Nepal’s leaders often make grandiose promises that they will turn the country into Switzerland within a decade. We will be lucky if Nepal could even attain the per capita GDP of Swaziland.
Becoming another Switzerland or Singapore is the boastful fantasy of <a href="https://nepalitimes.com/editorial/politics-as-usual">incompetent serial politicians</a> who keep getting themselves elected again and again.&nbsp;
So, what has to change?&nbsp;
It has to be <a href="https://nepalitimes.com/here-now/looking-ahead-to-nepal-s-2027-elections">through elections</a>, but there is spreading distrust of the democratic system bordering on nihilism among Nepalis. The three main parties must have sensed by now that they are doomed if they do not get their act together and inject new untainted blood into tickets in 2027.&nbsp;
One election will not clean up the muck that has accumulated over the past 35 years, but we have to start with the next one. Politics cannot be business as usual any more, voters are fed up with what is on offer.&nbsp;
Over <a href="https://nepalitimes.com/news/push-factors-driving-nepalis-out">one-third of young Nepalis are not even in Nepal</a>, and they are not allowed to cast their ballots. But we saw in 2022 that the diaspora can have an impact on how their folks vote back home, and this trend is bound to increase in 2027. It would finally break the vote banks on which the established parties have relied on to perpetuate misrule.
Nepal needs solutions urgently to address snowballing crises on multiple fronts: social inequity, joblessness and low purchasing power, failing agriculture, breakdown of services, a pandemic of corruption feeding mal-development, low capital formation, environmental woes, and to top it all off — a runaway climate emergency.&nbsp;
Yet, there are bright spots, many of which happened despite political instability: falling poverty rate, improved health and education status, increase in forest cover, conservation successes, growth in hydropower.&nbsp;
Just imagine how much further ahead Nepal would be if it was not plagued with chronic mismanagement, <a href="https://nepalitimes.com/opinion/higher-corruption-in-high-places">corruption and conflict</a>.
It is because of these modest gains that <a href="https://nepalitimes.com/news/not-poor-but-not-rich">Nepal will graduate</a> from a ‘least-developed’ to a ‘developing country’ in November 2026, and transition to middle-income status by 2030 — even though it still has an annual per capita income below the $1,306 threshold.
The driving force for this growth comes almost entirely from remittances which make up 26% of the GDP — the third highest in the world. Inflows officially hit $12.54 billion last year, and nearly 65% of households depend on money <a href="https://nepalitimes.com/editorial/the-new-equaliser">family members send home</a>, spending most of it on basic needs.
A recent discussion at the Institute for Integrated Development Studies (IIDS) titled Diaspora Dialogue: Innovation, Identity and Global Influence looked at leveraging the 4 million Nepalis who live and work abroad to spur investment and growth.
IIDS has been involved since 1979 in policy advocacy to propose sustainable solutions to governments under at least four different political systems. The fact that we are in the state we are in now must mean that not many of the policy priorities the IIDS put forward in the past 40 years have been properly implemented.&nbsp;
For decades, we’ve heard that Nepal’s path to economic growth lies in <a href="https://nepalitimes.com/opinion/people-power/nepal-can-level-up-tourism-with-electricity">hydropower and tourism</a>, but that narrative has to change, noted IIDS Executive Director Biswash Gauchan.&nbsp;
“Forget falling water, forest and forex,” he said. “Nepal has to move to a knowledge economy, boost investment and look beyond our neighbours to the diaspora.”&nbsp;
There is an artificial bubble in real estate and banking due to remittances. Even if Nepal gets 3 million tourists a year and exports most its hydropower it will not be enough to take the annual per capita income to $6,000 by 2050.
A knowledge economy means thinking beyond enrolment rates and basic literacy to quality education relevant to the <a href="https://nepalitimes.com/opinion/investing-in-people">human resources the country needs</a>. This will ensure jobs at home in import-substitution agriculture, value-added manufacturing and export of services.
