No system becomes a democracy simply by calling it a democracy. Nepal was declared a democracy in 1950 after the fall of the Rana regime in face of an armed rebellion. At that time, an agreement for electing a constituent assembly was reached and a coalition government between the king, the Rana oligarchy, and the Congress Party was formed to carry out that election. Those rebels of the Congress Party who demanded the complete abolition of the Rana regime were exiled and what ensued was not democracy – the king was sovereign and the people were not.
Without holding any election, the king appointed Prime Ministers for eight years before unilaterally issuing a constitution, written by palace operatives, which formally gave sweeping power to the king, who then used it in 1960 to consolidate all powers to him. Although many party operatives who benefited from the king’s actions during that period still refer to the day that King Tribhuvan landed in Kathmandu as Democracy Day (Phalgun 7), it is nothing but a perversion of what democracy is all about. When King Tribhuvan died in 1955, the position and authority to rule Nepal was inherited by his son Mahendra, who also inherited the sovereignty. Successive democratic movements were ultimately betrayed time and again by the palace and Nepal always returned to an autocratic rule. The April 2006 popular movement was supposed to be the end of this tradition and be the birth of a republic. However, too much energy is still being expended on the fate of monarchy, which should already have been a thing of the past.
So far, the retention of the monarchy has been made possible due to those political forces that preach democracy but practice monarchy both in the country and within their own parties. These dual character royalist forces masked in the shroud of democracy are developing the habit of retaining autocracy instead of the habit of throwing it away. Not only is the monarchy a drain to the nation’s treasury, it is diverting resources that would otherwise have been used for productive work. And, the monarchy will remains as an instigating and legitimizing force for military coups and curtailment of democracy in the future. As long as these unjust traditions are not dismantled, justice will not take hold in the system. “Allocating the state power and state money to an unelected person without popular mandate in such a manner that the power and wealth can be passed through inheritance is not about democracy”  but is about retaining autocracy and feudal rule. And, the dream to establish a lasting democracy in Nepal may well be betrayed again if the institution of autocracy is not removed permanently. Abolishing the monarchy would be the first step for Nepal on the path out of its feudal past and into an age of democracy where no person can pass his power and authority to his descendents but rather every person has to earn his or her position through virtues that are integral to the person.
Moreover, a modern democracy must be about more than just conducting a periodic election. Today democracies are not reformed enough to empower people but instead they are giving the politicians an unwarranted power, which is giving rise to the erosion of the political culture and allowing corrupt politicians and officials to continue wielding power. “The voter does not enjoy any power or opportunity to influence the process of governance after he/she cast the vote at an election. The structure and process of governance … does not provide space for the voter to exercise his/her right to influence policy decisions or administrative decisions unless he/she resorts to legal action or joins a powerful lobby” . And, in the absence of proper access to information pertaining to governance, including its finance, citizens would not be able to evaluate the performance of the government. Therefore, any future model of democracy must empower citizens to participate in policy making, supervising institutions, and measuring institutional performance. This will ensure that the incorruptibility, transparency, responsiveness, equity, and efficiency of the system could be improved iteratively over time. In fact, this would be made possible if elected representatives are required to be scrutinized during the open meetings of the citizens. However, for such a system to be practical, the basic and sovereign units of governments should be small enough for ordinary citizen to have influence over it. This leads to the model of distributed federalism to which the rest of this article is devoted.
Historians write that there was a period in Nepal at the time of Lichhabi rulers when Dwaidh Sasan was in place. This was a time of great prosperity in Nepal which peaked somewhere around 500AD and lasted sometimes past 800AD. This duel form of governance would have called a federal state in today’s terminology. However, this paper skips this part of history due to lack of reference material. However, local government and central government which carried mutually exclusive duties seem to have existed in the Indian subcontinent on the name of “panchayat” and “rajya” for long. Similarly, a unique version of federalism was also established by Kublai Khan in Yuan Dynasty China in the 13th century.
The concept of federalism as we know of today was not critically analyzed and debated in modern Nepal until a federal system was demanded by the Communist Party of Nepal (Maoist) through its “40 point demands” , presented to the Government of Sher Bahadur Deuba in 1996. This demand set the pretext for their armed uprising and it took many more years for it to be taken seriously by other political parties. Ten years of uprising and 13,000 lives later, this problem has emerged with such a force that all major political parties have come to terms with the concept of federalism. Today the time has come for everyone to thoroughly debate this issue and find a proper outlet for the future of Nepal.
