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Amid talks about energy trade between Nepal, India and Bangladesh, ApEx caught up with Energy Secretary Dinesh Kumar Ghimire to discuss the prospects and challenges ahead. Excerpts from the interview:     What is the current energy scenario of Nepal? The country has been generating about 2,500 MW of energy against the daily demand of 2,500-3,000 MW. Of the total output, 2424 MW is connected to the grid. This output is a mix of hydropower, solar energy and thermal power (53 MW is generated from thermal plants). There is a growing concept about energy mix for sustainable energy transitions in the Ganges river basin. Is the government of Nepal also thinking of switching to hydro-only solutions? Does the concept of energy mix figure in meetings between Nepal, Bangladesh and India? We are committed to energy transition. We need to replace fuelwood, biogas, petrol and biomass with green energy. The need is to switch from other sources of energy to hydropower as we have a good potential in the hydropower sector. But the current situation is such that we have to depend on rainfall patterns and make plans accordingly. Having said this, we must focus on hydro-only solutions. Nepal can play a lead role in energy transition, given its water resources. The topic of energy mix features in these meetings. Different countries are generating energy using a variety of sources. For example, Bangladesh generates energy from gas. Whatever the mode of generation, energy generation cost should go down. Ganges river basin countries are increasingly vulnerable to energy supply shocks, like recent hikes in gas prices. This makes the transition to other renewable energy sources necessary. Your thoughts on this? The countries should maximize the use of available resources. Nepal, for example, can generate hydropower from its rivers. Other sources of energy will be expensive; they will not be viable for us. Instead of panicking, we should rather focus on generating hydropower. How will climate change impact hydropower generation in Nepal? Can the country benefit from India’s solar projects? Climate change will surely have an adverse impact on hydropower. In fact, this global phenomenon has already started impacting Nepal. For example, there has been no rainfall so far this winter. Less rainfall will lead to decreased farm yields. We need to make plans and designs in keeping with changing weather patterns. We need to explore alternative ways of energy generation. For example, we can increase solar power generation and explore the possibility of harnessing wind power. Nepal cannot benefit much from solar projects in India. Hydropower export to India will benefit us. Hydropower projects have impacted the livelihoods of local communities and local environment, biodiversity and river ecology. Have government plans tried to address these issues? Government plans have incorporated these issues. Cost of projects also entails fulfilling corporate social responsibility vis-a-vis local communities living in and around project sites. Projects that generate less than 100 MW have to spend 0.75 percent of total project cost on CSR. Whereas projects generating more than 100 MW must spend 0.5 percent of the total cost toward the mitigation of impact on the environment and on the livelihoods of local communities. Nepal has held talks with Bangladesh and India in recent months. What was discussed and decided? What issues did Bangladesh raise vis-a-vis energy trade with Nepal?  We have been discussing issues related to electricity trade with Bangladesh and India. Nepal and India have agreed to increase power trade. We have decided to increase the volume of power to be transmitted via the Dhalkebar-Muzaffarpur transmission line. This started with Nepal and India signing a power trade agreement in 2014, opening up new vistas of cooperation in the hydropower sector. Power trade talks are also going on with Bangladesh. Bangladesh has raised the issue of transmission lines. It is seeking India’s permission for the transmission of electricity generated in Nepal using the Indian infrastructure. It also wants dedicated transmission lines. It will be easy for Bangladesh to pay the holding charge to India for using the latter’s transmission lines to import electricity generated in Nepal. Bangladesh has expressed interest to invest in the 683-MW Sunkoshi-III semi-reservoir project on the Sunkoshi River along the border of Ramechhap and Kavre districts. Both Nepal and Bangladesh have sought permission for the use of Indian infrastructure—the transmission line—for facilitating energy trade between the two countries. Has there been any progress on this front? What do you think are the major challenges hindering energy trade between South Asian countries? How can member countries facilitate this trade? India has issued a cross-border electricity guideline 2018 to facilitate and promote cross-border power trade. Talks are on with India and Bangladesh with regard to power trade with Nepal. We are planning for a trilateral meeting between Nepal, India and Bangladesh on this issue. Lack of cross-border infrastructure is hindering energy trade between the countries in South Asia. So, the focus should be on developing regional infrastructure capable of transmitting a huge quantum of power. Each country has its own set of technical guidelines and those parameters should be met. There should be a common grid between countries, if we are to boost cross-country power trade. South Asia should have a common technical utility to address these issues. Generation of electricity from a single source is insufficient. Countries should not depend on a single source of energy. A country may have surplus energy whereas another country may be suffering from a crunch. For example, during the monsoon, Nepal has surplus energy whereas India may have a shortfall, meaning we can supply the surplus. If there are diverse sources of energy, the price goes down, the reliability of the system increases and energy consumption also goes up.

