Poor Leadership Cripples Public Enterprises

 Of the 45 public sector enterprises (PSEs) operating in Nepal, 17 are running at a loss. In Fiscal Year 2023/24, the public enterprises in the industrial, commercial, public utility, service and financial sectors earned a net profit of Rs. 42.63 billion. But the top five profit makers – Nepal Oil Corporation, Nepal Electricity Authority, Nepal Telecom, Citizen Investment Trust, and Deposit and Credit Guarantee Fund – make almost 84 per cent of this profit, while the rest made a combined profit of Rs. 6.94 billion.

Meanwhile, other offices performing general administration tasks have long been failing to provide timely service and meet public expectations, which has contributed to increasing public frustration and decreasing the credibility of the state. Administrative offices and state-owned enterprises seem sluggish. While multiple reform plans and strategies have been announced, their implementation remains rather pathetic.

Management failure

The miserable state of PSEs results from management failure, which is due to incompetent, inefficient, and visionless leadership. Many of the public sector companies are on the verge of going belly up because of direct political interference in the appointment of the managers and the vested interests of regulating bodies in micromanaging the business or industrial entity. The terms of reference of the job or qualification criteria are bent to present the lucrative posts to the henchmen of certain leaders. The managers, who snatch the positions from deserving candidates through their political connections, have less to do with the prosperity of the institution. 

They create an island for themselves and always remain in a coterie of 'yes men'. They live in an ivory tower and look down on the subordinates and 'foot soldiers' who struggle hard to take the enterprise on the path to success. This type of manager tends to show their allegiance to their political masters, remain indifferent to the career growth and capacity building of the staff of the organisation, and ignore the customer and market interests and business growth. However, they might exhibit a sort of loyalty to the trade unions affiliated with their respective political parties at the cost of the overall organisational benefits. Political patronage has become the largest bane of the PSEs in Nepal.

These managers can never be true leaders; instead, many of them end up becoming power brokers at their level or fundraisers for their political masters and parties. They are risk-averse and are myopic in terms of organisational or business transformation. Their lack of knowledge about the business and products of the enterprise, innovations in the sector, and the status of competition in the market sustains the fear of taking any risks. This is the era of global competition, and any company or product has to either compete at the international level or face the influx of international products in the domestic market, or experience both.

These challenges demand that the managers of the PSEs possess knowledge and expertise in marketing, human resource management—with the capability to find and develop talent within and outside the organisation—collaboration and cooperation with different stakeholders of the business, and the ability to work on both short- and long-term strategies. But the managers in the PSEs are initially overconfident about solving the challenges in the enterprise, simply because they have connections with high political offices. In reality, it doesn't happen. Decisions should come through a due process defined by laws, which bar the ambitious managers, many of whom have been parachuted into the organisation and feel alien throughout their tenure, from making decisions haphazardly. 

Even their political masters suggest that they must not go beyond the legal framework. Those who are catapulted to the post for the first time find themselves ping-ponged between Singha Durbar and their workstation. Some managers just have the posts but lack the decision-making authority. They can't solve the problems of their staff and customers. If a leader doesn't have the right and power (resources included) to solve the challenges faced by the subordinates, he or she bears no authority to direct them to put in additional efforts for exclusive results. Meanwhile, many of the PSEs are headed by acting chiefs. 

Assigning the 'acting' post instead of full-fledged responsibility for the job might have repercussions on the confidence and decision-making ability of the manager. Several such enterprises have had 'acting' chiefs for the last many years who are not fully satisfied with their job title but carry out the day-to-day responsibilities while not taking initiatives for long-term business growth and solutions. Many of the PSEs, therefore, lack O&M policy and strategy, hindering healthy organisational growth.

Pain points 

To make the PSEs more competitive, sustainable, and economically rewarding, managers should be ready to hear from the foot soldiers – the lower rung of employees – and address the pain points at various levels. The power of communication should not be ignored, as it is not only useful in mapping the environment in an organisation and building rapport with the entire team, but also in finding the pain points, managing resources, and solving problems. Effective communication within and outside the institution can also help find new insights, navigate through complexities, and address conflicts.

Having said that, the ultimate basic requisite to have good leaders in PSEs is to bring in the managers who match the requirements of the post and can fulfil the demands of the market. One should always be reminded that serving the consumers is the ultimate goal of the company they are leading. Failing in this objective means failing on every front.

