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Both the countries were monarchies within living memory. They are both landlocked and have similar population sizes. They are also SAARC member states. That is where the similarities between Nepal and Afghanistan end. Or do they? 

India and China are heavily invested in intra-Afghan peace talks taking place in Qatar’s Doha for the mainstreaming of the Taliban. India has never trusted the Taliban, which it sees as a proxy of the Pakistani army and holds responsible for terror attacks on its soil. India finds the prospect of Taliban’s return to power in Kabul troubling but in that case it has no option but to engage with the once-dreaded enemy.

That is because India’s continued aloofness could drive the future Afghan government, with Taliban representation, closer to Pakistan, which brokered the Doha talks. India could then have to live with the nightmare of a hostile Afghan-Pak-China strategic alliance next door. China has promised heavy investments in Afghan infrastructure—including on roads to Taliban-held areas—if the mujahideen abandon violence. Such help, China hopes, will prevent the radicalization of the Uyghurs in Xinjiang on Afghan border. 

The Americans, for their part, are keen to pull most of their troops out of Afghanistan after 19 bruising years of fighting, during which they lost 3,500 soldiers and $975 billion (and counting). Yet the US would like to continue to have a toehold in this old hotspot of global geopolitical intrigue. Besides the Indian and Chinese interests, Afghanistan is also never far from the Russian radar. 

The new, multi-pronged geopolitical (if less intense) tussles we now see in Nepal have long been the norm in Afghanistan. The Islamic state formally joined SAARC in 2007 at the insistence of India, the two countries having long suffered from terrorism emanating from Pakistan. Afghan foreign minister Rangin Dadfar Spanta left no doubt that the goal of his country’s SAARC entry was to “seek help from the SAARC member countries to join counterterrorism circles.” Including Afghanistan in SAARC, then led by India’s favorite Hamid Karzai, was also a way for India to balance China’s growing role as Pakistan’s enabler in the regional body.

The Afghans say their land will help South Asia connect with Central Asia. This is fanciful as Afghanistan will remain restive for years if not decades. ‘The Heart of Asia’ is also where China’s BRI ambitions hit a roadblock. 

Nepal joined the BRI to diversify its external links to Central Asia and beyond. Yet that will be difficult amid Afghanistan’s never-ending sectarian violence, coupled with rising tensions between India on one hand, and Pakistan and China, on the other. China wants Afghanistan to be a part of the CPEC that passes through the disputed Kashmiri territories, which is party why India and China are now close to a war. 

There is also no prospect of a revival of regional cooperation under SAARC. With this larger goal shelved, the story in all small South Asian states is now pretty much the same: that of intense India-China rivalry, with the Americans increasingly aligning with the Indians to checkmate China. This is as true of Afghanistan today as it is of Nepal and Sri Lanka.

SAARC’s dismal failure also underscores the continued relevance of national borders—the new India-China standoff only accentuating their importance. The big takeaway for Nepal is that, its BRI link to Central Asia sundered by the rugged Afghan mountains, it will continue to have to rely predominantly on its neighbors. As in Afghanistan abutting Iran and Pakistan, so in Nepal flanked by India and China.

The appointment of Yubaraj Khatiwada as the special economic advisor of Prime Minister KP Sharma is no surprise at all. More surprising is that the government has taken a decision that directly undermines the role and importance of the Ministry of Finance as an institution. The prime minister would have put in some effort to get the right finance minister if he really cared about developing institutions. Alternatively, if Khatiwada was an indispensable asset, PM Oli should have found a way to retain him as finance minister. The ministry will have to pay for PM Oli’s lack of foresight.

The prime minister could have appointed anyone as his special economic advisor, but that decision could have been taken after the appointment of the new finance minister. PM Oli is also wrong if he is considering keeping the finance ministry portfolio himself, running it with Khatiwada by his side. Khatiwada is being equally irresponsible if he has advised the PM to do so. Both are undermining the ministry’s role just to please their egos. Finance minister is not just another position to be filled. His or her leadership is sought every day within the ministry premises in Singha Durbar. 

The ministry has two secretaries: revenue secretary and finance secretary. These two secretaries provide leadership to the entire workforce linked to MOF, from the federal to local level. On everyday basis, they also process decisions that demand an input from political position, i.e. finance minister. It is impossible to keep running to Baluwatar every time they need guidance. Vital decisions will be delayed due to this arrangement, which in turn will have economic costs. This thus represents a blatant abuse of power.

Like most others, this columnist also had high hopes from Khatiwada when he took the helm as finance minister. Two and half years down the road, he has exited from the ministry to sheer disappointment of all. The first budget he presented was balanced and could have yielded dividends if implemented well. But then he started to undercut the private sector, undermine the role of a functional capital market, and bear down on small and medium enterprises in the name of revenue collection. People lost hope and the economy came to be supported by the rigid public sector alone. Khatiwada could not clear the path for growth by identifying key growth trajectories. In a nutshell, he missed the opportunity to do something substantive.