And that is where global Nepalis come in. Connectivity means the end of geography, and diaspora talent and capital can be harnessed for investment and involvement in innovation to take Nepal into a <a href="https://nepalitimes.com/here-now/smart-ageing-is-nepal-s-next-frontier">digital future</a>.&nbsp;
This needs a paradigm shift away from a rent-seeking state to a ‘whole-of-government’ strategy that can only come from a new crop of competent technocrats with integrity and vision to seize the moment. They have to see migration not as 'brain drain' but as 'brain circulation'.
Those Nepalis exist. In Nepal and all over the world. Swaziland’s anuual per capita income is $4,000 — think we can do it <a href="https://nepalitimes.com/here-now/nepal-in-2050-wk6r5r1j">by 2050</a>?
Kunda Dixit

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Size does not matter

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.” This Editorial is brought to you by <a href="https://nepalitimes.com/" target="_blank">Nepali Times</a>, in collaboration with <a href="https://inpsjapan.com/en/" target="_blank">INPS Japan</a> and <a href="https://sgi-peace.org/" target="_blank">Soka Gakkai International</a>, in consultative status with UN ECOSOC.

Sonia Awale

Not poor, but not rich

One of the greatest obstacles to better jobs and faster <a href="https://nepalitimes.com/news/nepal-s-bubble-economy">economic growth in Nepal </a>today isn’t a shortage of natural resources, challenging geography, or limited access to finance. It is the unrealised potential of its people—not due to a lack of talent, resilience, or ambition, but because the country has not invested enough to unlock that potential.
Too many <a href="https://nepalitimes.com/here-now/no-country-for-young-men-c89lgrrl">young Nepalis </a>are growing up without the quality education, healthcare, and skills needed to succeed in the modern economy—especially those in <a href="https://nepalitimes.com/editorial/not-rising-nepal">poorer and more remote areas</a>. As a result, much of Nepal’s human capital remains underdeveloped and underused, reinforcing <a href="https://nepalitimes.com/editorial/institutionalised-inequality">inequality</a> and holding back productivity, innovation, and inclusive growth.
This is not a challenge unique to Nepal. Around the world, successful economies are not those that only have abundant <a href="https://nepalitimes.com/opinion/working-with-nature-to-protect-people">natural resources</a>, but those that invest early and consistently in their people by ensuring access to <a href="https://nepalitimes.com/banner/after-quantity-nepals-education-needs-quality">quality education</a>, <a href="https://nepalitimes.com/banner/altruistic-healthcare-models-in-nepal">healthcare</a>, and nutrition. These are the building blocks for accumulating human capital.
When these foundations are strong, countries benefit from a more productive workforce, healthier communities, and faster economic growth. But when these investments are neglected, entire generations are left behind, trapped in cycles of low productivity and limited opportunity.
A new World Bank report—the <a href="https://www.worldbank.org/en/country/nepal/publication/nurturing-nepali-talent-to-foster-economic-growth-a-human-capital-review-for-nepal" target="_blank">Nepal Human Capital Review</a>—finds that a child born in Nepal today is expected to achieve just 51% of their full productivity potential by age 18.
Limited access to quality education, healthcare, and nutrition means that half of a child’s productivity potential remains unrealised. This is more than a missed opportunity for the child— it represents a significant productivity loss for the country’s long-term growth.
Beneath this national average lie even deeper inequalities. Imagine two children born on the same day in 2020—one in the<a href="https://nepalitimes.com/here-now/the-karnali-s-hunger-emergency"> remote hills of Karnali</a>, the other in the more urban and better-connected areas of Bagmati, near the capital.&nbsp;
The child in Bagmati is far more likely to attend a private school or benefit from better education and health services, thanks to higher household incomes and greater availability of providers. In contrast, the child in Karnali is more likely to rely solely on the public system, which remains under-resourced and overstretched.
