THE ECONOMIC WEEKLY ANNUAL January 1956 Nepal Has a Five-Year Plan Y P Pant "Nepal is not at the moment, and will be for some time, in a position to produce a regular plan in the true sense of the term:" Thin sentence occurs in the Preface to the First Five-Year Plan for Nepal which was announced by a Royal Proclamation by King Mahendra of Nepal on October 10, 1955. In view of almost complete lack of statistics and of a cadestral survey of the country, this is not sur- prising. The Plan makes adequate provision for removing this basic limitation to planning and has allotted 7 per cent of the total proposed outlay of Rs 210 million to geological aerial and cadestral surveys. Transport and Communications, however, get the highest priority and hare been allotted 33 per cent of the total-—t-he largest allocation under arty one head. 7 his is called for by the special topographical features of the country and almost complete absence of roads. Nepal's isolation, sedulously preserved under the Rana regime, will soon be a thing of the past. Develop­ ment of tourist traffic is one of the items in Nepal's First Five-Year Plan. As we go to press, Nepal Radio has announced the formation of a Central Planning Commission with nine members of whom the author is one. The main work of the Commission will be to draw up the final Plan on the basis of the Draft Outline and to assess the progress of the Plan from time to time. ON October 10. 1955. King Mahen- ever, was done to give effect to any availability of statistics leaves much ' dra issued a Royal proclamation of these proposals and shortly after to be desired even in highly deve­ announcing a Five-year Plan for the Plan was announced, the idea loped countries, but in Nepal, even Nepal for attaining self-sufficiency was given up and the Planning Com­ on the Governmental level, collection and for establishing a Welfare State. mittee was dissolved all of a sudden. of economic facts are few and far be­ The formation of a seven man Cen­ tween and one has to depend on Separate Ministry for Development scrappy information. tral Planning Commission was also After February 1951, however, announced, the membership of which more serious efforts were made and Secondly, the inadequacy of admi­ was to be decided later. a separate ministry was formed for nistrative, technical and scientific Under the old regime also, plan­ promoting national development. In personnel required for planning is ning had been talked of. For in­ the beginning of 1952, the then Prime another severe limitation, which in stance, just before the outbreak of Minister, announced at a press con­ turn may render any developmental the second world war, when Shri ference that a Planning Sub-com­ plan somewhat unrealistic. Thirdly, Juddha Shamsher was the Premier, mittee was soon going to be appointed the sources of income are so limited the Nepal Darbar had announced a to advise on problems of development as to present insurmountable obsta­ 20 year plan, but, nothing was done and to co-ordinate the various deve­ cles to effective planning. Because of about it. In fact, not to speak of lopment activities of the State. In the budgetary deficits (annual deficit planning, Nepal did not have any March 1952, Nepal had joined the being more than one crore of rupees systematic policy for economic deve­ Karachi session of the Colombo Plan in a budget of about Rs. 5 crores) lopment until the end of 1949. as one of the member countries. But and lack of capital, the country's in­ Again, on October 31, 1941, till the recent announcement, not ternal resources alone cannot pro­ the Rana Prime Minister Shri much progress had been made in vide the base for any substantial Mohan Shamsher, had set up planning. The efforts so far made long-term economic development, a National Planning Committee were based on ambitious assumptions judged by the criterion of expansion. which was entrusted with the but no thorough and detailed investi­ Main Features task of preparing a 15-year gation of the various problems facing Bearing these basic difficulties in plan of economic development the country had been undertaken. mind, one should proceed to examine for making Nepal completely self- The efforts also suffered from lack the Draft Plan, The document pre­ sufficient in all respects. Without of perspective and inaccurate prac­ sented by the King to the people of any survey of the country's resources, tical observations. There was also Nepal covering 60 foolscap typed the Committee came out with a plan little integration among the various development activities that had been sheets tries to do justice to various of which the main features were the problems of economic development. following: envisaged. The development of transportation 1. Expansion of agricultural pro' Economic Limitations and communication gets the highest duction. In an atmosphere of haphazard priority in it. In every country, eco­ 2. Cultivation of indigenous herbs and