I’m sorry to break your illusion. Nepal will be same as of now; even after 20 years. May be at best, you will see bit wider roads and few new houses in your neighborhood. But Nepal’s economy won’t move any further or see new heights.

While the politicians love to show us the dream (joke) of how Nepal will be a superpower in future, it won’t reach anywhere. This opinion isn’t pulled out of thin air — rather it is surface level observation. The surface level research is enough to prove my statement.

You might pull out argument such “but Nepal is fastest growing economy”, or put an argument on how we were able to survive global economic crisis of 2008 (the effect were less because Nepal had very minimum to zero investment abroad) — but both are invalid argument.

Nepal’s economy is supported by the thin line of remittance money. Remittance money played a huge role in helping Nepali economy during the civil war period, blockade, earthquake and during almost any turmoil. Remittance money is the only supporting bar for Nepal’s economy. Remittance money contributes 32%, according to the official source. The number might be much higher if “hundi” is to be considered.

The other highest contribution to Nepal’s GDP is agriculture standing at around 35% employing around 60% of the population. The much sought after “Tourism Sector” contributes merely 4% to GDP. Even if zero tourist visits Nepal, Nepali economy can easily handle this loss. Nepal’s economy is much pushed by remittance money. And the government is the official manpower agency in large scale.

The ratio between export and import is 1:7. For every $1 of export, Nepal imports $7 worth. This has caused the budget deficit since ages. If it wasn’t for India’s fix exchange rate, Nepal would have been the Zimbabwe of Asia.

The hydro-power capacity of Nepal has become a mere meme. China and India (our potential buyers) have more electricity capacity than of us and we are most likely to buy from them. China alone has electricity capacity of 1,00,000 MW — Nepal’s economically feasible capacity is 48000.

Most of the tourists who come to Nepal are not huge spenders — unlike tourists in countries like Dubai, Qatar. Actually, there are very limited places where tourists can spend. Tourism contributes to just 4% of GDP.

Just to repeat again, Agriculture contributes around 36% of GDP employing 65% man power; Remittance contributes 31% employing only a portion of the population. School student should be taught, Nepal’s primary export is Nepali.

One of the main reason, Nepal economy won’t reach anywhere is because Nepal has no manufacturing industries. Whatever is produced inside the country is barely sufficient for Nepal. Nepal import includes — flowers for festivals, food, rice, fruits, livestock etc. from neighboring countries.

China and India are predicted to be next economic super-power because it has industry and human capital. They produce everything! India is rapidly moving forward in the manufacturing industry and giving China a sharp challenge. FDI did play an important role in the development of India. However, we cannot expect FDI in Nepal. We can get some micro-investment from a foreign country but not on the large scale. We don’t have enough human capital, Nepal is considered risky for investment and the economy of Nepal is semi-closed. Why invest in Nepal when there is India and China with much better investment environment, better support from government and are economic powerhousees. Plus, they have cheaper labor, might be bit expensive than Nepal but this is a minor trade-off.

Think of the major “conglomerate” corporate houses in Nepal. I can bet they are also involved in the import business. Indian products like Lays, Parle-G etc. have a good market in Nepal — but they are produced in India, not in Nepal. Where as Nepal’s own WAIWAI is not exported to India from Nepal. They are manufactured in India for distribution in India.

Even after all this, optimism of Nepalese people are still high. Nepali people are still eyeing for FDI. I doubt, Nepal government is secretly mixing prozac in our drinking water. There is India with liberal economy, bigger market, connection to global economy and other side there is China — global economic powerhouse. Why would any company invest in Nepal and take risk instead of going in these countries? The best “FDI” we can get in is probably in service industry but sadly they will be limited to Nepal only and will take more than they they invest.

The day remittance money stops flowing in — Nepal’s economy will start to dwindle. The remittance inflow is maintained by exporting Nepali all over the world, based on their qualification. The government makes sure Nepali are compelled to leave the country by forcing shit condition, shit system, and unemployment (44%). They put the burden of debt in these people to make sure money continues to flow in.

The unscientific federalism and partition of local bodies is sure to increase government expenditure and put financial burden. The increase in tax rate is expected. With limited industry and huge unemployment the tax burden will be shifted mostly to general people. Increase in tax will most probably slow down growth rate and will be seen as red flag for foreign investors. While the government has predicted double digit growth, it is unachievable due to increase in tax rate like no tomorrow. Negative growth would not be a surprising for fiscal year 75/76 and there after.

People in Greece are idiot! If they had taken advantage of EU zone and exported Greece people all over EU they would have solved the debt problem to some extent. Some people in Greece choose to revolt, LMAO!