Since the Gen-G uprising in Nepal on 8-9 September, 76 people have been reported dead and over 2,000 injured. Political, economic and social life still does not seem to have returned to normal. The new challenges in countless sectors have further strained the already ailing economy.

The government, which has long been a victim of fiscal mismanagement, has focused its first attention on accounting for the additional costs and securing resources that have been added to the economy. The full impact of the costs will take a long time to materialize.

Based on the preliminary information published so far, the damage is estimated at around 3172.5 billion rupees ($22.5 billion), which is almost half of Nepal’s gross domestic product (GDP) of around 6345 billion rupees ($45 billion) at current market prices, excluding inflation and purchasing power parity.

The losses are particularly dire if we add up the industrial output, provincial expenditure, direct and indirect expenditure, all of which have been hurt by the disruptions in insurance claims, electricity transmission and added liabilities, which are being published in large numbers by the private sector.

Good governance

Good governance is one of the core issues raised by youth. Important features of governance often include transparency, accountability, rule of law, responsiveness, inclusiveness, participation, effectiveness and equality. In Nepal, especially after the Gen-G uprising, it is necessary to focus on these fundamental elements to strengthen governance, which will need to balance local challenges and the demands of the youth-led movement. 

Nepal’s Gen-G uprising has raised the demand for serious systemic transformation, not superficial change. Strong governance must combine transparency, inclusiveness, legal and institutional reforms, and socio-economic responsiveness. A coordinated effort by political leaders, civil society, and the public will be essential to sustain the momentum of long-term change and prevent a recurrence of unrest.

As the then government turned a blind eye to rampant corruption and the height of impunity, good governance became an integral agenda of the movement. In addition, the protest programs that began with high educational fees and bans on social media have become increasingly widespread, and proposals have been put forward to end the ineffectiveness of the representative institutions of the state, dissolve the parliament, form an interim government, hold elections, and amend the constitution. The government’s political dialogue with the currently deprived youth community has intensified. It may take some time for the youth groups that are being formed nationwide to organize, but if their interest, seriousness, and involvement continue, it seems that the voice of the youth can find a proper place in the policies necessary for the operation of the state in the country. 

The biggest problem of the current change is the management of the political transition period. The role of Gen-G will remain important in the coming days. Even groups with the same objective have begun to form different factions. If the group divisions could be reduced, the aspirations of the youth could be satisfactorily protected due to a unified voice in the upcoming elections and the political reforms to be brought about thereafter. In this way, it seems that the youth groups, when they put forward a structured policy proposal through organizational integration, can further strengthen their faith in the public.

Corruption 

An important issue raised during the Gen-G movement, which was supported by all Nepalis, is decades of corruption. The constitutional changes in Nepal's governance system and the creation of federal governance structures were expected to significantly improve the culture of corruption, but nothing happened. It is said that policy-based corruption is pervasive in all branches of the state, including the executive, judiciary, and legislature. Political parties, senior officials, and business interest groups are all involved in some form of corruption.

Ineffective operation of corporations, increasing losses, and declining dividends are generally a matter of concern. Data shows that public corporations in Nepal are either in losses or they produce very low dividends. The returns compared to the budget allocated to public corporations are disappointing.

The average rate of return on equity investments from public enterprises in Nepal was 2.4 percent for the fiscal year 2023/24. The government had invested a total of Rs. 703.93 billion in these public corporations, of which Rs. 364.86 billion was share capital and Rs. 339.07 billion was debt. Despite this huge investment, the government received only Rs. 8.83 billion in dividends, compared to Rs. 1.1 billion in the previous year. 13.75 billion.

Such problems appear to have arisen due to political interference and corruption in governance, along with irregularities in operations. Many public institutions have been found to be underperforming financially due to lack of policy reforms and management. This situation has created problems in the management of government investment and assets. Sectoral corruption appears to be safe in political patronage, where the main perpetrators often escape accountability. Nepal is ranked 107th out of 180 countries in the 2024 Corruption Perceptions Index (CPI), where it scored only 34 out of 100.

A comprehensive multipronged approach to reducing corruption can be used to develop objective data and perception-based indicators that can be measured and verified on the legal basis, without missing out on the multifaceted areas of governance reform, transparency, accountability, and the current cultural change. The use of e-governance in Nepal is low, so it does not appear that even the minimum use of statistical indicators on corruption has been made. Regularly disclosing the income and assets of officials at various levels is more difficult than climbing Mount Everest. This does not seem to bring transparency in the sources of political parties. Corruption can be reduced, but some technical efforts must be made.

