The cause of the poor directly and indirectly constitutes the basis for practically every foreign-aided development project in Nepal. The state of poverty in this poorest of poor countries manifests itself in many ways, and this provides many opportunities for “donor intervention” in the form of the projects. Because Nepal has all along been a poor, rural country, it would have been natural to assume that this fact would be taken into account in designing development projects. In reality, however, international as sistance programmes have not been consistent in providing for rural development. Following American assistance for community development in the mid-1950s, and the subsequent Indo-American competition in this field in the late 1950s, the Swiss-aided Jiri Multipurpose Development Project (1964-70) was the only foreign-aided rural development project in Nepal during the entire decade of the 1960s. It was not until the reorientation by the World Bank of its lending policies to poor countries during die early 1970s that rural development projects became part of a legitimate as well as fashionable aid portfolio for many donors. The period between the mid-1970s and early 1980s saw the initiation of seven major rural development projects, which covered almost one-third of Nepal´s 75 districts.
A study of rural development projects of the past decades show a reluctance on the part of the donor agencies to encourage national assessment of problems and needs. It is a task that they prefer to handle themselves, to the extent that they display intolerance of national initiatives, probably because they would lead to designs that differ from the donor´s prescriptions. Indeed, an enormous row broke out in 1978 when a team of Nepali officials working in a Royal Palace-related think tank produced a policy paper on Nepal´s rural development under the title, Integrated Panchayat Development Design. This report emerged at about the same time that a World Bank team working from the local Soaltee Hotel had just delivered to their Resident Representative a Strategy Paper on Nepal´s Rural Development
The idea that Nepal should come up with an approach paper different from the one prescribed by the Bank was a source of considerable consternation to both the visiting officials and Bank office in Kathmandu. The imposition of external policy prescriptions is facilitated by the unquestioning obeisance of Nepali officials towards donor counterparts. For example, the World Bank´s Strategy Paper never received rigorous scrutiny from the Nepali concerned officials. Its only review was done by a Swedish expert in town, at the behest of one of the top officials at the National Planning Commission. Not that it did much good, for the Strategy Paper soon came under the imprint of the Ministry of Finance and was presented as the Government´s policy paper on rural development to the Nepal Aid Group that same year.
Lack of unity of purpose among officials has long been the hallmark of the Nepali development bureaucracy.* This is aggravated by intense inter-personal rivalry and intolerance. A conscientious official might try to scrutinise a project proposal, but he can be overruled (and invariably is) by seniors or by interested politicians. The donor agencies are not above using this top-down route to bypass “troublesome” officials and to get things done their way. A smart donor will throw in a little something for the Minister´s constituency to ensure the latter´s dogged backing of the entire project package.
Most Government officials find a project proposal attractive if it includes foreign visits, vehicle-support and other perks. The opportunity to travel overseas can also be used by Nepali project officials to “buy out” recalcitrant colleagues. Project designers in donor agencies are quite aware of the power of the “foreign travel” component and use it deftly to guide a proposal´s passage through Government corridors. The Chief Technical Advisors (CTAs) of individual projects also use “study tours” to keep Nepali officials sufficiently pliable. Nepali officials, for their part, have different reasons to keep their expatriate counterparts in good humour. It could range from a job in the donor agency to getting a son or daughter admitted to an overseas college. Some years ago, a Project Chief concerned with women´s development in Nepal used the project´s funds to publish a calendar which showed a flower pot being watered by different jugs, each representing a specific donor by name. The plant itself (representing the project) comprised a number of branches, each one a district in which the project had a tiny activity or two. The image carried no development message and was used solely as a means to gratify donor officials for the Project Officer´s personal gain.
THE FINANCE MINISTRY
It so happens that the cash from foreign aid projects constitutes an important source of foreign exchange, to be used to maintain Nepal´s always-precarious balance of payments.
For this reason, the Ministry of Finance has always had a built-in bias in favour of aid projects. A project receives quick approval if it involves transfer of a good sum of foreign exchange to the Nepal Rastra Bank.
Occasionally, a zealous official or another in the Finance Ministry does try to come down heavily on projects that require too many expatriate consultants, vehicles, or some other extravagance. But the donors know that any momentary hitch created by conscientiousness within the Ministry can always be waited out.
Given the existing compulsions, and the general lack of professionalism in the Nepali bureaucracy, it comes as no surprise that projects proposed by aid agencies are rarely analysed for their technical soundness. Formal negotiations between the donors and the Government often degenerate into squabbles among the Nepali officials present, with the Finance people trying to convince the others that a donor´s proposal is worthy. The Finance Ministry seems convinced that money coming into Nepal in any form cannot but be good for the country.
