Economic Agenda of Thecommunist Parties of Nepal
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ECONOMIC AGENDA OF THECOMMUNIST PARTIES OF NEPAL A Thesis Submitted to the Central Department of Economics Tribhuvan University, Kirtipur Kathmandu In Partial Fulfillment of the Requirements for The Degree of Master of Arts IN ECONOMICS By Yan Prasad Dhungel Roll No: 477/065 T U Regd: 7-1-999-266-2000 Central Department of Economics Tribhuvan University, Kirtipur Kathmandu, Nepal February, 2014 LETTER OF RECOMMENDATION 1 The Thesis entitled "Economic Agenda of the Communist Parties of Nepal"has been prepared by Mr. Yan Prasad Dhungel under my supervision in partial fulfillment of the requirements for the degree of Master of Arts in Economics. I forward it with recommendation for approval. ................................... Mr. Bharat Pokharel (Thesis supervisor) Central Department of Economics Tribhuvan University CampusKirtipur, Kathmandu Date:11th February, 2014 2 APPROVAL LETTER The thesis entitled "Economic Agenda of the Communist Parties of Nepal" has been prepared by Yan PrasadDhungel to the Central Department of Economics, Faculty of Humanities and Social Sciences,Tribhuvan University Campus, Kirtipur,Kathmandu in partial fulfillment of the requirements for the Masters of Arts in Economics has been found satisfactory in scope and quality. Therefore we accept this thesis as a part of the degree. Evaluation Committee: ……………………….. Dr. Ram Prasad Gyawali ( Head of the Department) .............................. Prof. Dr.R. K. Shah External Examiner ............................... Mr. Bharat Pokharel (Thesis Supervisor) Date:20th February, 2014 3 TABLE OF CONTENT Letter of Recommendation Approval Letter Acronyms and Abbreviations CHAPTER - ONE INTRODUCTION 1.1 General Background 1 1.2 Statement of the Problem 3 1.3 Objectives of the Study 4 1.4 Significant of the Study 4 CHAPTER - TWO REVIEW OF LITERATURE 2.1 Conceptual Framework 5 2.1.Early Thoughts of Communism 5 2.1.1 Concept of Ideal State 6 2.1.2 Origin of State 7 2.1.3 Utopian Socialism: Idea of Equality, Freedom and Brotherhood 8 2.1.4 Pre - Marxism Socialism 10 2.2 Background of Marxist Theory 11 2.2.1 Major Concepts of Marxist Political Economic Thought 12 2.2.1.1 Dialectical and Historical Materialism 12 2.2.1.2 Labor Theory of value 14 2.2.1.3 Use Value and Exchange Value 14 2.2.1.4 Role of Competition 15 2.2.1.5 Money and Price 15 2.2.1.6 Surplus Value 16 2.2.1.7 Scientific Socialism and Communism 18 2.3 Development of Neo - Marxism andLeninism 21 2.3.1 Breakdown Theory 22 2.3.2 Revisionism 22 2.3.3 Democratic Socialism 22 2.3.4 New Left Movement or Radical Marxism 23 4 2.3.5 Leninism 24 2.4 Application of Marxism Leninism and Various Thoughts 28 2.5 Mao's Intellectual Marxist Development 29 2.6 Development of Capitalist Economic Thought after October Revolution 1917 31 2.6.1 John Maynard Keynes 31 2.6.2 Robert Heilbroner 31 2.6.3 Emergence of Broader view on Development 32 2.7 Implication of Marxist economic thoughts in different countries 33 2.7.1 Application in Soviet Union 33 2.7.2Application in China 38 2.7.3 Communist Government in North Korea 42 2.7.4 Communist Government in Cuba 42 CHAPTER - THREE RESEARCH METHODOLOGY 3.1 Conceptual Background 44 3.2Sources of Data and Information 44 3.3 Methods of Analysis 44 CHAPTER - FOUR MARXIST ECONOMIC POLICIES IN NEPALESE POLITICAL PARTIES 4.1 Introduction 46 4.1Communist Party of Nepal (UM L) 46 4.2 Nepal Workers and Peasants' Party (NWPP) 49 4.3 Communist Party of Nepal (Masal) 52 4.4CPN-Maoist 53 4.5 Unified Communist Party of Nepal (Maoist) 53 CHAPTER - FIVE 5.1 Influence of Marxist on Various Economic Policies in Nepal during 1990-2006 58 5.1.1 Formation of Interim Government and Economic Policy Towards Liberal Economy 58 5.1.2 The Constitution of Nepal 1990 and Influence of Marxist Economic Thought 59 5.1.3 First General Election and State Economic policy 61 5.1.4 Period of Coalition Government (1995-1999) 62 5 5.1.5 The Royal takeover period of Multiparty Democracy (2002-2006) 64 5.1.6 Popular Movement of 2006 and Establishment of New Interim Government 65 5.1.7 Three -Year Interim Plan and Influence of Marxist Philosophy 65 5.2 Linkage of Marxist Economic Thought on present Economic Scenario 70 5.2.1 Macro Economic Situation 71 5.2.2 Poverty, Employment and Inequality of income in Nepal 70 5.2.2. 