Nepalese Business Environment

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Nepalese Business Environment. Sandesh Shrestha | Khitiz International College. Political Environment . Lesson 2. Outline. Introduction to political environment Political parties and political structure in Nepal Relationship between political structure and the economy - PowerPoint PPT Presentation

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Nepalese Business EnvironmentSandesh Shrestha | Khitiz International College1Political Environment Lesson 22OutlineIntroduction to political environmentPolitical parties and political structure in NepalRelationship between political structure and the economyGovernment and its branches: legislative system executive system, and other constitutional bodiesBasic Issues in business-government relations, Government ownership of Nepalese businessProblems of Nepalese political environmentImpact analysis of overall Nepalese business by citing above political environment particularly with reference to business sectorMay require more than one slide3Political EnvironmentPolitical environment is defined as the state, government, institutions and laws together with the public and private stakeholders who operate and influence that system. Business managers will pay attention to the political environment to see how government actions will influence their company. Political environment also includes the political culture which are views held about what governments should act with relation to its citizens.Political EnvironmentPolitics is universal social activity Politics is concerned with gaining/using power to achieve goals To study political system business firm should know to: Analyze constitution major political parties form or structure of government the mechanism designed to guide a transition of power from one leader to another key power blocks All above factors are concerned with political stability a major factor for business environment

Political SystemBusiness firms have to bear, cope with ideological tensions, conflict Political system is concerned with i) the direction and administration of state ii) the government iii) the regulation of social relationship State: is an association of people formed for specific common purpose with a clearly defined territory system of laws and an organized government Government: involves in making and implementing laws, representing state, reunite political affairs management Social relationships: in aggregated forms are integrated & regulated by state & its government for national harmony, peace & well being, development & human rights Economic System is determined by political systemMarket economy: what is produced in what quantity determined by supply/demand and through a price systemMixed economy: a balance of both of the aboveState-Directed economy: state directly influences investment activities of private enterprise through industrial policy. Command economy: planned by government

Impact of Political EnvironmentNature of country`s political system reflects certain underlying social values and philosophies Political parties have their own economic policies Democratic set up: Political system changes somewhat along with change in government. Such political uncertainties create opportunities and threats Business firms also do exercise considerable influence on political and government machinery to draw attention to fulfill their needs Business firms also influenced by international politics.(Change in international politics affect domestic government policies which have impact on country`s environment)

Political Structure and Political Parties Constitution It is a legal document, a blueprint for the governance of the state. It lays downs the fundamental principles, policies, institutional power and sets limits on the exercise of such power by a particular body politic Nepal has gone through major political transitions and at current it is also in transition phase Nepal does not have a long constitutional history.However, several constitutional exercises were made in the country prior to the people movement of 2006.The historic people s movement of 2006 expressed the prime goal of building a prosperous, modern Nepal.

Political Structure and Political Parties Constitution ( Contd.) A comprehensive Peace Accord was signed on November 21,2006 to accomplish, through the Constituent Assembly,certainity of sovereignty of the Nepali people, progressive political outlet, democratic restructuring of the state and socio-cultural transformation.The parties agreed to seek the UN assistance in monitoring the management of the arms and armies both sides by the deployment of qualified UN civilian personnel to monitor all the arms and ammunition of Maoists according to international norms.

Political Structure and Political Parties Constitution ( Contd.)The Interim Constitution of Nepal,2007 was enforced and the common minimum programs were agreed based on eight party consensus.November 20,2007 was declared the date for the Constituent Assembly elections. However on October 5,2007 ,the seven party alliance decided to postponed the elections till further decision. first constitution election 2064, chaitra 28 ,caste and division issuesJesth 14,2070 constitution assembly was adjourned.Mangsir 4,2070 Election was done.

Political Structure and Political Parties Constitution ( Contd.) Salient features of Interim Constitution are as follows; Promotion of conditions of welfare on the basis of principles of an open society by establishing just system in all aspects of national life Establishment and development of healthy social life on foundation of justice and morality and harmony among all castes, tribes Wider participation of the people in governance of the country, decentralization and promotion of general welfare for protection and promotion of human rights

Political Structure and Political Parties Constitution ( Contd.) Policies to be adopted by state Emphasis on education, health, housing and employment of people and raise the standard of living of people. Environment protection. Participation of female population in national development Safeguards the rights and interests of children Promotion of interests of the economically and socially backward groups.

Political Structure and Political Parties Constituent Assembly The interim Constituent adopted in January 2007,transferred the executive power of the King to the Prime Minister and established a 330 seat Interim Parliament, this was later replaced by an elected 601 seat Constituent Assembly.After two postponements in 2007,Nepals first ever Constituent Assembly elections were finally held on April 10,2008.A mixed electoral system was adopted with 240 seats for direct elections from the constituencies,335 for proportional representation on the basis of parties overall share of the votes, and 26 seats for distinguished individuals to be nominated by the cabinet. The constituent Assembly was given two years timeframe to draft a constitution that speaks to the needs of Nepal multi-ethnic population.

Political PartiesPolitical environment is most powerful and most influential components among the external factors.Political system is the outcome of the agreement of the various political powers ( parties and social factors). In multiparty system, political parties are the backbone of the political system of the country.Out of the 139 political parties, 76 are new ones that were not in existence during the 2008 CA election.

Government, its branches and Political InstitutionsPolitical system consist of : a) legislature, b) Executive and c) Judiciary.Legislature is also known as House of representative or parliament or Pratinidhi Sabha in Nepal.Executive is also know as Government or Council of Ministries or Mantri parishadh.Judiciary is known as Court of Justice or Sarbochcha Adalat.

Legislature ( House of Representative)Most powerful institution of the state / nationRepresentation of the people / elected bodyPrepare acts even constitution as per the need of the society / country.Approve budget, control executives, Facilitates the business through formation of various acts.Direct the executives to prepare policies and provide supports.

17V semester NBEExecutives ( Council of Ministries)Centre of political authority which possess immense power to exercise.Prepare rules, regulations, policies and procedures to enhance the business environment.It composites Ministries, Department, Division, district branches of various ministries, District Development Committee, District Branches, Municipalities and VDCs.It shapes, guides, controls, promotes, fosters and destroys the business activities.

18V semester NBEThree levels of courts are exist : Supreme -1, Appellate-16 and District - 75.Supreme court has rights to review and make void any acts prepared by parliament if contradict with constitution.Legal disputes are settled by the court. It provides justice to the victimized group and give punish who break the law.

19Judiciary (Courts)V semester NBEGovernment, its branches and Political InstitutionsThe Interim Constitution of Nepal,2007 imagine the Constituent Assembly as the Legislature-Parliament.The president of Nepal has the responsibility to act as the head of the state and guardian of the constitution.The term government refers to the center of political authority having the power to govern those it serves. In Nepal, the Council of Ministers headed by the Prime Minister represents the executive system.In Republican Parliamentary democracy, the real storehouse of power is the Cabinet. The Cabinet, functioning on the principle of collective responsibility, is the top policy making body in the government.

Government, its branches and Political InstitutionsThe local government structure comprises the VDC and municipalities.Each of the 3915 VDCs in the country comprises 9 wards, a VDC has approx 800 households and there are 58 municipalities in the country.At the district level, each of the 75 district has a district Development Committee.The Judicial System ensures that the executive system does indeed function as conceived, and also provides the mechanism to deal with deviations. The cour