After serving as a finance minister, he should not have been part of the process to undermine the importance of the ministry he led. Developing an institution is also helping it get right leadership and then granting it the needed autonomy. In the absence of finance minister who can provide day-to-day leadership from the ministry, not much can be achieved on this front. As a special advisor, Khatiwada may provide excellent piece of wisdom to PM Oli but that will not be reflected in the economy as the ministry as an institution will be directionless. Hence, Khatiwada will end up being a liability to the government and to the country.

As Khatiwada is around, one may ask him and PM Oli about the report on public expenditure prepared by the team of Dilli Raj Khanal. Why hasn’t that report been publicized and its recommendations implemented? Why have vital institutions like the National Natural Resources and Fiscal Commission and the National Planning Commission not been strengthened under this government? The answer is lack of interest in developing these economic institutions. The constitution guarantees inclusive political institutions but if we cannot develop inclusive economic institutions to back them up, the political achievements will also come to a naught. Again, having a special economic advisor in Baluwatar when the finance minister’s cabin in Singha Durbar is vacant is a body blow for the ministry’s institutionalization.

Nepali business leaders must urgently construct a new narrative for the private sector that offers an alternative path to shared prosperity for all and, in the process, helps restore confidence of ordinary Nepalis in government institutions.

Fading relevance

The “Ease of Doing Business,” a widely quoted index developed by the World Bank that measures the regulatory environment for businesses and the strength of private property rights, tells only half the story. To complete the story, the other half must look into the relevance of private sector businesses. A lousy rating on the index means nothing if the private sector is irrelevant in the first place.

Long before the pandemic, the relevance of private businesses in Nepal was eroding. Nepalis were singularly and overwhelming reliant on the government for social services, employment, investments, security, growth—just about everything. Buoyed by revenues from consumption taxes and generous donor assistance, the government’s growing balance sheet was crowding out private investments. This only reinforced public reliance on government.

In Nepal, the underlying justification for private property, enterprise, and business success increasingly derives not from fundamental rights enshrined in the constitution, but from government entitlements. Entitlements can be a government-granted contract, right, privilege, dispensation, or property. They are different from rules and policies, as they are one-off and zero-sum. One-off because they are not routinely provided. Zero-sum because if someone gets that entitlement, no one else can.

When the justification for private sector stems from an undeniable, fundamental constitutional right to property, enterprise and employment, the government is forced to develop regulations and policies that create a rule-based economy.

Nepal’s private sector, unfortunately, has allowed its existence to be justified by government entitlements. As a result, Nepal is transforming rapidly from a rule-based to an entitlement-based economy.

Nepal’s business associations have failed to respond. First, they are too fractured, making it extremely difficult to converge on any meaningful agenda of change. Second, they have remained extremely myopic, focusing narrowly on short-term tax adjustments, government spending, and subsidies. They have done little to identify, build consensus, and motivate more important and deeper structural changes.

Nepal’s Ease of Doing Business index never radically improves as there is no real demand or genuine internal pressure to improve the ease of doing business.

Business responsibility

Should Nepali businesses have broader social, political, and economic responsibilities even as they seek to deliver profits?

In Nepal, continued failure of successive governments is eroding people’s confidence in the State. Corruption is endemic, sanctioned by the State and executed with impunity. Other State institutions—for example, the army, the president, the judiciary—are being equally discredited. They appear to have little ability (or interest) to stem the decline in governance or restore public confidence. This absence of institutional, legal, or moral accountability in governance is reducing people’s confidence, trust, and legitimacy in State institutions.

Nepali businesses have the power to reverse this decline. They must lead the responsibility to restore people’s confidence in government and State institutions.

Business narrative

Nepali businesses must craft a new narrative with action towards two goals. One, enhance political governance. Two, restore people’s confidence in the political, social, and economic institutions of the State. There are many options for such a narrative. Here is one simple suggestion.  

The Political. All large businesses, and business leaders, voluntarily provide annual audited statements disclosing how much of the firm’s revenues, including individual wealth of owners, resulted from government entitlements.

The Social. All large businesses voluntarily conduct and disclose annual social audits measuring the human development indicators (e.g., access to education, health, sanitation, empowerment, environmental impact, inclusion, and upward economic mobility) across all employees and supply chain partners.

The Economic. All large businesses voluntarily agree to ensure that at least 70 percent of their supply chain comes from non-related businesses not owned by friends, family, or associates (preferably small and medium enterprises, or women-led). Further, large businesses voluntarily agree to structure these supply chain arrangements into long-term bankable contracts which could then serve as collateral to raise investments for new firms or grow existing ones.

Of course, businesses could do nothing and retain the status quo of the entitlement economy. But remember this: in an entitlement economy, what the government giveth, the government can taketh. In many corners of Nepal, the fires of a second-generation revolution have begun to be lit. Businesses are directly in that line of fire.  

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With a steady increase in daily Covid-19 cases, its patients occupy almost all beds and Intensive Care Units of hospitals across the country. Against this backdrop, management of asymptomatic, mild, and moderate cases of Covid-19 at home or non-healthcare settings is important for both patients and authorities in order to relieve pressure on the healthcare system.  

