<figure><img width="1500" height="1000" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109171144/636bd9a69c7e80680e080225jpeg.jpg" alt=""/><figcaption>Photo: BIKRAM RAI</figcaption></figure>Looking at the daily statistics from the Ministry of Health, the figures are alarming. Nepal is nearing the 100,000 Covid-19 cases mark, and this week the country overtook the total number of cases in China. <a style="font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/latest/coronavirus-in-nepals-corridors-of-power/" target="_blank" rel="noopener noreferrer">Kathmandu Valley has emerged as a major hotspot</a> since August-September and now accounts for one-third all Covid-19 deaths and over 61% of active cases nationwide. This is a dramatic about-turn from July, when the Valley accounted for only 4% of all active cases in Nepal. But by August it was up to 15%, and 34% in September.On Wednesday, Nepal recorded its highest number of positive cases on a single day with 3,439, out of which 1,684 were in Kathmandu Valley alone. Fifteen people died in the past 24 hours, bringing the total fatalities to 578. The number of active cases on Wednesday also crossed the 25,000 threshold, which the Ministry of Health had warned would overwhelm Nepal’s health infrastructure and a lockdown may need to be re-imposed. Currently, 233 patients are being treated in ICU and 37 are on ventilator support. Bagmati province has 127 patients in ICU and 25 on ventilators. <a style="font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/latest/local-governments-lack-resources-to-tackle-covid-19/" target="_blank" rel="noopener noreferrer">Nepal’s health infrastructure</a> is far from being overwhelmed by Covid-19 patients. There are an estimated 2,600 ICU beds in private and government hospitals nationwide, and of the 900 ventilators in hospitals 490 are in working order. The problem is that there is uneven distribution of these facilities. There are not enough ICU beds where they are needed most, and beds available in private hospitals tend to be unaffordable to most Nepalis. The <a href="https://www.nepalitimes.com/here-now/kcs-fast-highlights-nepals-covid-19-failure/" target="_blank" rel="noopener noreferrer">government’s 25,000 threshold</a> appears to be a deliberate strategy to convince people to adopt preventive measures to control the disease, since curative capacity is limited. In Wednesday’s press briefing, the Ministry of Health did not say anything about a re-imposition of the lockdown.  Bir, Teaching, Teku and Patan are the only government-run hospitals in Kathmandu Valley admitting seriously ill Covid-19 patients, and their limited capacity is getting saturated. All 20 ICU beds in Teku are occupied, so are 10 beds in Bir Hospital, 20 in Teaching and 22 in Patan that are set aside for Covid-19 patients.The Armed Police Force (APF) hospital also designated for Covid-19 care has a 20-bed ICU, but only half are in operation because of the lack of trained healthcare workers. Some private hospitals in Kathmandu Valley like Star, MediCiti, Grande, Norvic, HAMS and B&amp;B also admit Covid-19 patients, but these are expensive and have only a part of their total beds designated as Covid-19 wards. Because of the pandemic, many non-Covid-19 patients are not seeking treatment, and private hospitals are converting existing capacity to coronavirus wards to compensate for the loss of revenue. For Samir Adhikari at the Ministry of Health, the limiting factor is not ICU beds but adequate supply of oxygen. He says: “Most patients do not need to be in ICU or have a ventilator, they need oxygen and it is much more critical to ensure that there are enough cylinders.”Adding to the problem is that patients without major complications have also occupied ICU beds, there is a poor referral system, shortage of drugs, mismanagement of human resources and facilities.  <figure><img width="2306" height="1108" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109171144/636bd9a99c7e80680e080226jpeg.jpg" alt=""><figcaption> </figcaption></figure><figure><img width="2334" height="1084" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109171144/636bd9ac9c7e80680e080227jpeg.jpg" alt=""><figcaption> </figcaption></figure>Since June, more than 350 healthcare professionals have been trained by the National Health Training Centre in critical care, and are now working in various hospitals and institutions across the country, but not in ICU wards. “We submitted the details of the trained professionals to the ministry and it is now their responsibility to deploy them where they are most needed,” says director of the Centre, Yaduchandra Ghimire. The Ministry of Health sent a budget to all government hospitals to repair ventilators, install ICU beds and oxygen generators. However, it does not look like this has been done. Director General of Health Services Dipendra Man Singh says: "We have to move fast. At the rate <a href="https://www.nepalitimes.com/latest/coronavirus-in-nepals-corridors-of-power/" target="_blank" rel="noopener noreferrer">Covid-19 infection</a> is spreading, it is becoming increasingly difficult for even Kathmandu to manage the treatment of infected patients.” This situation was not unexpected. Last month, the Nepal Society of Critical Care Medicine had suggested the Health Ministry to establish 500-bed medical college with 50-bed ICU for a possible surge in symptomatic patients.  "Infected people are now dying at home without treatment. The infrastructure needed to treat critically ill patients has not been managed due to the conflicting interest of the leadership at the health ministry," says one doctor affiliated with the group. While Kathmandu Valley’s hospital capacity is stretched, <a href="https://www.nepalitimes.com/here-now/covid-19-lessons-for-kathmandu-from-the-tarai/" target="_blank" rel="noopener noreferrer">things have more or settled down</a> in Province 2 and Sudur Paschim Province that saw multiple peaks back in June-July (see graphs, above) following the return of migrant workers from India. Hospitals there were also overwhelmed then, but now able to manage patients. Additional reporting by Ramu Sapkota.