Subrata Banerjee is the General Manager of Radisson Hotel Kathmandu, one of the leading five-star properties in Nepal. He has been associated with the Radisson Hotel Group for more than 10 years and has been running Radisson Kathmandu as General Manager since 2017. As a seasoned hotelier, Banerjee spoke to ApEx about the current state of the domestic hospitality industry and its future outlook. Excerpts: What was the impact of the Pokhara air crash on Nepal's tourism sector? We did receive cancellations, and I'm sure many also postponed their visits out of fear. However, I would like the media to encourage more tourism instead. Let's not stab ourselves in the back by talking about the crash too much. It's not as bad as the media is portraying it to be. For instance, certain other International Airlines had accidents before, but people are still traveling in those airlines. Once you're in the air, there is always a certain level of risk, but as long as you're confident that the aircraft is well maintained and the pilots are properly trained, it should not bother you much. What is the current situation of the Nepali hospitality sector? The Nepal Tourism Board has shown some aggression in promoting tourism, but we need to do much more to showcase ourselves globally. To help the hospitality sector, we must focus on 360-degree improvements in road and infrastructure development. We should promote Nepal not only in India, but also in other countries by using visual aids to highlight the country's natural beauty as a tourist destination. However, once tourists start visiting, it's important that our infrastructure can properly support them. For example, Nagarkot is a beautiful place, but a poorly maintained road leading to it could create a negative impression. The same goes for Pokhara; although I enjoy driving, the road leading up to Mugling is quite bad. Human resources availability has emerged as a huge issue for the hospitality industry post- pandemic. How are you managing human resources and overall business after covid? It's a serious problem, as there is a significant shortage of skilled manpower, particularly in the hospitality sector, since many have moved to other countries. We're currently recruiting individuals with comparatively less skill and providing them with training to fill those positions. As for businesses, they're slowly returning to normalcy, but it will likely take until the end of third quarter of this fiscal year for it to reach pre-pandemic levels. How is Radisson expanding its presence in Nepal? Radisson has signed a few more properties in Biratnagar and Bhairahawa, with more properties on the verge of getting signed. Oriental Hotels Limited, which owns the Radisson Hotel in Kathmandu, is also expanding its infrastructure. Oriental Hotels Limited has recorded profit in the first half of this fiscal year. What is the financial condition of the company? Yes, the company is currently profitable. However, Oriental Hotels experienced losses for two consecutive years due to the pandemic. For most of the pandemic period, the hotel was completely shut down. As the pandemic subsided, we adopted a policy of gradually reopening the hotel. As business began to grow, we opened both buildings. The government has set a target of one million tourists for 2023. Do you think this goal is achievable, and what steps should the government take to make it possible? I believe it is definitely possible if the government takes the initiative to showcase Nepal at all international trade fairs using proper visual aids to attract tourists to visit. At the same time, the government should ensure that Nepal's infrastructure is greatly improved. If these steps are taken, achieving the target of one million tourists is possible. Many five-star hotels are coming up in Kathmandu as well as other parts of the country in the near future. Can they make a profitable business in the present scenario? On one hand, more branded hotels coming up will raise the standard of hospitality because everybody will be on their toes. All these groups who're developing five-star properties have done their homework and they know the place has potential. The only thing that needs to be done from our side is to make sure we have a stable government in place. We have to make sure that tourism is given due importance as it is one of the major sectors that bring foreign currency to the country.

