When a screenshot embedded in a Tweet and tagged with #DigitalNepal is enough to excite, one begins to scratch the surface of desperation that is shared by digital economy advocates in Nepal. To be fair, imagining a digital future is probably not the highest priority for Nepali policymakers, many of whom continue to struggle with the subtle differences between “digital”, “IT” and the “internet”, but this is a matter for another blog. For now, we are ecstatic just imagining the endless possibilities of Nepal’s own digitally-enabled economic revolution.
But first, some context: as a concept, #DigitalNepal has its roots as far back as 2017/18 when Frost & Sullivan, operating as Moses Pvt. Ltd. in Nepal, began authoring the Digital Nepal Framework. Part framework and part recommendation-set, this work product was funded by Axiata-owned Ncell and is considered a groundbreaking assessment of the current state and potential benefits of a digitized Nepali economy. The report catalogs a menu of digital pursuits, sliced, diced, and neatly choreographed for a federally devolved public sector audience. The Digital Nepal Framework was adopted by the Ministry of Information and Communications (MOIC), endorsed by Prime Minister KP Oli in August 2108, and formally approved by the Council of Ministers in October 2019. Although sporadic progress updates have appeared in the local media, the pace of implementation of this framework has been antithetical to its namesake.
At around the same time in 2017/18 (and initially on a parallel track), the F1Soft Foundation had also launched Digital2020. This initiative was positioned as a private sector-led approach to digitizing the financial services layer, which was also a cross-cutting recommendation in the Digital Nepal Framework. Digital2020 was conceived alongside a wide stakeholder group of domestic and international private sector entities, representatives from the Central Bank’s Payments Department, the Chairman of Nepal Bankers’ Association, the erstwhile CEO of the Investment Board (who is now the Governor of the Central Bank, Mr. Maha Prasad Adhikari), the former UK Ambassador to Nepal, and the World Bank Country Manager (now Country Director) for Nepal, Sri Lanka and the Maldives, Faris Haddad-Zervos. Mr. Haddad-Zervos in particular played a pivotal role by lending early support and Governor Adhikari was equally instrumental in helping cement wide stakeholder participation for Digital2020.
In May of 2019, Digital2020 was taken over by the United Nations Capital Development Fund (UNCDF) in Nepal and repackaged as “Digital2030”. This transition was accompanied by a promise of expanded participation and accelerated implementation. There was an explicit understanding with UNCDF that seed funds were already available and that additional funding from the UK’s Department for International Development (DFID, or #UKAid in Nepal) would be mobilized to help deliver Digital2020. However, delivery failed to materialize after the UNCDF Representative to Nepal at the time, transferred to another role in New Delhi. Digital2020 as an umbrella initiative has stagnated since although individual efforts to promote digital financial services by Donor and private sector entities have progressed in bespoke formats.
Fast forward to August 2020, and “thanks” in large part to the COVID-19 pandemic, #DigitalNepal is back on the policy radar and (we hope) on a prioritized implementation path. The propelling force this time around, is the following: for Nepal to “build back better”, wide-spread adoption of digital platforms and services, a robust and transparent regulatory framework, and a well-coordinated effort among the private, public and donor domains, is mission-critical.
In oversimplified terms, to qualify as “better”, every item on Nepal’s development agenda – whether in health, education, mobility, logistics, commerce, banking, finance, etc. – should be prefaced with the letter “e” or the word “digital”
Another aspect to “building back better” means learning from past experiences within Nepal and in-sourcing the most relevant lessons from abroad. There is ample room in Nepal’s context to better align a host of donor-driven, private and public sector interventions that directly and indirectly contribute to a #DigitalNepal. Achieving this strategic alignment is crucial to ensuring sustainability through commercial outcomes. Similarly, when applying lessons in success, access to a curated body of global and regional knowledge is an equally important tool to maximize the success of #DigitalNepal.
Further, the default format of each donor agency asking the government for a wishlist and then repurposing resources to meet volume targets has to be replaced with a conscious effort at nudging the Nepali Government to set the foundations for a digital economy. For this outcome to materialize, strong relationships must exist between leaders in the donor agencies and their counterparts in at least the Ministries of Finance, and Information and Communication for starters, but also with the Governor of the Central Bank. These relationships must also permeate down to the working-level to ensure survivorship of #DigitalNepal. Luckily for Nepal, the stars are currently aligned – the two cabinet portfolios are held by Yubaraj Khatiwada, the Governor is a trusted and forward-thinking confidante, and the relationships between these individuals at the World Bank in Nepal appears at an all-time high.
On all of these accounts – coordination, convening power, access to expertise, and high-quality relationships – lead partner selection is paramount. Selection should be driven a verifiable track-record of digital economy work in multiple other geographies, deep knowledge of successful frameworks (e.g. the India Stack and MDEC), ready access to institutional funding sources (grants, technical assistance, and lending instruments), and the ability to assemble an eclectic group of stakeholders across the private, public and development domains. If this Tweet is indicative of the entity the Government is leaning on to progress #DigitalNepal, the odds of success now are far higher than at any point since the call for a digital economy entered the mainstream discourse.