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The country has added less electricity to the national grid in the fiscal year 2022/23 compared to the fiscal year 2021/22. Around 492 MW of electricity has been added to the national grid in the last fiscal year. A total of 735 MW of electricity was added to the national grid in FY 2021/22.

With electricity generated from more than 27 power projects being connected to the national transmission system in the last fiscal, the total installed capacity of hydropower plants operational in the country has reached 2,759 MW by mid-July 2023. However, it is less than the government target. The government had set a target of adding 717 MW of electricity to the national grid in FY 2022/23. According to Nepal Electricity Authority (NEA), a total of 21 hydropower projects and six solar power projects began their commercial production in the last fiscal year. 

The construction of the Solukhola (Dudhkoshi) Hydroelectricity Project, the largest hydropower project developed by the Nepali private sector, was completed in the last fiscal year. Developed by Sahas Urja, the 86 MW project commenced its commercial production on 1 March 2023. 

The Nepal Electricity Authority (NEA) has earlier projected an additional 811 MW of electricity will be added to the national grid in FY 2022/23. The state-owned power utility had expected the 111 MW Rasuwagadhi, 42.5 MW Sanjen, 14.8 MW Upper Sanjen, and 102 MW Madhya Bhotekoshi to come online by the end of the current fiscal year. However, these projects failed to complete their construction within the last fiscal year. 

The 54 MW Super Dordi ‘B’ in Lamjung and the 2 MW Solar Power Project in Nawalparasi, the 6.8 MW Solar Power Project in Morang, and the 10 MW in Banke have been already connected to the national grid. The 10 MW Makarigad Project also started commercial production in the last fiscal year.  

The government has targeted to add approximately 900 MW of electricity to the national transmission system in the current fiscal year. According to the federal budget 2023/24, the completion of projects promoted by the Nepal Electricity Authority such as the 111 MW Rasuwagadhi, 102 MW Madhya Bhotekoshi, and 42.5 MW Sanjen hydropower projects, as well as hydropower and solar projects initiated by the private sector will help the country’s total installed capacity to reach 3,600 MW by the end of FY 2023/24.

Currently, projects with an accumulative capacity of 3,280 MW are under development and once they are completed, the national grid will have around 7,000 MW of electricity.

On the transmission line part, the process of constructing the New Butwal-Gorakhpur 400 kV transmission line has moved ahead. 

The government in the federal budget has announced that project development agreements (PDAs) for strategically important projects like the West Seti Hydropower Project, Seti River 6 Project, and Lower Arun Project will be signed, and development work will be commenced.

Similarly, the government also plans to determine the investment modality for reservoir-based hydro projects such as the 1200 MW Budhigandaki Hydropower Project and 635 MW Dudhakoshi Hydropower Project and begin their construction. 

As for the hydropower projects such as Upper Arun (1061 MW), Chainpur Seti (210 MW), Jagdulla (106 MW), Tamakoshi-5 (99.9 MW), Simbua River (70.3 MW), and Ghunsa River (77.5 MW), the government is planning to take ahead these projects under the co-financing modality of all three tiers of government.

Before the unveiling of the new monetary policy, I had, through the media, advised the government to exercise caution while addressing some of the demands of the private sector. Thanks to the government for incorporating my suggestions. 

The policy has pledged to boost small and medium-sized enterprises, but it has not said how Nepal Rastra Bank will do it.

The policy has also promised to review risk weightage on margin lending, housing loans, and hire purchase loans. Last year, the external sector was in a tight position. Before that, the Covid-19 pandemic had hampered the economy. Now, we have enough foreign reserves to trade for nearly 10 months, which is a better situation. Banks and financial institutions too have extra Rs 400bn for investment. But the industrial sector has not recovered and the policy has not much to offer. All in all, there is room for improvement in the policy.

The author is an economist

The spread of lumpy skin diseases in cattle has hit farmers across the country. They are facing a triple whammy as the dairy production has decreased, fields remain unploughed and paddy transplantation has not taken place due to widespread infection. 

Lumpy skin disease is caused by the lumpy skin disease virus, which belongs to the genus capripoxvirus, a part of the poxviridae family (smallpox and monkeypox viruses are also part of the same family). It is a contagious vector-borne disease spread by mosquitoes, flies, and ticks.

