On World Health Day on 7 April this week, the Air Quality Index (AQI) in Kathmandu exceeded 300 – one of the dirtiest in any city in the world. Breathing was literally <a href="https://nepalitimes.com/banner/breathing-is-hazardous-to-health">lethal</a>.
Although the main source of pollution this week was smoke from brushfires raging across the country, emissions from diesel and petrol vehicles are a bigger year-round source of hazardous suspended particles and toxic gases.&nbsp;
The good news is that the sale of electric four-wheelers is growing rapidly, and battery-powered vehicles now account for one-third of Nepal’s total car imports. Outside Kathmandu, vans, microbuses and three-wheelers are switching to electric as never before
All this has happened even though there is still a hefty <a href="https://nepalitimes.com/news/1-step-forward-2-steps-back-in-nepal">tax on battery-powered vehicles</a>. In last year’s budget ex-Finance Minister Prakash Mahat increased the tax on smaller EVs and electric vans while inexplicably reducing the tax on luxury SUVs.
This year, all eyes are on the new Finance Minister Barsha Man Pun, who is under pressure to raise government revenue that has fallen drastically due to a slowdown in imports. Instead of lowering taxes and even announcing subsidies on electric cars and appliances, he may actually increase them. He could also do it selectively to favour certain EV brands imported by cronies.
“The government should be more careful in how it taxes electric vehicles,” says air pollution activist Bhushan Tuladhar who is also the director of Sajha Yatayat, the public transport company that is operating 40 electric buses. “It should be consistent, predictable and guided by science, it can’t be a kneejerk reaction with no real planning.”
One large electric bus can replace at least 10 cars, easing road congestion, improving air pollution and reducing petroleum imports. But existing excise and import taxes make battery-powered buses up to five times more expensive than a diesel bus of similar capacity.&nbsp;
On Tuesday, <a href="https://nepalitimes.com/news/sajha-s-green-buses-go-greener">Sajha Yatayat inaugurated Nepal’s largest charging station</a> with 24 charging points where it will charge its 40 e-buses. Speaking at the event, Kulman Ghising of Nepal Electricity Authority (NEA) acknowledged that Nepal was undergoing a “massive transport transition”.&nbsp;
“We will soon have surplus power even in winter, and private EVs can only use so much of our electricity, what we really need is to electrify our mass transport,” he said. “On one hand, by increasing our consumption of electricity, it will reduce our petroleum imports and subsequently our trade deficit. It will also help us meet our net zero target. This is also very feasible as a business model.”
Petroleum imports account for one-fourth of Nepal’s total imports and is more than all of our exports combined. Reducing petroleum consumption by just 10% would save the country over Rs30 billion whereas even exporting all of our current power generation of 3,000MW would earn us just half that amount.
It is simple maths: prioritising <a href="https://nepalitimes.com/multimedia/missing-pieces-of-the-hydropower-jigsaw">domestic electricity consumption</a> is a win-win-win for the country. Electrification of industries, tourism and agriculture would also mean tens of thousands of new green jobs and help stem the mass exodus of youth.&nbsp;
A policy decision is also urgently needed for electric taxis. Bagmati Province does not register new battery-powered cabs, but they are still being imported as private cars which then buy number plates of the older taxis. This means the electric taxis have to pay higher road taxes, keeping their fares high.
A battery-powered taxi can be fully charged for just Rs106, and will have a range of 180km. A petrol taxi would need Rs3,500 worth of petrol to cover that distance.&nbsp;
Climate expert Manjeet Dhakal says that budget fluctuations make people and investors lose confidence, and this is especially important ahead of the Nepal Investment Summit later this month.
“At a time when the whole world is moving towards clean energy, Nepal’s contradictory policy regarding EV sends out the wrong message to the business community,” he adds. “But at the next &nbsp;budget, we must incentivise electric buses. Even within the EV bracket, this is the segment we have to hit had if we are to make a real difference.”
Without state subsidy and support, the private sector is unlikely to expand on electric facilities. Pollution tax can very well come in handy here if there is a political will.
Even then EVs are just a part of an ecosystem, we need charging infrastructure, skilled human resources for the new technology, and policies that promote them.
Similarly, two-wheelers make up nearly 80% of total vehicles in Nepal. But there are electric bikes and scooters, government and the private sector have much to do to increase consumer and market confidence in them.