The statistics are striking—a child born in Karnali is expected to reach just 46% of their productivity potential, which is well below the average for lower-middle-income countries. Meanwhile, a child born in Bagmati is expected to reach 58% —a level comparable to upper-middle-income economies.&nbsp;
These differences stem not just from geography, but from unequal access to quality services—whether public or private. They reflect a public system struggling to deliver quality services for all, and one that families with more resources are often able to supplement through private investments. These are not just numbers, they are life trajectories—shaped not by ability or ambition, but by the simple event of where a child is born and raised.
Even for those who manage to build their human capital, the labour market often fails to reward their efforts. Given the difficulties of finding a good job, a child born in Nepal today is expected to realise just 18% of their productivity potential—one of the lowest rates in the world. The reason is simple: there are too few quality jobs.
Read also: <a href="https://nepalitimes.com/news/brain-gain-into-brain-drain">Brain gain into brain drain</a>, Sonia Awale
Between 2010 and 2018, only four in ten new entrants to the working-age population were able to secure paid employment. Most jobs are informal, low-paid, and offer little in terms of security or career growth. The situation is especially challenging for young people—more than a third of those aged 15 to 24 are not in education, employment, or training. And for women, <a href="https://nepalitimes.com/review/the-women-left-behind">labour force participation</a> remains stubbornly low at just 29%, about half the rate of men.
Nepal’s low levels of human capital—combined with the wide gap between the number of people seeking work and the availability of jobs—pose a serious threat to the country’s long-term growth and social inclusion.
SHAPING A FUTURE
To change the course of Nepal’s human capital trajectory and lay the foundation for a more prosperous future, public investments in education, health, and social protection must increase while ensuring that every rupee is spent effectively and reaches those most in need. Closing the gap in access to quality services—especially for those who rely exclusively on public provision—must be a top priority.
Investments must be targeted so that every child—regardless of where they are born—has access to early learning opportunities, qualified teachers, textbooks, nutritious meals, and basic health services. These are the corner stones to build human capital.
Just as important as building human capital is ensuring there are job opportunities. Over the next three decades, Nepal will need to create 6.5 million jobs just to keep up with its expanding working-age population. Therefore, the need to accelerate job creation at scale has never been more urgent.&nbsp;
This requires more than business as usual. It calls for a fundamental shift from short-term fixes to long-term, <a href="https://nepalitimes.com/news/why-invest-in-nepal">strategic investments </a>in people and systems and by making Nepal a better place to invest, by Nepalis and foreigners, alike.
Creating jobs in Nepal must be a combination of efforts to simultaneously build a workforce with the skills for the 21st century while simultaneously making the policy reforms and investments to let the world know that Nepal is, truly, “open for business”.
Today, too many young people leave school without a clear path into the workforce—and that needs to change. Boosting youth employability demands stronger links between training and labour market needs, expanded reskilling programs, and developing public-private partnerships that deliver modern, relevant skills.
Young people must be equipped with quality technical and vocational education, digital skills, and lifelong learning opportunities—especially in underserved communities. These must become core elements of Nepal’s education system if the country is to be competitive in an increasingly fast-moving, technology-driven economy.
The future of a Nepali child should not be determined by whether they are born in Karnali or Bagmati. This is a moment for bold action. Investing in people is not just the right thing to do, it is the smartest strategy for creating jobs, driving growth, and building a more inclusive economy where all young Nepalis can thrive.
David Sislen is the World Bank Country Division Director for Maldives, Nepal, and Sri Lanka.

Investing in people

It is the same every year. Just as the <a href="https://nepalitimes.com/banner/now-the-economy-stupid">finance minister prepares to deliver his budget</a>, there is a last minute spending spree across the country to disburse as much money as possible before the fiscal year ends in July.