According to the United Nations Food and Agriculture Organisation (FAO), infected animals shed the virus through oral and nasal secretions which may contaminate common feeding and water troughs. Thus, the disease can either spread through direct contact with the vectors or through contaminated fodder and water.

The incubation period or the time between infection and symptoms is about 28 days, per the FAO. Per some other estimates, the incubation period is 4 to 14 days. 

Some of the symptoms of the disease are nasal and ocular discharge, discharge of mucopurulent (containing mucus and pus) with progression of the disease, fever, swelling of joints, swollen superficial lymph nodes, sharp reduction in milk production and formation of skin nodules all over the body. Damaged skin and hides, fertility problems and death are some of the impacts of the disease along with increased treatment costs.

Morbidity rate of the infection is usually 5–45 percent and mortality rate is usually less than 10 percent, according to the Central Veterinary Laboratory.

Many farmers have complained that the government has not taken effective measures to control the disease.

“I have just returned after burying an ox from one of my relatives because one of my oxen is sick and struggling for life. There is no vaccine at the municipal veterinary,” says Surya Thapa Magar, a farmer from Aiselukharka, Khotang. 

It is a distressing situation for farmers like Magar. At Aiselukharka, there is no household where the cattle infection has not spread. In fact, the disease has reached all 77 districts of the country, infecting around 555,000 and killing at least 21,000 cattle so far, according to the Animal Service Department.

The infection is particularly high in mid-hill and hill regions of Karnali, Lumbini and Koshi provinces. 

The spread of the disease can lead to substantial and severe economic losses, particularly in the dairy industry. The disease leads to reduced milk production as animals become weak as they lose appetite due to mouth ulceration. 

The annual total milk production in Nepal is 2,301,000 metric tonnes. About 40 percent of milk production is contributed by cows and the remaining 60 percent by buffalo. There are about more than 500,000 dairy farmers and 1,700 dairy cooperatives involved in the dairy sector in the country.

A risk assessment study conducted by the United Nations’ Food and Agriculture Organization (FAO) based on information available from 2019 to October 2020 revealed that the economic impact of the disease for South, East and Southeast Asian countries “was estimated to be up to $1.45bn in direct losses of livestock and production”.

According to Nepal Veterinary Council, the mortality rate of the infections in animals is 3.8 percent and there is a loss of Rs 49,135 per animal in the country. Animal deaths resulting from this disease have already caused a loss of NRs 27.22bn.

In the absence of timely treatment, the disease could spread in over 2.5m animals, resulting in the death of 100,000 cows and buffalos, causing a total loss of Rs 1.26trn, per the council. There are over 7.4m cows and more than 5m buffalos in the country.

“It’s a huge economic loss for us. We haven’t been able to plough the field as tractor costs Rs 2,000 per hour, which we cannot afford. On top of that, the production of milk has also decreased,” says Chiranjibi Poudel, a farmer from Halesi, Khotang. 

While the government has expressed its commitment to providing all resources required for the prevention and control of the disease, many farmers say the help has not arrived. In Baitadi district, for instance, vaccines are not available so far. Farmers say they feel helpless watching their cattle die a slow, painful death. 

“The cases of lumpy skin infection are increasing by the day but the district lacks vaccines. We have written to the federal and provincial governments requesting vaccines,” Dr Bishal Pathak, livestock development officer at the Veterinary Hospital and Livestock Service Center. 

Officials, however, claim that the government has imported 737,000 doses of vaccine and supplied them to all seven provinces. The government has allowed importers to import Neethling strains vaccine, which can be administered to pregnant cows and buffaloes. 

Veterinarians say as the disease can easily transmit from one animal to the other, the infected animal should be kept separate from healthy animals. They suggest vector population control, hygienic measures in the farms, awareness campaigns and vaccination as preventive and control measures.

The vaccines are not produced in Nepal; they are imported. The government has allowed importers to import Neethling strains vaccine. The vaccine can also be administered to pregnant cows and buffaloes. The calves born will be resistant to the virus for three months. 

The infected animals should not be administered vaccines. They should only be given vaccines a year after they have been infected with the disease. As the anti-virus resistance is formed in the cattle it is not necessary to vaccinate them immediately after their recovery.

The farmers demand the vaccines be made easily available to prevent infection spread in the healthy cattle. 