Consecutive governments have been flip-flopping tax rates on electric vehicles in recent years. In 2020, <a href="https://nepalitimes.com/news/nepal-reduces-tax-on-electric-cars">the government reduced the taxes on battery-powered vehicles</a>. A year later, it re-imposed tax for electric SUVs while cheaper vehicles were still taxed less. Last year, the tax on smaller EVs and electric vans was increased while that on luxury SUVs was slashed.
Not long ago a former finance minister was caught questioning how the government would earn its revenue if it didn’t tax electric vehicles. Such is our policymaking that we rely on imports to generate income for the government when in fact revenue should be based on local industries and goods.
“Financial policy is based on politics and that is the sad reality, more so now with coalition governments,” says Tuladhar. “But even then, taxation should not be a long-term policy. But unfortunately, people who are making policies aren't riding buses &nbsp;so they have no interest in public transport or don’t even know what to do with it.”

Sonia Awale

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EV year २०८१

<img width="1500" height="1000" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110141128/636cfd179c7e80680e0a0bc6jpeg.jpg" alt=""/>In 1911, Nepal became the second country in Asia to install <a href="https://www.nepalitimes.com/banner/nepals-1st-hydroelectric-plant-is-a-museum-piece/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/banner/nepals-1st-hydroelectric-plant-is-a-museum-piece/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNGTfe_ElDUnDBA5y1fWiNeNMmj3iw">a hydroelectric plant</a>, and was a pioneer in  electric transportation with the opening in <a href="http://archive.nepalitimes.com/news.php?id=1651#.YREMFtMzbRY" data-saferedirecturl="https://www.google.com/url?q=http://archive.nepalitimes.com/news.php?id%3D1651%23.YREMFtMzbRY&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNFCMXd7Cwgzp9Nvx_5uv6jjxw5VdA">1922</a> of a ropeway connecting Kathmandu to Dhorsing and <a href="https://archive.nepalitimes.com/article/business/ropeways-connecting-nepal,1749" data-saferedirecturl="https://www.google.com/url?q=https://archive.nepalitimes.com/article/business/ropeways-connecting-nepal,1749&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNFoAmTmRhO8F_jUynodP4VGdDGB2g">later to Hetauda</a>.  The Chinese gifted an <a href="https://www.nepalitimes.com/banner/kathmandu-bhaktapur-trolley-bus/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/banner/kathmandu-bhaktapur-trolley-bus/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNEJ0EZMCfEEa7kLPULhzZRB_DGcng">electric trolley bus line</a> from Kathmandu to Bhaktapur in 1975, which provided valuable commuter service for nearly 30 years. In 1995, the government replaced polluting diesel three-wheelers with electric ones, and 700 of the <a href="https://www.nepalitimes.com/opinion/12-full-opinion/how-to-get-things-done-in-nepal/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/opinion/12-full-opinion/how-to-get-things-done-in-nepal/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNHCvZcncwin-QX5AckUaljaRos77g">Safa Tempo</a> are still running on 28 routes, serving Kathmandu’s public transport needs. However, despite these milestones in electric transportation, Nepal has not taken the leaps it could have in powering mass transit with the country’s plentiful renewable energy potential.“We missed the bus on electric buses,” says environmental expert <a href="https://www.nepalitimes.com/here-now/cleaner-air-with-greener-buses/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/here-now/cleaner-air-with-greener-buses/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNEl_IlhZ7KVICnzsc-SRPKQHCTwSQ">Bhusan Tuladhar</a>. “We could have taken e-vehicles to the next level much earlier.”Indeed, the Safa Tempo now faces competition from diesel buses on trunk routes, and government policy on replacing larger diesel buses with electric ones has been erratic. Daily commuter volume in Kathmandu today now needs larger mass transit modes, but Safas are ideally suited for narrower streets of the inner city.“After the diesel three-wheelers were replaced by Safa Tempo, the government adopted a contradictory policy of promoting micro-buses,” explains Dharma Kumar Shrestha of NEVI (Nepal Electric Vehicle Industry).  <figure><img width="1435" height="1845" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110141128/636cfd1b9c7e80680e0a0bc7jpeg.jpg" alt=""><figcaption> </figcaption></figure>Sadly, in the early 2000s, the <a href="https://www.nepalitimes.com/banner/kathmandu-bhaktapur-trolley-bus/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/banner/kathmandu-bhaktapur-trolley-bus/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNEJ0EZMCfEEa7kLPULhzZRB_DGcng">trolley bus system</a> and another cargo ropeway to Hetauda were closed due to losses and mismanagement. Although private electric cable cars are coming into operation nationwide for tourism, there is still no strategic solution in sight for electrified public transportation, particularly electric buses.<a href="https://www.nepalitimes.com/banner/nepals-electric-transport-future-is-here/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/banner/nepals-electric-transport-future-is-here/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNEluSwdpWldVQB8IdEn83UBiR6-RQ">Electric vehicles</a> still have problems with carbon emission during production and battery disposal, but they will help improve the air quality and reduce Nepal’s petroleum imports which have more than doubled in the past 10 years. Some <a href="http://www.mofe.gov.np/downloadfile/E-mobility%20Assmnt%20NDC%202020_1623998131.pdf" data-saferedirecturl="https://www.google.com/url?q=http://www.mofe.gov.np/downloadfile/E-mobility%2520Assmnt%2520NDC%25202020_1623998131.pdf&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNE2VntIF8kJ7PIXXcPqAHkOF4QTHQ">12%</a> percent of the greenhouse gas emissions from the energy sector in Nepal comes from transportation, with heavy vehicles like fuel-run trucks and buses being the main polluters. There are now about 6,000 battery two-wheelers, over 27 thousand electric three-wheelers, and 1,000 electric vehicles in Nepal, but this is still only 1% of the total, according to a <a href="http://www.mofe.gov.np/downloadfile/E-mobility%20Assmnt%20NDC%202020_1623998131.pdf" data-saferedirecturl="https://www.google.com/url?q=http://www.mofe.gov.np/downloadfile/E-mobility%2520Assmnt%2520NDC%25202020_1623998131.pdf&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNE2VntIF8kJ7PIXXcPqAHkOF4QTHQ">Ministry of Forests and Environment report.</a> <figure><img width="1000" height="589" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110141128/636cfd1e9c7e80680e0a0bc8jpeg.jpg" alt=""><figcaption> </figcaption></figure>“Since transportation contributes a significant amount of Nepal’s total greenhouse emissions, a shift to electric is essential to achieve the country’s goal of being carbon-neutral by 2050,” says Radha Wagle, Chief of the Climate Change Management Division under the Ministry of Forests and Environment. Electric Vehicles are initially more expensive, but in the long run not are not just less-polluting, but will also help improve Nepal’s balance of trade deficit with India. While production and battery cost of electric bus makes them more expensive than a new diesel bus of the same capacity, running costs, maintenance and repairs means that for every kilometer travelled, an electric bus will be <a href="https://www.nepjol.info/index.php/jiee/article/view/34321" data-saferedirecturl="https://www.google.com/url?q=https://www.nepjol.info/index.php/jiee/article/view/34321&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNHvg12N6jF8_nWl4dVJoCTHjzyUSQ">Rs14 cheaper to run.  </a> “The operational cost of a diesel bus is high,” says Tuladhar, who is also a board member of Sajha Yatayat, where 40% of the running cost is diesel. “If we switch to an all-electric fleet, we will have significantly lower costs that will let us provide better service. But because of the higher initial investment necessary, a government subsidy is necessary for the purchase of electric vehicles.” In this year’s budget, the <a href="https://www.nepalitimes.com/latest/new-nepal-budget-sparks-electric-comeback/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/latest/new-nepal-budget-sparks-electric-comeback/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNGOdQbO8PkEMjBfZpNw847NLJ3Q-w">government reinstated tax rebates</a> on electric vehicles which now makes their cost comparable to 4- and 2-wheelers of the same capacity. However, the capital cost of electric buses is still more than double the cost of diesel-run buses, which is why further subsidies are needed. The government can easily recoup the lost tax revenue from reduced petroleum import bills, experts say.  NEVI’s Shrestha agrees that government subsidies would inventivise buyers for electric vehicles, and also setting up charging stations across the country.  Among all registered vehicles in Nepal, nearly 80% are privately owned two-wheelers, but they contribute only 8% to total emissions from transportation. Trucks and public buses emit 57% of CO2.  