Nepali Times
Economic Sense
Closed economy


The events that unfolded in the past week prove one point-strikes have been the only major achievement of restored democracy. Political ambitions and motives today hold this nation to ransom. The fact that we are losing out as a nation has stopped mattering to anyone. In the past two months, we have ruined our tourism industry with strikes and threats of strikes and if we continue to glorify our right to strike, we will not have any industry left, forget about tourism.

A country with a GDP of just over $4 billion cannot afford any disruption to its economic activities. With half the populace living below subsistence levels, it is absurd to have such frequent disruptions. The plight of the leadership of political parties can be judged from the fact that they never want to stop carrying out their antics even if the business community makes pleas at all levels. The irony is that the level of understanding of the so-called leaders of this country is pathetic and their vested interests always rise above national interest.

Strikes are a sign of an underdeveloped country run by quasi-developed brains. Almost all encyclopaedias refer to strikes as a short-term outcome of the Great Depression, but it's extremely unlikely they'll have any historic impact in Nepal. Strikes are on the wane worldwide. The only region that continues to strike with clockwork efficiency is South Asia. But even in India strikes are regular only in states with low levels of economic activity. We should learn from the experience of West Bengal. The state has been plagued by strikes, including state-sponsored ones, and the economy has stagnated. A state that once led India's economic advancement is today an eyesore. The same could be the story for Nepal.

We need to question the concept of strikes. There's also the issue of the legality of strikes. Is it the fundamental right of a small group to encroach upon the fundamental right of the majority populace? The Labour Law does not explicitly talk about strikes in industries. In fact, no legal document addresses the basic question of what a strike is? Have strikes been successful in crippling normal life because the government is either participating in them directly or indirectly? Or can it not provide adequate protection to its citizens to lead a normal life? Have strikes been successful because we dislike productivity and cherish the additional inactive day bestowed upon us? Don't we Nepalis, even if we crib about shutdowns, cherish the days we have to do nothing?

The issue in the past week of strikes is not the Rs 100 million lost either by way of empty hotels, restaurants, rafts and aircraft. It is the isolation we are nudging ourselves into. An economy that revolves around tourism closes on a day that is one of the biggest money spinners all over the world. We talk about WTO, an open economy and liberalisation, but do not accept the importance of a day of such high economic activity. Nepal will have to follow the world. Sadly, it cannot be the other way around.

The damage has already been inflicted and if we do not take immediate damage-control actions, the impact on the economy may be more far reaching than we can possibly comprehend. Either through legislation or activism, strikes and the threat of strikes should be eliminated. I personally favour legislation echoing Calvin Coolidge's words-"There is no right to strike against the public by anybody, anywhere, any time." t

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(11 JAN 2013 - 17 JAN 2013)