The habit even has a pejorative Nepali phrase: असारे विकास, the frantic last-minute resource execution. But every year, even after all that eleventh-hour expenditure, the budget remains woefully underspent. &nbsp;
Nepal’s budget is classified into three parts: current expenditure for administrative spending, capital expenditure for long-term <a href="https://nepalitimes.com/here-now/protecting-protected-areas-from-infrastructure?fbclid=IwAR1wK0MDFlFST_2EYb3f54LS4-fPt6rYfLG1DJ1JaQsU3w8-ezyXIxGOqzk">development and infrastructure</a>, and debt servicing.
Current <a href="https://nepalitimes.com/news/till-debt-do-us-part">expenditure and debt servicing</a> account for a significant portion of government spending, leaving little money to improve roads, build facilities and buy equipment. But every year for the last nine years, the government underspent by an average of 35.3%. &nbsp;&nbsp;&nbsp;&nbsp;
Till Wednesday, the three layers of government had spent only 66% of the total budget of Rs1.8 trillion, and 37% of its Rs352 billion development budget. Where does all that unspent money go?&nbsp;
Unused funds from some ministries go back to the national treasury. But Nepal has a revenue shortfall, and there is a tendency to allocate funds without ensuring resource availability.&nbsp;
“The main reason Nepal is unable to spend even the money allocated for development is because projects are not prioritised properly,” explains economist Kalpana Khanal.&nbsp;
The National Planning Commission’s (NPC’s) Project Bank is tasked with selecting national projects for <a href="https://nepalitimes.com/news/unique-hospital-handover-in-dolakha">public-private partnership</a> investments and ranking them into three tiers based on priority. &nbsp;
Per the classification, the standards for Priority 1 projects include a completed Detailed Project Report and Environmental Impact Assessment report, as well as land acquisition guarantees. But these are just on paper, which means resources are diverted to politically expedient projects or those not fully developed. &nbsp;&nbsp;
Furthermore, Nepal’s procurement mechanism involves choosing the lowest bidder, which presents domestic barriers since contracts are stretched beyond capacity and expertise. This is compounded by the quick turnover of skilled administrative and technical staff, and project managers.&nbsp;
Then there is over-regulation. Budget expense categories are rigid, which limits the ability to reallocate funds where they are needed.&nbsp;
In October 2024, a High-Level Commission on Economic Reform, was formed to assess <a href="https://nepalitimes.com/news/nepal-in-the-red">the country’s overall economic situation </a>and provide recommendations. Khanal was a member of the commission, and says it remains to be seen whether their suggestions are implemented in the budget.&nbsp;
“We must first properly identify national priority projects, strengthen our internal capacity and human resources, diversify our procurement process, and ensure oversight agencies focus on monitoring and evaluation without over-regulating,” says Khanal. “For this, we need both political and bureaucratic integrity.”
That is a polite way to say that there is too much <a href="https://nepalitimes.com/here-now/nepals-only-growth-industry-private-sector-corruption">corruption and cronyism</a>. Case in point: discussions surrounding the new budget took a backseat this week as Home Minister Ramesh Lekhak was embroiled in a scandal involving payoffs for Nepalis leaving on visit visas.&nbsp;
Opposition parties including the Maoist-Centre and the RSP obstructed Parliament and demanded Lekhak’s resignation. The scandal has already led to the removal of and an investigation into Chief Immigration Officer Tirtharaj Bhattarai.&nbsp;
This is reminiscent of last year’s budget presentation by Prime Minister Puspha Kamal Dahal’s government. The Nepali Congress, which was then in opposition, similarly obstructed Parliament and demanded the resignation of Home Minister Rabi Lamichhane citing his involvement in a cooperatives fraud.&nbsp;
Home Minister Lekhak, who was not able to explain himself in Parliament, held a press conference to deny any wrongdoing. Despite obstruction, opposition parties said they would allow the budget to be presented, and the Finance Minister is presenting the budget in Parliament on Thursday.