The demand for electric vehicles is highly sensitive to government policies. With the taxes imposed in 2020, the import of electric vehicles in the first 5 months of the fiscal year at the start of 2021, <a href="https://www.nepalitimes.com/latest/how-much-will-electric-cars-cost-now/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/latest/how-much-will-electric-cars-cost-now/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNFvouUWmKFkrMCzKw9Z2vqYQ76y_g">declined by 88% compared to the previous year</a>. However, sales are expected to pick up again after the tax reversal. Electric rickshaws are gaining popularity in the Tarai, with over 26,000 registered  –- making up 0.82% of all vehicles in the country. <figure><img width="1588" height="946" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110141128/636cfd219c7e80680e0a0bc9jpeg.jpg" alt=""><figcaption> </figcaption></figure>“A transition towards e-transport will reduce our trade deficit massively and further ensure green economic growth,” says Rajan Thapa, a climate change expert. Over the past decades, successive governments have taken pro-electric policies. The National Transport Policy in 2001 was developed to make the transportation sector environmentally friendly, and the Environmentally Friendly Vehicle and Transport Policy of 2014 calls for diversifying vehicles to run on electricity, hybrid, and gas. The government also is going to open 50 charging stations across the country and announced that it is buying 300 electric buses. The second Nationally Determined Contribution (NDC) that Nepal submitted to the UN last year pledges a 200km electric railway network, increasing the total sale of private e-vehicles to cover 90% and public transport (besides three-wheelers) to 60% of imports by 2030. This is expected to reduce carbon emission by 28% and <a href="https://www.nepalitimes.com/here-now/green-sticker-green-light-to-pollute/" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/here-now/green-sticker-green-light-to-pollute/&amp;source=gmail&amp;ust=1628960160899000&amp;usg=AFQjCNE3Q7u9yrExf3zy5U0L51alzQDptQ">lower pollution levels in cities</a>. “The government of Nepal is being more ambitious and committed to ensuring net-zero emissions ahead of 2050, " says Prem Kandel, secretary of the Ministry of Forests and Environment (MoFE). “We have made a long-term strategy that will provide us with evidence and policy choices to look at potential ways of reducing carbon emission. E-mobility is one of the means of achieving our ambitious target.”Diya Rijal is a communication consultant for the UK government-funded Policy and Institutions Facility.

The road to electric transportation in Nepal

The monsoon has got bad press because Nepal’s tourism operators actively told visitors to avoid <a href="https://nepalitimes.com/opinion/managing-the-monsoon?%2F">the rainy season</a>. It is time to change that. The reason can be found right here in the vast alpine meadows of Central Nepal where this time of year you can walk on velvet grass of pastures abloom with delicate pink, red and yellow flowers as the mist rolls up the valley. There is no sound except the hum of bumble bees. &nbsp;&nbsp; There are dozens of places across high Nepal called Chaurikharka, which means yak pasture. But this particular Chaurikharka in Rukum East located at an altitude of 4,000m stands out for its serene beauty, rustic charm and bucolic setting. There is just the occasional chime of <a href="https://nepalitimes.com/here-now/when-yaks-go-so-does-culture">yak bells</a> in the distance, and the sharp whistle of herders corralling sheep. &nbsp;&nbsp; The grass shoots are so fragile that one hesitates to step on them, the rounded ridges appear and quickly vanish in waves of mist. With the<a href="https://nepalitimes.com/here-now/before-the-next-monsoon"> arrival of monsoon</a>, these meadows are a soothing shade of green dotted with millions of <a href="https://nepalitimes.com/review/the-anatomy-of-a-flower?%2F=">multi-coloured flowers</a>. Until very recently, it took a week or so to hike up to places like Chaurikharka, but with the expansion of the road network even to these far-flung mountains in the lap of Dhaulagiri, they are much more accessible. It is just a three-hour uphill from the Mid-Hill Highway on the border between Baglung and Rukum East.