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Experts urge formalisation of economy to discourage migration

Experts suggested formalisation of agriculture, trading, construction; transport and micro enterprise sectors that could help discourage outflow of Nepali youths from the country.

Currently, around 1,500 youths leave the country daily in search of employment in Gulf and Malaysia due to government’s failure in creating jobs back home. However, the migrant Nepali youth – without any skill – end up in low paying jobs.

The failure in systematising labour market, lack of skilled workers and organisations to provide them skills and lack of awareness about occupational responsibilities among workers are also some of the major challenges towards formalisation of economy, they said, adding that state’s failure in formalising and regulating economic sector has led to exploitation of workers and crippled economy. “Institutional protection of informal economy could also lead to scarcity of human resources,” they added.

Nepal has been placed in the second spot in terms of the most informal economy in South Asia after Sri Lanka and in the 37th rank globally in 2012, according to World Bank. “About 38.4 per cent of Nepal’s gross domestic product (GDP) is generated by the informal sector.”

Speaking at a programme in the Valley today, the experts also said that the current Labour Act has failed to address problems of workers in informal sector.

Since the Act has helped increase problems, it needs to be amended, they added.

“Lack of social and occupational security is one of the major causes for outmigration,” according to chief executive of the Lalitpur submetropolis Tara Bahadur Karki, on the occasion.

The government should recognise the informal sector that could create more jobs for youth, he said, adding that the problems could be solved, if the people respect the work. Lack of legal and institutional framework, discrimination among workers and poor governance has also encouraged informal economy.

However, ILO programme coordinator for Nepal Shailendra Kumar Jha, on the occasion, said that one should not wait for the government to do everything rather they should work in improving working environment. ”

He also stressed on need to engage in social dialogue, implementation of skill development schemes and elimination of discrimination in the wages of male and female workers.