence on external resources, they also tend to conduct themselves with an arrogance blind to their expatriate employees' general lack of familiarity with the depth and breadth of Nepal's long and extensive development experience. Most often, failed programmes in Nepal today are the relics of donor mismanagement. Decentralisation is one such victim in recent years, because of the interference of two donors Ė one multilateral and one bilateral Ė engaging in a pernicious turf war over the programme. GTZ, too, recently went back on its formal commitment to the Small Farmer Cooperative Programme while the Finance Ministry was only too happy to oblige it.

Briefly put, if donor agencies want to be professionally honest to themselves and deliver for their host country, they must learn from Nepal's successes and build on them with the beneficiaries themselves in command. Given the continuing political and bureaucratic corruption and the stalemate that afflicts Nepali politics, the donor community may well have much to offer at this juncture in Nepal's history.

Bihari Krishna Shrestha was with the National Planning Commission, and the ministries of health and physical planning and local development.

This article is based on his address at the Madan Puraskar Award Ceremony on 10 October.

Corruption, Inc., EDITORIAL
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Looking east, ARTHA BEED

1. x2beta
"While King Birendra overrode the objections of self-serving politicians at the time to get on with the decentralisation initiative, the so-called representative system of the last two decades has singularly failed to elect anybody with the wisdom and courage to act as a statesman."

-- this is so true

2. ram lal
what a silly lecture at madan puraskar prize ceremony. what arrogant certitude. we know what works, and you don't. give this gentleman a noble peace prize from baneswor's noble academy. if the panchayat was so good, could he compare the annual growth rates from 1981 to 1990 with those from 1991 to 2000? the only reason the likes of Mr. Shrestha want much from donors so that they can hire themselves out for consultancy contracts. there's a section of nepalis, of whom Mr. Shrestha is one, who hate the donors in public, but in private depend on the very same donors for daily dal bhat. 

3. LaliGurash
It is disappointing to learn that Mr Lal has become so very frustrated and annoyed that nothing looks to get him satisfied. A person who has showed some hope that there is something good too happening in this third world country is something to cheer about this tihar. HAPPY and A SAFE TIHAR to all readers.

4. DG
The local self government must be the strongest body with power dovoluted to them in the next constitution. ;not the provincial government. Otherwise we will create local chief or rajas or warlords,out of the present NGO funded so called activists., who do not agree to give/share power with the local bodies. Their Nepalese(American) Dream is to be the local boss' the Chief Minister.    That is the one and only one way all the small and marginalized communities can be empowered.

(11 JAN 2013 - 17 JAN 2013)