Positions in the Foreign Aid Division of the Ministry are sought after for their glamour—it is the Division which gets to formally represent the Government to the donors. As a former Vice Chairman of the National Planning Commission recently lamented, the Commission´s differing views were rarely reflected in project designs due to the unilateral commitments made by the Ministry to the donors.
TOO MANY DESIGNS
Because of the Government´s permissive attitude, foreign assistance takes on immense variety, even within one programme area. The reason for this variety does not have to do with philosophical difference in approach among donors. Sometimes it just has to do with the amount of money that is available. While the United States-funded Rapti Integrated Rural Development Project carried a per capita investment of over NRs 500 during its first phase in the mid-1980s, during the same time the per capita investment made under the British-aided Koshi Hill Area Rural Development Project (KHARDEP) barely touched the NRs 200 mark. Each donor agency seeks to leave its own distinctive imprint as far as structure and modalities of a project are concerned. If road-building is a major component in the rural development schemes funded by the Asian Development Bank, it is almost taboo for the Canadian Karnali- Bheri Integrated Rural Development Project (K-BIRD).
There is not even coordination on what to call what. If the period leading up to project implementation is called the “preparatory stage” by one agency, another prefers to call it the “confidence-building stage”. If one “rural development project” includes health and education aspects, another might not.
The way in which funds are transferred also differs considerably. I While the multilateral lenders prefer to reimburse the expenditure made by the Government, some make thrice-a-year advances, to be accounted for in the third trimester. The Canadian International Development Agency (CIDA), trying to be even more innovative, asked that the Government provide the “base level funding”, while it would provide the additional expenditure. This has led to an enormous volume of unspent donor funds. While funding provided by most donors is reflected in the annual budgets of the concerned ministries, the German agency GTZ transfers all its funding exclusively through the Ministry of Local Development for disbursment by the Local Development Officer at the district level. This officer has to use all his public relations skills in cajoling line ministry colleagues to utilise the available funds.
The Government has thus allowed the parallel existence of an incredible variety of funding mechanisms without looking at the relative merits and issuing directives to streamline procedures. Whatever the complications of each project design, the Government invariably bends over backwards to appease a donor´s fancy.
While they might differ significantly in project design or funding mechanism, aid agencies are all one when it comes to their domination over the planning and management of projects. Project offices are established in Kathmandu, independent of the Government bureaucracy, to act as de facto centers of planning and monitoring work in the field. Almost all pertinent data relating to projects are generated and analysed here, and the Government has to ask the project offices for whatever information it requires.
The information generated by the agencies are primarily meant for consumption at headquarters in their respective national capitals. Rarely is the effort made to provide these invariably glossy presentations for in-country introspection and dialogue. In any case, most expatriates would consider this over and above their call of duty. It is also true, unfortunately, that the few who do try to provide useful information to Government offices invariably get frustrated by Nepal´s politico-bureaucratic regime.
Somewhere along the line, the donors tend to lose sight of the fact that development assistance, to be meaningful, must include the prospect of sustainatality, which only comes with the building up of domestic institutional cap ability. The most common refrain among expatriate officials, at the counter part bureaucracy is ill-prepared to shoulder responsibilities, is vain. By taking over the functions that legitimately belongs to the host Government, they are actually suppressing the possibilities of institutional growth and ignoring their own cardinal mandate.
THE ADVISOR´S POWER
When Nepalis are embarrassed by the failings of their governmental bureaucracy, they tend to forget that the donor bureaucracy is not too different. Agency officials, too, have to please their bosses. The fate of an agency official working in Nepal is decided not so much by his ability to empathise with the country´s problems as by his skills in keeping superiors at headquarters happy. The expatriate official´s busiest time is when the boss visits Kathmandu.
When Robert McNamara, World Bank President, once visited the Rasuwa- Nuwakot project area on a private visit, the CTA to the Project was able to hypnotise him with sweet-talk. McNamara later boasted to the press about how the World Bank project had been instrumental in ensuring greater food sufficiency in the area. Actually, the maize d is tributed by the project had failed to germinate that very year, and had created a crisis. It is doubtful that the World Bank . President would have gone out of his way to pull strings to get the expatriate CTA a job ai World Bank headquarters, had he known what the people of Rasuwa- Nuwakot had been “calling him (McNamara) “Makaimara,” the killer of the corn.