uncoordinated efforts, King: nomic progress depends on the pro­ and plants in the plains. Mahendra's desire for the country's per development of transport. This 3. Development of medium-sized planned economic development is is even more so in Nepal, because of and cottage industries for exports, much to be welcomed, Before ex­ the country's topography, and of its 4. Improvement in means of trans­ amining the Draft Outline of Nepal's 278 miles of highways. Again, the port and communications. First Five-Year Plan, it is necessary extremely restricted mail service, It was also broadly emphasized to refer to some of the basic defi­ small number of telephones and that due regard should be paid to the ciencies of the country's economy, as radios, and shortage of news organs national, regional and rural needs of in many respects, these deficiencies make it difficult for the Government Nepal and that provision should be may hinder the working of the Plan. to maintain proper contact' for the made for adequate finances for im­ First and foremost of them is the promotion of development pro­ plementing the Plan' Nothing, how­ ' absence of statistical data. No doubt, grammes and for the proper admi- 113 THE ECONOMIC WEEKLY ANNUAL January 1956 nistration of the country, it Is, like­ lands, to distribute expropriated pressure of population in the hills. wise, a. tremendous handicap from lands among the landless, organise The shifting cultivation practised in the standpoint of defence also. agricultural credit and classify land the hills leads to deforestation, land­ Thus it is obvious that until the according to its productivity for re­ slides and flood, both in Nepal and in country's economy is integrated venue purposes. India. The development of these through a well-developed transport valleys is. therefore, considered im­ system, no substantial programme of Medium Sized and Cottage- Industry perative both for attaining regional development involving a continuous Agricultural development, however, self-sufficiency and restoring the na­ movement of goods and men from is incomplete without a corresponding tural ecological balance of the Hima­ the centres of production to the cen­ process of industrialisation. There layan submountain region. tres of distribution can be success­ is a provision for 8 per cent of the The Rapti Valley is one of the most fully undertaken. Realising all total outlay for the development of beautiful river valleys in Nepal, rich these difficulties, the Draft Plan has large scale and cottage industries. in natural resources, centrally locat­ quite properly given the first priority In view of the failures of managing ed and easily accessible from Kath­ (more than 30 per cent of the total) agency In Nepal in the past, the Plan mandu. An intensive cultivation of to the development of transport and seeks to reorganise the existing in­ food and cash crops in the Rapti communications. Highways, airways, dustries and recommends the setting Valley would also enable the setting railways, ropeways and waterways up of a high-powered commission to up of industries subsidiary to agricul­ are the main types of transport examine the existing industries and ture. The development of the valley which are to be extended luring the to recommend ways and means was scheduled to commence forth­ Plan period. for reviving them. It is only after with and be completed in 1961. Cadas­ Development Sectors for Agriculture the revival and restoration of the tral survey, irrigation, malaria con­ virtually crippled industries that the trol, road building, settlement of The Plan also aims at increased Plan advises establishment of new landless peasants, introduction of production in the agricultural sector industrial units, e.g. a cement better farming, setting up of co­ through irrigation and agricultural factory, a medium sized pulp mill operative credit. extension service, extension schemes, and puts ade­ and a sugar mill in central Nepal. provision for social welfare and wild quate emphasis on development The Draft Plan also recommends life preservation are the important from below. Since 85 per cent of the that possibilities should be explored, features of this Multipurpose Pro­ total population eke out a precarious both in Hilt and Tarai regions, for ject, Besides, finance permitting, living from agriculture, a concerted setting up various medium-sized in­ establishment of medium sized indus­ programme of development of agri­ dustries through private enterprise tries like match factory, tobacco culture needs no special pleading. in the Plan period, with emphasis on curing, cigarette manufacture, oil The Plan proposes to .set up 8 deve­ processing export goods. A well mills, saw mills, and rice mills, lime lopment sectors in 16 districts com­ planned Cottage Industry develop­ kilns, fruit, canning, and power gene­ prising both Hill and Tarai areas in ment Scheme and a financial corpo­ ration programmes will be taken up.