Sonia Awale

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As virus spreads, Kathmandu hospitals strain to cope

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110914110/636ba4b39c7e80680e07367fjpeg.jpg" alt="" width="1500" height="1000"/><figcaption>Children in Gai Jatra procession in Kathmandu on Tuesday even as the risk of COVID-19 looms over the capital. Participants have however taken to wearing masks as mandated by the government while partaking in festivals. Photo: MONIKA DEUPALA</figcaption></figure>Prime Minister K P Oli held a meeting with 20 public health experts on Tuesday to discuss steps to deal with COVID-19, especially in <a href="https://www.nepalitimes.com/latest/heightened-covid-19-risk-at-india-nepal-border/" target="_blank" rel="noopener noreferrer">cities bordering India</a> – a sign that his government is taking a recent surge in cases seriously.The meeting came as Nepal reported 259 new cases on Tuesday, taking the total number so far to 21,009 and the number of fatalities up by one to 58. Kathmandu Valley detected 62 new cases and now has 727 confirmed cases (481 active) with 5 deaths.The government this week put six districts with over 200 cases (Kathmandu, Rautahat, Kailali, Mahottari, Parsa and Doti) in the Red Zone. (see map) In Kathmandu, 72 staff at Nepal Police Headquarters have tested positive and the premises are sealed off.<a style="font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/editorial/lockdown-may-be-over-but-pandemic-is-not/" target="_blank" rel="noopener noreferrer">Lockdown may</a>be over, but pandemic is not, Editorial<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110914110/636ba4b69c7e80680e073680jpeg.jpg" alt="" width="1275" height="1650"><figcaption> </figcaption></figure>Speaking at the interaction, Prime Minister Oli said: “We must lower the infection rate to zero, and treat those who are sick. But as long as we keep the border open, there will be more cases ... so we have to test them before allowing them to travel to home districts.”Experts present noted that although the numbers are rising, the World Health Organisation (WHO) still puts Nepal in the ‘cluster spread’ stage, <a href="https://www.nepalitimes.com/editorial/lockdown-may-be-over-but-pandemic-is-not/" target="_blank" rel="noopener noreferrer">where the virus is not showing community transmission</a>. They advise the government against re-imposing a lockdown, saying it was not a long-term solution.Most public health experts favour a ‘smart lockdown’ where localities with cluster outbreaks are sealed off, and tested – while strictly enforcing masks in public places and preventing crowds.Since the lockdown was lifted on 21 July, the rate of infection has increased to 3.37%, indicating rapid spread in districts bordering India where all major cities like Birganj, Bitartnagar, Dhandagi, Nepalganj, Janakpur and Rajbiraj are under curfew.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110914110/636ba4b99c7e80680e073681jpeg.jpg" alt="" width="1265" height="822"><figcaption> </figcaption></figure>Officials in Kathmandu Valley are also said to be considering lockdown, but experts say it is more advisable to seal off neighbourhoods rather than a strict blanket closure.Medical experts fear that another shutdown is likely to kill more people than the disease it seeks to control, as people with non-coronavirus ailments cannot get to hospital for treatment, and the economy suffers even more, <a href="https://www.nepalitimes.com/latest/covid-19-leaves-millions-of-south-asian-children-hungry/" target="_blank" rel="noopener noreferrer">lowering nutrition levels</a> of people.Government figures show that there were <a href="https://www.nepalitimes.com/banner/children-are-collateral-damage-in-nepal-lockdown/" target="_blank" rel="noopener noreferrer">30% more child deaths in April-May</a> this year compared to last year. <a href="https://www.nepalitimes.com/here-now/birth-and-death-during-a-pandemic/" target="_blank" rel="noopener noreferrer">Maternal mortality has also gone up</a> because many more mothers gave birth at home instead of going to hospital. There has been a <a href="https://www.nepalitimes.com/here-now/meanwhile-a-measles-outbreak-in-nepal/" target="_blank" rel="noopener noreferrer">spike in measles</a> and other infections because of delays in vaccination campaigns.