Nepal ranks 134th on FDI Inflow Index- 2011

Nepal's ranking in UNCTAD's foreign direct investment (FDI) Performance Index is unchanged in 2011. UNCTAD's World Investment Report (WIR) 2011 has placed Nepal at 134th position in the Inward FDI Performance Index. According to WIR, FDI inflow to the country in 2010 was same as that in 2009. The report says Nepal received $39 million in FDI in 2010.

Nepal's worsening image as FDI destination is further illustrated by the latest statistics of the Department of Industry (DoI). As per DoI statistics, FDI commitment has declined by 48.35 percent in 2010-11.

With FDI inflow to India and Pakistan declining by 31 percent and 14 percent, respectively, in 2010, it was understandable that Nepal would not witness an increase in foreign investment. If delays in the approval of large FDI projects along with other macroeconomic concerns were responsible in the slide in FDI inflow in India, protracted political transition played a key role in the slowdown in FDI commitments in Nepal.

Interestingly, more than half of global FDI inflows were into developing countries and transition economies. The report says FDI inflows to Bangladesh increased by nearly 30 percent to $913 million with the country becoming a major low-cost production location in South Asia.

Accroding to UNCTAD report, global FDI flows recovered from the post-meltdown $1.19 trillion to $1.24 trillion in 2010, with the United States being the largest recipient ($228 billion), followed by mainland China ($106 billion) and Hong Kong ($69 billion).

The new report tells the same story about Nepal which the 2010 report had told. The 2010 report had said FDI to almost all LDCs increased during the 1990-2008 period, with the exception of Nepal, Burundi, Eritrea, Samoa and Timor-Leste.

Nepal, after success of 1990s, has not been able to attract foreign investors in recent years.

Although Nepal got FDI commitments worth Rs 9.81 billion in 2007-08, the highest in the last two decades, Nepal's image as FDI destination is eroding fast.

FDI or foreign investment refers to the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. It usually involves participation in management, joint-venture, transfer of technology and expertise. There are two types of FDI: inward foreign direct investment and outward foreign direct investment, resulting in a net FDI inflow (positive or negative) and "stock of foreign direct investment", which is the cumulative number for a given period. Direct investment excludes investment through purchase of shares. FDI is one example of international factor movements.

The UN World Investment Reports have been published by the UN since 1991. They focus on worldwide FDI trends, at the regional and country levels. The reports contain recommendations as well as put special emphasis on the development implications that influence the FDI trends.

(2011 July)

Nepal ranks 25th among 26 Asia-Pacific in ICAO audit

Nepal is at the botton of International Civil Aviation Organisation’s audit report of the Asia Pacific region featuring at the 25th position.

The Universal Safety Oversight Audit Programme of ICAO that has featured 26 nations within Asia Pacific region is based on the survey by ICAO team in Kathmandu on May 8 - 14, 2009.

According to the audit report Nauru stood at the 26th position.

Civil Aviation Regulation 2058, Civil Aviation Accident Investigation Regulation 2024, and Aviation Security Regulation 2046 of Nepal are the legislation in the process of amendment.

The ICAO Universal Safety Oversight Audit Programme (USOAP) was launched on 1 January 1999. It is managed and run by the Safety Oversight Audit (SOA) Section of the ICAO Air Navigation Bureau. SOA is certified under ISO standard Quality Management Systems - Requirements: ISO 9001:2000 since 16 October 2002.

(2011 July 10)

Progress of the World's Women- 2011

Nearly half the population of women in the Asia-Pacific region have experienced physical and sexual violence at the hands of their partners, a report called 'Progress of the World’s Woman: In The Pursuit of Justice,', by UN Women claimed. Released on 6th July 2011, the report, which offers a comprehensive global review of women's rights around the world, said that the level of domestic violence is very high in the Asia-Pacific region.

In the Asia-Pacific context, the report said that there are 19 countries and territories in the region that have passed laws to prohibit domestic violence. "However, only eight countries and territories throughout Asia-Pacific region explicitly criminalise marital rape, leaving millions of women exposed to abuse at the hands of their partners," it said.

