Minister for Industry ANIL KUMAR JHA is accredited for the Indo-Nepal Bilateral Investment Promotion and Protection Agreement (BIPPA) as well as his efforts to materialise the Double Taxation Avoidance Agreement (DTAA).
Jha spoke about the industrial scenario in Nepal, current accomplishments and challenges faced by the sector with Sneha Koirala of THT Perspectives. Excerpts:
How has your tenure as the minister for industry been so far?
Heading the Ministry of Industry means ensuring smooth running of the industrial sector as a whole. I’ve learnt a lot, but I’m also aware of the time constraint, as my tenure depends upon Nepal’s political scenario. The situation of the industrial sector is more critical than what we evaluate from afar. Therefore, the solutions we consider might not work and our judgment could prove wrong in some cases. It’s safe to say that there is lot on my plate that needs to be taken care of.
What targets had you set to achieve as the minister?
Our party was informed about being considered for the Ministry of Industry just few hours ahead of taking the oath. So, I wasn’t very prepared about my goals when I was asked to take over the responsibility. However, once I got a closer look at the scenario, I realised that a lot of
issues needed to be addressed immediately.
I wanted to focus on an investment friendly scenario and we have been pursuing it with the declaration of the upcoming year as ‘year of investment’ and by having various investment friendly agreements with prospective investors. Now that the situation is much under control, I’ve begun to set targets. My focus is on the declaration of industrial corridors and conducting feasibility as well as pre-feasibility study of prospective industrial zones.
What do you consider to be your accomplishment within the three months of your occupancy?
Three months is actually a very short period of time, although Nepali politics ironically considers it a long duration and demands returns at the state-building level. However, I have tried to create a healthy foundation for investment in the country. Though I’d have
considered BIPPA and DTAA as achievements, the decision of Supreme Court (SC) to hold proceedings until further notice has discouraged me a little. Nevertheless, I’d like to believe that I’ve added few bricks in the foundation of industrial development of Nepal. We’ve considered reanalysing the situation of six major industries, including Janakpur Cigarette Factory, Biratnagar Jute Mill, Gorakhkali Rubber Industry, Nepal Aushadhi Limited and Nepal Metal Company. As many of these industries are facing liquidation, decision on revival or ultimate closure of these industries will be made upon completion of the study. I’m also working on the issue of adequate petroleum dissemination. We hope to find solutions to the issues by around six months.
What is your say on the current industrial situation of Nepal?
I think there’s a need to assure the industrial sector. The labour-industrialist issues are never ending and instability is adding to the confrontation. Moreover, though we have signed BIPPA, the investment is just one way as the law doesn’t
allow Nepalis to invest abroad. In addition, Ministry of Industry is not an independent body and can’t uplift the industrial sector on its own, as it doesn’t have a separate treasury to support the bodies it governs. The frequent change in team players also makes cooperation rather difficult. Therefore, I think there’s a dire need for teamwork and people need to stop working for themselves or their parties and start working for the country. Labour unions also need to understand that many industries are not even in the position of supporting themselves, let alone meet their excessive demands. Industrialists should also realise that labour force is their ultimate weapon. There needs to be a win-win situation for all.
What should different parties — government, political parties, labour unions, industrialists and general public — do to
improve this situation?
Pessimism is not an option for us. From what I see, there is abundant prospect for growth. The never-resolving labour issues occur because we’re not seeking meeting points and are focused on differences. The way I see it, the basic solution is sticking to your commitments. The government should be able to ensure stability and parties should align in the matters of national interest. Laws need to be rectified and investments by Nepalis on foreign grounds should be allowed, at least for agreement holding nations. Labour unions need to understand that the state and industrial sectors are now open to them and their demands — although not all of them can be met. Also, after agreement on certain issues, they shouldn’t be involved in strikes and vandalising. Industrialists also need to be clear about labour issues and meet their basic needs at any cost. Most importantly, industries shouldn’t limit their corporate responsibility to labours and focus
on their accountability towards the state as well. Besides, we also need to decide on the type of industry we need — remittance-oriented, labour selling or income generating. If we want the former, we can continue the existing trend but if we opt for the latter, we need to change our mindset and revive the Nepali industrial sector.
How can BIPPA assist in this? How can it be brought into practice soon and made more effective?
After being put on hold by the SC, BIPPA has been going through various diplomatic channels so that it can function immediately after getting the green signal. We all know the investment prospect for India in Nepal, especially in hydropower. But we can’t ignore that there are only a handful of Nepali investors who can actually invest abroad. So, through BIPPA, we basically want to attract direct foreign investment. For early implementation of BIPPA, we’re also pushing DTAA forward after which, in coordination with different bodies of state, effectiveness can be ensured.
What is your opinion on labour laws and current labour issues, including minimum wage?
Labour strikes are the most recurring issue in the industrial sector and complications arise due to problems that persist even after reaching an agreement. However, I think this is nothing more than a misunderstanding. The labour unions need to understand that some
industries are on the verge of bankruptcy, as are many financial institutions that have invested in such sectors. Just because an industry is up and running doesn’t mean that it is making profit. Regarding current minimum wage, an agreement has been reached between industries and labour unions, which I hope is implemented with both parties staying true to their words.
What steps should the state take to create stable foothold for the struggling industrial
Boards have been formed for evaluating, advising and guiding government-owned and private industries, but
political stability is the biggest need. I also think that the positive steps taken during the tenure of one minister should be carried on by the success-or, so that the output can be observed in the estimated period of time.