Analysis of CPN's Election Manifesto: Ambitious Economic Goals Meet Implementation Hurdles

Kathmandu. As the House of Representatives election scheduled for February 21 approaches, political parties are beginning to unveil their manifestos. On Tuesday, the Communist Party of Nepal (CPN) launched its ambitious commitment paper (manifesto), promising an economic transformation for the country.

The 57-page manifesto covers sectors such as agriculture, tourism, energy, infrastructure, urban development, labor, employment, and enterprise. Ambitious agendas, such as achieving double-digit economic growth and creating hundreds of thousands of jobs, are mentioned in the CPN's manifesto. But how realistic are these attractive slogans and targets when viewed against Nepal's current economic reality, implementation capacity, and past failures?

A comprehensive analysis of the economic plan presented by the CPN shows a mixture of ambition and challenge. Dr. Min Bahadur Shrestha, former Vice-Chairman of the National Planning Commission, states that while the economic development goals included in the CPN's election manifesto appear ambitious, they are not impossible.  

Speaking to Ratopati, Dr. Shrestha acknowledged the public disillusionment caused by parties bringing forth good agendas in every election that fail to be implemented, but argued that if the agendas put forward by the CPN this time are pursued with the right 'spirit,' results can be achieved. However, he pointed out that these goals will not be easily achieved and require political stability and good governance.

Stable Government and Corruption Control are Essential Requirements

According to Dr. Shrestha, goals mentioned in the manifesto, such as achieving an economic growth rate above 10 percent and reducing multidimensional poverty to 5 percent within five years, are achievable, but certain preconditions must be met. Dr. Shrestha put forth political stability as the first prerequisite for the manifesto's implementation. He suggests that the government, whether led by a single party or a coalition, must function stably for five years. Citing the lack of policy continuity due to unstable governments in the past, he claimed that targets would only be met if an environment is created where work can be done without worry for five years.

He explains corruption control as the second pillar of development. He claims that in the country, more than half of the allocated budget is misused, rather than there being a shortage of budget.

“We say we lack budget, but if the existing resources are fully utilized, we can achieve double the economic growth even in the current situation,” says Shrestha.  

According to Dr. Shrestha, a 10 percent economic growth rate cannot be achieved with the traditional bureaucratic machinery and structure. He suggests that many state institutions are defunct and need to be abolished or restructured. “It is a matter already admitted by chief secretaries that only 20 percent of the current employees work, and the rest do not,” he says. To break this situation, he suggests that, as mentioned in the manifesto, it is necessary to bring in 30 percent new and technology-friendly manpower into the employee administration.

“Due to the coalition's compulsion to say, 'If our demands are not included in the budget or if a contract is not given to someone, we will topple the government,' the Maoists have never been able to work 'independently',” says Shrestha. “Therefore, if CPN can lead and run the government for five years on its own, it might not be difficult for them to approach the manifesto's goals. We can give them the benefit of the doubt.”

Economic Slogans in the Election

CPN has stated that Nepal's economy is currently in a phase of multidimensional crisis, characterized by long-term recession, weak productive sectors, import-dependent consumption, widespread unemployment, and youth migration. To address this, the party aims to strengthen national self-reliance through political, economic, and policy self-determination, end foreign interference and dependence, and guarantee equitable prosperity, good governance, and social justice.

The manifesto sets ambitious targets to achieve an economic growth rate of over 10 percent and reduce the multidimensional poverty rate from the current 20.15 percent to 5 percent within the next five years. To achieve this, it has declared that production growth, job creation, financial inclusion, and self-reliance will be prioritized.

Transformation of the Agricultural Sector: The Illusion of the 'Decade of Agricultural Investment'

CPN has put forward an ambitious plan to become self-sufficient in major commodities such as paddy, wheat, maize, vegetables, fruits, sugarcane, milk, meat, and fish within the next two years by declaring a 'Decade of Agricultural Investment.' Measures mentioned for this include collective and commercial farming, advanced technology, ensuring irrigation, and feasibility studies for chemical fertilizer factories. The party has also committed to distributing land ownership certificates to landless Dalits, squatters, and the irregularly settled within two years, declaring Nepal 'landless-free,' and providing cultivable land capable of sustaining livelihoods to farmers directly involved in agriculture.