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250802130828_a0b06b494d751b2144ffbbf10894ea64b29e8aed844bc8c66171783abfaf4e16.jpg" data-media-id="editor_4" data-image-id="20250802130828_a0b06b494d751b2144ffbbf10894ea64b29e8aed844bc8c66171783abfaf4e16" data-rendition-name="original" width="2048" height="1365" loading="lazy" alt="Visit Nepal in the monsoon"> </figure>  Purists would say that such easy access devalues the sanctity of these remote high meadows, but it also means more people will be moved to treasure the experience, appreciate <a href="https://nepalitimes.com/banner/natures-fragile-gift-to-nepal">the value of nature </a>so they can take steps to protect it.&nbsp; To be sure, the <a href="https://nepalitimes.com/here-now/deadly-monsoon-in-nepal-turns-deadlier">monsoon season can be challenging for road travel</a>. The roads are rough even at the best of times, and in the monsoon they become muddy and treacherous, often blocked by<a href="https://nepalitimes.com/news/monsoon-deluge-in-nepal"> landslides</a>. But that could be precisely the kind of adventure that the more intrepid visitors crave. Improved road connectivity has already made Chaurikharka and places like Badimallika &nbsp;and other sacred lakes in the mountains of western Nepal popular with domestic tourists. What is driving this traffic is the urge to go to exotic new places and share videos and selfies on social media. Several of Nepal’s travel vloggers have visited Chaurikharka and popularised the place, enticing followers on TikTok or YouTube to retrace their footsteps. But even as they become more popular, these fragile and once-remote places should be protected from over-tourism.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250731110736_f97110b7cdc3e7f80d5877690948fc9f4c95a09c583deb23b07355491e6c5446.jpg" data-media-id="editor_8" data-image-id="20250731110736_f97110b7cdc3e7f80d5877690948fc9f4c95a09c583deb23b07355491e6c5446" data-rendition-name="original" width="1083" height="699" loading="lazy" alt="Visit Nepal in the monsoon NT"> </figure>  <h2>INCREASING FOOTFALL</h2> Chaurikharka is located in Bhume Rural Municipality of East Rukum, near the scenic valley of Dhorpatan in Baglung district. Even in the <a href="https://nepalitimes.com/banner/monsoon-culture">middle of the monsoon</a>, there is a steady stream of Nepali hikers trooping to these high pastures – especially during festival days like Saune Sankranti which this year was on 17 July and actually marks the auspicious beginning of the monsoon here. “This year the rains have not been as heavy and there have been some clear mornings when we could see everything from Dhaulagiri to Machapuchre,” says Khageswar Bhandari, who trekked up here from the road. “The flowers, the greenery and the snowy mountain views make this an incredibly unique place.”&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250802130824_1b9e26f2e9853fdfe69154bb42a7c9ea6da4bf4940efc1da99b304dcfbd7d3d9.jpg" data-media-id="editor_10" data-image-id="20250802130824_1b9e26f2e9853fdfe69154bb42a7c9ea6da4bf4940efc1da99b304dcfbd7d3d9" data-rendition-name="original" width="2048" height="1152" loading="lazy" alt="Visit Nepal in the monsoon"> </figure>  Chaurikharka is worthwhile to get to in any season, but it has a different charm during the monsoon. Word has spread and because it is now easy to get to from Baglung or even Pokhara, people have been flocking here.&nbsp; “Holidays and Saturdays see the largest crowds, with up to 500 visitors every day,” says ward chair Mankaji Pun of Bhume.&nbsp; There was a time not too long ago when local herders brought sheep, goats, cows, buffaloes, horses, and mules to graze here during the monsoon. Although there are still livestock around, animals have been replaced by visitors taking selfies. Read also: <a href="https://nepalitimes.com/here-now/the-monsoon-and-nature-s-arithmetic">The monsoon, and nature’s arithmetic</a>, Tom Robertson Ward Chair Pun says infrastructure development is his main priority. A foot trail to Chaurikharka was built last year by the Tourism Division Office in Kohalpur, but access via the Raniwas-Koipa road section still remains challenging.&nbsp; “If we get more budget, we can improve the road and facilities to make Chaurikharka the main tourist attraction of this region,” says Bhume Municipality Chair Hom Prakash Shrestha. “After that, we hope to promote Chaurikharka as a top tourist spot.”&nbsp; Economic activity is also picking up with the arrival of visitors, but there seems to be a need to manage the makeshift sheds made of corrugated sheets that spoil the beauty of the place. Tea shops and lodges are also available but facilities are basic. Kuldeep Neupane took a three-day trip from Ghorahi in Dang to visit Chaurikharka recently, and says: “This is an ideal trip to make a quick getaway and let nature recharge your mind and body. And it is much more fun with a tent, to watch the sunrise over the Himalaya or the mist blowing in.”

