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The Russia-Ukraine conflict has driven up global fuel prices. Petrol price in Nepal has reached Rs155 a liter while a liter of diesel costs Rs138. Looking at the current trend, with no sign of a letup in the war, oil prices are expected to further increase. Priyanjali Karn of ApEx talked to Chandan Sapkota, an economist, on Nepal’s oil dependence and the national economy’s future.

How does the hike in fuel prices increase overall inflation?

Twenty percent of our total import is petroleum products. So whenever fuel prices go up, it has a ripple effect throughout the market. Higher oil prices lead to higher transport costs. This, in turn, drives up the prices of goods and agricultural products, again because of high transport fares. And the same applies to airline and public vehicle fares. 

Likewise, plants and factories rely on generators for production if they do not have adequate voltage to operate. They need fuel for this. Increase in petroleum prices, therefore, could also affect their production cost.

Fuel is connected to every industrial sector and to our everyday life, so the increase in its price directly contributes to inflation.

Nepal Oil Corporation has declared itself bankrupt. What is the government role here?

The corporation is a government-owned agency. So, whatever happens to it, the government has to bear the cost. This means that its losses will have to be covered by the taxpayers’ money.

Until 2014, the corporation was at a loss. Later, even when the fuel prices had decreased in the international market, it didn’t decrease the rates in Nepal, raking in additional profits. Still, it has continued to be at loss.

The rate at which the NOC sells petrol is much lower than the rate at which it buys. This has also resulted in an enormous debt. It is up to the government to rescue the state oil monopoly. 

How is the Russia-Ukraine war affecting our oil prices?

Russia produces 12 percent of the world’s oil, and Ukraine 5.2 percent. No other countries can replace what these countries provide to the world. So the Russia-Ukraine war directly affects global petroleum prices.

How can Nepal reduce its dependence on fossil fuels?

The best solution is to opt for a green economic recovery. We have the resources for this too. This is also the right time to transition to a green economy.

To decrease our dependence on petroleum, the government should think of ways to make electricity cheaper. This can be done by improving supply chains and transmission lines, by reducing taxes, and by opening more charging stations. 

This will not only be a better and cheaper alternative to petroleum products but also help our environment.

How do you envision our economy’s future?

Our economy is in a difficult position. Fuel links almost all sectors, and we have too many problems at the same time. And with the elections coming up, economic activities may further slow down. 

Recovering from this loss is a long-term process and a lot needs to be taken into account. Tourism is slowly picking up, but not much compared to the pre-pandemic level. Our private sectors are also weak at the moment owing to high interests on loans. It is hard to have high expectations when it comes to economic prosperity. 

But we have the right ingredients to fix the economy. We have the resources to replace petroleum products. 

Senior CPN-UML leader Bhim Rawal is a fierce opponent of the Millennium Challenge Corporation (MCC) Nepal compact. Amid protests, the Federal Parliament had endorsed the compact on February 27. Rawal continues to speak against the compact, maintaining that it compromises Nepal’s sovereignty. Priyanjali Karn of ApEx talked to him to solicit his views on the compact and his future plans.  

Despite your strong objection, the parliament endorsed the MCC compact. What next?

In line with our constitutional provisions, we should always keep national interest at the center of our external dealings. Nothing is more important. Without changing its provisions that challenge our national interest, the MCC compact was endorsed in a haste and amid protests. This shows Prime Minister Sher Bahadur Deuba and other top leaders are not sensitive about our national interest. Additionally, the parliament should function as per the parliamentary regulation, but in the case of compact ratification, it was violated. 

Could you explain how the compact-ratification process was against the constitution?

Article 279 of the constitution clearly stipulates which type of agreement needs the backing of two-thirds majority and which can be passed by a simple majority. We should first formulate a federal law to chalk out a procedure on the passage of agreements by majority votes. But right now there is no such law. That is why the compact’s endorsement goes against the constitution.

Our constitution also talks about independent foreign policy and we remain firm on a non-alignment. Some provisions of the compact go against these constitutional provisions, but the government ignored such a sensitive matter and steamrolled the compact. 

What does the compact’s endorsement say about our political parties?

Like I said, the compact has several provisions which go against our national interests. If such provisions are implemented, our domestic laws, our right to self-determination, our national independence will be compromised. Therefore, all patriotic Nepalis should cautiously and consciously watch how such provisions unfold in the coming days.

Prime Minister Sher Bahadur Deuba is at the forefront of violating the constitution and laws. We have to watch closely how the government implements the provisions that are against the constitution and takes forward the interpretative declaration endorsed by the parliament. The compact’s endorsement clearly shows our political parties serve foreign powers.

You have been a rebel in your own party, including on the compact. What is your current status in CPN-UML?

I am just an ordinary UML member. I am also a member of the House of Representatives elected from Achham district.

How is your relationship with party Chairman KP Oli?

I do not have any special relationship with him. We have not talked since the party’s 10th general convention in Chitwan.

Three months ago, Sher Bahadur Deuba defeated Shekhar Koirala to be reelected party President at the 14th Nepali Congress General Convention. After the convention, Koirala emerged as the leader of the party’s rival faction. Koirala has since adopted the policy of supporting Deuba on an issue-by-issue basis. Kamal Dev Bhattarai talked to Koirala to solicit his views on electrical alliance and intra-party rivalry.