However, considering the reality that Nepal's agricultural sector is still subsistence-based, reliant on traditional technology, and vulnerable to climate change, the goal of self-sufficiency within two years appears very challenging. Past experiences suggest difficulties in resolving sensitive issues like protecting the rights of sharecroppers and contract farmers in land management and 'ending dual and absentee land ownership.' Given the long and controversial history of land reform, the question remains unanswered as to how the party will implement these commitments free from political maneuvering.

Special Packages for Target Groups: More Apprehension Than Enthusiasm

CPN's manifesto places entrepreneurship as a national priority, focusing on youth, women, Dalits, indigenous nationalities, and marginalized communities. It states that projects will be developed according to the characteristics of the provinces. The manifesto mentions specific programs for various target groups, which sound attractive but appear equally challenging to implement in practice.

An agenda has been put forward to operate special grants, training, technical support, and market access programs to transform traditional skills of Dalit communities, such as blacksmithing, leatherwork, and handicrafts, into modern commercial ventures. Furthermore, an ambitious declaration has been made to provide loans up to NPR 10 million at a 5 percent interest rate for 10 years to encourage entrepreneurship among Dalits, minorities, and persons with disabilities. While this provision seems to offer significant relief to groups struggling with capital shortages, the manifesto lacks a concrete framework on how such a large amount of subsidized loan will be managed, who will bear the risk, and how access will be ensured for genuine entrepreneurs. Special subsidized loans, training, market support, and mentoring programs will also be operated to promote women-led entrepreneurship, and a 'Women Enterprise Development Fund' will be established. Emphasis is placed on quality control, branding, and export promotion to commercialize the traditional skills of indigenous nationalities.

Startups and IT Enterprises: A Dream

Another significant aspect of the manifesto is prioritizing startups and IT enterprises by offering free registration, full tax exemption for the first five years, followed by progressive tax benefits. Commitments also include developing special incubation centers and IT parks, establishing an Innovation Fund, and ensuring mentoring and investment security. Provincial plans, such as developing Bagmati Province as an urban/IT and innovation hub, have also been put forward.

These provisions may attract young entrepreneurs and those wishing to work in the technology sector. However, considering Nepal's slow internet speeds, energy irregularities, shortage of skilled technical manpower, and the challenging environment for startup capital investment, there is apprehension that these goals might only remain election slogans. While tax exemptions are one aspect, the challenge of the country's weak revenue collection also exists.

Industrial Development: The Dream of 'Smart Manufacturing'

The party has put forward an ambitious plan to transition the country's industrial sector towards AI-based smart manufacturing. It has declared special incentives for industries that substitute imports and promote exports, prioritizing agriculture, tourism, hydropower, and information technology as areas of comparative advantage to attract domestic and foreign investment. It mentions establishing incubation centers to promote and upgrade rural micro, cottage, and small industries. Commitments have also been made to boost private sector morale through investment security, strict legal frameworks, and the formation of an industrial security force.

However, considering the reality that Nepal's industrial base remains weak, technological infrastructure is insufficient, and there is a shortage of skilled manpower, the dream of AI-based smart manufacturing seems distant. The lack of a concrete framework in the manifesto regarding how the large capital, competitive energy supply, stable market, and political stability required for industrial development will be ensured is noticeable. While there is talk of boosting private sector morale, the question of whether the Communist Party's socialist-oriented economic ideology might create suspicion among the private sector remains unanswered.

Employment through 'Returnee' Enterprises

CPN also aims to operate a 'Returnee Entrepreneurship Program' to utilize the knowledge, skills, experience, and capital of 100,000 Nepalis returning from foreign employment within the country. Furthermore, a special fund and training will be arranged in the agriculture, tourism, and processing sectors by developing collective and cooperative-based production systems.

