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Nepal, a relatively youthful country with the median age of 24.6 years (Worldometers), is ranked 135 out of 190 economies for the World Bank's ‘Starting a Business’ index that tracks small and medium enterprises all over the world. In other words, Nepal is not exactly a business-friendly country.

But still, in the past few years, young entrepreneurs have been coming up with innovative business ideas. Among the hundreds of startups that have originated in the country in recent times some have even gotten global recognition and funding. Even with the domination of a few large industries in Nepal, small and medium enterprises have emerged, creating jobs, contributing to the economy, and providing consumers with a variety of products at fair prices.

According to the central bank's 2019 report titled ‘SME Financing in Nepal’, as of fiscal 2018/19, a total of 275,433 small and medium enterprises (SMEs) were registered in Nepal. The Industrial Enterprise Act 2016 defines small enterprises as businesses having up to Rs 100 million in fixed capital, and medium enterprises as businesses as having fixed capital between Rs 100 million and Rs 250 million. The SMEs contribute an estimated 22 percent to the GDP, while employing 1.7 million people. 

Even with little government support, entrepreneurship was thriving in the unsteady Nepali economy. But then the Covid-19 outbreak hit and the lockdown took hold starting March 2020, destroying the hopes and dreams of entrepreneurs and their businesses. Mostly based in Kathmandu, Nepal’s young entrepreneurs are reeling under the pressure of exorbitant rents, high taxes, and other liabilities, even as their businesses have struggled with Covid-19 over the past six months.

Rohit Tiwari, CEO/Co-founder of the pioneer homemade food delivery service, Foodmario, has always had issues with government apathy of startups. Although Tiwari’s Foodmario can now be considered a successful business, the hazards of entrepreneurship have not spared him. Tiwari has also taken it upon himself to actively promote other new ventures, especially the ones taking big risks. Even access to global funding is hard, he complains, as the minimum amount for Foreign Direct Investment (FDI) is set at a rigid Rs 50 million.

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Confused government, confounded businesses

“The startup environment in Nepal was already poor when the pandemic hit. Business shrunk by more than 80 percent for most of us during the four months of the lockdown,” says Tiwari who was this year on the prestigious list of ‘Forbes 30 Under 30 Asia’. “At Foodmario, we had to temporarily close down entire operation for three weeks and instead deliver vegetables and essentials to keep the business going,” he explains.

During the lockdown Tiwari had expected some government help for small and medium enterprises. No such help has materialized. “The government seems confused,” he says. The only ray of hope, he adds, is that consumers learned the value of online business during the lockdown.

Bilal Ahmed Shah, CEO and Founder of Latido Leathers, says he had expected the lockdown to last a while and planned accordingly. To ensure the safety of his staff and factory workers, Shah sent them back to their ancestral homes as Latido’s showroom and factory closed. Many of them are yet to come back.  

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“Even as our expenses have been rising, we have not earned much in the past few months. There is no way to tell if and when we will be fully operational again,” says Shah, unaware at the time of another round of imminent lockdown in Kathmandu.

On the same website that ranks Nepal so low on ‘Starting a Business’, the country is ranked 79^th in ‘Protecting Minority Investors’ and 94^th in ‘Ease of Doing Business,’ which are again not very inspiring. Perhaps this is why their friends and families discourage young entrepreneurs from taking what are indeed considerable risks.

Neha Singh, originally from Birgunj, is one such aspiring entrepreneur who has fought all kinds of odds to try and establish a business in Kathmandu. Living by herself at the age of 22, Singh runs ‘Chhotusart,’ an online store for customized products that is yet to be legally registered. “I was just about to register when the lockdown started and all my business plans fell apart,” Singh says. Singh’s online store was the outcome of her creativity and a bit of pocket-money, but has grown into a sizable business, which now requires legal registration. “I managed to make enough to expand my business and also to have some savings, but now everything I saved is being spent on my living expenses, since I have had no income lately,” Singh says.

Panic and anxiety

Singh’s quest for financial independence through a steady business that would cover her living costs, as well as studies, is now in jeopardy. “Entrepreneurship is already difficult for women in Nepali society. Now this pandemic and the ensuing problems will push us back even further,” Singh says.

With her savings almost gone and no sign of the pandemic coming under control, Singh is anxious about the future of her business and fears that she might have to start from the scratch after the pandemic. Her biggest fear at the time of our interview was another lockdown. “Don't know what I will do if I have to stop my business again,” she had said.

Her fear, unfortunately, came true. This second lockdown, which could possibly be further extended, might be the final nail in the coffin for many of the SMEs in Nepal. Without protection from the government, which instead imposes heavy taxes and regulations, entrepreneurs and SMEs will either have to fend for themselves to survive the pandemic or lock their doors forever.

