The National Planning Commission (NPC), the apex advisory body to formulate plans for the country’s development, has unveiled a roadmap to transform Nepal into a high-income economy in the next 25 years. In its 15th Five-Year Plan, NPC has aimed to increase the per capita income to USD 21,500 by 2043 maintaining a minimum average annual economic growth rate of 9.4 percent. The commission must have worked hard to prepare the 15th Five-Year Plan which is quite appealing at a glance. Its concept of ‘generating prosperity and happiness’ is also very pleasing. The targets have been determined using complex statistical models.

 

However, there is no basis to realise the euphonious targets of the plan. At a time when people have been questioning the necessity of periodic development plans and NPC’s existence due to its ineffective role, it is obvious that there will be a big question mark on the targets set by NPC. While there is the desire of officials at the commission to make Nepal a high-income country, there is no point in preparing a more ambitious plan without finding the reasons behind the failure of past periodic plans. The role of NPC is confined to formulate plans and work as an advisor to the government. But the big question remains as to whether or not the government has been working to realise the targets set by the commission and considering its recommendations. How realistic will it be to think that government bodies will implement the objectives of the periodic plans, given that they can’t even spend the money allocated in the annual budget even in the National Pride Projects. At a time when the government has not given an appropriate role to the private sector for the country’s development, there is no roadmap for the government, bureaucracy and private sector to work to achieve the objectives announced by NPC.

 

The commission sets the ceiling of the national budget. The government has not even been following this element which is considered mandatory in the budget formulation process. It is very difficult to believe that the government which does not follow the binding recommendations and reports presented by the Office of the Auditor General will work according to the recommendations of NPC. The people in the government and bureaucracy are not legally obliged to follow the recommendations of NPC.

 

Neither will the private sector make investment decisions based on the objectives of the 15th Five-Year Plan. It is a different thing as to whether the plan can provide a basis for NPC to set a budget ceiling according to its objectives. It can also be the basis to ask donors for assistance. The role of NPC should only be in the formulation of policies. This is why countries like India have abolished their planning commissions and only policy formulating institutions are in existence there. Many economists have been suggesting implementing a similar thing in Nepal.

 

The 15th Five-Year Plan has many shortcomings. For example, the activities of Nepal Rastra Bank, Insurance Board and Securities Board Nepal have been incorporated as the targets of the NPC’s periodic plan. These bodies cannot limit themselves to what such document say. There is no mention of a transformative and effective implementation mechanism for the economic sector and no space is given to connecting agriculture to the market and industry. In this situation, it is impossible to realise the objectives set in the 15th Five-Year Plan. It could have been more fruitful if efforts were focused to find and resolve the root causes of existing problems in the country’s development.

 

Madan Lamsal

madanlamsal@gmail.com