Visit Nepal in the monsoon

Two weeks ago, Prime Minister KP Sharma Oli announced jubilantly on social media that Nepal had achieved a historic annual growth of 81.8% in exports. He was right. Nepal’s trade did take a great leap forward compared to last year. But the dramatic rise was mainly due to processed soya bean oil.&nbsp; However, Nepal does not produce the edible oil it exports. In fact, the soya and palm oil that make up 44% of total exports are imported from Southeast Asia and South America, and simply re-exported, mostly to India.&nbsp; Under the SAFTA (South Asian Free Trade Area) Agreement, Nepal can export products to India duty-free if it has at least 30% value-added. Nepal’s traders have taken advantage of SAFTA even though the edible oils they export do not reach that value addition threshold. “The 30% value addition requirement is often only on paper,” says former commerce secretary Purushottam Ojha. “It is clear that simply packaging edible oils in Nepal does not fulfil the terms of the trade agreement.” Prime Minister Oli is aware of this, and even called Nepal’s export figures “fake” at an earlier event. The government is relying on other iffy figures to suggest that Nepal’s economy is strong and getting stronger. For example, the value of imports rose by 13.25% in 2024-25 compared to the previous fiscal year.&nbsp; Some of it was due to a jump in electric vehicle imports worth Rs 31.76 billion, but mostly it was because more wholesale soya oil was imported to be re-packaged and sold in India. The very fact that the government boasts about increased imports is an indication of how much it relies on taxing them for revenue. Touting such trade figures cannot be the basis to claim an economic rebound.&nbsp; “A jump in the value of imports can be interpreted as an increase in purchasing power, but it is not evidence of a stronger economy,” says economist Keshav Acharya. “Even though imports have increased, Nepal's domestic production and productive capacity have not improved.” Nepal Rastra Bank's semi-annual economic activity study report shows that industrial production was down in the first six months of the last fiscal year. This despite an increase in the number of new industries registered and investment commitments. Out of the Rs70.2 billion proposed foreign investment, Nepal received only Rs17.9 billion last year.&nbsp; Meanwhile, the rate of capital formation was limited to 24% last year, which is lower than the year before, suggesting that new investment, job creation and economic expansion all declined. If domestic production does not improve in relation to this year’s inflated trade figures, the outflow will put pressure on foreign exchange reserves like it did three years ago. At that time, Nepal borrowed from the IMF under its Extended Credit Facility Program to kickstart the economy.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2025080710084_2cdaaa5795828c4a7de93a0604ba884ef0a8b8f24cccd939f6c24e279ab6058f.jpg" data-media-id="editor_0" data-image-id="2025080710084_2cdaaa5795828c4a7de93a0604ba884ef0a8b8f24cccd939f6c24e279ab6058f" data-rendition-name="original" width="1633" height="723" loading="lazy" alt="Nepal's bubble economy NT"> <figcaption>Source: NEPAL RASTRA BANK</figcaption> </figure>  The macroeconomy is on firm footing with foreign exchange reserves at a comfortable Rs2,520 billion in May, up 23% from last year. This was largely due to remittances, and partly due to a falling NPR exchange rate. Real estate transactions and the stock market index have also been climbing as a result of government policies to revive the sector.&nbsp; However, former executive director of Nepal Rastra Bank Nar Bahadur Thapa cautions: “This is not organic growth, it is the result of deliberate policy decisions to relax rules on real estate and stock markets transactions.” In reality, the sharp rise in land prices have increased the cost of production, and excessive monetisation of the real estate has become the main source of Nepal’s economic woes. The central bank has announced a slew of new policies, shifting the terms of loan repayment for industrialists and entrepreneurs, reducing interest rates, and injecting more working capital — all designed to inject adrenaline into the real estate and stock market sectors.&nbsp; When he was governor, Mahaprasad Adhikari made several financial reforms during the latter half of his tenure to stimulate the economy, including tightening credit flow.&nbsp; By the last fiscal year, additional financial reforms had resulted in a credit expansion rate of around 8%. As the pace of credit expansion slows, real estate prices have started to fall. This is actually beneficial to the economy, because it lays the foundation for improvements in land-related entrepreneurship, production, and the construction sector. Just because real estate and the stock market transactions increase, it does not indicate an economic turnaround — especially when manufacturing and productive sector continues to languish.&nbsp; “It is foolish to believe that real estate and the stock market have magically revived our economy. Agriculture employs more than half of the population, but it is in decline. Investment in the productive sector has not increased, and job creation has not increased.” Two years ago, Nepal’s industrialists, business leaders, and political leadership predicted a recession amidst a sluggish business, declining market demand, large-scale job loss, and a shrinking real estate and share market.&nbsp; Still, the economy grew by 3.36% in fiscal year 2023/24. In fact, Nepal’s economy has grown nominally over the last two decades even when all sectors of the economy are in decline.&nbsp; Says Keshav Acharya: “The growth in trade, real estate, and the stock market are bubbles. The real economy remains stagnant.”