Tourism, investment and returns

Since the success of the priorities presented by the youth largely depends on the economic health of the country, it is also necessary to consider the situation of tourism, investment and returns in terms of expenditure in the current context. During the recent protests, international hotel chains, telecoms, private sector residential houses and commercial establishments suffered huge losses. Hilton, Hyatt and other star hotels, important infrastructure were damaged.

As a result, the cancellation of tourist tours scheduled in advance may not affect the tourism sector as a whole as we would like, even at a time when the number of tourists is increasing rapidly. Although the number of tourists may have increased slightly at the moment, this sector is very sensitive and can be affected by even small incidents. Therefore, the continuation of peace is a necessary condition for progress. The current problem is for the government to implement policy reforms as soon as possible and ensure the security of private property.

It is not easy to attract foreign investors for investment as it will be difficult for us to get concessional loans when we graduate from the least developed country status in 2026. International organizations have revised their estimates of Nepal's economic growth.

The economic growth of about 5.2 percent is projected to decrease to 2.1 percent or even be negative. The problems added by the current movement have added to the concerns of insecurity and policy instability among businessmen. This situation is bound to have a negative impact on foreign investment. This is also the reason why the 'track record' of this sector is not good. In a decade (financial year 2071/72-2080-81),

Rs. 395.92 billion was committed, of which 39.59 billion was received. While the average realization in emerging economies is 70 percent to 80 percent, the actual realization or realization in Nepal is 38 percent.

Unemployment

The unstable political environment seen in Nepal within a short period of time due to the uprising and the fact that some prisoners who were arrested in criminal cases broke out of jail and escaped with weapons, there are also reports that employers are hesitant to accept even our innocent workers due to suspicions that they will enter foreign countries as migrant workers. If this happens, there is a possibility that it will have some negative impact on the remittance economy, which accounts for more than a quarter of GDP.

Youth unemployment is also one of the major issues raised by Gen-G. There are about 12.4 million young people in the age group of 16-40 in Nepal, which is 42.4 percent of the total population, of which 20.8 percent are unemployed. This unemployment is 15.7 percent and 15.8 percent respectively in Bangladesh and India. Even in Sri Lanka, it is not above 20 percent.

The main institution providing employment-oriented technical education and vocational training in Nepal is the CTVT, and about 1,100 institutions approved by it offer diplomas and pre-diploma degrees in engineering, healthcare, agriculture, and IT. Although vocational training institutions have been provided across the country, there is no harmony between the degrees they offer and the market demand. The main reason for this is that our training system cannot maintain a good relationship with the needs of industrial establishments. In other words, it is because the trainees are provided with complete theoretical education rather than fulfilling the lack of necessary practical work skills.

Training institutions should bring timely improvements in their curricula in line with the rapidly developing technology and new demands emerging in the consumer market. Most institutions also lack training for trainers. This is the reason why, since vocational education does not even get the social recognition it needs, the youth are not able to believe that such training can be useful in the market. Despite making job creation an election slogan, neither jobs have been available, nor have industrialists stopped hiring foreign experts to guarantee returns on their investments. 

In Nepal's labor market, most employers seem to be in need of medium-skilled management and semi-skilled technical personnel, especially those working in the hydropower, electrical and transmission line engineering, garment manufacturing, gold and silver handicrafts, plumbing, jewelry making, and furniture industries. In addition, there is a shortage of people with knowledge in market management, customer relations, information technology, and digitization, as mentioned in personal discussions. We have training and degree-granting institutions, there is demand in the market, and there are millions of unemployed people who have given up looking for work, but there are still no jobs available. This is ironic. 

Conclusion

The Gen-G revolution in Nepal has come at an important and historic juncture. It has demanded immediate and comprehensive reforms in the country. It will be the responsibility of the new government to address sustainable development and widespread corruption, restore public trust, and ensure transparent accountability. Addressing youth unemployment through targeted economic policies can mobilise the youth power that wants to make a meaningful contribution to the country’s progress. Creating a stable and investor-friendly environment to promote foreign investment is essential, so that Nepal can demonstrate its serious commitment to sustainable development.