29 May was also Republic Day, and marked symbolically by the monarchist RPP to launch a campaign of<a href="https://nepalitimes.com/news/republicans-and-royalists-on-nepal-s-streets"> pro-royal rallies in the capital</a>.
The budget comes as the government faces a revenue crunch, as well as the loss of funding for the social sector because of the <a href="https://nepalitimes.com/news/how-usaid-cut-affects-nepal">USAID cutoff </a>and <a href="https://nepalitimes.com/news/the-great-game-2nd-half">shrinking donor aid</a>. Rights-based programs related to gender, health, and education will suffer. Common sense would dictate that the unspent funds in the next budget be quickly reallocated to health and education. &nbsp;&nbsp;
Says Khanal: “Once the budget is allocated, the budget cycle must be improved— the tendency to overspend towards the end of the fiscal year must be minimised.”&nbsp;
Read also: <a href="https://nepalitimes.com/opinion/how-nepal-can-budget-wisely">How Nepal can budget wisely</a>, Siddhartha Rayamajhi

Shristi Karki

Understanding Nepal's underspending

I have just finished reading the recently published Cuckooland: Where the Rich Own the Truth, by Tom Burgis that was <a href="https://nepalitimes.com/here-now/nepal-s-crony-communism-exposed">recently reviewed in this paper</a>, and examines the phenomenon of corruption across several continents, and the career of powerbroker Mohamed Amersi. 
In the Nepal section, the focus is on Amersi’s links with prominent Nepali ‘businessman’ <a href="https://archive.nepalitimes.com/news.php?id=776#google_vignette">Ajeya Sumargi</a>, the activities of the Nordic telecommunications giant TeliaSonera and its Nepali network Ncell, and Amersi’s relationship first with <a href="https://nepalitimes.com/banner/food-of-the-royals">the royal family</a> and after 2006, with certain prominent politicians, including the <a href="https://nepalitimes.com/banner/all-is-fair-in-war-and-peace">Maoist </a>leader formerly known as ‘Prachanda’.
It is well recognised in Nepal that <a href="https://nepalitimes.com/editorial/nepal-s-corruption-carousel">corruption</a> in high places is one of the major features of Nepal’s political economy. In February, while I was visiting Kathmandu for the first time in five years, there was an editorial in The Kathmandu Post headed ‘Rotting from the Head’ which suggested that ‘frustration with corruption, mismanagement and bad governance is reaching a boiling point’.
The latest Transparency International report showed that the corruption perception index (CPI) for Nepal was 34 out of 100, marginally lower than the previous year. In the review period, <a href="https://archive.nepalitimes.com/news.php?id=15139">Prachanda</a> (the CPN Maoist Centre chair Pushpa Kamal Dahal) was prime minister until mid-July 2024 when he was replaced in the merry-go-round of <a href="https://nepalitimes.com/news/the-geopolitics-of-nepal-s-politics">Nepali politics</a>, by UML chief K P Oli, the current prime minister.
Several decisions of the <a href="https://nepalitimes.com/banner/left-led-coalition-upturns-nepal-politics">Oli-led government</a>, including one to build his party’s central office with funds from <a href="https://archive.nepalitimes.com/news.php?id=5082">Min Bahadur Gurung of Bhatbhateni</a> and the Giribandhu Tea Estate scam related to the illegal <a href="https://archive.nepalitimes.com/regular-columns/This/peaceful-land-movement,658">use of land</a> exceeding the prescribed ceiling, were just the latest <a href="https://nepalitimes.com/news/ciaa-traps-small-fish-lets-big-ones-go">corruption cases </a>linked to the prime minister.
Pushpa Kamal Dahal claimed that the two other major parties, the Nepali Congress (NC) and the UML had plotted his removal because of his ‘campaign against corruption’, but he himself was compromised by colleagues like <a href="https://nepalitimes.com/banner/the-rise-and-fall-of-comrade-mahara">Krishna Bahadur Mahara</a>, who was implicated in a gold smuggling case and, arguably, by his own dealings with Ajeya Sumargi and TeliaSonera, that are discussed by Tom Burgis in Cuckooland.