Latido's Shah is already in a panic mode after the announcement of the second lockdown. The previous lockdown had put a big dent on his production and sales. "We will still have to pay rent for our showroom and factory. An even bigger problem is that we will now be unable to prepare for the peak winter season," Shah says.

Rohit Tiwari sums up the hardships of a handful of businesses that were operational during the previous lockdown and subsequent restrictions. Discussing the disruptions to his food delivery business, he writes on his Facebook page: "Only if I could request Government of Nepal to allow smooth Delivery of essentials, Bakery, Dairy products if nothing more! Half of the time we have to call traffic police, ask someone for source Force, just to do simple business. Sad!"

As transgender women, Nisha, 23, from Humla district, and Dilkumari, 22, from Dailekh district, were already dealing with considerable social stigma, multiple economic barriers, and denial of access to even basic services. The lives of the two temporary residents of Kathmandu has been made harder still by the Covid-19 pandemic. Here are the accounts of the hardships of these two women—as well as the community they represent—in their own words.

Dilkumari

My parents remind me that I have studied more than them and I thus know how to handle my sexual orientation. They also tell me not to kill my desires. Mindful of their support, I wanted to go back to my ancestral home after coronavirus gripped Kathmandu. But then I decided to stay back rather than face social stigma. Yet the transgenders have it though even in Kathmandu. I lost my job during the pandemic. I recently paid Rs 13,000 in rent by taking out a loan. How can I pay the rent when I don't even have enough to eat? Instead of helping us, the government asks us to produce our citizenship when we go to ask for pandemic relief. Just like me, many are transgenders in Kathmandu are suffering, and they don’t even where their next meal is coming from.

Nisha

Every day is hard. I was in my fourth year of college but I can’t attend classes anymore. I used to work as a social worker, but I have lost that job as well. I took out a small loan to survive but that too is running out. I am worried my landlord will kick me out as I don't know where the rent money is coming from. But I am not the only one struggling, many others are too. To survive, many have had to go back to sex work. It is hard to find clients in the pandemic and to be out late at night. The locals have started clamping down. They beat up one of my friends yesterday as she was moving around. We lived in pain during the previous lockdown, and the new one will bring us more misery.

It is time to take the cabbages and beans produced in Kikrya Sherpa’s farm in Phungling Municipality-9, Kunkulung to the market. In the past seasons, he would have been picking his produce from his farms and loading then onto trucks for transport. Not this year. Sherpa, who sold cabbages worth Rs 1.5 million and beans worth Rs 200,000 last year, is now worried his vegetables could rot in the farm.

“Expecting a repeat of previous season’s success, I had planted more vegetables this year and had contacted traders from as far as Jhapa and Sunsari,” Sherpa says. “But the tide has turned. If the pandemic continues, I will be unable to even regain my investment this year.” Sherpa has already spent more than Rs 500,000 on fertilizers, seeds, and tending his farm so far. He sees no possibility of sales now, as hotels and restaurants in the district are closed and people’s mobility is restricted.

Many hotels have opened up in Taplejung targeting tourists going to Pathibhara, Kanchananghal and other nearby places. But these hotels are now closed, and farmers who depend on them are worried. Around 300,000 tourists visit Pathibhara and 2,000 visit the higher Himalayan regions every year.

According to Pasang Rita Sherpa, another farmer from Bungkulung, both the price and demand of vegetables have declined. The market price of cabbage, which was Rs 40 a kg last year, is now Rs 15 a kg, he informs. He has planted cabbages, potato, radish and beans on more than 15 ropanis (approx. 2 acres) of land. The potatoes and beans are ready for the market while cabbages and radishes will be ready in a week, he informs.

Although there are farmers’ markets on Saturdays and Tuesdays in Phungling Bazaar, the district headquarters, the consumption there is negligible, the farmers say. If the vegetables that formerly went to hotels and restaurants are not sold within a month, they will rot in the farms, Pasang Rita says.

Gangamaya Giri, also a farmer from Phungling, adds that the stalks of brinjals, okra and baby sponge gourd plants have started drying. “I produce over two quintal vegetables a week,” she says. “Right now, I am selling only 100 kg a week and that too at minimum prices”. The rest become fodder for livestock, she informs. With the construction of two motorable bridges on the river Tamor and increased business activities in Dobhan Bazaar, Giri had increased her investments in farming. But the lockdown put paid to her plains; most local industries closed and their employees went home.  

These farmers are now asking for a government relief package. “We have invested in farming by taking out big loans,” says Krishna Maya Limbu of Meringden rural municipality. “But now our produces are going to waste without market access. We won’t last for long without government help.”

Locals of Khokana, a small ancient village on the southern outskirts of Kathmandu Valley, are protesting the government’s plans to build the Kathmandu-Nijgadh expressway through the village. They say the massive construction project will destroy their rich Newari heritage. Various Janajati groups and organizations are supporting their cause, as they feel it is a violation of Janajati people’s land rights.