Hari Sharan Subedi is the Managing Director of A.D Release, one of Nepal's leading media buying agencies. With over 20 years of experience in the Nepali media and advertising industry, Subedi has played a pivotal role to introduce pioneering program concepts into the Nepali television industry that include reality TV shows such as Nepal Idol, The Voice and SaReGaMaPa Li’l Champs Nepal along with full production and marketing of the Super Dancer Nepal. Subedi and his team have also introduced Nepal’s local reality shows such as Comedy Champion and the popular comic series Sakkigoni. Subedi has been at the forefront of changing the television media sales landscape via innovative advertising segments including on-screen advertising and sponsored segments across news and programs. He is currently the Executive Member of the Advertising Association of Nepal (AAN) and a member of the Information and Communication Technology Development Sub-Committee of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI). The Annapurna Express caught up with Subedi to talk about media buying and the Nepali television industry, Excerpts: Your agency has consistently been at the forefront of television advertising in Nepal. How would you introduce your business and the industry you are in? We are a team of think-alike people, and it has been a collective achievement so far. The Nepali television industry has come a long way as the industry grew manifold, thanks to investment in news and programming as well as technology. Today, the television industry employs over 3,000 people, ranging from journalists to production, engineering, administrative and marketing professionals. The main source of revenue is advertisements. And, the whole advertisement segment has also evolved remarkably in these years. We have seen the whole transition, from VHF tapes to DV tapes and now to transferring audiovisuals digitally across various TV stations from your own office. As a media buying agency, we take pride that we also contributed to this transition positively which helped the overall industry to expand. Of late, with the growing number of TV channels, there is also the issue of sustainability that is being increasingly discussed within the TV industry. As TV channels fight for advertising revenue that has not grown, do you think these channels will survive?  We have seen flooding of TV stations, from satellite TV stations to regional TVs and those promoted by TV channel distributors in recent times. Around 200 satellite TV stations have taken licenses, of which over 60 are currently in operation. Even when operated in a very minimalistic manner, the combined operating cost of these channels would be approximately Rs 3 billion. However, the size of the advertising market has fallen post-Covid, and even further due to the current economic slowdown to around Rs 2 billion. How can advertising sustain the television industry in this scenario? On the other hand, there is a lack of investment in content and broadcast quality. For any TV to have a huge following, one needs to have programs that are attractive, and intriguing for the viewers. Instead, what we see is that most TV stations have the same kind of programming. And, there is also a serious dearth of specialization. Internationally, sports channels are the most expensive to subscribe to. The world has realized that live sports generate the highest viewership. Unfortunately, we are going one step further in Nepal, killing the exclusivity of TV broadcasts by coupling it with the concurrent digital broadcast. Reality shows, series, sports, and everything are available on YouTube, and this is the main reason behind the falling TV subscriptions. And to add to this is the Clean Feed debacle. International channels were supposed to be free of advertisement, but we have to see the same irritating promotional spot repeatedly. TV watching has become unpleasant with average content, subscriptions have fallen, and with the economic slowdown, it is natural that advertising revenues have also declined. What are the pressing issues plaguing the TV industry? Why is the Nepali advertisement market not able to sustain the growing number of TV stations? Despite the economic slowdown, the number of new media outlets is growing. The situation is such, every advertiser faces a huge dilemma today. While the advertiser's advertising budget has not grown, they are getting increased follow-up from the media marketers. Rather than advertising on the media platform that suits their target group, advertisers are literally forced to balance the media, particularly the smaller media outlets that resort to unfair practices. I am personally aware of some larger advertisers forced to distribute ads proportionately across larger to smaller media. Everyone wants to run a news channel – every TV, every online portal, and every YouTuber. And then there is an absence of television and media rating mechanisms. In India, the TRAI, the government body, rates media by their reach and popularity or following. There is no such mechanism in place in Nepal. The economic downturn has impacted all businesses across Nepal. But you say that a 'lack of regulation' is hurting television media. Are you hinting that there is a lack of regulation across the media sector of Nepal? Yes. If we look at the huge investments made by satellite TV stations in broadcast equipment, satellite and carriage charges, generating employment, licensing fees, royalties, and taxes, how is it fair for them to compete for viewership with one individual flashing a Go-Pro or cell phones and broadcasting live news on YouTube? Globally, TV is still considered the most credible or trusted source of information. Major TV stations ensure the source or accuracy of news before broadcasting, or otherwise, they have to face complaints and a hit to their credibility. While the developed world is out there battling fake news and taking Facebook and Twitter to court, we in Nepal, are allowing 'one-man armies' to broadcast news unabashedly. It is only fair that the government regulates online and social media before too much damage is done. If the TV industry falls, thousands of jobs, huge investments, and families will suffer. Media owners also need to do their bit. They must lobby with the government to ensure appropriate regulation, and maintain the exclusivity of their content. They must stop immediate or concurrent digital broadcasts. Look at international practice—one may be able to enjoy a short clip of a program on digital platforms only after one to four weeks, but you will not find the entire program on YouTube. Similarly, TV stations should not be marketing themselves based on YouTube or Facebook views, and content makers should stop developing content solely for digital platforms. Don't you think TV stations also need to upgrade their content and broadcast quality? Not all TV stations are of low quality. TV stations such as Nepal TV, Kantipur HD, Himalaya HD, AP1 HD, and Galaxy 4K have spent millions on quality equipment, and are investing big in programs and reality shows. Many TV channels have staff or stringers throughout the country. But not all TV stations have invested in broadcast equipment, human capital, and content quality. We could introduce some strong provisions to open a TV station, such as increasing the license fee and setting criteria for infrastructures. Let there also be regulation for existing channels to ensure the quality of their broadcast standard. TV viewing would become more pleasant with better broadcast quality. And, it is also the responsibility of TV channels to make people watch TV. There are sufficient examples in India, of how they dramatize series, news, and reality shows, adding intrigue to their presentation to ensure viewership. This was possible due to their separation of production and broadcasting. They outsource content production, while still retaining creative control. The very existence of production companies depends on the quality of their output. Don't you think there is also a lack of regulation on digital advertising in Nepal as well?  I am confident that the central bank has no data on the size of digital marketing in Nepal. At the outset, it would seem that advertisers are spending only some of their budget on digital advertising. But, a large number of small budgets adds up to a large outflow of forex. And does the country benefit from that spending? Traditional media would pay taxes on their earnings to the government. Does Google or Facebook pay taxes to the Nepal Government? In addition to this, there is an issue with clean feed. Nepali TV channels are not supposed to play foreign or dubbed advertisements. But these very advertisements can be played on digital and outdoor media platforms. How is it fair? Why would advertisers then develop localized advertisements if they can do it on digital and outdoor media? They would simply change the medium of advertising, replacing TV with digital media. And then TV advertisements must be censored to ensure no misinformation. Digital platforms go uncensored, untaxed, and unregulated. It is high time the government took these matters seriously. Not doing anything means bidding farewell to the Nepali TV industry. If the advertisement market cannot sustain the growing number of TV stations, how can we expect them to invest further in content and broadcast quality? Under current circumstances, the market cannot sustain the growing number of TV stations. Look at the international practice where TV stations earn almost equally through advertising and subscriptions. Nepali households pay handsomely to watch foreign channels but want to watch Nepali channels for free, and then complain about content and broadcast quality, comparing them with Indian shows. Isn’t that hollow nationalism? If Nepali TV channels give strong content backed by the international-level production quality, why would people need to watch foreign channels? But, for this to happen, Nepal must embrace the subscription model. This is not a new concept though, the industry has discussed this for over a decade, but has been unable to implement it due to differences between TV owners themselves and TV distribution companies. Should they embrace it, subscription revenue would pave the way for further investment in content quality, and the competition between TV stations would automatically filter out stations that don’t invest in quality and content. TV channels can price themselves based on demand, viewers are able to pick and choose the channels they are willing to pay for, and advertisers have a strong basis to select where to advertise.