It is safe to consume milk from cattle infected by Lumpy Skin Disease, as it is a non-zoonotic disease. 

FAO says that a large portion of the milk in Asia is processed after collection and is either pasteurized or boiled or dried in order to make powdered milk. It ensures that the virus is inactivated or destroyed.

“It is safe to consume milk from the infected cattle but it will be beneficial to drink milk after boiling. However, if the cattle is given antibiotics then the milk should not be consumed from the day when the antibiotic was started and after a week from the day when the antibiotic was stopped in the animal,” the Department of Livestock Services said. 

Symptoms

• Nasal and ocular discharge
• Discharge of mucus and pus with progression of the disease
• Fever
• Swollen joints and superficial lymph nodes
• Sharp reduction in milk production
• Formation of skin nodules all over the body

The entrenched issue of political fragmentation and instability in Nepal are two deep-rooted problems. Over the years, the country has witnessed the emergence of several political parties, many of which have divergent ideologies and national objectives. Due to the difficulty in forming stable, efficient governments as a result of this fragmentation, coalition politics and frequent changes in the political leadership have hampered the creation and implementation of long-term policies.

Political parties have also failed to adequately address the nation’s socio economic problems, such as poverty, unemployment, and infrastructure deficiencies. Because the political system has failed to address these critical concerns, social discontent, and dissatisfaction have grown, which has weakened support for major parties and increased the need for alternative political options.

Leadership questions

Any political party can face serious leadership challenges with an adverse effect on their performance. The characteristics and behaviors of the party’s senior leaders frequently play a role in leadership issues in the context of political parties. The ability of a leader to effectively articulate the concerned party’s vision, objectives, and policies to party members and the general public can be impeded by a lack of strong communication skills. At the same time, a lack of vision among leaders makes it difficult to establish strategic priorities and make wise choices, which undermines the party unity and a sense of direction. A party’s capacity to put on a united face and successfully rule can be undermined by internal rivalries, leadership conflicts, and a lack of cooperation among party members. Certain parties may occasionally be ruled by political dynasties, in which positions of power are passed down within families. This could impede the formation of new, competent leaders and help explain why there is a dearth of creativity and diversity.

Corruption and governance challenges

Nepal has long struggled with issues of corruption and poor governance, which have hampered the nation’s growth and political stability. The several types of corruption include low-level bribery, elites’ embezzlement, and nepotism. Public faith in political institutions is damaged by widespread corruption. A major issue in Nepal has been a lack of accountability in governance. When corruption and the abuse of authority are frequently left unchecked, a culture of impunity takes root. The ineffectiveness, excessive paperwork, and opaqueness of Nepal's bureaucracy have been criticized. Administrative procedures that are too onerous might make it easier for corruption to flourish and delay timely implementation of plans and initiatives. Political parties stifle public institutions’ independence and objectivity by influencing administrative decisions. Political meddling in governmental affairs can result in bias, compromise merit-based hiring decisions, and jeopardize public services. When it comes to delivering justice on time and handling cases of corruption, Nepal's court has experienced difficulties. This could deter people from bringing up corruption and seeking judicial redress, continuing the cycle of impunity.

Institutional feebleness

Political parties in Nepal have had a lot of difficulties due to institutional inadequacies. These flaws affect a number of political institutions, including the legislature, the judiciary, the electoral system, and other governmental organizations. Weak institutions may make it more difficult for political parties and their leaders to be effectively checked and balanced. This may lead to a concentration of power in a small number of people, opening the door for possible abuse of power and compromising democratic ideals.

Daron Acemoglu and James A. Robinson’s book “Why Nations Fail: The Origins of Power, Prosperity, and Poverty” makes the argument that institutions are vital in determining a country's success or failure. The laws, customs, and groups that make up a society’s political, economic, and social interactions are referred to as institutions. When a strong elite controls the government, they frequently create extractive institutions in order to preserve their privilege and stifle opposition to their rule. In the case of Nepal, leaders’ poor judgment and shortsightedness in constructing extractive institutions caused the failure of the nation’s overall development.