But even with this support, the government has chosen to ignore them. According to some, this indicates a weakening of the Janajati movement in Nepal. (As per the 2011 national census, Janajatis comprise 35.4 percent of the total population of 26.4 million.) The various Janajati groups that appeared stronger than even some of the big political parties six or seven years ago are now struggling for survival. Their involvement in lobbying and creating awareness on Janajati issues has also waned considerably.

Golden era

Janajati and adivasi agendas started coming to the fore of national politics in an organized way after the 1990 political change. Before that, the Janajati political agendas like the right to self-determination, secularism, and federalism were largely ignored. It was only after the 1990 constitution guaranteed fundamental rights of all citizens that Janajati activists started organizing themselves. After that, the Maoist movement played a key role in establishing Janajati issues. The Maoist party had federated the country into 14 states and named them after various ethnicities, which in turn earned the party the support of various Janajati groups. The second Jana Andolan in 2006 was another turning point in the growth of the Janajati movement. It was then that political parties brought Janajatis on board by supporting their agenda of regional autonomy and right to self-determination.

In the first Constituent Assembly, there was a sizable presence of Janajati lawmakers from across the political spectrum. The Maoist party, which emerged the largest in 2008 CA elections, backed the demands of the Janajati constituency. Altogether, 198 lawmakers formed a cross-party caucus to jointly fight for Janajati rights. Due to the pro-Janajati position of the Maoist party and cross-party consensus, the first CA took several monumental decisions. For instance, its State Restructuring and Distribution of State Power Committee submitted a report proposing 14 provincial units based on ethnic/community identity.

Hence, 2005-2012 is considered the golden period of the Janajati movement. The Janajati groups had put up a strong fight to save the first CA, to no avail, and the assembly was dissolved in May 2012 without promulgating a constitution. Nepali Congress and CPN-UML, which opposed identity-based federal structures, emerged as the dominant parties in the second Constituent Assembly. The second CA refused to accept the reports of its first avatar. “The Janajati movement started on a downward spiral after the second Constituent Assembly came into being in 2014, from which the movement has yet to recover,” says Om Gurung, an academic and a Janajati campaigner. Even the Maoist party, which had strongly advocated ethnicity-based federalism, has now abandoned that agenda.

2015 constitution

Arguing that identity-based federalism would lead to conflict, NC and UML opted for crafting provinces based on their financial viability rather than their ethnic make-up. Janajati leaders thus believe their key demands remain unfulfilled. For instance, some Janajati lawmakers from Province 3 had proposed that their province be named Newa-Tamsaling, in lieu of the two ethnic communities in the region, but the majority ruling party lawmakers named it Bagmati, after a river. 

Gurung says one of the core Janajati demands on the establishment of a secular state was achieved in the new constitution, “and yet the caveat that secularism is tantamount to protecting the Sanatan Hindu religion hollowed it out.” On language, all languages spoken in the country were accepted as national languages, even as the official language remained Nepali.

Some indigenous rights are protected under the fundamental rights of the new constitution. Article 42 guarantees social justice rights for Janajatis and ensures their participation in state bodies based on their population estimates. Similarly, Article 18 ensures right to equality, as it states that the state shall not discriminate citizens on grounds of origin, religion, race, caste, tribe, sex, economic condition, language, region, ideology, or similar grounds. Janajati leaders, however, say laws are yet to be formulated to implement these fundamental constitutional rights.

Likewise, according to Article 261, there shall be an Indigenous Nationalities Commission. The government has already formed Madhesi, Tharu and Muslim commissions but not the indigenous commission. “This shows the ruling Nepal Communist Party and the government it leads are not in favor of the walfare of Janajatis,” says Dev Kumar Sunuwar, Editor of indigenousvoice.com, an online portal dedicated to Janajati issues.

Ruling party and the movement

With the formation of the Nepal Communist Party (NCP)-led government two and a half years ago, there has been a systematic effort to suppress the movement, say Janajati leaders. According to them, the ongoing protest in Khokana is a case in point. NEFIN and other Janajati groups accuse the government of trying to finish off the culture and identity of the local community in Khokana. They complain of similar efforts to keep Janajati communities away from natural resources and displace them from their traditional places in the name of development.

“Neither have their constitutional rights been granted nor are the Janajatis in a position to amend the constitution,” rues Gurung. The ruling NCP was formed after the 2018 unification of CPN-UML and CPN (Maoist Center). The UML leadership has always been against all kinds of identity movements. The Maoist party was more sympathetic to their cause—and many leaders in the ruling party from the Maoist background still are.

