Unseen Consequences and Utopia of Federal System
Our political leaders have always been more provocative; their lack of understanding of the real situation, their intellectual incompetence and their lack of farsighted vision has undoubtedly led to the consequence to where the country stands today. Our political leadership should learn to acknowledge that there cannot only be a political solution to the socio-economic problems. Prescribing federal system as a solution to these problems at the cost of national integrity can prove to be a suicidal decision.
By Upendra Sapkota
The federal system now has become a buzz word. Most of the political leaders from seven parties started singing the rhyme of a federal system without even realising the consequences the nation could face. Even to pacify the ongoing Madhesi andolan, the current government was compelled to promise a utopian federal system without any homework and realistic assessment of the country’s geo-political situation. The announcement came just as a political reaction to the mass that had shaken the foundation of the current Loktantrik government. Decentralisation suddenly became an obsolete policy and federal system is taking shape.
Today, we are at a point where every ethnic community is demanding its own territory- a federal state, if not a separate state. How practical is this system for Nepal ? We are not the United States of America where geographical range is vast; we are not India where religious and communal hiccups always play major roles in shaping the fate of political leaders. We are a very small country where literacy is below par, economy is held together by remittances and donor agencies, physical infrastructure is in poor condition and our bureaucracy is outdated. Tomorrow if Nepal follows the federal system, how will it manage its resources, income and trade revenues and issues related to complex caste system and ethnic diversity? I suppose the current political leaders do not have an answer to all these critical issues. A brief assessment is presented below to provide an insight into the impacts of the federal system, if it is going to be imposed without any homework on the country’s geo-political situation.
Influence on Economy
There will be a huge impact particularly on the economic sector and the country’s economy as a whole. As of now, given the access, infrastructure facilities and easy transportation of raw materials from the southern border, most of the industries are aligned along the southern Terai belt. Job opportunities in Terai, regardless of educational profile of the locals, are higher than in the rest of the country. In a federal system, the growth of industries might experience a stumbling block as they might have to pay taxes both to the state and the national government. Since Nepal is just crawling towards the implementation of VAT, introduction of any new system would rather destabilise the whole system of revenue generation. Also the ambiguity of bifurcation of the revenues for both national and state government from the tax payers will remain importunate and cumbersome.
From the national point of view, apart from Terai region, the rest of the country is not that appropriate for industrial and agricultural development. In case of which, for a nationwide equal distribution of resources, the national government will have to take substantial revenues generated from the Terai industries, both from the employees and the employers. This would definitely escalate the regional tensions on a national level. If at all both national and state governments, through some legislative measures, bonded to agree on these issues, the private sector and consumer society will ultimately have to bear the brunt of price hike and inflation.
Also, our bilateral trade and revenue generated through custom points would be the other key area that is going to be affected particularly. The revenue generated from the custom offices, as of now goes to the national treasury. Once the federal system is imposed, it is most likely that the state government will be playing its own role based on the local problems, ignoring the common national concern. Our agro-based products, generated from Terai, are likely to be traded to the neighboring Indian areas, which are geographically more accessible than rest of the hilly areas of our own country. Controlling such trade and transactions from the national level will become almost impossible under the federal system. Under these circumstances not only will the western remote hilly regions be subjected to food problem but the entire nation will have to face the repercussions, from scarcity to severe price hikes.
Water right problem
Another problem Nepal might face would be the water right problem and issues related to water supply and hydropower. Most of our hydropower plants are in the hilly region, which contributes to the total electricity supply to the nation. In a federal system, a state would be an important factor and so will its resources. So to add to the regional tension, there will be big conflicts if a particular state has to do too much to feed another state or the country as a whole. For example we don’t have to go very far; our neighbor India has been facing the same problem related to Kaberi river which originates from Karnataka and flows through Tamil Nadu. These two states have been fighting legal battle for their water rights. Also, some western states of the United States like Washington , Colorado , Wyoming and California have been facing similar problems. Does Nepal have the capacity to tackle such problems? So, what would be the future of our hydropower industry; what will happen to Melamchi, which is already facing so much of pressure from the locals and how would such sectors be managed? I leave these questions to be answered by experts and political leaders of the country.
Caste/Ethnicity problem
The current federal system is purely envisaged based on the caste and ethnicity rather than decentralisation of resources and human capital. Once the federal state is formed, individual identity will dominate over regional tolerance and harmony. In Nepal , where its people speak more than 100 different languages, how will this system establish a regional harmony? This conflict will further escalate the local, regional and national tension.
