Economic growth is contingent upon a country’s natural resources, human capital and investment capacity. In Nepal’s case, hydropower and biodiversity are our main natural capital. But we are desperately short on human capital and investment capacity. This is because Nepal’s human capital development is not geared at harnessing natural resources through scientific research and endogenous development. Likewise, the country has failed to attract bilateral and multilateral capital for large hydro projects. Nor have we been able to cash in on the country’s advantageous geostrategic position.
The service sector, especially the remittance regime and the field of nature tourism, has become sine qua non for the country’s economic survival, as political instability continues to undermine industry and commerce. Paradoxically, agriculture and forestry (Biodiversity) have not contributed to economic growth. Growth retardation, I argue, results from the country’s failure to invest in science and technology. Thus greater investment in science and technology to capitalize on country’s human capital is important for our sustainable economic growth.
In Nepal’s context, natural resources are products of interaction among Men (humans), Mountain (land) and Monsoon (water). The three M’s are responsible for subsistence, sustenance and economic growth in Nepal. The country’s economic growth for the fiscal 2011/2012 (4.56 percent) is projected to surpass growth rates for the last two years (4.3 percent and 3.9 percent respectively). Much of this can be attributed to good remittance, labor export and better monsoon. But at the same time the industrial sector has staggered owing to labor unrest, political instability, energy crisis and insecure investment climate.
Young Nepali men and women go to foreign lands as unskilled laborers. As things stand, agricultural productivity based on monsoon is de-facto paddy productivity. The entire gamut of cash crops, horticulture, livestock and fisheries make little contribution to agriculture. The contribution of forest sector (including Non-Timber Forest Products and floriculture) in economic growth also stands low. Moreover, Nepal has not been able to exploit even two percent of its hydropower potential.
Over 80 percent of Nepal’s population is comprised of rural farmers. Their competences in farming and forestry, in animal husbandry and poultry keeping, in utilization of wild plants and animals for food and medicinal purposes and in maintenance of age-old cultures are well known. People of Nepal spanning across many climates conditions and cultures represent a vital stock of competencies, knowledge and creativity. This capital is fleeing to foreign countries as raw laborers. As of now, almost three million youths are away from Nepal.
Over 56 percent of rural households depending on remittances do not have the capacity to harness land resources. As such, indigenous knowledge systems and traditional technologies are both severely threatened. Nepali sweat is being shed to make a desert bloom while the garden paradise back home is left unattended. The vital task at present is to orient and absorb human capital to enhance land productivity and product modernization.
Water is Nepal’s most important resource, not only as a drinkable commodity, but also because of its enormous potential energy and its renewable nature. Every year, the Himalayas are charged with the monsoon water, with over 6,000 rivers draining into Nepal. The boon and bane of monsoon rain remains an unfinished story for Nepali people. Our generation is tired of hearing that Nepal has a theoretical potential of 83,000 MW of hydroelectricity, while the commercially feasible potential stands at 43,000 MW. Yet the installed capacity has not risen over 659 MW. Thus the country has so far exploited a meager 1.53 percent of its total hydroelectricity potential.
Coming to bioresources, they include not just plants and animals but also their habits. Fortunately, Nepal is very rich in biodiversity as well as in ecosystems. Almost 200 ecosystems have been identified on the basis of the differing types of vegetations. Nepal can grow almost anything that can be cultivated on earth. Besides, there is nothing that Nepali farmers, attuned to all kinds of bioclimatic environments, cannot grow. This makes ecosystem federalism an essential component in the federalism debate.
Nepal is recognized as a zone of interpenetration of several phytogeographical/ zoogeographical provinces in Asia. Nepal brings to one place the central Asiatic bovine, the yak and the southern Asiatic bovine and the gaur. The snow leopard and the Royal Bengal Tiger are just 80 km apart. Elements of Mediterranean flora (olives, pomegranates and cedars) meet Sino-Japanese cherries, maples and rhododendrons in Nepal. South Asian Rauwolfia and the Central Asiatic Ephedra cover pages of ancient texts of Amchies and Ayurveda. Cranes and ducks migrate from Siberia to Sri-Lanka via Nepal. Nepal is thus a crossroad and a corridor of biological dispersal.
Mingling and merging of differing biological species has resulted in new creations and active evolution. There are several centers for species dispersal along Nepal’s expanse of the Himalayas. Identification of new protected areas is an ongoing process in Nepal, even as quarter of Nepali territory is already occupied by protected areas (10 National Parks, 6 conservation areas, 3 Wildlife reserves, and one hunting reserve). Of them, the Sagarmatha National Park and the Chitwan National Park are listed as World Heritage Sites. Besides there are eight wetlands (Rara Lake, Lake Phoksumdo, Ghodaghodi Lake, Jagdispura Reservoir, Bishajaria Tal, Gossainkunda Lake complex and the Mai Pokhari). Protected areas are proven assets for eco-tourism.
Currently, service sector makes up for most of the economic growth in Nepal. But despite large volume of remittance, national productivity (agro and industrial productions) has declined. This is because remittance earnings are being spent on non-productive sectors. Industrial sector is hard hit by labor unrests, whether we talk of Surya Nepal or Birgunj Sugar Mills. Business investment is depressed with forced closures of business establishments like KFC and Pizza Hut and Greenwich Hotel sending out a wrong message to likely investors.
Economic growth of a poor country like Nepal is based on the productivity of the land and the promises offered by its unique landscapes through which to address persisting underdevelopment and poverty. Nepali farmers who fled to gulf Countries and Malaysia have found, on returning, that their own farmlands are more rewarding if they know how to commercialize their farm products, for instance through the production of cash crops such as vegetables and fruits, ornamental flowers and seeds, coffee and tea, cardamom and medicinal herbs. The livestock sector is equally lucrative in terms of milk and cheese, meat and eggs, fish, honey and so on. Let us not forget: Nepali land is hospitable not only to Java coffee but also to Australian Ostrich.
Herbal products, green economy and organic farming are words that capture global imagination for a sustainable future. Thus science and technology and innovation for economic growth have to be geared at solving problems in the farm fields and forests. The long awaited Federal Republican governance would demand eco-friendly technologies and enterprises development based upon bio-resources. A network of provincial bio-centers should be visualized along MS Swaminathan’s concept of Bio-Village with its orientation towards pro-nature, pro-poor and pro-woman initiatives. Greater use of bio-technology and information technology offer the country’s the best bet for economic success. We don’t want to sell our productive lands, nor our valuable laborers. We rather want to sell our products. Investment on science and technology should be geared towards that end.
Adapted from the author’s plenary lecture to the Sixth National Conference on Science and Technology (Sept. 25-27) in Kathmandu
The author is a lifetime member of Nepal Academy and holds a doctorate in Ecology and Biogeography