Prime Minister KP Sharma Oli, however, thinks the 2015 constitution has already addressed most demands of Janajatis. With a strong NCP-controlled government at the center, as well as in six of the seven provinces, Janajati agendas have weakened. It does not help that leaders form the community who are in positions of power have abandoned their traditional agenda. For instance, of the seven chief ministers, two—Province 1 Chief Minister Sher Dhan Rai and Gandaki province Chief Minister Prithvi Subba Gurung—are from the Janajati community. So is the country's vice-president, Nanda Bahadur Pun. Yet seldom do they raise the agendas identified with the Janajati movement. 

Photo Source: Indigenous Voice

Likewise, there are several Janajati ministers in the federal and provincial cabinets. Repeating after Oli, they say there is no need for another Janajati movement as the constitution has already secured most of their rights.

Government and foreign support

In recent years, the government has reduced the budget for the National Foundation for Development of Indigenous Nationalities (NFDIN), the autonomous organization for the welfare of indigenous nationalities that was established following the restoration of democracy in 1990. Its current vice-chair Gokul Gharti says some budget cuts are understandable as more resources are going to provincial and local governments. However, he says the cuts have been so deep that the organization is now struggling to function effectively.

Similarly, the international community has stopped supporting awareness and livelihood projects of the Nepal Federation of Indigenous Nationalities (NEFIN). Just like NFDIN, NEFIN was established in 1991 as an autonomous group and the only representative umbrella organization of 59 indigenous nationalities or peoples of Nepal. During the second Jana Andolan, the United Kingdom’s Department of International Development (DFID) had supported the NEFIN. “These days, the leadership of NEFIN is not active in approaching donor agencies, nor do donor agencies seem interested. The government has also been calling on donor agencies to stop funding NEFIN projects, often by giving them wrong information on Janajatis,” says Gurung.

Dev Kumar Sunuwar agrees that the international support for Janajatis has dried up due to “close monitoring of international assistance that comes to Janajati organizations”.

Role of NEFIN

NEFIN currently has under its umbrella 56 distinct indigenous member organizations across Nepal. During the second Jana Anadolan, NEFIN had played a key role in rallying the Janajati constituency in the movement against the monarchy. At the same time, espying the power of Janajati leaders to earn them vital votes, political parties started courting them. As a result, NEFIN was thoroughly politicized. Janajati leaders close to ruling NCP are no longer interested in taking up any movement. “This is why NEFIN has become incapable of launching a decisive movement by taking all sections on board,” says Gurung.

Furthermore, there is competition among top political leaders to induct the Janajati leaders close to them into the federation. Vice-chair Magar dismisses the charge that his organization has become dysfunctional, arguing that it is still busy. “Hitting the street is only one form of agitation. We are preparing for another movement, but in a different way. We are educating our constituency and are in constant touch with members of other marginalized groups to develop a common front,” says Magar. He explains that the organization is now working on forming a clear vision and actively courting the international community. But says journalist Sunuwar, absence of strong leadership further weakens      the NEFIN.

With Madhes-based parties

Madhes-based parties and Janajati groups have been trying to launch a joint movement for constitution amendment. The newly formed Janata Samajbadi Party is holding talks with various Janajati groups for the same.

NEFIN’s Magar states, “We should not reject the constitution but continue our struggle to secure the rights of Madhesis and Janajatis. For that we need to review the past movement and prepare for the next one.”      

In the past, Madhesi and Janajati forces were on the same page on multiple issues. But after the promulgation of the constitution, journalist Sunuwar observes, the government has taken a ‘divide and rule’ approach. “With a purpose of dividing indigenous communities, the government formed separate commissions for Thaus, Madhesis, and Dalits,” says Sunuwar.

However, according to Keshav Jha, a Janata Samajbadi leader, discussions to create a Madhesi-Janajati alliance are still underfoot. But Janajati experts are not hopeful. There are top Madhesi leaders in parliament to take up Madhesi issues, but there are no such Janajati leaders to do the same for      Janajati issues. Most Janajati leaders espousing the community’s traditional agendas lost the 2017 elections.

But senior lawyer Shankar Limbu, a long-time advocate of Janajati rights, has a different take on the Janajati movement. He says the movement is not dying, only changing its shape. The real Janajati movement has only just begun, he argues, and it is entirely different from the previous center-based street protests. “The Janajati movement has reached the community level, as in Khokana. There are other examples where Janajati people have protested against various hydropower projects for violating their land rights, for instance in Lamjung, Tanahu, Rasuwa and Palpa districts,” he says.

“There continues to be strong Janajati resistance movements in various parts of the country,” adds Limbu, and that it is difficult to suppress such community-level movements. These days, Janajati groups are also engaged in rigorous research, while new Janajati associations are being formed in education and other sectors. All this, says Limbu, will give the movement a new shape and strength. That, alas, is a minority view among Janajati activists.