Will CA Election help boost economy?
Nepalis are braving bombs, bandh and the poll-opposer 33-parties led by CPN-Maoist Mohan Baidhya and voting today for a peaceful, democratic, free and prosperous future.
Dismissing various political pundits' prediction of low voter turnout, the people – mostly the youths – excercised their rights today across the country for the second Constituent Assembly (CA) election that is crucial not only to n complete the drafting of democratic Constitution but also kick start the stalled economic movement.
Though the first and the historic CA election in 2008 was able to throw away the over two centuries-old Monarchy, it could not chart out the course of a developed and prosperous Nepal due to UCPN-Maoist's ideological and economic policy confusion.
The UCPN-Maoist that had an overwhelming victory in 2008 failed the people as it could not get out of war era mentality and tried to backtrack the liberal economic policy, used its labour wing to disturb the investment-friendly environment and disappointed the private sector and foreign investors.
They neither could deliver the Constitution through Constituent Assembly that took almost seven decades to materialise. However, the political parties – in the last six years – completed the peace process and settled the throny issue of Maoist combatants.
Despite the poll boycott by some of the parties, the peaceful election of CA will certainly give the economy a boost. "The interim election government is going to handover a robust economy to the elected government," according to the finance minister Shankar Prasad Koirala.
But the transition has taken its toll in the market as it has been witnessing price hike and shortage of essential commodities. "The government has to concentrated fully on to hold CA election and could not regularly monitor the market," accepted Koirala, who is also commerce and supplies minister.
The election also has its own impact on economy as the political parties and the government spending is expected to exceed Rs 40 billion. The over supply of money will fuel the inflationary pressure on economy.
"The over flow of money in the market will challenge the government and central bank that have targeted to contain inflation at eight per cent," said former chief adviser to the Finance Ministry Keshav Acharya.
Most of the expenses in election will go to unproductive sectors, he said, adding that that will increase the inflationary pressure. "But the election will also give new hope to the economy also."
Formation of new elected government could help boost the economy like in 2008 post CA election. The economy that has not been able to grow above 3.5 per cent after the 2008 CA election, when it had recorded 5.8 per cent GDP growth, might get a respite and look up in the next fiscal year.
Likewise, the Nepal Stock Exchange (Nepse) index – that is considered as a mirror of economy – also closed four year high of over 600 points – on Thursday – after 2008.