Even as India continues to seek 33 percent reservation for women in parliament and state legislatures, Nepal is the only country in the region which has reached the 30 percent critical mass mark for women in parliament. "Women parliamentarians have played a key role in passing new laws on domestic violence and improving poor women's access to reproductive health care," the report said.

The report also highlights 10 fascinating legal cases from around the globe that forever changed laws restricting women’s rights and access to justice. These range from the case of Martha Solay of Columbia who won the right to have a life saving abortion; or the case of Meera Dhungana of Nepal which lead to the enactment of marital rape laws.

Since 2000, a number of countries have decriminalized homosexuality, including Armenia, Fiji, Nepal and Nicaragua. Sic more prohibit discrimination on sexual orientation in their constitution: Bolivia, Ecuador, Portugal, South Africa, Sweden and Switzerland. Same-sex activity between consenting adults is still illegal in 40% of nations.

Saying that the private sphere must not be "outside justice", the report added that a large number of women in the region feel it's alright for a man to beat his wife. "According to surveys in seven countries in the region, on average, a third of respondents say that it is sometimes acceptable for a man to beat his wife, including over half of respondents in Malaysia and nearly two-thirds in Thailand," the report said.

The report says that the issue of women's rights in the present day world is a paradox. "The past century has seen a transformation in women's legal rights, with countries in every region expanding the scope of women's legal entitlements". "Nevertheless, for most of the world's women, the laws that exist on paper do not translate to equality and justice," it said.

Women are also under-represented in the justice system, the report said. In South Asia, women make up just nine percent of judges and four percent prosecution staff. Also, women are just three percent of police in South Asia and nine percent in East Asia and the Pacific, the report said.

Trafficking in Persons Report (TIP) - 2011

The government of Nepal has continued to improve efforts to combat human trafficking despite limited resources, according to the 11th US Annual Trafficking in Persons (TIP) Report released on 27th June 2011 on Washington.

The report released by the U.S. Department of State says the country has not fully complied with the minimum standards for the elimination of trafficking.

Nepal's section on the report

Nepal is mainly a source country for men, women, and children who are subjected to forced labor and sex trafficking. Some Nepali women and girls are subjected to sex trafficking in Nepal, India, and the Middle East, and also are subjected to forced labor in Nepal and India as domestic servants, beggars, factory workers, mine workers, and in the entertainment industry, including in circuses and in pornography. They are subjected to sex trafficking and forced labor in other Asian destinations, including Malaysia, Hong Kong, and South Korea. Nepali boys also are exploited in domestic servitude and – in addition to some Indian boys – are subjected to forced labor in Nepal, especially in brick kilns and the embroidered textiles industry. One NGO is concerned that China is an emerging sex trafficking hub for Nepali girls. There were reports of traffickers in the remote Karnali region who deceive families into sending their children to urban areas with false promises of schooling. Many of these children, however, are never sent to schools and some end up in forced labor, including forced begging. Bonded labor exists in agriculture, brick kilns, and the stone-breaking industry. Particularly in agriculture, this is often based on caste lines, where traditional landlord castes use debt bondage to secure unpaid labor from Dalit laborers. Traffickers generally target uneducated people, especially from socially marginalized and traditionally excluded groups. However, a growing number of victims are relatively well-educated and from traditionally privileged groups.

Many Nepali migrants seek work in domestic service, construction, or other low-skilled sectors in Gulf countries, Malaysia, Israel, South Korea, Afghanistan, and Libya with the help of Nepal-based labor brokers and manpower agencies. They travel willingly but some subsequently face conditions indicative of forced labor such as withholding of passports, restrictions on movement, nonpayment of wages, threats, deprivation of food and sleep, and physical or sexual abuse. Some are deceived about their destination country, the terms of their contract, or are subjected to debt bondage, which can in some cases be facilitated by fraud and high recruitment fees charged by unscrupulous agents. Many workers migrate via India; this is illegal, due to the 2007 Foreign Employment Act that requires all workers to leave for overseas work via the Kathmandu airport. Many migrants leave by land because it is easier and cheaper than traveling by air, and to avoid legal migration registration requirements, the scrutiny of a labor migration desk in the airport, and bribes that some officials reportedly require at the airport to secure migration documents. A recent survey of returned migrants served by the NGO Maiti Nepal assessed that 67 percent of female Nepali workers who returned from the Gulf were unhealthy; most disorders were psychological illnesses. Nepali officials have reported a large increase of Bangladeshis transiting through Nepal in recent years due to increasing migration restrictions of Bangladeshis by foreign countries. Officials believe many Bangladeshis illegitimately obtain Nepali visas and work permits for employment in the Gulf, and noted, because these Nepali documents are often produced fraudulently, the Bangladeshis are at risk of being trafficked.