“A lockdown is not the solution to the coronavirus crisis. We must first analyse why we did not do the previous four months to take measures to control the spread,” says Sher Bahadur Pun of the Ministry of Health, “another lockdown will not make a difference.”Pun adds that uncontrolled movement of people across districts during the lockdown with thousands crossing the Indian border to reach their homes, led to the flare-up in the infection.“It is only going to get worse from here, especially as winter approaches,” predicts Buddha Basnyat of Patan Academy of Health Sciences. “We have to accept this and prepare for it, but another lockdown is only the last resort.”Basnyat says the government has to get on a war-footing to <a href="https://www.nepalitimes.com/editorial/open-and-shut-case/" target="_blank" rel="noopener noreferrer">increase testing in the Tarai districts</a> enforce mask-wearing and physical distancing, and as the number of severe cases rise, develop a treatment taskforce.Hospitals should be better equipped to handle the increase in symptomatic and severe coronavirus cases being seen now, with clear treatment guidelines identifying the most effective drugs and therapies for Nepalis, so there is no expensive over-prescription.As the ICUs get filled up, there is an urgent need for ventilators and oxygen concentrators, Basnyat adds. There are now 36 patients with COVID-19 across the country, with 23 in Bagmati Province, which includes Kathmandu Valley. Birganj is said to have reached saturation in ICU capacity, and hospitals in other Tarai cities are also filling up.Health experts say that while Nepal may not be able to build hospitals in a week like Wuhan did, the government can start mass testing in the high-risk zones, set up tents and ICU beds and stockpile life-saving drugs and medical equipment.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110914110/636ba4bd9c7e80680e073682jpeg.jpg" alt="" width="858" height="671"><figcaption> </figcaption></figure>Experts are also advocating for regular mass testing in cities with more movement of people. And if there is indeed another lockdown, they say testing in densely populated urban centres is a must.A recent surveillance based on swab samples of 10,000 of the people who entered Kathmandu Valley last week found that 0.7% of them tested positive for SARS-CoV-2. Despite this seemingly low positivity rate, health officials say that the finding is significant because those individuals would have been carriers in their families and communities.More worryingly, there is now a rise in cases with serious symptoms across Tarai districts, unlike in the past when most were asymptomatic or had co-morbidity. Hospitals in the Tarai are seeing a surge of typical COVID-19 symptoms with advanced pneumonia.“Most hospitals and doctors in Nepal are now starting to feel the devastation this virus can cause, as it did in Lombardy, New York and parts of India,” says Buddha Basnyat. “Which is why despite low fatality rate in this part of the world and the concept of herd immunity, there is no time to be complacent.”A rise in influenza in the rainy season could also be a reason for misdiagnosis because flu and COVID-19 have similar symptoms. Experts suggest flu to be tested with COVID-19, especially as winter approaches.But even with all the planning in the world, strategies, drugs and medical infrastructure, the most effective tools against the virus are the three <a href="https://www.nepalitimes.com/opinion/prevention-while-searching-for-a-cure/" target="_blank" rel="noopener noreferrer">simple safety measures</a>: physical distance, masks and hand hygiene.Says Sher Bahadur Pun: “Testing, tracing and treating are important. Government action is crucial. But how strictly Nepalis follow safety guidelines and adapt it into their everyday lives will make the most difference.”