How do you evaluate Deuba’s performance as party president in the past three months?

It is too early to evaluate his performance this early into his re-election as party president. In this period, we have handled a few issues. He made some nominations in the party. Obviously, questions were raised on the nominated names and appointment criteria. I have been pushing to define criteria for such appointments.

On the MCC compact negotiation, the party president involved all of us under his leadership and it produced a good result. He was successful in bringing major parties on board to ratify the compact, which is a plus point. To resolve issues related to the party’s sister organizations, we are still doing homework. There is no alternative to dissolving sister organizations and starting afresh.

There are talks of an electoral alliance with communist parties. Do you see that happening?

In local elections, we should not forge an alliance with communist parties. Nepali Congress is capable of winning on its own. If we forge an alliance, we will appear weak in front of voters.

Further, there is a lot of animosity between the Congress and Maoist cadres at the grassroots level. The wounds of the 10-year Maoist insurgency are yet to heal. Congress cadres at the local level were the prime targets of the Maoist party during the insurgency.

Our ideology, our orientation, and our behavior do not match those of communist parties. In the previous elections, we supported some candidates of other parties, but we did not get anything in return.

I do not think supporters of communist parties would vote for our candidates, as there is a gap between our schooling and theirs. There are some fundamental differences. For instance, Congress is a mass-based party, while communists are cadre-based. We should take this reality into account. Communists always see Nepali Congress as an enemy.

As for the current ruling coalition, it should continue till the elections and beyond, as the chances of a single party securing a majority are slim. But an electoral alliance is not beneficial for us.

There are also talks of deferring local elections and holding federal polls first.

We have already announced the date for local elections and they must be held on time. The Supreme Court has also ruled that local elections were announced as per the constitution. But if we plan on early federal elections, the main opposition, CPN-UML, and other major parties should be on board. The decision should be based on consensus. 

What is the state of factionalism in Nepali Congress, which had reached new heights at the time of the general convention?

It is normal for relationships among rival factions to sour during general conventions. We have already left the animosity behind. This was evident when the Nepali Congress presented a united front on the MCC compact. Our party moves ahead as one based on agendas. We will also stand united during the elections.

But there is a worry that disputes at the center have percolated to the grassroots, harming the party’s electoral prospects.

There is some discord among rival factions at the local level. I have been counseling leaders at the grassroots level to bury old differences emanating from the convention and maintain unity. Winning and losing are part of democratic process. Now, we have to fight against other parties. It will certainly take time, but I am hopeful that most grassroots-level differences can be resolved in the next two to three months.

Women’s rights activist Lily Thapa is a member of the National Human Rights Commission, the constitutional human rights watchdog. In this interview with Stuti Mittal of ApEx ahead of the International Women’s Day on March 8, she discusses the current status of Nepali women.

How do you evaluate Nepali women’s participation in key sectors?

Compared to 10 years ago, after the heralding of federalism, women’s participation has already exceeded 40 percent at the local level and 30 percent at the central level. Quantitatively, the target for women’s inclusion has been met. However, there is yet to be meaningful participation. Women’s voices are still being ignored despite their greater representation in key sectors.  

What is the government doing to lift the status of women?

The government has taken many steps to lift the status of Nepali women. Following the Beijing Conference of 1995, a study on gender status evaluation was conducted from 1995 to 2015. It showed progress on indicators such as a higher level of women’s participation, inclusiveness, and diversity.

The fact that women’s rights are enshrined as fundamental rights in the constitution is a major step towards improving women’s status in Nepal. Not just that. There are separate points on reproductive rights, mobility and gender equality in the constitution, which too is a milestone.

Between 1995 and 2015, over 167 policies were amended and legal reforms enacted in terms of gender equality. There has been a decline in maternal mortality from 600 per 100,000 live births to 140 per 100,000 births, a rise in women’s life expectancy from 50 to 70, and an increase in their access to land and property.

Since the implementation of affirmative policies over the past two decades, about 20 percent Nepali women own land and over 13 percent have a house registered in their names. 

Why are Nepali women still not entrusted with leadership roles?

The biggest culprit is expected gender roles. Women who are professionals and in leadership roles are still expected to fulfill their household duties. Though women are considered equal by the law, the stereotypes have not changed. During past elections, women were unable to lead electoral campaigns as they had to be home by the time their children came back from school. While much progress has been made in the past two decades, gender discrimination is still rampant. 

How do you compare Nepal to other South Asian countries in terms of women’s rights?

In comparison to other South Asian countries, Nepal has the best women’s rights policies after Sri Lanka. Gender policies, laws and national action plans are women friendly too. Nepal may not be ahead of other countries on women literacy and economic empowerment, but progress is being made. 

What are the areas Nepal needs to improve on for greater gender equality?

The first and foremost thing that needs to change is people’s perception of women who are still considered second-class citizens. This is something deeply rooted in our culture. It’s vital to change people’s mindset in order for women to be treated equally. The policies and plans are there of course, but their implementation remains weak. Progress has been made over the past two decades. This process takes time and there should be constant advocacy. Slowly but surely, Nepal will one day achieve the desired level of gender equality.