Is Federalism Falling Into ‘Debt Trap’?

Ritu Raj Subedi


As the country completes third year of the promulgation of new constitution, some sinister scenes come to the fore, posing a threat to the new political setup and country’s sovereignty. The secessionist forces have their field day as the federal government sorely fails to nip them in the bud. It is an irony that the strong communist government that boasts of its ‘nationalistic’ stand remained a spectator when a separatist group openly organised a rally, challenging the state to split a vast territory from it. This exposes the weak security arrangement and lackadaisical posture of the concerned province. ‘Free Madhesh’ activist CK Raut chose the Constitution Day to push his egregious agenda and held a mass meeting in Janakpur in defiance of both federal and provincial governments. Despite massive arrests of his cadres, he duped the security personnel and succeeded to deliver anti-state remarks, pandering to his followers’ baser instinct for the country’s disintegration. Reports say his supporters outnumbered the cops mobilized to thwart his gathering at Ramananda Chowk on September 19. This is a bad omen for the country that has just found its feet following decades of political turmoil and transition.

Stringent measures
The government’s failure to put CK Raut behind bars sharply contrasts the repeated arrests of Biplav-led Communist Party Nepal’s (CPN) leader Khadga Bahadur Bishwokarma alias Prakanda. He was nabbed from the premises of Apex Court several times despite the latter’s order of his release. Prakanda too is involved in anti-state subversive activities. He has been accused of extorting over Rs 700 million from different business houses, contractors, bankers and senior bureaucrats. No doubt, Biplav’s party has also posed a threat to national security. And the government has recently formed a panel to hold talks with it and similar other outfits so as to bring them to the mainstream politics. However, the disruptive campaign, carried out by CK Raut’s group directly impinges on national security and territorial integrity. Allegedly backed by some western INGOs, Raut appears to be emboldened as the government of Province No 2 and centre cross swords over the new constitution. The Oli government must not drag its feet in adopting stringent security measures to crush Raut’s separatist activities before they spread their ugly tentacles.
Meanwhile, Province No 2 Chief Minister (CM) Lalbabu Raut, who was appointed to the post after swearing by the constitution, boycotted the Constitution Day only to intensify conflict with the centre. He did not attend any formal programmes on the occasion. During Indian PM Narendra Modi’s visit to Janakpur, he criticised the constitution before the foreign guest, disregarding the minimum diplomatic etiquette and constitutional behaviour. CK Raut and Lalbabu Raut seem to be two sides of the same coin. Both are trying to emasculate the inner vitality of Nepali state through their different strategies. CM Raut’s party, Madhesi Janaadhikar Forum, Nepal, is in the Oli cabinet and its ministers enjoy all perks and facilities as per the laws of the land. Raut too has all benefits granted by the state based on the constitutional provisions but does not hesitate to undercut the very sacrosanct document adopted by the overwhelming majority of the erstwhile Constituent Assembly (CA). The constitution has oodles of provisions aimed at enhancing inclusive democracy through the proportional representation of all marginalised social groups and regions in the organs of three tiers of government – local, provincial and federal. The Madhes-based parties could not see the forest for the trees as they are guided by strident ethno-centric politics and regional parochialism. The constitution has spelt out 31 fundamental rights that every Nepali citizen from the mountain to Terai is entitled to enjoy. The federal parliament has very recently endorsed the laws that will pave the way for the implementation of these rights of citizens.
Amidst these nasty developments, the federal project has hit a snag. Instead of embracing constitution’s vision, efforts are underway to render the centre weak in the garb of federalism. The relations between the chief ministers and prime minister seem to have gone sour especially after hyper-activism of chief ministers who have ganged up, demanding that the centre allocate resources and provide laws to provinces right away. The present government is still struggling to put its house in order as it had inherited a country in shambles, economically and politically. It is irrational to demand that things are in apple-pie order right off the bat. The provinces are not separate nations but parts of the country. The provincial bosses have behaved if they were the satraps of independent states. Some CMs have met foreign envoys and sought cooperation from them going beyond the constitutional boundary. The statute does not allow them to deal with foreign representatives, which solely falls into the jurisdiction of the federal government.
In fact, the constitution has not envisaged strong provinces. Rather it grants sweeping powers to the local units so as to bolster the grassroots democracy. But the chief ministers are demanding greater say and more resources where lies the root of the problem. And it is obvious that there will be a trilateral friction between centre, province and local units over the allocation of resources. The provinces and local units are fully relying on the centre as they are yet to tap the potentials existing in their geographies. Federalism is an expensive system that Nepal has adopted to address particularly the demands of Madhesi constituency. The country has to look to foreign donors and investors for major development works. The contribution of taxes to the GDP is only around 15 per cent. This means the country does not have enough resources to oil the wheels of federalism. So there is a risk of the country falling into a ‘debt trap’ if the government fails to generate necessary revenues to sustain it. Last month the World Bank provided 100 million US dollars to ‘secure Nepal’s stable path to federalism.’ The million dollar question is: How long will federalism roll with foreign loans?

Multiple power centres
It is no secret that the major political parties perfunctorily accepted federalism under pull and push of internal as well as external pressures. Federalism is about ensuring self-rule and shared rule between the three tiers of government through the judicious allocation of resources among them, but its opponents claim that federalism was foisted on Nepal as per the Indo-European design to create multiple power centres. This is to weaken Nepal’s sovereignty so that it can’t withstand the blitz of globalisation and execute its assertive foreign policies. If such a scenario comes to reality, Nepal will turn into a breeding ground for the foreign agencies intent on containing Chinese influences in the region. If so, there is a danger that federalism can be a poisoned chalice, with the dream of inclusive growth and prosperity turning into a mere chimera.

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