Published in The Rising Nepal daily on 18 August 2025.  

Unemployment measurement remains a puzzling job

Kathmandu, Aug. 23

In 2017, there were approximately 20.7 million people of working age, of whom 7.1 million were employed, while 908,000 (11.4 per cent) were unemployed, according to data from the Nepal Labour Force Survey (NLFS) Report 2017/18. The NLFS considers citizens aged 15 and above as part of the labour force.

However, the National Census 2021 reported that of the 23.958 million economically active population (aged 10 years and above), 37.46 per cent remained without any work. According to the census conducted by the National Statistics Office (NSO), 40.99 per cent reported working for more than six months, 11.40 per cent worked for a period of 3–6 months, while 10.14 per cent worked for less than three months. Even if the 12 per cent share of the 11–15 year age group in the population is taken into account, the share of the unemployed population remains quite high.

Meanwhile, the Fourth Nepal Living Standards Survey (NLSS) 2022/23 reported that the headcount rate of the unemployed population stood at 24.73 per cent, while 20.96 per cent were inactive.

As the various surveys and censuses apply different methods and parameters, they produce different, and often contradicting, data sets on employment and unemployment.

Although the NSO and economists maintain that the final say on employment status should be made by the NLFS, they agree that it may not provide a comprehensive analysis of the ground realities in a country where one-quarter of the national economy relies on agriculture, yet nearly three-fifths of the economically active population is engaged in it.

Estimates from the national accounts for the Fiscal Year 2024/25 show that Nepal's agriculture sector contributed about 25.6 per cent to the country's Gross Domestic Product (GDP), while the share of industry and services stands at 12.4 per cent and 62 per cent, respectively. In contrast, the NLFS 2017/18 reported that one in every five people employed in Nepal worked in agriculture, the largest employing industry.

The NLSS defines persons in employment as individuals of working age who, during a short reference period (7 days), were engaged in any activity to produce goods or provide services for pay or profit. It includes those 'at work' (i.e., having worked for at least one hour in a week) or 'not at work' (due to temporary absence from a job). According to this definition, the unemployment rate measures the proportion of the labour force that is actively seeking work.

 

Data not portraying actual scenario

Nepal uses the method prescribed by the International Labour Organisation (ILO) for the NLFS, which is globally recognised. However, in an economy like Nepal’s, where informality is high and the largest share of the population is engaged in low-paid or unpaid agricultural work, the unemployment statistics are unlikely to reflect the actual scenario.

Lok Bahadur Khatri, Information Officer of the NSO, explained that support workers, who help even in commercial establishments and agriculture, are considered employed if they work for about 14 hours per week. Since many of these workers are non-wage earners, their contribution to the national economy is not calculated, making their 'employment status' misleading.

The unemployment data from the NLFS 2017/18 reflects only those actively seeking work and does not include those who are idle and not engaged in any work.

Suman Raj Aryal, Secretary of the National Planning Commission (NPC), said that although current statistics may not accurately reflect the actual unemployment status in the country, they were collected and analysed using internationally prescribed methods by the International Conference of Labour Statisticians (ICLS). He stressed that the frequency of data collection should be increased to ensure statistics that better reflect reality.

"Having accurate statistics allows for the development of effective and impactful plans for development. If we have disaggregated data on unemployment, the government can develop targeted policies and programmes to address the needs and bring the concerned stakeholders together," said Aryal.

 

Formalisation is solution

Aryal added that while the informal sector exists in all economies, Nepal has an exceptionally high rate of informality. According to the Economic Census 2018, of the 923,356 business institutions in operation at the time, 49.9 per cent were operating without being registered with any government authority.

The informality of jobs is especially high in agriculture and the Micro, Cottage and Small Enterprises (MCSEs) sector, which also employs a large number of workers. Economist and former NPC member, Dr. Ramesh Paudel, acknowledged the reliability of the NSO’s statistics but said that the unemployment data does not reflect the ground realities.

He argued that the most appropriate way to obtain reliable data is by formalising economic activities. "Although the existing data shows that 40-50 per cent of the economy is informal, more than 60 per cent of economic activities in the country occur informally," said Dr. Paudel, adding that in such a situation, generating reliable data is highly challenging.