The outcry for changing a system comes when it does neither function well nor meets the expectation of the people. When people question the accountability, transparency, responsiveness, equity, and efficiency of a system, change becomes the business of the day. But it is often possible to meet the expectation of the people with incremental changes in structure and processes if the institutions are already established and acceptable processes are entrenched. But there are situations where the state institutions and processes do not function due to administrative and political dysfunctions characterized by corruption, mismanagement, unaccountability, exclusion, instability, inequity, and conflict. And, such situation warrants devolution of the state to make it manageable and accountable once again.
The hallmark of a durable system is its ability to incrementally improve, and institutionalize its structures and processes. But, in contrast, Nepal is characterized by dysfunctional state institutions, political unaccountability, entrenched corruption and mismanagement – an antithesis to a self-cleaning system. Therefore, the most effective way to fix this system is to devolve the state structure such that it is then founded on the building blocks of governance that are self-cleaning. And, for any system governed by ordinary people to be made self-cleaning and progressive, the size of the building block has to be small enough to be comprehensible to a common citizen. Corollary of this statement is that a devolved state must be composed of a large number of local governments. I call such a system a “massively federal” system and the federalism of such kind a “distributed federalism”.
Independent to what has transpired in Nepal, the need for a massively federal system also stems from the fact that the democracies of today – both federal and unitary – are unable to deliver a system of governance to which the citizens feel connected. People’s feelings of being not represented by their government have been further exasperated by the effect of globalization, competition and individualism. The “mechanistic top down models primarily concerned with economic development” has not been able to address many fundamental human needs and a new approach is, therefore, required to address the broadened sphere of human development that encompasses economic development. And such work is desirable for the countries in transition, such as Nepal, to bring about a more socially equitable economic growth.
This paper is written in this context to layout some important issues related to federalism for accelerating understanding on this matter and for fostering debates.
Characteristics of Federalism
Ideals: The greatest ideal attached to the concept of federalism is to develop a system of governance that is politically and administratively capable of identifying and responding to local needs and preferences of the people. Additionally, it is hoped to be more responsive and adaptable to future events that cannot be predicted today. Federalism is also described as a vehicle to address the problem of regional and social inequities primarily by eliciting the citizen participation in decision making and in accelerating development. Therefore, it is supposed to be the model of the future that brings improved management of the state and adheres to the ideals of promoting, supporting and sustaining both human and economic development.
Constitutional Mechanism: In a system of governance founded on the concept of federalism, the total power of the state is divided constitutionally between the central government and the local governments. The division of authority is made such that each political entity has a designated authority that cannot be trampled by the other entity. And, no entity retains the right to change the constitution, without the consent of all the involved parties. Therefore, the rights of devolved units are given to them by the constitution and not by the parliament and, therefore, cannot be withdrawn unilaterally by any parliament. Sovereignty of citizens: While the boundaries of each governing entity is constitutionally divided and defined, the citizens are the source of power in its entirety. Therefore, each governing unit derives its mandates to rule directly from the people and acts directly on those citizens from whom this authority was derived. The overall system is to be founded on the principles of freedom, processes, equality of humans, and rights of individuals.
Inter-governmental dependence: The overall system is designed in such a way that the local governments are obliged to adhere to central policies on the issues mandated to be decided by the central body. Similarly, the central body is obliged to listen to local voices on matters that affect the local bodies. Despite clear-cut division of power, they are interdependent for their effective functioning. Intra-government checks and balances: Each unit is divided into more than one sub-unit, related to each other through intransitive protocols, such that one sub-unit acts as an umpire for the other sub-unit. In most systems of governance, each unit is divided into three sub-units: legislative, executive, and judicial. Their powers are also separated constitutionally and clearly. This ensures that they cannot take unilateral actions. Constitutional justice guarantees that all players in the system comply with that division .
Inter-government dispute resolution: The judiciary acts as an umpire in case the disputes emerge and they are to be resolved. Such disputes may emerge either between local governments or between the central government and the local government.
Institutions and processes: Every government, local or central, is wholly responsible for the processes, institutions, and personnel to discharge its duty to the people. It has its own bureaucracy, developed, recruited, paid-for and controlled by itself to execute its functions. Whether it is unitary or federal, its effectiveness and sustainable relevance rests on its processes and institutions to carry out its duty and to facilitate its smooth relationships with other governments.
But federalism is not going to deliver the promised outcome if it is founded on the traditional hierarchical power structure. Instead, the system will become even more difficult to change from a structural level in case it does not function well. Hierarchical systems are based on supremacy and control and do not deliver fairness and equality. Moreover they are extremely vulnerable to minor defects and it is only a matter of time before they invariably fail.
