Nepal is grappling with a significant challenge: the widespread exodus of its young population. Every day, thousands of young Nepalis depart in search of better opportunities abroad, driven by the stark reality of unemployment, economic instability and limited prospects at home. This alarming "brain drain" reflects deeper systemic issues within the country, where the lack of meaningful opportunities has left many of Nepal's youth disillusioned and compelled to seek brighter futures elsewhere.

One of the primary reasons for this exodus is the lack of employment opportunities in Nepal. According to the International Labor Organisation (ILO), youth unemployment in Nepal is alarmingly high, with rates of around 19 per cent. This is exacerbated by the high underemployment rate, where many young people are forced to take jobs that do not match their skills or qualifications, often in the informal sector where job security and benefits are minimal.

The economic structure of Nepal, heavily reliant on agriculture, is not conducive to generating sufficient employment opportunities. Agriculture employs a significant portion of the population but is characterised by low productivity and wages. The industrial and service sectors, which could potentially create more and better-paying jobs, remain underdeveloped.

Adding to the problem is the mismatch between the skills provided by the education system and the demands of the labour market. This skills gap drives youth migration. Low wages in Nepal also contribute to the youth exodus. Even for those who secure employment, the wages offered are often insufficient to meet basic living expenses, particularly in urban areas where the cost of living is high.

Several issues contribute to the government's inability to create sufficient job opportunities, which include political instability, corruption and bureaucratic inefficiencies. Frequent changes in government have resulted in a lack of continuity in policymaking and implementation, creating an uncertain business environment that deters both domestic and foreign investors from committing to long-term investments in the country.

Corruption is another major issue that has hindered job creation in Nepal. Funds allocated for infrastructure projects or social programmes are often siphoned off by corrupt officials, leaving the intended beneficiaries with little or nothing. This not only hampers job creation but also erodes public trust in the government and its ability to address the country's pressing issues.

Bureaucratic inefficiencies further exacerbate the problem. The complex and cumbersome regulatory environment in Nepal makes it difficult for businesses to operate, let alone thrive. Starting a business involves navigating a maze of red tape, including obtaining licenses, permits and approvals from various government agencies. This lack of entrepreneurship and innovation stifles job creation and limits the economy's ability to grow and diversify.

To address the issue of youth migration, Nepal must focus on attracting foreign investment and multinational companies. Foreign investment is crucial for economic development, as it brings in much-needed capital, technology and expertise, which can help create jobs and stimulate economic growth. However, attracting foreign investment requires creating a conducive business environment that encourages investment and supports the growth of both domestic and foreign enterprises. Improving transparency and accountability in government dealings with businesses is also essential to ensure that investors can operate in a fair and predictable environment.

Political stability is another key factor in attracting foreign investment. Nepal must work towards reducing political instability by promoting good governance, strengthening democratic institutions and addressing the root causes of conflict and division within the country. Incentivising investment through tax breaks, subsidies and other financial benefits can also make Nepal an attractive destination for multinational companies. The government should consider offering special economic zones (SEZs) with favourable tax rates and relaxed regulations to encourage foreign companies to set up operations in Nepal.

Improving infrastructure is another critical component of attracting foreign investment. The government should prioritise infrastructure development by investing in roads, airports, energy production and telecommunications. Public-private partnerships (PPPs) can be an effective way to leverage private sector expertise and investment for these projects.

Tourism holds significant potential to reduce unemployment in Nepal by creating both direct and indirect job opportunities. By developing tourism infrastructure and promoting niche markets such as adventure, wellness and cultural tourism, Nepal can attract more visitors, leading to increased demand for services like hotels, restaurants and transport.

Tourism also fosters inclusive growth by benefiting rural and remote areas where many of Nepal's attractions are located. Improving access to these regions and engaging local communities in tourism initiatives can uplift economically disadvantaged areas, providing employment and supporting small enterprises. Moreover, sustainable tourism practices can ensure long-term benefits for the economy while preserving the environment and cultural heritage.

The government must recognise the severity of the youth exodus crisis and take decisive action to create jobs, attract investment and retain its young talent. By fostering a business-friendly environment, investing in infrastructure and reforming the education system, Nepal can build a brighter future for its youth and the nation as a whole.

If the current trend continues, Nepal risks losing its most valuable asset-its young people. The time to act is now, and the government must rise to the challenge to ensure that Nepal's youth see a future in their homeland, rather than abroad.

Published on: 9 September 2024 | The Himalayan Times