The Government of Nepal does not fully comply with the minimum standards for the elimination of trafficking; however, it is making significant efforts to do so, despite limited resources. During the year, the government established the Central Crime Investigative Bureau’s special unit to investigate trafficking and increased its direct financial support for protective services in Nepal and abroad. Incidents of trafficking-related complicity by government officials were not documented by the government, but reported by civil society. The lack of proactive victim identification remained a serious problem in Nepal.

Recommendations for Nepal: Increase law enforcement efforts against all types of trafficking, including labor trafficking, and against government officials who are found to be complicit in trafficking, while respecting the rights of victims and defendants; institute a formal procedure to identify victims of trafficking and refer them to protection services; ensure that sex trafficking victims are not punished for involvement in prostitution; improve protection services available for victims of all forms of trafficking; promote legal awareness programs to potential trafficking victims and government officials; work with Indian officials to establish a procedure to repatriate Nepali victims of trafficking in India; decentralize the system to file complaints under the Foreign Employment Promotion Board as a means to facilitate victims’ access to legal remedies; consider increasing avenues for female migrant workers to migrate legally and safely to the Gulf; and provide disaggregated data under the Human Trafficking and Transportation Control Act.

Prosecution : Nepal prohibits most forms of trafficking in persons, including the selling of human beings and forced prostitution, through its Human Trafficking and Transportation Control Act (2007) and Regulation (2008) (HTTCA). Prescribed penalties range from 10 to 20 years’ imprisonment, which are sufficiently stringent and commensurate with those prescribed for other serious crimes, such as rape. The Bonded Labor (Prohibition) Act (2002) prohibits bonded labor, but has no penalties. Defendants in trafficking cases are not assumed innocent, violating fair trial standards. According to the Office of Attorney General, 174 offenders were convicted in 119 cases tried in court under the HTTCA; 71 cases resulted in convictions and 47 cases resulted in acquittals in Nepal’s 2009-2010 fiscal year. This compares with 172 offenders convicted in 138 cases tried in court, with 82 cases resulting in convictions and 56 case acquittals, in the previous fiscal year. It is not known how many of these cases were for human trafficking, since the HTTCA also prohibits other offenses that do not constitute human trafficking, such as people smuggling. Government statistics did not include information about punishments and did not disaggregate whether convictions were for sex trafficking, labor trafficking, or non-trafficking offenses. The much lower number of convictions reported in the 2010 Report represented only convictions obtained from the Supreme Court, while the numbers offered above represent convictions obtained from district courts. Some Foreign Employment Tribunal case convictions under the Foreign Employment Act may have involved human trafficking. The tribunal is based in Kathmandu without branch offices, which restricts victims outside of the capital from filing cases. In 2010, the government established a special unit to investigate human trafficking within the Central Crime Investigative Bureau. One government source noted a decrease in victims’ confidence in the prospect of justice in Banke district – a western district of Nepal – because very few labor traffickers of migrant workers have been punished in the district. This is believed to have negatively affected the number of trafficking cases filed with police in the district.

The incidence of trafficking-related complicity by government officials remained a problem. Anecdotal evidence suggests that traffickers use ties to politicians, business persons, state officials, police, customs officials, and border police to facilitate trafficking. Although in the past it was reported that many dance bars, “cabin restaurants,” and massage parlors in Kathmandu that facilitate sex trafficking were co-owned by senior police and army officials, some security officials report that recently adopted police and army rules prohibit officials from running businesses without approval, and that this has decreased the practice; this has not yet been confirmed by civil society groups. Some Nepali officials may work with traffickers in providing false information in genuine Nepali passports. Politically-connected perpetrators enjoy impunity from punishment. There were no trafficking related investigations, prosecutions, or convictions of government officials for complicity in trafficking during the reporting period. Between January and March 2010, according to official statistics, the Maoists discharged the 2,973 child soldiers they recruited during the 10-year conflict, some of whom may have been trafficking victims. However, no Maoist official has been charged in connection with the conscription of child soldiers. Government officials who participated in counter-trafficking training-of-trainers programs led workshops in their various districts.