Both Secretary Aryal and Economist Dr. Paudel opined that there needs to be a robust data recording system. They also agreed that increasing the frequency of data collection, or making it real-time, could address many of the issues.

 

500,000 labour force enter market

The country largely relies on estimates regarding the labour force. According to government estimates, more than 500,000 people enter the labour market every year, while only about 100,000 jobs are created in the public and private sectors. The government annually announces initiatives to employ large numbers of youth, such as the Prime Minister Employment Programme (PMEP), but such initiatives have had limited effectiveness as they often provide seasonal or short-term work.

For instance, the government announced the employment of 200,000 individuals under the PMEP for 2024/25 and the creation of jobs for 100,000 youths under various programmes of the Ministry of Youth and Sports. In 2023/24, the government targeted the creation of over 250,000 jobs, while the target for 2022/23 was around 200,000.

As such short-term work cannot serve as an alternative for sustainable income, youths are less inclined to engage with such initiatives.

 

MoLESS installing system for reliable data

Meanwhile, the Ministry of Labour, Employment and Social Security (MoLESS) is in the process of installing a nationwide system to collect real-time data on labour and employment. Krishna Prasad Sapkota, Joint Secretary and Chief of the Internal Employment Management Division at the Ministry, said that the system has already been installed and is operational in 691 local bodies. Within a couple of months, it will be expanded to all 753 local units.

"Following the operation of the system, we will have reliable data on employment and unemployment. It will also provide disaggregated data by sector," he said.

According to Sapkota, the web-based platform will also maintain data on employers, educational institutions, training providers, and partial employment. Since this system will integrate all systems and applications implemented by MoLESS and various departments under the Ministry, it is expected to address the existing weaknesses.

Currently, all local bodies have labour and employment centres, with one employment coordinator employed at each centre.

 

Informal sector dominates

According to the NLFS 2017/18, the trade industry had the second-largest share of employment (17.5 per cent), followed by construction (13.8 per cent). The informal sector accounted for a larger share of 62.2 per cent. Close to a quarter of all employed individuals (23.8 per cent) were employed in service and sales occupations, followed by elementary occupations, which accounted for just over 20 per cent.

In terms of gender, females reported a higher unemployment rate of 13.1 per cent, which is 2.8 percentage points higher than the male unemployment rate. There are significant disparities in other labour market indicators between females and males. For example, the female employment-to-population ratio (EPR) is 22.9 per cent, which is 25.4 percentage points lower than the male EPR.

The female labour force participation rate (LFPR) was 26.3 per cent, compared to the male LFPR of 53.8 per cent. There were also geographical disparities in labour market outcomes, with Bagmati reporting the lowest unemployment rate (7 per cent) and Madhes reporting the highest (20.1 per cent).

According to the survey, the most common method for job seekers in Nepal was seeking help from relatives and friends, with at least 57 per cent of those looking for work doing so by contacting their relatives and friends.

Published in The Rising Nepal daily on 24 August 2025.  

FM Dr. Rana urges Vietnam for flights to GBIA, PIA

Kathmandu, Aug. 23

Minister for Foreign Affairs Dr. Arzu Rana Deuba has urged Vice President of Vietnam, Vo Thi Anh Xuan, to help create conditions for flights from Vietnam to Nepal’s Gautam Buddha International Airport (GBIA) in Bhairahawa and Pokhara International Airport (PIA).

During her courtesy call to VP Vo in Kathmandu on Saturday, she requested Vietnam’s support in the post-2026 context, as Nepal prepares for graduation from the status of Least Developed Country (LDC), according to a statement issued by the FM Dr. Rana's secretariat.

Pointing out that the number of tourists travelling between Nepal and Vietnam had grown significantly in recent years, FM Dr. Rana expressed the view that both countries should seize this opportunity and collaborate in advancing the tourism sector.

VP Vo arrived in Kathmandu on Saturday morning for a 3-day official visit at the invitation of Nepal's VP Ramsahay Prasad Yadav.

Likewise, FM Dr. Rana stressed the need to highlight the cultural ties between the two countries, underlining Buddhism as a strong bond that further deepens relations between the peoples of Nepal and Vietnam. Referring to the large number of Vietnamese citizens who visit Lumbini, the birthplace of Lord Gautam Buddha, she said that the two countries could work together in the field of promoting cultural tourism.