While these goals are ambitious, there is a lack of clarity on how the administrative hassles, market shortages, capital management issues, and psychosocial problems faced by returnees starting businesses in Nepal will be addressed. In the past, many returnees were forced to go abroad again because such programs were ineffective. Although the concept of collective enterprise is old in Nepal, the manifesto does not show sufficient detailed planning on how the necessary transparency, leadership development, and active participation of members will be ensured to make it successful.

Similarly, job creation has been given high priority by the party. It has announced a goal to ensure a total of 500,000 jobs by adding an additional 150,000 jobs annually over the next five years. To achieve this, it is stated that fallow land, rivers, forests, minerals, and biological resources will be utilized productively. Although these commitments seem attractive, there is a visible lack of a clear and practical action plan on how such a large number of jobs will be created.

'100% Green Energy' and the Dream of 10,000 MW

In the energy sector, the party has set a long-term goal of increasing per capita electricity consumption to 750 kWh in the next five years and generating 40,000 MW of electricity by the year 2100. Ambitious commitments include reaching a national system capacity of 10,000 MW in the next five years and declaring the country an 'Energy-Friendly Nation' by utilizing '100% green energy.' Emphasis is placed on hydropower, renewable energy, and the construction of integrated corridors for this purpose.

However, hydropower projects in Nepal have always faced delays due to issues like land acquisition, environmental impact, displacement of local residents, and political interference. The manifesto lacks sufficient concrete plans regarding the large investment, technical capacity, and assurance of an inter-country market required to achieve the 10,000 MW target. While the provision to 'open Power Purchase Agreements (PPAs) for new projects and allow private sector companies to enter into such agreements' may bring some ease, the challenge of winning back private sector confidence due to past policy instability remains.

'Rapid' Construction of National Pride Projects and the Dream of Connectivity

In physical infrastructure, CPN has committed to rapidly completing the construction of national pride projects that have seen little progress and new important projects. Priority has been given to the construction of the East-West Highway, Postal Highway, Mid-Hill Local Highway, Kathmandu-Madhes Expressway, railway lines, and the Nijgadh International Airport. It also mentions advancing the construction of expressways, local highways, and tunnel roads in various parts of the country.

However, national pride projects have been moving at a snail's pace for years, mainly due to political interference, disputes related to forests and environment, and land acquisition problems. Simply stating that they will be 'completed rapidly' is not enough; the manifesto lacks a concrete action plan on how these problems will be resolved. There is no clarity on how complex issues like the environmental impact assessment and local opposition to the Nijgadh airport will be addressed. Furthermore, there is a lack of concrete explanation regarding the large resources and technology required for urban infrastructure plans, such as implementing a 'Mass Transit System' in major cities.

Leap from Urban Chaos to 'Smart City'?

In the context of urban development, the manifesto includes an ambitious plan to remove haphazard settlements and develop organized and integrated settlements, and to bring modern services and facilities to settlements in villages and towns. Commitments include making 20 cities 'Smart Cities' and 100 rural settlements 'Smart Villages' within the next five years, providing clean drinking water to all Nepalis, and constructing 500,000 new housing units under the concept of 'one family one housing unit.'

However, considering Nepal's rapid and unplanned urbanization, increasing land disputes, the influence of land mafias, and weak urban planning and management, achieving these goals appears very challenging. The slogan of Smart City has been repeated many times in the past without concrete progress. There is a visible lack of a detailed plan for the large investment, land management, and quality construction required to build 500,000 new housing units.

Tourism Development: Opening '97 Peaks' and Removing the EU Blacklist

Important agendas have been put forward to make the tourism sector an attractive, safe, and accessible destination, to remove it from the EU blacklist, and to promote eco-tourism, adventure tourism, health/wellness tourism, and herbal tourism. There are also commitments such as promoting mountaineering by opening 97 lesser-known Himalayan peaks ('97 Peaks'). While their implementation could boost revenue, concerns have been raised about the impact on the Himalayan environment and sustainable tourism. Commitments such as banning single-use plastics and tightening environmental regulations in mountain, wildlife, and conservation areas are welcome, but the challenge of implementation remains.