Experts caution against extending Nepal lockdown

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

Nepal is graduating to become a developing country on 24 November 2026 after half-century in the Least Developed Country (LDC) category. By 2030, the country hopes to transition to middle-income status.&nbsp; Everone from Prime Minister K P Oli have boasted that this is a matter of national pride, and will have a multiplier impact on trade and economy.&nbsp; But will it make any difference to the average Nepali? Not unless improved governance <a href="https://nepalitimes.com/news/why-invest-in-nepal">spurs investment and creates jobs</a>.&nbsp; Countries need to meet at least two of the three criteria in two consecutive triennial reviews to be eligible for graduation from LDC. Nepal has consistently met the thresholds for the Human Assets Index (HAI) and the Economic and Environmental Vulnerability Index (EVI) in 2015, 2018, and 2021. But Nepal was recommended for graduation before meeting the per capita <a href="https://nepalitimes.com/banner/nepals-great-income-divide">Gross National Income (GNI)</a> threshold of $1,306. “A major implication of LDC graduation is the loss of preferential market access available through Generalised System of Preferences (GSP) and other arrangements,” explains economist Sameer Khatiwada. “But over two-thirds of <a href="https://nepalitimes.com/news/nepal-doesnt-produce-its-2-biggest-export-items">Nepal’s exports</a> are to India, and the preferential market access to India is through a bilateral trade agreement. This has nothing to do with our LDC status.”  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250815060832_f5eabe7628a8cdf84f33b25d7cef3c4dc8913a26d8e5b253ea52a36e176b8a85.jpg" data-media-id="editor_3" data-image-id="20250815060832_f5eabe7628a8cdf84f33b25d7cef3c4dc8913a26d8e5b253ea52a36e176b8a85" data-rendition-name="original" width="640" height="470" loading="lazy" alt="LDC graduation "> </figure>  Furthermore, a provision under the South Asian Free Trade Area (SAFTA) allows Nepal to export to India duty-free if the items are at least 30% value-added. Nepali traders take advantage of this by re-exporting edible oils without meeting that requirement, falsely boosting Nepal’s exports.“ Following graduation from LDC, the value addition threshold might increase to 40%,” says Kalpana Khanal of the Policy Research Institute. “This is supposed to work to our advantage, because on paper value addition inherently means <a href="https://nepalitimes.com/multimedia/staying-home-to-create-jobs">job creation at home</a>.” But Nepal’s exports to other major destinations will face <a href="https://nepalitimes.com/news/nepal-and-the-us-india-tariff-tiff">tariff increases</a> with the graduation. A South Asia Watch on Trade, Economics and Environment (SWATEE) study shows that while tariff increase in the US market is relatively low (see page 5) it is considerably higher in Europe. The International Trade Centre (ITC) in a 2022 study also estimated that graduation could result in a 4.3% decline in Nepal’s projected exports, but this is excluding the impact of changes in ‘rules of origin’ provisions in preference-granting countries such as the UK and Europe.&nbsp; Nepal’s top export to these preference-granting countries is <a href="https://archive.nepalitimes.com/news.php?id=1482">carpets</a>, and will not be impacted, but other items such as textiles and apparel will be heavily affected due to higher cost of production. The impact will felt mostly by small and medium enterprises which represent the largest share of exports to LDC-specific preference-granting countries. As for the service exports, Nepal never really made use of the World Trade Organization’s LDC services waiver anyway, hence the effect will be minimal, if any. There is also concern about Nepal’s graduation at a time when the global economy is topsy-turvy, amidst <a href="https://nepalitimes.com/opinion/turning-point-in-us-india-relations">tariff wars and conflicts</a>. This affects Nepalis abroad directly and may impact <a href="https://nepalitimes.com/news/more-remittance-more-than-remittance">remittances </a>which hit $11 billion in 2024. In comparison, Nepal only received $350 million in foreign loans and grants last year.