The <a href="https://nepalitimes.com/banner/rsp-quits-nepal-coalition">Rastriya Swatantra Party (RSP) </a>emerged dramatically as the fourth largest party in the House of Representatives in <a href="https://nepalitimes.com/news/nepals-local-polls-a-rehearsal-for-federal-elections">2022</a> on a platform of <a href="https://archive.nepalitimes.com/news.php?id=5944">corruption control </a>and <a href="https://archive.nepalitimes.com/regular-columns/Comment/compassion-better-governance-Nepal-development,299">good governance</a>. But its president, <a href="https://nepalitimes.com/news/the-rise-and-fall-of-rabi-lamichhane">Rabi Lamichhane</a>, had been suspended as a lawmaker and faces charges of embezzlement of the deposits of cooperatives in five districts.
Other politicians also, including former NC home minister Balkrishna Khand, who was only released on bail after detention on the charge of sending Nepalis as <a href="https://nepalitimes.com/opinion/comment/scapegoating-a-champion-of-democracy">fake refugees from Bhutan</a> to the United States, and former prime ministers Baburam Bhattarai and Madhav Kumar Nepal (now leaders of their own small parties) were considered not to be ‘above question’ with regard to illegal sales of government land at Lalita Niwas.
On 20 March 2025, the East Asia Forum published a piece by Anil Sigdel, founder of Nepal Matters in Washington DC, lecturer at the University of Vienna and author of India in the Era of China’s Belt and Road Initiative: How Modi Responds to Xi. He looked back on the previous year and suggested that corruption and crisis defined Nepal’s <a href="https://nepalitimes.com/editorial/south-asia-2040-qxr16oup">2024</a>.
In addition to the <a href="https://nepalitimes.com/news/poor-cash-rich-nepal">dire state of the economy</a>, stagnant <a href="https://nepalitimes.com/news/nepal-economy-shifts-away-from-farming">agricultural production</a>, the virtual absence of industry, massive<a href="https://nepalitimes.com/here-now/the-geopolitics-of-nepal-s-water-and-electricity"> trade deficit especially with India</a> and crippling <a href="https://nepalitimes.com/editorial/the-new-equaliser">reliance on remittances</a> from <a href="https://nepalitimes.com/here-now/nepal-on-my-mind">Nepalis living and working abroad</a>, Sigdel highlights the sclerosis, the pervasive corruption and the rent-seeking of the political elite, and the phenomenon of what might be termed ‘the abuse of public trust for private gain’ -- a definition of corruption provided by Tom Burgis.
Now, Nepal has introduced a fresh provision in its newly-amended <a href="https://nepalitimes.com/opinion/anti-corruption-vaccine-for-nepal">anti-corruption</a> law that will penalise public officials not only for the abuse of power but also for their inaction or indecision. The amended Anti-Corruption Act 2002, which took five years to pass through the federal parliament, has now come into effect following presidential approval. Offenders could face up to six months detention or a fine of up to Rs50,000, or both. 
The Act also imposes up to a year’s imprisonment or a fine of Rs500,000, or both, for officials found guilty of abusing their official position or duties. But this amendment is directed essentially at <a href="https://nepalitimes.com/opinion/comment/nepals-uncivil-servants">civil servants</a>, and does little to deal with those in high places, <a href="https://nepalitimes.com/news/the-business-of-politics-in-nepal">politicians and businesses</a>, who continue all too often to abuse public trust for private gain.
Is it too much to hope that continued pressure from the public and scrutiny by the media will not only bring to light corruption where it exists but gradually reduce its incidence? 
David Seddon is Director of Critical Faculty, author and co-author of many publications on Nepal, including Nepal in Crisis (with John Cameron and P M Blaikie) first published in 1980.