Key Issues of Federalism
It is only natural to think that there exists an anti-thesis for every thesis there exists in the world. Therefore, federalism would not pass the test of time without a context. There is abundance of opposition from within Nepal and outside Nepal which predicts gloom and doom if federalism were to be adopted in Nepal. Others fall onto more than sixty countries in the world to find the meaning and scope of federalism. However, my view is that these models of federalism have not been able to successfully address the central question of empowering the people. For example, USA is one such country with entrenched federalism where majority of people do not even care to vote let alone participating in the decision making process. But at the same time, the animosity between the states and those between the states and the central government in USA are not as bitter as in those countries with small number of provinces such as Canada. Constant frictions and animosity between the central government and the provinces are common occurrences in Canada despite practicing a form of federalism for more than a century. I, therefore, am outlining some of the contradictions that make the matter complicated and feed the logical arguments that are developed either for the supremacy of central state or that of the federal state.
- Autonomy vs. Coordination
- Stability of government vs. Fairness in representation
- Inclusion vs. Free market competition
- Self-reliance vs. Equity and welfare
- Collectivism vs. Individualism (Human vs. Free-individual)
- Resilience (defense) vs. Size (offense)
- Constitutional authority vs. Agency
- Familiar vs. Experimental
- Identity vs. Unity 1
- People vs. Monarchy
- Change vs. Continuity
- Bottom-up vs. Top-down
- Entrepreneurial vs. Regulated
- Regional interest vs. National interest
- Responsiveness vs. Planned development
- Transparency vs. Ease of execution
- Right to secede vs. Indestructible union.
My thoughts stem from a belief that large number of local governments – that are not eclipsed by intermediary governments like provincial governments – are required to constitute a federal system of governance of the future. In absence of having sustainable mechanisms to address the core issues of inclusion and empowerment, introducing provinces may lead to misunderstandings similar to those that emerged in Sri Lanka after introduction of provincial councils in 1987 . If a single country is too large for it to be effectively managed from a single centre, it will be almost as difficult to manage from a few provincial centers for the same reason that they are not conducive for participation by ordinary citizens in the making of the policies for the province. The sovereign unit of the federation should, therefore, be small enough so that a common citizen would be able to participate meaningfully and influence the policy of the local government. Therefore, a country like Nepal – where social, regional, and ethnic disparities and diversities are dominant – should develop its own model of federalism for its future governance that is based on distributed federalism.
Political stability is best preserved if everyone feels they can have a say in government. – Socrates 
Federalism as practiced in various countries today can be broadly classified into two categories: “dual federalism“ as practiced in USA where the state and the central government exercise their own exclusive sovereignty and “co-operative federalism” as practiced in Canada  where inter-province equalization and welfare mechanisms are built such that the federal-provincial cooperation is necessary for the state to deliver many important services to people. Although they have successfully served their respective countries, Nepal should not be too eager to adopt them. Despite the fact that they did address the specific historical necessities of nation building in those countries, these models are not in synch with the realities of the societies of the new age of consciousness and world understanding. Today’s developing countries, including Nepal, are in such a historically important juncture that they could access information from all around the world and learn from them with small efforts – thanks to the age of information. In light of this, I am presenting a model of distributed federalism with a view that it is practicable and desirable for Nepal to organize the system of governance based on a model similar to this.
The distributed federalism is developed with the following assumptions:
- Purpose of democracy is to institutionalize freedom, empowerment and inclusion but not to carve geographical boundaries.
- Every person has two identities: one as a “free individual“ and other as a “human – group belonging“.
- An individual is better protected by an assembly of individuals.
- A human is better protected by an assembly of humans (groups).
- It is possible to achieve liberation without mechanical separation .
- Hierarchy is incompatible with the basic principle of democracy .
- An average citizen can influence policy decisions at a local level much better than national level.
- Institutions are built by people, and, therefore, the size of the institution must be manageable by common people.
- Historically, when large and centrally administered systems fail, society naturally resorted to massively parallel and distributed systems.
- Federalism of the future should lend itself to institutionalization by the virtue of its inherent nature. [Should not have to wait for a miracle leader to descend from somewhere for the godly management of the country.]
A society fractured by conflict, oppression and deprivation cannot develop institutions of democracy without massively devolving the central power. If Nepal is to ignore this fact and is to remain a unitary state, the country will be in a danger of giving rise to authoritarian rule, perennially divided society, and recurring conflicts. For the present context of Nepal, a distributed federalism is the most viable option for the integrity of the country and progress for its people.
Because the political and economic corruptions are curtailing the process of institutional development today, creating smaller replicas of similar bureaucratic and political mechanisms in a provincial scale is not going bring the governments closer to the people and make them suddenly responsive to their needs. A person of Baglung will be nearly as far and alienated to a government in Pokhara as it would be to the one in Kathmandu because the person would be as minimally empowered to participate in the process of making decisions in Pokhara as much as he or she would be to those made in Kathmandu.