Nepal’s bubble economy

The final investigation report on the crash of a Saurya Airlines jet on 24 July 2024 at Kathmandu airport has revealed flaws in the carrier’s technical operation procedures, poor monitoring by the Civil Aviation Authority of Nepal (CAAN) and gaps in the airport’s emergency response. Eighteen people including a child were killed, and only the captain survived as the plane plunged seconds after takeoff, crashing within the airport perimeter. This was the latest in a series of aircraft accidents in previous years, and further tarnished Nepal’s already poor aviation safety record and contributed to the country being retained in the EU’s air safety list. &nbsp;&nbsp;&nbsp; The circumstances in the Saurya crash were different from the Yeti Airlines crash in Pokhara in January 2022 that killed all 72 on board, and two Tara Air crashes in February 2016 and May 2022 on approach to Jomsom that together claimed 45 lives. However, all four tragedies were a result of negligence of carriers and crew, failure to follow procedures, regulatory slackness, and overconfidence. The Saurya crash, especially, was a glaring example of how an ailing airline broke its own rules to allow passengers, including non-employees, a joy ride to Pokhara on a maintenance ferry flight. CRASH REPORT The Final Investigation Report prepared by the Aircraft Accident Investigation Commission and released on the first anniversary of the crash last week carried a long list of rules that were ignored or broken, and of regulatory failure. The first mistake was to cram spares, tools and inflammable chemicals needed for the aircraft’s C-Check in Pokhara into the cargo hold flouting its own ground handling procedures.&nbsp; There was no check-in of passengers, some of whom were not even employees – even though regulations say only flight and maintenance crew should be on board a maintenance positioning flight. Many brought their own luggage into the plane and stored it unsecured in the cabin. There was no flight attendant to give a safety briefing to passengers. The load and trim charts given to the flight crew were rough estimates, and the total takeoff weight of the plane was 18,300kg plus or minus 200 kg. That would still have been all right, but there was a glaring mistake in the speedchart Saurya pilots were using to calculate the minimum takeoff speed (known as VR), and it had been wrong ever since the 21-year-old aircraft entered service with the airline in 2017. FAULTY DATA&nbsp; The Commission probed Flight Data Recorder inputs from previous takeoffs of the Canadian-built CRJ200-LR in 2023-2024 and found that the undetected error in the speedchart had caused the plane to pitch up at an abnormal rotation rate at least 18 times on previous takeoffs.&nbsp; Any rotation rate more than 3°/sec is regarded as unusual. But on at least two occasions, this aircraft with tail number 9N-AME had rotation rates of 5.8°/sec and 5.5°/sec, the second one was when the pilot who survived was flying in March 2024.&nbsp; On this particular day, the plane’s rotation rate was 6.5°/sec, causing it to go into a deep stall soon after takeoff, the Commission report said. Essentially, the plane was not flying fast enough down the runway to take off safely.&nbsp; It is not yet clear whether excess weight, unsecured luggage, wrong centre of gravity were also factors, but relying on a faulty speedchart for the given takeoff weight, the captain flying pulled back on the yoke before the plane had reached takeoff speed and at a pitch angle that was too steep. The investigation report says the plane then went into a deep stall and started banking right with the stick shaking. At this point, the flight officer on the right hand seat is heard on the cockpit voice recorder saying: “Whoa, whoa, whoa. Sir, Sir, Sir…” It then banked left before the pilot flying turned the plane sharply to the right again in an evasive action to avoid the parking aprons of the international and domestic terminals. Had he not done so, there would have been a disaster of a much greater magnitude at Kathmandu airport that day. The plane scraped the runway with its right wingtip, collided with a container having helicopter spare parts, and plunged into a gully east of the runway, exploding in a fireball. The investigation also noted that the impact forces seemed to be survivable for some occupants. The fire trucks took unnecessarily long to reach the site even though it was inside the airport perimeter. The absence of an ICAO-standard runway strip, inadequate rescue drills, lack of training, and a blocked emergency service gate leading to the crash site were cited as other factors. &nbsp;&nbsp; <h2>Timestamp of a Disaster</h2>  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250731110724_39cdd04693994ce6e55a5b302905c0fa4884fe85bed21ff0779bb1439f3a5725.jpg" data-media-id="editor_0" data-image-id="20250731110724_39cdd04693994ce6e55a5b302905c0fa4884fe85bed21ff0779bb1439f3a5725" data-rendition-name="original" width="778" height="826" loading="lazy" alt="Flouting rules caused Saurya tragedy NT"> </figure>  11:10:34 - The Saurya Airlines CRJ200 on the takeoff roll from runway 02. It had a takeoff weight of about 18,300kg, but the pilot’s speedcard had a previously undetected mistake about the minimum takeoff speed. 