Tensions between the US and China are increasing day by day and its implications are already felt in Kathmandu. The Pushpa Kamal Dahal-led government faces an herculean task of managing a balanced and trustworthy relations with all major powers to reap benefits from their economic development.

In this context, Pratik Ghimire talked to Rupak Sapkota, a foreign policy expert to solicit his views about Nepal’s changing foreign policy picture and geopolitical situation.

What is your view on the recent shifting of geopolitical tension in the Himalayan belt?

Over the past few years, big powers have adopted an assertive foreign policy. Let’s ponder the ongoing Russia-Ukraine war and the position taken by major powers. America and its traditional allies are providing arms and ammunition to Ukraine. Similarly, it is also urging its Asian allies to stand in favor of Ukraine and provide weapons. American military and diplomatic officials are undertaking a world-wide tour to advance their agenda. On the other hand, strategic relations between China and Russia have been developing and growing too. At the same time, Xi Jinping has been re-elected for the third consecutive term, and the political document endorsed by the Chinese Congress shows that China desires to change the world order in its favor.

China has the economic and diplomatic strength to undo the existing world order. America is enhancing its presence in the Indo-pacific region with a primary goal of containing China. It has launched a fresh campaign to re-energize its alliances both in Europe and Asia. China, meanwhile, is adopting a dual strategy. Its immediate priority is not to alter the existing world order but to exploit its industrial and technological advantage. At the same time, China also wants to promote its Belt and Road Initiative (BRI) with a mantra of human community with a shared future. America’s leadership is becoming weak and in this context, China along with Russia and other emerging economies, who want to see change in the current world, are advocating for a new world order. In a nutshell, world powers are heading towards a bitter conflict and confrontation. And in this scenario, the countries of the global South are particularly fearful that they could be trapped in the stiff geo-political contest between the US and China.