&nbsp; Tourism arrivals have finally reached pre-pandemic levels, but bad publicity about pollution, poor infrastructure and bureaucratic hurdles hinder further growth. Manufacturing continues to struggle, while hydropower and the IT sector have taken off.&nbsp; “Look at data -- <a href="https://nepalitimes.com/news/tourism-needs-a-new-push">tourism arrivals</a> are up, spending is up, IT exports are up, <a href="https://nepalitimes.com/news/why-nepal-needs-to-restore-ev-tax-subsidy">EV sales </a>are up, Europe still needs 85-90 million skilled workers. We are sitting on $16 billion in cash reserves, our balance of payment, foreign exchange reserve, tax to GDP ratio, credit flow are all positive, we have to build on these factors,” says Sujeev Shakya of the Nepal Economic Forum. He adds: “Our mindset creates negativity to promote rent-seeking behaviour, but this cynicism will go away after 2026 with LDC graduation. We must deal with data, look at trends, and projects which will bring in <a href="https://nepalitimes.com/from-the-nepali-press/why-there-is-no-foreign-investment-in-nepal">international investments</a>.” Khanal agrees that investment is not dependent on<a href="https://archive.nepalitimes.com/regular-columns/backside/Nepal-not-the-least-developed-country,306"> LDC status</a>. The factors that that affect investment are policy stability, a strong legal framework, market potential and ease of doing business. She adds, “That is where our focus needs to be, and we need to retain <a href="https://nepalitimes.com/diaspora-diaries/migrant-worker-returns-to-create-work-at-home?fbclid=IwAR09xJfsClCwn8uRVAmz28CU658vdKpuyDwB_b1sNlvKtAFFnSldnA0JS2g">Nepalis with jobs at home</a> for our sustained growth.” After 2026, financing support from donors and aid agencies could be affected and Nepal will no longer be able to access Least Developed Countries Fund (LDCF) to adapt to the impacts of climate change. But the Global Environment Fund and Green Climate Fund will still be available.“ LDC status does not determine bilateral development aid, that is usually driven by broader <a href="https://nepalitimes.com/here-now/looking-beyond-two-boulders">geopolitical considerations</a>,” says Sameer Khatiwada. “The World Bank and Asian Development Bank, which provide concessional loans to Nepal, it is determined mainly by per capita income, not LDC status.” &nbsp;However, Nepal may lose some concessional terms for loans. Nepal is currently a lower-middle-income country as per the World Bank in the bracket for GNI between $1,036 and $4,045. The country is already receiving more loans than grants and in July the World Bank increased its interest rate on loans by 100% from 0.75 to 1.5%. “All this means that the impact of LDC graduation for Nepal might not be as earth-shattering as some tend to think. Countries that have recently graduated, such as Botswana and the Maldives, have shows that graduation is just a step in a country’s development path,” says Khatiwada. Sujeev Shakya also sees the glass as half full, explaining that LDC graduation is just a stepping stone if Nepal has the right policies in place. He adds, “Nepal’s biggest advantage is our<a href="https://nepalitimes.com/opinion/investing-in-people"> working age population</a> and we have investments coming in. These aided by how adaptive we are as a society are the very foundations on which Nepal will grow.”

Not poor, but not rich

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>.

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