11:10:55 -The plane with tail number 9N-AME goes into deep stall soon after takeoff because it does not have enough speed to lift its weight. The plane also has an abnormally steep nose-up attitude.&nbsp; 11:11:03 - Without enough speed to generate lift, the plane banks right, then left and right again in CCTV photos taken from the domestic apron (below). If it had not banked right, it could have hit the aprons and terminal buildings. Seen parked is Saurya’s other CRJ200 with tail number 9N-ANM.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250731110732_608132f7225c649125cca2691dd6a6bf930984c5b359e888d7ad9e5eacce3afd.jpg" data-media-id="editor_1" data-image-id="20250731110732_608132f7225c649125cca2691dd6a6bf930984c5b359e888d7ad9e5eacce3afd" data-rendition-name="original" width="770" height="555" loading="lazy" alt="Flouting rules caused Saurya tragedy NT"> </figure>  11:11:08 - The plane scrapes the runway with its right wingtip, and falls into the gully. The captain is thrown off the left side of the cockpit and survives. 11:11:15: Plane explodes in a fireball inside the airport perimeter. Firefighters take time to reach the site because of lack of access road and a blocked gate. Read the full investigation report <a href="https://www.tourism.gov.np/files/9N-AME%20AIC%20Final%20Report.pdf">here</a>.

Flouting rules caused Saurya tragedy

American artist Peter Makela was in Nepal in 2022 on a Fulbright scholarship when he experienced the Matya festival in Patan in which devotees made the rounds of the city’s shrines.&nbsp;
He joined the procession, walking through 2,600 stupa and 140 bahal of the town. That immersion left a lasting impression.
As part of Gallery Mcube’s international residency program in Patan, he put his inspiration to canvas in the exhibition Yala Yatra: Walking, Working, Worshipping. The exhibition also coincides with this month’s Matya festival.&nbsp;
Makela has visited Nepal often in the past 11 years but he mostly stayed in and spent his time around Boudha. “This time I stayed in Patan, put the sites I wanted to visit on my map, and off I went,” he tells us. “Each of my artwork is inspired by the stupas and shrines in Patan that I visited.”
The stupa and Ganesh are recurring motifs in his watercolours, and the elephant gods are located in chaityas — reflecting the interplay and blending of the Hindu and Buddhist faiths in Kathmandu Valley.&nbsp;
The stupas and Ganesh are painted in vivid red, yellow, blue and green against abstract backgrounds meant to represent the sky.
“I use the sky as a backdrop because the sky has no border,” says Makela. “The four colours represent the four elements, the different Buddha families and also lights bouncing off of a rainbow.”
The use of just four colours for all the artwork stands out, and combined with the absence of heavy canvases, frames or stands render Makela’s art striking in its simplicity.&nbsp;
The Ganesh is always holding something and the art also portrays the elephant god’s sacred vehicle, the mouse.
While his vibrant stupas and Ganesh reflect the tangibility of Patan’s tradition and heritage, it is as if the backdrops with their shades of grey and red and yellow capture the soul of the city’s shrines.
“If you look closely, there is a sense of form and formlessness at the same time,” he says.&nbsp;
Makela walked 108 kora around the shrines during his exploration of the town, and in the process developed a spiritual connection with Patan’s heritage and traditions.&nbsp;
The exhibition connects with visitors on a deeper, more spiritual, level as well. And with it, they feel a sense of pride as well as the need to urgently preserve Patan’s heritage for future generations.
“Peter’s inclination and approach towards Nepali art and culture is fascinating, and it reflects in his work,” says Mcube curator Manish Lal Shrestha, whose international artist residency program promotes Nepal’s cultural heritage. &nbsp;&nbsp;
Yala Yatra: Walking, Working, Worshipping
1-5 August&nbsp;
10AM-7PM
Gallery Mcube, Patan

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Walking, working, worshipping in Patan