Are hill economies condemned to remain at the fringes, surviving as appendages to the plains? Or is there a path of development for them that is autonomous, different, creative? Unless economists and philosophers brave these questions and seek answers specific to the hill condition, the road to marginality is wide and welcoming at the economic periphery where highlanders reside.
Nepal, together with the hill economies of all the Himalaya generally, is today stuck in a developmental blind alley. The myopia which has got us into this gully is linked to acceptance of an economic philosophy — the conceptual outlook for managing a country´s household budget and resources—that is biased towards the market and the plains.
The history of how Nepal´s human and water resources have met the market provides ample indication of how those who have ruled and continue to rule the hill kingdom have no understanding of the hill economy. An inquiry into the record yields valuable insights on what not to do in future, and should be useful not only for Nepalis but for politicians, planners and philosophers of Tibet, Bhutan, Himachal and Uttarakhand as well.
Among all the states, provinces and nation-states of the region, by virtue of being the most-sovereign, Nepal should have been in a position to chart an independent course for its economy. Unfortunately, just the opposite has happened, and largely to blame is the intellectual milieu in Kathmandu, where the economic debate rages insipid and lifeless. Nepal has too few economic philosophers able to paint the broader canvas. It has too many econometririans, all of them pujaris of foreign aid who merely add details to someone else´s canvas, who constantly massage hopelessly unreliable data seeking the formulae for hill development.
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If they wish to improve upon the earthy wisdom of the subsistence hill farmer—whose lot it is there job to try and better—Nepali economist must try to traverse the distance from ´economy´ to ´political economy´ of the hills and bring the latter to center stage. Without addressing issues such as control over terms of trade and risks of one-sided dependence (which the subsistence farmer understands), it will not be possible to move away from conceptual blind alleys such as the "mechanistic efficiency" route of neo-classical economics. Study of the political economy will also force planners to acknowledge the role of values which have thus far been ignored in the teaching, learning and practice of economics.