It is very true that in our human social system, majorities have been dominant and minorities have suffered. Even in the US history, African American communities have always been discriminated. After the World War II, the GI bill was passed by the US congress giving financial opportunity only to the white war veterans. African Americans remained deprived although they fought equally in the World War. Even though they are discriminated and deprived, none of the African Americans have asked for separate state or territory for their sake. So a small country like us, which has a lot more issues to deal with, would be facing tremendous pressure under the caste and ethnicity based federal system.
Chart, -source-Dahal, cbs.gov.np
Also looking at our demography, it has changed significantly over the past years. According to the 2001 census, all the indigenous communities seem to have become minorities, particularly in urban areas. (See Chart, -source-Dahal, cbs.gov.np)Thus economic and other opportunities are in a way being taken away by the people who migrated from India- the Marwari in the business level and Halkhor (a lower caste migrating from India in search of better quality of life), in the labor level. The close connection of these groups with India and their presence in urban areas and the Terai will cause serious conflict in the region. In addition to that, their political and economic approach in the state government will create detrimental impacts on the national interest. Under such circumstances, will we be able to protect our identity, regional territory and nationality? Nepal may remain a sovereign country in the map but, politically and socially it might lose its foothold to the friendly neighbor.
To add insult to these injuries, the current uncontrolled distribution of citizenship has created a situation where these immigrants from the south are more likely to get citizenship. Under the federal system, this issue would become even more vulnerable in an absence of control from national level. It is not an exaggeration to say that if such practices continue to take root, the indigenous population will be in minorities very soon and will disperse into small fragments.
Foreign policy
Another key factor is the foreign policy, particularly with India , in which we have a love and hate relationship. The Nepalese people always presented their weakness in maintaining foreign policy which would benefit the country. Under the federal system, owing to regional interest and representation from the particular region, politicians will not be able to focus the foreign policy which would benefit the nation as a whole. Recently from an interview with Ashok Mehta (an Indian expert of Nepalese relations) on the BBC Nepali service, it looks even more daunting. He clearly stated why India wants to abolish monarchy. According to him, the monarchy did not help India to attain its strategic position, regional and worldwide, neither in the present nor in the past. Looking at the political development over the past two or three years, it is clear that how much our neighbor has to do with our internal politics. What we should not forget is the current government in India , will follow the Nehru Doctrine, which expresses a keen geo-political interest over the entire Himalayan region; Nepal , Bhutan and Sikkim . This fact was explicitly stated by Nehru after his visit to China in 1954. The latter two parts are now virtually under the control of India and Sikkim is already part of India state. Nepal was pretty stable despite the odds imposed by India by virtue of our close ties with China . Today when it is very likely that new political set up will be highly obliged to our southern neighbor, and since there is no common leader who would lead the country to a different level, Nepal presents an even weaker position under the fragmented federal system.
On the other hand, owing to its current growth, India might face serious crisis of energy and water. Nepal and Bhutan can only be a possible source to fill this gap. Under the federal system, India will have a more pronounced role because of geo-ethnic proximity of our southern border, which is the only possible place to tap water from Nepal . Thus, under the federal system Nepal as a country will not be able to take substantial benefits from its resources.
Lastly, all these facts and indicators show that the federal system would create huge disparity over the entire nation. Our political leaders have always been more provocative; their lack of understanding of the real situation, their intellectual incompetence and their lack of farsighted vision has undoubtedly led to the consequence to where the country stands today. Our political leadership should learn to acknowledge that there cannot only be a political solution to the socio-economic problems. Prescribing federal system as a solution to these problems at the cost of national integrity can prove to be a suicidal decision. If at all there is a problem, political leaders, social scientists and development experts should be able to formulate a solution within the realm of national integrity. Otherwise GOD BLESS NEPAL .
(The author is a master’s level student of Urban Planning at BallStateUniversity, Muncie, Indiana, USA and can be reached at usapkota@bsu.edu)
(Editor’s Note: Nepalis, wherever they live, as well as friends of Nepal around the globe are requested to contribute their views/opinions/recollections etc. on issues concerning present day Nepal to the Guest Column of Nepalnews. Length of the article should not be more than 1,000 words and may be edited for the purpose of clarity and space. Relevant photos as well as photo of the author may also be sent along with the article. Please send your write-ups to editors@mos.com.np)