Higher corruption in high places

https://www.youtube.com/watch?v=uNdMuD_4yGwTim Gocher, Founder of the Dolma Impact Fund, speaks to Nepali Times Studio.Nepali Times: It looks like you have quite a soft spot for Nepal.Tim Gocher: I first came here in 2003 and just like for a lot of westerners, there was something magical here for me. And, over the years, I have begun to put my finger on what that magic is. I almost found what I was looking for in a remote Himalayan village. But I have to say the real magic was my wife Pooja Gurung who I met in Dhunche during a trek 15 years ago. I have never looked back.And how did the Dolma Impact Fund come about?It was not a business to begin with, it was the love for the country. I had met a girl named Dolma, she was nine, but not going to school. I sponsored her education, and that grew into the <a href="http://www.dolmafoundation.org/">Dolma Foundation</a> which still educates hundreds of children. I lived a double life. I had this voluntary charity while also working for investment banks in Singapore, London, and New York. I wanted to bring the two together – to bring the power of markets and capital to stimulate sustainable growth. It took us three years to persuade anybody to invest in the first private equity fund for Nepal. I got laughed at in quite a few offices.Which sector do you think is most critical for Nepal’s economic development?I don’t think we at <a href="http://www.dolmaimpact.com/">Dolma Impact Fund</a> are focused in any one sector. The underlying fundamentals for infrastructure are holding companies back. So we have invested in two hydro power projects and I was going say how great the political stability is till … (Laughter, as a political demonstration passes the street outside).How did the <a href="https://www.nepalitimes.com/here-now/nepal-turns-to-solar-and-batteries-to-meet-peak-demand/">transition to peak demand generation from solar</a> happen?We saw companies across the board operating at this cost disadvantage, and wanted to use new energy technology to help with domestic energy production. Solar and battery costs are going down. We can provide through Dolma Himalayan Climate Fund a solution which is very similar to seasonal hydro storage where they would deliver power on as needed basis in the dry season by storing water in summer. The beauty of it is speed. Big hydro storage plants take a long time to build, but solar can be built in two years. It is not going to replace hydro, but it does give Nepal another energy option to offset some of the imports from India.How do you see the political and economic future of Nepal?I certainly won’t tell you how I see the political future of Nepal, none of my business. But I will tell you a bit about business future. Do you want the bad news first, or the good news?Bad news?I have invested and done business in many countries, and there is obviously need for reform. We tend to see some restrictive things. Things that are meant well actually might stop the initial investment growth, job creation, prosperity. But it doesn’t stop us, we were certainly well aware before we came in. We now provide employment in our portfolio companies to 3,000 people. If that’s the bad news the good news must be really good.This is not a small country, it has the population of Malaysia. There is rarely a place where the regulations are perfect. Where else do you get to meet the ministers and governors, and they will hear you out. They are not always going to act, but sometimes they do. It is not all not mapped out for us business people and as investors it is risky. But you also feel like you are a part of something bigger. It’s not just about the money. If was just about the money I would still will be in London or New York.Read also: <a href="https://www.nepalitimes.com/here-now/nepal-turns-to-solar-and-batteries-to-meet-peak-demand/">Nepal turns to solar and batteries to meet peak demand</a>, Kunda Dixit

“A part of something bigger”