The most effective way the people can be made to feel that the actions taken by their government are their own is by eliciting their participation in the decision making process. And, for that to happen in a society where people do not have luxury to leave their home base for the sake of advancing government work, bulk of the activity of governance has to be brought physically closer to the people. This warrants that most of the roles played by the central government today must be played by numerous small local governments, which could be managed by common people. And, the far-centre must play a role of solving bigger issues of national defense, international affairs, monetary affairs, inter-region equity, dispute resolution, and affairs of developing protocols of governance and standards for enhancing compatibility and measurability.
A democratic state becomes stronger by institutionalizing justice, freedom, empowerment, and inclusion but not by mere carving of geographical boundaries. Moreover, the smaller the size of a government, the easier it is to make it responsive, accountable, and self-healing. It is easier to develop small institutions that are comprehensible to common citizens. If the size and complexity of the system becomes large, people will not be able to keep it in check. For that reason, a new institution of governance called PROVINCE should not be created in Nepal with a wishful thinking that they will bring the government closer to the people. This experiment was embarked by Sri Lanka, a country with a highly educated population and a much better human development index than many developing countries, with a creation of nine provinces and transfer of many central authorities to them in 1987. However, the result was dramatically different than the one envisioned by those who proposed this idea. It alienated the minorities more than ever before and the people did not feel that their government was any closer to them than before but rather it augmented role-confusion and misunderstandings.
A system of two governments – one central to solve the macro problems of the country and the numerous local governments to solve the local and micro problems of the communities – is more practical for Nepal than other models of governance. And, this system is at the heart of the distributed federalism. The distributed federalism reflects the successfully practiced system of local governance historically practiced in the greater region of South Asia and China. However, the same concept of the system of local governance was attempted to be utilized by Panchayat regime as a vehicle to enforce central control and mostly to track and suppress the political opponents. Any sign of political dissent was reported to higher authority and people were summoned to the Chief District Officer, and sometimes to Chief Zonal Officer, who decided the punishment for the dissenting citizens of their jurisdiction. Most often, the political activists were liked by the villagers and even the village council officials. However, the council had no independent control over the affairs of the village because the power was vested to it by the higher authority and could be taken away from it at any time. But if the power to govern local affairs was constitutionally-and-irrevocably given such political suppression of the village citizens by the higher authority could not have taken place.
Most of today’s conscious people desire to have human-freedom, justice, equality, innovation, and prosperity as part of our human virtue. However, when it comes to thinking about building institutions and systems to accomplish them, we tend to wish to copy obsolete models practiced by others instead of understanding our own unique context and a model suited to it. And, in Nepal, much debate has taken place between the centralists and the proponents of the provincial systems, but both systems cannot address the aspirations of today and the world of tomorrow in which we want to live and do that competitively. This paper presents a concept of distributed federalism as the most desirable form of governance for Nepal. This model demands that the total sovereignty be divided into two disjoint subsets and one set be vested to the local government and the other to the central. And Nepal must be governed through these two layers of government instead of multi-layered ones practiced by other countries- whether they are unitary states or the federal states.
 Pramod Dhakal, “State Power, Monarchy, and Girija”, Kantipur Online, Aug 2006, http://cffn.ca/news/0608/_0608_1.php
 Sudatta Ranasinghe, “Democracy and local governance some critical issues and their implications”, Governance Journal, Vol 1, No 1, pp.10, Sri Lanka Institute of Local Governance, 2001
 “Fourty Point Demands of the United People’s Front”, Submitted to Govt of Nepal, Feb 1996, http://cffn.ca/historicdocs/1996_40PointDemand.php
 T.K. Dassanyake, “Some Thoughts on Government and Governance”, Governance Journal, Vol No 02, pp. 32, Sri Lanka Institute of Local Governance, 2003.
 Tania Groppi, “Federalism and Governance Tools”, Italy for Iraq, 2007, http://www.italyforiraq.it/en/corso/03.asp.
 A.P. Dainis, “Good Governance and Local Government”, Governance Journal, Vol No 02, pp. 53, Sri Lanka Institute of Local Governance, 2003.
 Dave Robinson and Judy Groves, Introducing Plato, Icon Books UK, 2000.
 Pramod Dhakal, “Road to Fair Representation: Ethnic Identity and Freedom”, Canada Forum for Nepal, Jan 31, 2007, http://cffn.ca/news/0701/0701_03.php
 Pramod Dhakal, “The Issues of Inclusion and Federalism in Nepal”, Canada Forum for Nepal, June 20, 2007, http://cffn.ca/news/0706/0706_03.php#pd