Moreover, the WHO says 80 percent Covid-19 are asymptomatic, mild or moderate cases, 15 percent have severe infections, and the remaining 5 percent are critically infected patients. The apex global health organization says asymptomatic cases including patients with mild and moderate symptoms can be treated at home by following preventive measures.

Mild cases of Covid-19 are the ones diagnosed positive in PCR test but without any evidence of viral pneumonia or hypoxia while the Moderate cases have mild pneumonia. Fever (<102.38°F), dry cough, smell blindness, and sore throat are the most common symptoms in mild to moderate cases. Severe and critical cases have trouble breathing, persistent pain in the chest, bluish lips, serious to severe pneumonia, or acute respiratory distress syndrome (ARDS). Both severe and critical cases require emergency treatment or hospitalization.

Irrespective of the level of severity of the coronavirus infection, pregnant women or those above 60 or individuals with underlying medical conditions like diabetes, asthma, hypertension, kidney problems, cancer, and obesity must seek hospital treatment. Home-based care is recommended for adults or children when the hospital setting is unsafe, health facilities limited in numbers or unable to meet demand. 

Covid-19 Cases Isolation Management Guidelines issued by the Government of Nepal also say asymptomatic and mild cases can be managed through home isolation by following set preventive measures to avoid cross-transmission. The below-mentioned measures are as helpful for home-quarantined patients as well:

Physical exercise: Activities like walking within the room, for 15-20 minutes at least three times a day, help maintain proper blood circulation and prevents blood clots in lower limbs from prolonged bed rest. Deep breathing through the nose, spirometer or balloon blowing exercise 8-10 times a day helps restore lung function and improve oxygenation in mild cases. (But lung exercises are not recommended soon after food consumption.)

Gargling: Coughing, the second most common symptom after fever, causes sore throat. Gargling, an ancient therapeutic measure, four times a day, at an interval of four hours, helps reduce viral load in the oropharynx and remove throat irritation. Betadine diluted with lukewarm water in the ratio of 1:3 can be used to gargle on throat made sore by corona infection. You should not eat at least 15-20 minutes after the gargle with betadine.

Balanced diet: The person in isolation needs to eat low-carb but protein-rich foods with spices like ginger, turmeric, and garlic that generally boost physical immunity. Combination of food rich in Vitamin C, Vitamin D, and zinc that produce a synergistic role in boosting immunity is recommended. Alcohol drinking during isolation can result in anxiety disorders or depression, with greater risk of suicide. In addition, alcohol harms the immune system. Smoking by individuals with mild or moderate symptoms further weakens their respiratory system and elevates the risk of severe pneumonia. Avoiding both alcohol and smoking is important during the infection.

Medical Evaluation through Measurement of Vitals and Observation: The health condition of mild or moderate coronavirus patients must be monitored at least thrice a day and their health status updated. The patients too must immediately contact concerned authorities if their health condition worsens or they experience any difficulty. Patients can take their vitals like body temperature with thermometer and blood oxygen saturation with pulse oximeter.  If body temperature steadily increases above 102.38°F and oxygen saturation (SPO2) gradually drops below 90-92 percent, help must be immediately sought. Besides these, if there are threatening medical conditions like troubled breathing, persistent chest pain/pressure, dehydration, mental confusion, and bluish lips, immediate medical attention must be sought at government-assigned Covid-19 dedicated hospitals.   

Regular communication: The government’s isolation guidelines say at least one health worker should be assigned to monitor 50 patients under self-isolation. As per the guidelines, the designated health worker must monitor health condition of the patients, especially vital measurements at least two times a day through a phone call or message. The health worker can prescribe antipyretics drugs like paracetamol and ibuprofen for management of fever and pain during isolation. Patients also must immediately contact their health worker if they experience further symptoms or if their caretaker observes deteriorating health conditions.

Patients should disassociate themselves from rumors and misinformation about coronavirus and maintain regular communication with their friends, family, and relatives via phone or video chatting to keep themselves in good spirits—all vital to beat the infection.  

Precaution by caretakers: Children and pregnant women without underlying medical conditions but with mild and moderate symptoms can be treated at home. However, they require a caretaker at home during their isolation period. Caretakers must maintain personal hygiene and sanitation and put on a medical mask, plastic apron, and gloves while providing care or disinfecting the frequently touched surfaces, clothes, and bed items.

The WHO estimates that people with mild to moderate symptoms generally recover within two weeks. But there are some instances of the symptoms extending by a week. Hence it is advisable not to overlook the cases as mild or moderate and seek immediate medical attention if symptoms prevail for over three weeks.

Asymptomatic patients in home isolation can discontinue their self-isolation 10 days after the date of their first positive RT-PCR test on mild or moderate cases; for those with symptoms, self- isolation can end after at least 10 days from the onset of symptoms and three more days without any symptoms. More importantly, if the patients with mild or moderate symptoms have a fever, it must recede without the use of any antipyretic drugs 24 hours before discontinuing self-isolation.

The author is a graduate in Epidemiology and Biostatistics from SRM University, India