Protection : The Government of Nepal does not have a formal system of proactively identifying victims of trafficking among high-risk persons with whom they come in contact. Some police officers made arrests during raids on commercial sex establishments but did not identify victims. As a result, child trafficking victims were arrested, jailed, and then charged “bail” which the police and court allowed traffickers to pay; this further indebted the girls before they were handed back to their traffickers. A 2009 Supreme Court ruling which ordered police to not arrest females in these establishments was largely unheeded, but some NGOs recently filed successful contempt of court cases which released some girls from detention. Police arrested some Bangladeshi migrant workers during raids in 2010 while they were allegedly trying to fly overseas with fake Nepali passports, and did not make attempts to identify whether they were trafficking victims.

During the last year, the Ministry of Women, Children and Social Welfare (MWCSW) fulfilled a commitment reported in the 2010 TIP Report to open and partially-fund five NGO-run shelter homes for female victims of trafficking, domestic violence, and sexual assault; a total of eight NGO shelters are now given some funding by the government. As of February 2011, 77 victims were in those shelters. During the year, the MWCSW fulfilled a second commitment to open 15 emergency shelters across the country for victims of trafficking and other forms of abuse. All facilities that assist trafficking victims were run by NGOs and most provided a range of services, including legal aid, medical services, psychosocial counseling, and economic rehabilitation. The Nepal Police Women’s Cells reportedly sustained partnerships with NGOs to ensure that victims were provided with available shelter; however, it is unknown how many survivors received assistance. There were not sufficient facilities to meet the needs of all survivors, nor were there any protective services for males. The Government of Nepal allocated approximately $7,000 for rescue efforts by the Nepal Embassy in India in the 2010 to 2011 fiscal year, a 55 percent increase compared to the previous fiscal year. The government continued to run emergency safehouses in Saudi Arabia, Qatar, Kuwait, and the United Arab Emirates. While the Foreign Employment Promotion Board collected fees from departing registered migrant workers for a welfare fund, most of the funds remain unused and are inaccessible to migrants who did not register with the Board; these irregular migrants may be most at risk to trafficking.

Limited protections for victims negatively affected law enforcement efforts. Victims were often intimidated in their communities not to pursue a case, and they did not want to prosecute due to concerns for personal and family safety, particularly as their traffickers may have been family members. Many victims were unaware that legal recourse was available against traffickers. The government did not encourage trafficking victims to participate in investigations against their traffickers. Judges reportedly often took an adversarial, rather than impartial, stance when dealing with trafficking victims.

Prevention : The Government of Nepal improved efforts to prevent human trafficking during the reporting period. The government organized rallies and distributed posters and pamphlets to mark the fourth annual National Anti-Trafficking Day. The National Human Trafficking Task Force was more active in the reporting period; it met more times than in previous years, secured more funds for rescue, and helped repatriate a Nepali victim from a rehabilitation home in Bangladesh. The MWCSW established District Committees on Controlling Human Trafficking in 49 districts this past year. While all districts are now covered, a number of those in rural areas are not active. According to the Foreign Employment Promotion Board, during the year the Board conducted safe migration radio programs on more than 50 stations throughout the country; this is twice as many stations as was reported in the previous year. In January 2011, the Ministry of Labor formed a Committee to Hear the Issue of Undocumented Workers. The committee met once during the reporting period, and includes an NGO. Chapter 9 of the 2007 Foreign Employment Act criminalizes the acts of an agency or individual sending workers abroad through fraudulent recruitment promises or without the proper documentation, prescribing penalties of three to seven years’ imprisonment for those convicted; fraudulent recruitment puts workers at significant risk of trafficking. Despite national registration drives and committees responsible for registering births, the Central Child Welfare Committee in 2008 reported that only 40 percent of children had birth registration certificates. All Nepali military troops and police assigned to international peacekeeping forces were provided some pre-deployment anti-trafficking training funded by a foreign government. Nepal is not a party to the 2000 UN TIP Protocol.