NATO has been paying close attention to Asia. Does this mean the geopolitical tension will further increase in future? 

This is entirely a new global phenomenon that we had not seen after the second world war. Over the past few decades, America was obviously paying attention to Asian countries but NATO’s Asia pivot is a new development. America is working at a structural level like QUAD and AUKUS but NATO’s direct communication and engagement with Asian countries is rare. The NATO chief recently visited Japan and South Korea, and is likely to visit India as well. The primary objective of NATO’s move is to secure more arms and ammunition for Ukraine, and the second is to enhance military and strategic cooperation with India, which is projected as a pillar of the Indo-Pacific region. India’s defense cooperation with Russia is strong and robust. And since India has adopted a policy of neutrality in the Russia-Ukraine war, it has made the US unhappy. NATO, America and other Western powers want to minimize India’s military dependence with Russia.

Over the past few years, the defense cooperation between India and US is increasing, which has been reflected through plus-two dialogue. This aims to minimize India’s defense cooperation with Russia. At the same time, India and China have been locked in a bitter border dispute since 2018, and there are no signs of rapprochement despite the dialogue between two Asian powers. Both India and the US view China as a common security threat. So, it seems that geopolitical gravity is gradually shifting to Himalayan region. America has been trying to upgrade its cooperative relationship with India for three reasons: to enhance the influence of the Indo-Pacific region; to contain China; and to minimize India’s defense dependency with Russia.

How do you see the recent US engagement with South Asian countries including Nepal?

As stated earlier, America is expanding multi-layer engagement with Asian countries and Nepal is also an important priority. Obviously, Nepal’s geopolitical location drives big powers to engage with us. A recent report from the International Monetary Front has shown the growing economic might of China as well as India. And since Nepal is between these two powers, it may have driven America to engage more with us. America’s economic engagement with Nepal, be it through MCC or other forms, is gradually increasing. The series of visits of American officials show that Nepal-US bilateral relations will further enhance in the coming days. Nepal’s geopolitical location has driven the US to engage more with Nepal.

Lying between the world’s two greatest economies, Nepal occupies an important position. Frequent visits of American officials show our relationship and engagement with America has expanded. America’s Indo-Pacific Strategy (IPS) has come up with a holistic approach—military, economic, governance and politics, trade and connectivity. Though American officials are not vocal about it, the US is conducting all its activities and assistance in this region through IPS.

How is the Nepal government preparing or dealing with these issues?

After the promulgation of a new constitution in 2015, Nepal has failed to navigate the fast-changing geopolitics, and does not have any plan on how to manage the competing foreign powers and pursue our national interest. There is a state of confusion on how we conduct our foreign policy in the current geopolitical flux. In many ways, I see a strategic void. Over the past few years, big powers have come up with different strategies, such as America’s Indo-Pacific Strategy. Nepal was asked to join the IPS during our foreign minister’s America visit in 2018. We endorsed the MCC with declarative interpretations and we have told big powers that we cannot join any military strategies. Similarly, we are moving ahead with China to cooperate on the economic front of BRI and other projects, but we have failed to make any substantial progress. India, too, is coming up with aggressive strategies.

Agnipath is a case in point. It is yet to be seen how the new government tackles the Agnipath scheme. The spillover effects of geopolitical rivalry have already been felt in Kathmandu, but we do not have any plan on how to push our economic agenda amid such strategies. This is a major challenge of the new government led by Pushpa Kamal Dahal. We should carve out a clear strategy of staying away from intense geopolitical rivalry and engage with big powers on clear economic terms. Development, prosperity and good governance are our key priorities, and to achieve them, we have to build international cooperation. We need to collaborate with all big powers on economic issues.

What are the key priorities of the Dahal-led government?

The Dahal government should conduct international relations focusing on three key priorities. First, staying away from military engagement with big powers while accepting economic assistance and investment. Second, it should conclude the remaining tasks of the peace process by taking the international community into confidence. And third, it should enhance climate diplomacy and raise Nepal’s climate vulnerabilities in the international forum. Along with these priorities, Nepal should also enhance its diplomatic outreach through multilateral agencies like SAARC. The new government should play an active role to revive the SAARC process.