Although most advisory assistance is paid for as part of the technical assistance or loan agreement, nobody in Government has any idea how much a given foreign expert costs the people of Nepal. The question of expatriate expert costs is a hush-hush affair all the way. The occasional Nepali official who allows his curiosity get the better of him is ignored by the donor counterpart, who can afford to do so because once the project document is signed the power over the project, including disbursement of funds, is exclusively in his hands.
Most experts hired by the agencies appear in the garb of “advisors”, but in reality they effectively control the flow and use of the donor resources. Advisors invariably end up running the projects. They also have the tendency to multiply. During the late 1950s, Indian advisors swarmed over the districts which received Indian aid, each one heading a different section. Before long, Nepali counterparts were relegated to the sidelines, and might have been called the “advisors” instead. Similar situations continue to recur, such as at the Swiss-aided Integrated Hill Development Project (HDP, 1974-90), in which each section was headed by, a Swiss expert. These experts were in total command because they controlled project allowances, foreign training, and other benefits.
In later years, donors were to devise a less obtrusive means of exercising control over projects. One is the system of implementation through “annual work plans”, which are formulated by individual donors and negotiated and approved each year.
Expatriate experts by the thousands have passed through Nepal over the last four decades, prompting an American professor to say that Nepal was “under-nourished and over-advised”. The impact of these thousands of advisors on the host system has been marginal. And yet, the aid agencies are not deterred from recommending more and more experts for Nepal.
Knowing the growing sensitivity among aware officials of the redundancy of many so-called “experts”, some agencies have devised a new ploy: they separate the expert salaries and perks from the project costs so that Government officials do not go into shock and are more easily persuaded. The marginal consequences of foreign experts paid obscenely high salaries and fees have so far failed to convince the donors, and the recipient Government, of the need to try and control this inundation.
The story becomes even more unsatisfactory when a donor agency decides to take over a project of indigenous design by providing “technical assistance intervention.” The Government´s decentralisation programme was a case in point The entire programme, including bylaws an d procedures, as well as the concept of “user groups” at the grassroots level, was set up by Nepali experts. But then UNDP´s eyes fell on the programme. Instead of assisting the programme while maintaining its indigenous nature, the technical assistance that the agency began to provide has overwhelmed the programme and brought it entirely into the donor´s orbit, with all the attendant consequences.
Most foreign-aided rural development projects have little to show for the investment of years of precious time and millions of scarce dollars. The goal has been “growth” and “equity”, but the result, overwhelmingly, has been neither.
The World Bank-funded Rasuwa- Nuwakot Project was started in 1976-77 with the aim of supporting “HMG development strategy which seeks to balance economic growth with income distribution, provide for more equitable regional development, and ensure productive benefits from previous road investments.” After 15 full years and two phases of project implementation, and with over U$ 25 million having been spent, a long-time official of the Project recently held his nose so as to say, “This project really stinks.”
Few rural development projects in Nepal have baseline data on the “pre-project” state of the area they work in. Where such information is available, like in the Rasuwa-Nuwakot Project, they are not used seriously for project planning and impact assessment- Thus, it would be safe to say that honest review of a project´s true usefulness is almost never carried out Some projects simply fold up when their specified period is over, such as 15 years in the case of the HDP. This rescues the donor from the embarrassing position of having to admit failure. Thus, for example, the Swiss Development Cooperation (SDC) never had to acknowledge that the growth, equity and environmental conditions in the IHDP area — which together formed the very rationale for the project — remained largely unchanged as a result of the project´s years of work.bihari
If not today, then tomorrow, the question of moral responsibility will have to be addressed by recipient Government and the aid agencies alike. At the end of almost every so-called project, it is the local people who have paid the heaviest price — in terms of unfulfilled aspirations, wasted time, misused resources, and, often, the breakdown of traditional institutions. Poverty eradication is necessary in order to ensure access to social services, population control and, also, strengthening democracy in an otherwise feudal context. At the same time, no need is more compelling than that of strengthening national integration, without which Nepali society could easily come apart at its seams. Nepal is a country of minorities, but it is far from being a melting pot as yet For national integration, the poor of every community must be made to feel that they have a fair share of the national cake.
While Nepal owes a debt of gratitude to the taxpayers of the rich countries for setting aside funds for development assistance, the way in which aid continues to be spent frustrates its humane intentions. As the aid money winds its way through the forbidding corridors of the donor and recipient bureaucracies, the poor of the country, 70 per cent of them living below the poverty line, remain all but forgotten.
In order to effectively address the problems of rural Nepal in their proper perspective, we must search for a new methodology of foreign aid. This new methodology must be liberated from the stranglehold of national and international bureaucracies and must, instead, be based on the principle of empowering the beneficieries in their access to the much-needed resources which only the foreigners seem to have.