She also sought Vietnam’s backing for Nepal’s candidacy for membership of the Human Rights Council for the term 2027–2029 and for the Economic and Social Council for 2029–2031. In response, Vice President Vo expressed Vietnam’s commitment to support Nepal.

The meeting recalled that Nepal and Vietnam have long extended cooperation and mutual support at both bilateral and multilateral levels, and it was agreed that the two countries should continue to work together on global agendas such as South–South cooperation and climate change.

As members of the G77 and the Non-Aligned Movement (NAM), Vice President Vo and FM Dr. Rana said that Nepal and Vietnam are working in unison to safeguard the interests of developing countries.

VP Vo's visit marks the first-ever highest-level engagement from Vietnam to Nepal.

Published in The Rising Nepal daily on 24 August 2025.  

Shortage of Twin Otters hits flight service to remote districts

Kathmandu, Aug. 22

Minister for Culture, Tourism, and Civil Aviation Badri Pandey said that a shortage of Twin Otter aircraft flying to the Himalayan and hilly districts is causing disruptions to regular air services.

Speaking at a discussion programme at the Surkhet Airport on Friday regarding the operation of flights to various districts in Karnali, Minister Pandey highlighted this issue.

Responding to questions raised during the discussion, Minister Pandey clarified that the shortage of Twin Otter aircraft has made it difficult to expand services to remote districts. He said, "We will reach a conclusion on whether operations from Surkhet as a base are feasible only after conducting technical discussions with the concerned agencies."

Minister Pandey said that to address the current shortage of Twin Otter aircraft, the ministry has proposed purchasing seven Twin Otters—one for each of the seven provinces. Expressing confidence that new aircraft would be procured transparently and services would b expanded in cooperation with the private sector, Minister Pandey said, "The issue cannot be resolved with just the two Twin Otters currently available to Nepal Airlines. We must add new aircraft with a long-term vision."

Highlighting that although the country has 53 airports, only a limited number of aircraft are currently operating, Minister Pandey said, "Nepal has 53 airports, but the number of Twin Otter aircraft is decreasing. If this continues, life will become even more difficult for the people in remote areas. Except for Humla and Lukla, most other airports have become almost inactive."

A delegation led by Karnali Province Chief Minister, Yam Lal Kandel, had drawn the attention of the federal government to the irregularity of flights operating from Surkhet as a base.

Participants in the discussion stated that air services are vital in the hilly districts of the province, where road networks have only recently been established and geographical challenges remain considerable. Chief Minister Kandel expressed that the provincial government is prepared to cooperate and urged the development of a clear action plan. He emphasised the significance of fulfilling commitments made at the time of obtaining permissions and proposed establishing Surkhet Airport as a ‘Twin Otter hub’.

A representative from Sita Airlines indicated that the absence of sufficient passengers hampers the operation of regular flights. He clarified that while some flights are currently conducted from Surkhet, they are only feasible when adequate demand exists from areas such as Jumla and Simikot.

He called for the provision of special subsidies to facilitate flights to remote districts.

Director General of the Civil Aviation Authority, Pradeep Adhikari, stated that there is potential to develop Surkhet Airport into a regional hub. He noted that regular flights to various remote districts could be operated from Surkhet in collaboration with Nepal Airlines and other private entities.

Published in The Rising Nepal daily on 23 August 2025.  

Socialist Front objects to deal to reopen Lipulek Pass for trade

Kathmandu, Aug. 22

The Socialist Front Nepal has condemned the recent agreement between India and China to open the Lipulek Pass for bilateral trade.

The Front in a statement on Friday expressed serious concern, stating that the agreement is a grave violation of Nepal's sovereign rights and territorial integrity.

In the statement signed by prominent leaders, including Pushpa Kamal Dahal 'Prachanda,' Madhav Kumar Nepal, Netra Bikram Chand 'Biplav,' and Mahendra Ray Yadav, the Front highlighted that the Lipulek, Limpiyadhura, and Kalapani regions are an integral part of Nepal's territory.

The statement asserted that the area has historically been under encroachment by the Indian side for a considerable period, and Nepal has not been able to make the necessary diplomatic efforts to reclaim the land. “The recent agreement between India and China has solidified this encroachment and further jeopardised Nepal's sovereignty,” read the statement.