1 Employment situation 70 5.2.2.2 Sources of Household Income and trend of income distribution 71 5.2.2.3 Basic Statistics and Trends of Poverty 72 5.2.2.4 Land Distribution and Poverty 73 5.2.5 Poverty and Scientific Land Reform 73 5.2.2.6 Human Development and Environment Status of Nepal 74 5.2.2.7 Cooperative as a Vehicle of Economic Growth 75 CHAPTER - SIX SUMMARY, CONCLUSION AND RECOMMENDATIONS 6.1 Summary 76 6.2 Conclusion 78 6.3 Recommendations 79 6.4 Recommendations for Further Research 81 REFERENCES 6 ACRONYMS AND ABBREVIATIONS CBS Central Bureau of Statistics. CP Chinese Communist Party UCPN (Maoist) Unified Communist Party of Nepal, (Maoist) CPN (UML) Communist Party of Nepal, (United Marxist Leninist) CPSU Communist Party of Soviet Union GDP Gross Domestic Product GNP Gross National Product IMF International Monetary Fund INGOS International Non- Governmental Organizations KMT Kuomintang NC Nepali Congress NEP New Economic Policy NPC National Planning Commission NRB Nepal Rastra Bank NWPP Nepal Workers and Peasants Party PMPD Peoples Multiparty Democracy TYIP Three Year Interim Plans UN United Nations UNDP United Nations Development Program US United States USSR Union of Soviet Socialist Republic WB World Bank WTO World Trade Organization NESAC Nepal South Asia Centre NLSS Nepal Living Standard Survey 7 CHAPTER ONE INTRODUCTION 1.1 General Background The twenty-first century is a great transitional era. During 1990’s, socialist economic model of the former USSR and Eastern Europe has been collapsed. Modern capitalist economists and western government propagandist triumphed on it. According to them, the debate between capitalism and socialism is over. Globalized world and New- Laissez fair economy have been the battle cry. The followers of this New- Laissez fair economy are announcing that there is no alternative of the capitalist economy. Capitalism is the last truth according to the western spokespersons. Another massively used word is sustainable development it is said that socialism has failed or not sustained and on the other side capitalism has proved its sustained growth. However, what is the present world reality? “we are witnessing explosive growth in all directions: growth in productive capacity among the rich, population growth among the poor, wasteful opulence and grinding misery; meteoric success stories and maws marginalization, globalized competition for markets and rapid depletion of fossil fuels, increasing erosion and environmental pollution, growing conflict over diminishing resources and the proliferation of increasing lethal weaponry, of late all these historical process seem to be accelerating.” Nobody can neglect the past human history. We can change our present reality. We can make our future, but we cannot change the history. The two system’s capitalism and socialism both are the experiment of the social engineering. Capitalism emerged in its natural historical stage avoiding the feudalism. During its various stages of development it has faced numerous ups and downs, turns and twists. The history of western civilization shows that from 15th century to 19th century, the capitalist social system and suffered from the old system: the feudalism, the feudal lords tried to stop the bourgeois revolution. The feudal lords and kings were able to regain power for short time. The hundred years of the struggle of French - Revolution and counter – revolution is the most suitable example. It was the historical necessity that feudalism could not survive in the western and many other parts of the world. There is still 8 remaining feudalism in most of the third world countries but nobody can say that this is an appropriate system. The negative consensus about feudalism is worldwide. Some years before the word “feudal lord” were so much respectable, but now this is an abusive word in the field of economics and politics. Likewise the socialism did not emerge in a day. It was the response to the failure of capitalism in eradicating the mass poverty. Merely saying that socialist model has been failed is not the correct answer, because “capitalist liberalism did not offer a solution” (Heilbroner, 1993) It is the human nature that has been struggling for equality. The issue of equality and inequality are obviously related to economic points. Without economic equality the questions of political equality becomes a mere slogan for ages human beings have been debating and making diverse researches on the issues of improving economic conditions of society. The emergence of capitalism and socialism and so called 'the failure of the socialist model' should be taken as the experiment of the human society. However, the researchers vary in their opinions and approaches about the problem. All the great thinkers though out ages,- either from the east or from the west. - Gautam Buddha, Socrates, Plato, Aristotle, Adam smith, David Ricardo, Charles Fourier, Robert Owen, Proudhon, Karl Marx, J M Keynes, and so on have been speculating on economic problems of human society. Here we should quote Robert Heilbronn. "It is the wealth is inextricably associated with inequality, this is an insight that we get from a most unlikely source. The first of the great philosophers of capitalism, who wrote, "Wherever there is great property, there is great inequality. The affluence of the rich supposes the indigence of the many." It is Adam Smith speaking not Karl Marx.