Nepal’s Federal Structure

It is but natural that the debate on federal structure is gaining ground each successive day in the post-election phase of Constitutent Assemly in Nepal. Now within two years or so, the constitution has to be prepared and in this context it is the issue federalism that is going to dominate the political debate in the country.

In the Nepalese perspective, federalism does have two distinct core aspects. One aspect is the geographical delimitation of the states within the given structure of the nation; while the second aspect is the reallocation of economic resources between the center and the states and also the relation between one state with the other.

However, very little effort has been made in the country to give any concrete shape to the concept of federalism. So far the government has made no effort in this direction except the commitment in favor of federalism. The Maoists have come out with certain framework on federalism by dividing the country into 9 states on ethnic basis. The Madhesis (people living in the plane land of Terai in the south of the country) have come out with the idea of single Terai state.

Yet none of the proposals put forward so far for federalism is acceptable to the major political players of Nepal as they all proved controversial in one or the other way. Even if any proposal in regard to the formation of geographical areas of federal states is ascertained, there would be another challenge as to how to ensure redistribution of economic resources within the country.

In view of some of these developments, certain effort has been made in recent days to propagate the idea of cooperative federalism. Under this structure, twelve ethnic regional enclaves with four states including Karnali, Gandaki, Koshi and Kathmandu have been envisaged. There is a provision for State Assembly and governor for each of the four states.

It is envisaged that the cooperative membership model of ethnic regions would reduce the prospect of resource conflicts among the states with diverse endowments. Besides, it is also anticipated that this would promote socio-economic and cultural autonomy without affecting the ethnic harmony and territorial integrity of the country.

However, the structure of the states as envisaged in the cooperative federal structure is mostly based on vertical rather than horizontal division of the country, which is reverse to the concept of “natural ecological boundary” of Nepal. Ecologically, the Terai or Madhes constitutes one region in the south; while the hills in the mid and the mountains in the northern Himalayas constitute other two regions of the country.

Another important factor in state restructuring should be ethnicity. People with common features would like to be governed by themselves. There is no meaning of federalism until the people of certain ethnic group is governed by themselves. If there is dominance of one ethnic group on the other, there is no federalism. Yet under the cooperative federalism the Madhesi ethnic group living in the south has been put with the ethnic group of extreme north in the Himalayas with whom they have no similarity.

More than any thing else, there has been deliberate attempt in the concept of cooperative federalism to ignore the population of Madhesis in all the proposed four states. There is hardly any figure to show as to what percentage of total population in the state constitute Madhesis.

Also, the Terai people including both the Madhesi and hill population constitute only 20.72% of the state population in Karnali. Thus, even many of the Tharus who have been advocating for a separate Tharuhat state will be further marginalized. This reflects the picture that the Tharus would be hardest hit and would be further marginalized if this proposition is implemented.

In the proposed state structure in the cooperative model of federalism, the Terai people constitute 49.63% of the total population in Gandaki state and 60.53% in Koshi state. However, in the Terai 33%  of the total population are non-Madhesis and if this percentage of population is reduced from each of the Terai regions, the Madhesis would be in utter minority even in Terai and would be further marginalized.

There is inadequate exercise on the model of resource sharing between the center and the states. Sometimes, it is forgotten that natural resources such as water and mining are the domain of the center and not of the state. More practical approach is needed in regard to reallocation of resources between the center and the states.

It is overlooked that if the concept of ‘regions’ within the state structure can hold good, there is no reason why the three regions including Maithili, Bhojapur and Awadhi regions or even Tharuhat region from east to west Nepal cannot be thought of in the single Terai state. The ecological comparative advantage of the three belts can be harvested even if the states are organized horizontally. But this is not digested under the structure of cooperative federalism.

In view of some of these hard facts, the proposed structure of state obviously appears to be biased against the Madhesi population. It looks similar to the concept of division of the country into 14 zones or its division in five development regions by the Panchayat system in which the Madhesis had been thrown into minority and perpetual poverty. And the same is going to happen again if the concept of cooperative federal structure is implemented.

 -- Written by: Prof. Hari Bansh Jha

Jha is Professor of Economics and Executive Director of Center for Economic and Technical Studies (CETS) in Nepal. He might be approached at dr.hbjha@gmail.com