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The 'Minimum policy priorities and common commitment' of the new five-party ruling alliance released last Tuesday, rather unconventionally, acknowledges the pervasive public perception that “everyone in public office is corrupt and useless.” It also vows to set an example of “the wrong-doers being legally punished”. Achieving this has and will indeed become a tall task as the entrenched corruption ‘ecosystem’ has hijacked the state system. In fact, (expected) honesty and integrity in high decision-making circles have conspicuously disappeared from mainstream political, civil and academic discourses.

Misuse of the country's highest public offices by office-bearers, their relatives and henchmen has become unimaginably horrific. Last week, police arrested former speaker of the House of Representatives, Krishna Bahadur Mahara, for his connection with the 9kg gold smuggling case. His son and staff used the high offices of the country's vice president and the speaker of the House to run a cross-country gold-hauling racket. Similarly, former home minister, Bal Krishna Khand, seemed to have mobilised his entire core team in the ministry to develop a fake list of Bhutanese refugees to facilitate resettlement in a foreign country. The incumbent Home Minister, Rabi Lamichhane, has allegedly been involved in illegally siphoning away the funds from a savings cooperative. These events, however, might just be the tip of the iceberg among unfolding scams involving high-profile public officials.

It is impossible to imagine that these people operated in isolation without the support of a strong network of bureaucrats, security officials and political patrons. The lucre amassed is unlikely to be used by these operatives alone. Their political bosses and parties must be sharing the pie and exacerbating the criminalisation of politics.

The outcome

Transparency International's corruption perception index (CPI) rank for Nepal in 2023 is 108 out of 180 countries. It has barely been below 100 (1 is ideal), while its immediate neighbours, China and India, feature in 76 and 93 positions, respectively. Similarly, in the World Bank-compiled World Governance Indicators, Nepal has scored only 33.96 percent, while in the global governance index, Nepal is ranked 64th.

Domestically, systematic data or scores are unavailable, though the impact of corruption is widely realised in the social, political and economic lives of the country. The luxurious, indulgent and extravagant lifestyles of politicians and bureaucrats of even moderate stature—apparently disproportionate to their legal source of income—have now become a socially accepted phenomenon. The race to become rich overnight has fueled irrational and risky migration and disrupted social cohesion in many perceivable ways.

Vote-buying politics has replaced ideological and ethical competition in elections. The cost of being elected even as a ward chairperson has risen to millions, complain the contestants. Only those who can contribute three separate purses are likely to bag the party tickets to contest in parliamentary frays. First, a purse must go personally to please the party leadership, who monopolises the 'mercy' of distributing the electoral tickets. Second, the aspirant must also contribute to the pool of the party's electoral fund. And third, one must be capable of spending 'enough' to 'buy' each possible vote to win the election. These practices are now uniform across all political parties, regardless of their ideological or organisational shades.

The politicians, bureaucrats and businessmen collude to apply umpteen types of extractive methods, including policy tweaking, rent-seeking and upfront bribery. Favouritism, nepotism and conflict of interest in awarding public contracts are evident, as many contractors and businesspeople have entered the federal or provincial parliaments. The infamous 'setting' practice results in massive under-invoicing of imported goods at the customs points, market-monitoring on prices and quality remaining as good as non-existent. Even limited public service delivery is accessible only after 'greasing' the frontline public servants.

The most tangible economic impact of widespread corruption is reflected in the government's struggle to meet its revenue target year-after-year. Despite increased consumption and imports, the actual inflation-adjusted value of collected revenue has declined in recent years. The collected revenue is insufficient to cover regular expenditure, let alone finance the capital allocation. Since everyone in the chain—the politicians, the bureaucrats and the importers, including petty traders—is making easy money, industrialisation and employment generation possible only through risky investments are natural to remain a pipedream for the economy. The incessant exodus of human capital and persistent poverty are thus obvious consequences.

Institutional degeneration

In Nepal, at least one and a half dozen agencies control irregularities, bribery and corruption. They include constitutional bodies like the Commission for the Investigation of Abuse of Authority (CIAA), government agencies like the National Vigilance Centre and Public Procurement Monitoring Office directly under the office of the prime minister, the Department of Money Laundering Investigation, in addition to police and other civil service and regulatory entities. Laws are not too weak, either.

However, their efficacy has continuously degenerated over the years, mainly due to excessive political meddling. For instance, CIAA was once a much-feared ombudsman during the early 2000s. A new anti-corruption law was enacted, and then, immediately after the post of chief commissioner started to be prized by the most notorious among corrupt faces like Lok Man Singh Karki and Deep Basnyat, tragically, in political consensus, this pivotal agency became effectively toothless. It is currently seen as an instrument that orchestrates to investigate and prosecute the 'small fishes' (low-ranked civil servants) and deliberately spares and protects the 'big fishes' (high-ranking officials and politicians).

Although the current government has announced that it will empower the CIAA, the trust deficit runs deep. Lately, agencies like the Nepal Police and Office of the Government Attorneys appear to have accorded larger roles compared to the supposedly independent constitutional bodies like the CIAA. The reason is obvious, only through this modus operandi can the government of the day, at its will, employ the weapon of anti-corruption in retribution against political opponents and distractors. The fragmented mandate among the multiple agencies creates a paradise for the discretionary to all-powerful who compete in both—to abuse the authority and make scapegoats only for the political adversaries.

Achyut Wagle holds PhD in economics and is currently a professor at the Kathmandu University School of Management. He is an econo-political analyst, writing for The Kathmandu Post for many years.

This article was originally published on The Kathmandu Post.
Views in this article are author’s own and do not necessarily reflect CGS policy.