November 9th, 2009
Having very narrow aim of restoration of multi-party system in Nepal, the 1990 mass movement invited a lot of contradictions along with the success of movement. This was because, the end of the movement was power equilibrium between customary powers led by Royal Palace and people’s power comprising liberal democrat with social democratic vision and the united left front dreaming radical change in the society. As a result the then Constitution of Nepal adopts a path of “constructive reform” and denies class struggle as expected by communist party and class hegemony as advocated by the conservatives.
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Nepal and Globalisation
It is an irony to Nepal that overthrow of absolute monarchy by Multi-party system and entry of globalisation came together in 1990. Following the similar paths prescribed by Britton woods institution in other countries of the world, Nepal also launched a similar process of globalisation such as predominant emphasis on privatisation of State Owned Enterprises blindly and haphazardly. The new regime even gave a misimpression that shifting from autocracy to democracy means selling-out of pubic properties to the private hands.
Having very narrow aim of restoration of multi-party system in Nepal, the 1990 mass movement invited a lot of contradictions along with the success of movement. This was because, the end of the movement was power equilibrium between customary powers led by Royal Palace and people’s power comprising liberal democrat with social democratic vision and the united left front dreaming radical change in the society. As a result the new Constitution of Nepal adopts a path of “constructive reform” and denies class struggle as expected by communist party and class hegemony as advocated by the conservatives. It seeks a social change based on people’s will.
On the contrary, the State after 1990 haphazardly followed neo-liberal economic policy, which actually didn’t suit to Nepali constitutional vision and socio-economic reality. This produced a systematic race to the bottom dynamics—poverty, inequality, social alienation and political protest. Analysing the mistake of policy makers, a social scientist says- “The post 1991 governments, however, deviated from the welfare state and sought to create a subsidiary state where poorer people and region subsidised the rich and powerful.” It was actually an outcome of heavily increased pressure of Globalisation in our national scenario.
Impact of Globalisation
Globalisation resulted direct threats to the interest of the working masses. Job security and employment security are heavily endangered. Even the formal sector of work is being informalised by the subcontracting of work and subcontracting of labour, in the name of gaining competitiveness, cost minimisation and a ‘comparative advantage in international trade’. The responsibility for sacrifices and the entire burden is being shifted to the workers.
Chart 1: Trends of Nepali Migration for Foreign Employment
Unfortunately, the government is facilitating the employers and the market instead of shouldering any social responsibility for the working masses. But legal provisions are insufficient to protect workers in this condition. The extent of the permanent workforce is gradually going down and the number in contract work or casual labour is sharply increasing. On the other hand there is sharp rise migration for foreign employment.
Charts given here clearly show declining trends of employment in manufacturing sectors and increasing trends of Nepali Migration for Foreign Employment.
Chart 2: Trends of Employment in Nepal
The policies of liberalization have caused deductions in social expenditures. Even the state expenditures in education and public health are being curtailed. At the same time the burden of foreign debt has constantly increased. Hence the hardships and difficulties of the working population have increased tremendously. The major consequences have been observed in the deteriorating living standard. Since the market deregulation has removed restrictions on prices, the cost of living has increased heavily. On the contrary, real wages and hence real incomes have declined. It is found that money wage of the workers is increasing but less compared to the inflation rate prevailing in the country. Consequently the real wage has declined every year, leading towards decline in the living standard of the workers. Table 3 exhibits picture of declining trends of real wage in Nepal.
Table 3: Real Wage of Workers, Nepal 1989-2003 (Base year 1989=100)
| Year |
Consume Price Index (CPI) |
Money Wage Index |
Real Wage Index |
| 1989 |
100.00 |
100.00 |
100.00 |
| 1992 |
144.59 |
132.33 |
91.52 |
| 1995 |
183.49 |
164.55 |
89.68 |
| 1997 |
214.86 |
202.15 |
94.08 |
| 2000 |
253.39 |
236.09 |
93.17 |
| 2003 |
271.38 |
283.78 |
104.57 |
The long working hours, low payment, the use of child labour, the existence of bonded labour in agriculture, gender discrimination in wages and terms of employment, no minimum wages in the informal sector and the non existence of any social security measures are the basic characteristics existing at present in the informal sector.
3. Flexibility of labour
Increasing trends of de-unionisation and introduction of labour flexibility in both forms; the numerical as well as functional is day reality under globalisation in Nepal. These can be listed as follows:
It is obvious that such effects are natural outcomes of the various contours of globalisation such as capital mobilisation, blurring of markets boundaries (Inviting MNCs), limits of role of State, shifting of business from manufacturing to the service etc.
4. Other impacts
Published at issues of the world of work