The public’s trust in institutions has been further eroded because political parties are taking advantage of this circumstance to advance their agendas without being held responsible for their activities. Because of institutional flaws, Nepal has frequently changed governments and coalitions. Weak institutions make it difficult to establish stable governments, which leads to frequent changes in leadership and the direction of policy, which is having an impact on the development and progress of the nation. Because some groups may feel excluded from or underrepresented in the political process, weak institutions can increase ethnic and regional tensions. Political parties in Nepal are taking advantage of these splits to win quick supporters, thus solidifying social and political divides.

In “Fixing Failed States: A Framework for Rebuilding a Fractured World,” another intriguing book by Ashraf Ghani and Clare Lockhart, the authors argue that states fail because they lack a flexible framework that can map what voters want and create the means for change. Leaders must also be prepared to make difficult choices in order to address the underlying causes of state failure and be dedicated to prioritizing national interests over personal or factional interests. But we observe in the context of Nepal that leaders are driven to satisfy their objectives through institutional manipulation. Recent instances of manipulation can be seen in the Lalita Niwas controversy, gold smuggling and the episode involving the phony Bhutanese refugee.

External influence

An important feature of Nepal’s political environment has been the involvement of outside parties. Due to its geographic location and historical ties to its neighbors, Nepal is vulnerable to outside interests. India and China have attempted to impose their will on Nepal’s politics and policy choices, frequently resulting in diplomatic wranglings and conflicting interests. Nepal has received support and foreign aid from a number of nations and international agencies. Although financial help is essential for humanitarian relief and development programs, it can also lead to a degree of economic dependency, which may have an impact on policy decisions. To advance their objectives in Nepal, external actors may ally themselves with particular political parties or leaders. These coalitions and political dynamics may be impacted by these alliances, which may result in changes in the balance of power and the direction of policy.

Nepal’s internal politics may reflect India and China’s geopolitical competition. It's possible for these two nations to try to acquire leverage by backing various political groups or adopting various positions on crucial topics, complicating Nepal’s international relations. The involvement of external entities in Nepal’s infrastructure and connectivity projects may have effects on the country’s economy and geopolitics. The country’s economic development and regional connectivity, for instance, may be influenced by projects supported by China’s Belt and Road Initiative or India’s connectivity initiatives. Particularly in relation to cross-border security challenges, external actors may have an impact on Nepal’s security dynamics. External participation in Nepal’s security matters may have an impact on regional stability.

Economic and social challenges

Nepal is dealing with a number of social and economic issues that may affect its growth and people’s well-being. The country has a high rate of poverty, especially in the countryside. Widespread unemployment and underemployment, particularly among young people, are caused by a lack of employment opportunities and limited economic alternatives. For the nation, overcoming poverty and establishing stable livelihoods remain major obstacles. A majority of people in Nepal depend on agriculture for their livelihood. However, the expansion and sustainability of the business are hampered by low productivity, conventional farming methods, and vulnerability to climate change. All across the nation, access to high-quality education and healthcare is still unequal. There are discrepancies in educational and health outcomes because many rural communities lack adequate schools and healthcare services.

Numerous Nepali residents go for employment overseas for want of economic prospects at home. Remittances support the economy, but they can also cause social problems like family dissolution and reliance on outside income sources. Gender discrepancies still exist in Nepal’s political representation, job, and educational opportunities. Girls and women frequently experience societal prejudice as well as restricted access to opportunities and resources. Nepal is also prone to natural calamities like landslides, floods, and earthquakes. Strong disaster management and climate resilience initiatives are required because these calamities represent considerable hazards to infrastructure, property, and human life.

The solution

Political parties must deal with these fundamental problems and seek to create a stable and accountable political system that can successfully address the nation’s difficulties and meet the goals so as to restore public trust and confidence. They must accord top priority to leadership development and foster an environment of accountability and openness in order to overcome leadership challenges. Effective leaders, who can inspire confidence, put forth a compelling vision, and rally party members around shared objectives can be molded by building a collaborative environment, encouraging open communication, and supporting leadership development programs. Ultimately, for the parties to succeed and successfully advance the interests of the people they represent, strong and effective leadership is crucial. Prioritizing equitable economic growth, infrastructural development, bettering access to healthcare and education, and enhancing climate resilience are all necessary in Nepal. Building a more wealthy and equitable society in Nepal also requires advancing gender equality, social inclusion, and political stability.

The author is a doctoral fellow of IR in China