International award doesn’t make Ram Sharan Mahat best Finance Minister

Onlinekhabar Commentary

Kathmandu, January 5

The entire country should have felt proud when The Banker declared Ram Sharan Mahat the Finance Minister of the Year. But it did not, for people do not consider this six-time finance minister of Nepal as a successful finance minister. Soon after the announcement of the award, netizens took to social networking sites to criticise Mahat and described the magazine’s move as a joke.

One of the controversial legacies of Mahat is the privatisation of public enterprises and state-owned industries at dirt cheap rates.

File Photo

The Indian blockade has shown how weak the Nepali economy has become, and how dependent it is on the Indian economy. And this is the right time to evaluate the role Mahat, the longest-serving finance minister since the 1990’s political change, in bringing the country to this pass.

Even when he was not holding the Finance Ministry portfolio, Mahat was instrumental in shaping economic policies. Mahat has influenced Nepali Congress’ economic policies heavily.

In the first Nepali Congress-led government formed after the restoration of multiparty democracy in the 90’s, Mahesh Acharya was the finance minister whereas Mahat was vice-chair of the National Planning Commission. Since then, Mahat has been instrumental in giving shape to Nepal’s economic policies.

The question arises: What are the net gains of Mahat’s leadership?

Today, lakhs of Nepali youths are toiling abroad. Domestic industries are dead and the national economy has been surviving on remittance.

A country rich in water resources has been reeling under extended load-shedding hours, with negligible amount of electricity generated in 25 years after the restoration of multiparty democracy.

Health and education sectors are under the grip of the private sector. There’s a huge gap between quality of health and education services for the poor and the rich. Commercialisation of education has produced two kinds of human resources in the country. Thanks to commercialisation of the health sector, the poor have no option but to die for want of treatment, for treatment costs are pretty high.

And there’s a huge imbalance between import and export. Nepalis have been utilising remittance for purchase of imported foodstuffs. With import increasing and export decreasing, the national economy has become fully dependent.

In a country with agriculture as its mainstay, cultivable land has been lying barren. On one hand, there are not enough human resources to tend the fields. On the other, unrestricted import of farm products has hit Nepali farmers hard.

Of course, Mahat is not only to blame for this grim scenario. But he is mainly to blame for the mess, nonetheless.

The Banker has lauded Mahat for bringing in foreign assistance and expediting relief distribution in the immediate aftermath of the quakes. He indeed played a crucial role in attracting foreign aid by convening a donors’ conference. But then this is the minimum role that a finance minister can play in the times of crises. . Every Tom, Dick and Harry could have done that. And the foreign aid commitment was not that big. Mahat held on to the Finance Ministry portfolio for six months after the quakes. During this crucial period, he did precious little in terms of reconstruction works meant to provide relief to quake victims.

Granted, that the Reconstruction Authority could not take shape and reconstruction works could not gain pace due to differences between political parties. But then why was Mahat adjudged the Finance Minister of the Globe and the Asia-Pacific for 2015 for the reconstruction that has not happened?

Before the quakes, Mahat could have changed the face of the economy in the capacity of the finance minister of a stable ruling coalition comprising the Nepali Congress and the CPN-UML. Despite this, the economic health of the country was far from satisfactory.

It was forecasted that the economy would grow by six per cent in the fiscal 2071-72, but the growth was restricted to three per cent. The April 25 mega quake affected the growth. But even without quake, the economy would not have grown by more than four per cent.

After the quakes, customs close to China got blocked. Allegedly, Mahat did not provide funds to reopen the customs points despite efforts at the local level. That’s why Nepal’s foreign trade has become heavily India-reliant of late. Mahat also faces charges of not showing willingness to provide relief to the victims.

In the eyes of the westerners, Mahat was a good finance minister because he adopted policies that were in the interest of donors.

He was friendly towards the World Bank and the IMF, so The Banker’s award is nothing unusual.

A Nepali finance minister getting a prestigious award, leaving behind counterparts from powerful countries, is a good news in itself. But the award does not make him the best finance minister, not for the Nepali people, at least.

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