The Socialist Front has declared its strong opposition and disagreement with the agreement, calling on the government of Nepal to initiate diplomatic efforts to reclaim its territory.

It has also urged the government to provide factual information to the public regarding the issue and to take concrete steps to protest the agreement and ensure the return of the Nepali land.

During a recent visit of Chinese Foreign Minister Wang Yi to India earlier this week, the two big neighbours signed a pact to reopen the Lipulek Pass for bilateral trade.

Earlier, in 2015, the two neighbours of Nepal had agreed to open the Pass which lies in Nepal’s territory at the border with China. It was closed following the clash between them at Laddakh in 2020.  

Published in The Rising Nepal daily on 23 August 2025.  

IBN approves Rs. 8.84 bn for Lower Apsuwa Hydel Project

Kathmandu, Aug. 22

The Investment Board of Nepal (IBN) has approved an investment of Rs. 8.84 billion for the 54-megawatt (MW) Lower Apsuwa Hydropower Project.

The meeting of the Board on Friday also decided to form a negotiation committee, led by the Chief Executive Officer of the Investment Board, Sushil Gyawali, to hold discussions with the developer of the 800-MW West Seti Hydropower Project regarding the draft of the Project Development Agreement (PDA) and financial structure and to present a proposal to the board.

Similarly, the meeting authorised the CEO of IBN to grant survey permits and request detailed feasibility study reports for the development and operation of the Panchkhal Special Economic Zone and the Kathmandu–Hetauda–Birgunj Podway Project. Proposals of these projects were received as unsolicited proposals – submitted to the IBN without being asked.  

Additionally, the meeting approved consent for the promoter company, Karnali Transmission Company Private Limited (KTCPL), to conduct a feasibility and environmental study for a new route alignment for the transmission line of the 900-MW Upper Karnali Hydropower Project.

The meeting was attended by Deputy Prime Minister and Minister for Finance, as well as Vice-Chairperson of the Board Bishnu Prasad Paudel, Minister for Physical Infrastructure and Transport Devendra Dahal, Vice-Chairperson of the National Planning Commission Prof. Dr. Shivaraj Adhikari, Chief Secretary Ek Narayan Aryal, Governor of Nepal Rastra Bank Dr. Bishwanath Paudel, and Secretary of the Office of the Prime Minister and Council of Ministers Raj Kumar Shrestha, along with other high-ranking officials.

Published in The Rising Nepal daily on 23 August 2025.  

Kathmandu Youth Conclave today

Kathmandu, Aug. 22

To foster youth entrepreneurship, leadership, management, and industrial skills development, the ‘Kathmandu Youth Conclave 2025’ is being organised in the capital on Saturday.

Jointly organised by Universal College, Phoenix College of Management, and Aryan School of Engineering and Management, the conclave will focus on promoting entrepreneurship, leadership development, creating opportunities within Nepal, preventing brain drain, and contributing to academic development, according to the event coordinator, Raju Tandon.

The organisers hope the conclave will serve as an ideal platform to connect young people and empower them with essential leadership, entrepreneurial, managerial, and industrial skills.

Tandon said that the conclave is expected to provide proper guidance to students, encourage social engagement, and support necessary changes in traditional teaching methods.

Students from the Kathmandu Valley as well as major cities across the country are expected to participate in the event. “The objective is to promote innovation in education by moving beyond conventional teaching methods. The programme also aims to assist young students not just in their studies, but also in developing entrepreneurial and professional skills, and to connect them with insights and experiences from various celebrities and distinguished personalities,” read a statement issued by the organisers.

Likewise, the conclave aims to urge the government to take the concerns and demands of young students more seriously. The organisers claim that at a time when interest in going abroad is rising among youth, the event seeks to inspire them by highlighting the vast opportunities available within Nepal itself.

During the event, Sisan Baniya will be honoured as the KYC–2025 Youth Icon. MMA fighter Rabindra Dhant will attend as the Guest of Honour, and popular singer Durgesh Thapa will be awarded the title of Performer of the Year.

Former captain of the Nepali national cricket team, Paras Khadka, along with other artists and notable figures, are also expected to address the audience. The conclave will feature various stalls, a gaming zone, and performances by students.

Published in The Rising Nepal daily on 23 August 2025.