<a href="https://nepalitimes.com/news/ball-in-balen-s-court">Nepal’s newly-installed Prime Minister Balendra Shah</a> unveiled his Council of Ministers after taking the oath of office on Friday in Kathmandu.&nbsp; Besides Nepal's pre-existing problems, his team will immediately have to deal with the fallout of the West Asia conflict to satisfy an electorate impatient for change. The Rastriya Swatantra Party (RSP) won a majority in the 5 March election and capped the Cabinet size at 15. Shah, a structural engineer and musician, himself has taken charge of the Defence and Industry Ministries. There has been an attempt to make the Cabinet inclusive with women in five of the new portfolios.&nbsp; After much negotiation, the powerful Home Ministry, a bone of contention between Shah and RSP Chair Rabi Lamichhane, has gone to Sudan Gurung, a hitherto little-known figure who <a href="https://nepalitimes.com/here-now/who-or-what-is-hami-nepal">rose to prominence after the September GenZ protest</a> and won the election from Gorkha-2.&nbsp; Gurung will be in charge of Nepal’s internal security apparatus and maintaining law and order. And with Gurung, a close ally of the Prime Minister, in charge, some note the Home Ministry will be a hook for Shah if Lamichhane, with his share of controversies, steps out line.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_c7725ea5fb9ffbf96df25a7b3122520b7ae3ee10548aed3f37781a7e5440e51a.jpg" data-media-id="editor_2" data-image-id="20260327090324_c7725ea5fb9ffbf96df25a7b3122520b7ae3ee10548aed3f37781a7e5440e51a" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> </figure>  Notable RSP leaders, including vice-chair DP Aryal, were said to have been vying for the portfolio.&nbsp; Gurung is the founder of the non-profit Hami Nepal, which worked primarily in earthquake relief in 2015, and emerged onto the national stage during negotiations to appoint Sushila Karki as interim PM after the unrest. He was also involved in key negotiations that cemented Balendra Shah and Rabi Lamichhane’s political partnership in the runup to the election.&nbsp; Most new Cabinet members are not just first-time ministers, but are also freshmen lawmakers. Many are experts in their fields. Finance Minister Swarnim Wagle is an <a href="https://nepalitimes.com/here-now/nepal-needs-to-rebrand-itself">economist </a>with degrees from the London School of Economics and Harvard, and was previously Chief Economic Advisor at the UNDP Regional Bureau for Asia and the Pacific, and also served in Nepal’s National Planning Commission.&nbsp; Previously a member of Nepali Congress, Wagle exited the party in 2023 following differences with top leadership, and joined the RSP. Wagle won a by-election from Tanahu-1 in 2023 and won again from the same constituency in this month’s election.&nbsp; Shishir Khanal, who heads RSP’s foreign affairs department, has been appointed Minister of Foreign Affairs. &nbsp;Khanal is co-founder of Teach For Nepal, was briefly Education Minister when the RSP was part of the the Pushpa Kamal Dahal-led coalition government in 2023.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_b1a670bac12e2bf4df955134f58c8de7718d48f6be4e1f2df7c7c52f82e36e42.jpg" data-media-id="editor_4" data-image-id="20260327090324_b1a670bac12e2bf4df955134f58c8de7718d48f6be4e1f2df7c7c52f82e36e42" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> </figure>  Law Minister Sobita Gautam is a lawyer by profession and worked in governance and public policy before she was elected as the youngest MP in the 2022 election.&nbsp; Health Minister Nisha Mehta is a nurse and became a lawmaker under the Proportional Representation system in this election which swept the RSP to power with a near two-third majority.&nbsp; Education Minister Sasmit Pokharel, a first-time MP elected from Kathmandu-5, served as an aide to Balendra Shah when he was mayor of Kathmandu and a was member of the KMC City Planning Commission.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_5ed794d7bf0cac2844277521810225c4355746b9c3f7369f70cacc878c94641f.jpg" data-media-id="editor_5" data-image-id="20260327090324_5ed794d7bf0cac2844277521810225c4355746b9c3f7369f70cacc878c94641f" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> </figure>  Biraj Bhakta Shrestha is Energy Minister, and also served as the Minister for Youth and Sports in the Dahal-led coalition government in 2024. Before joining RSP, Shrestha was elected to the Bagmati Provincial Assembly in the 2017 elections representing the r<a href="https://nepalitimes.com/here-now/rsp-s-activist-dna">eformist Bibeksheel Sajha Party</a>. He will immediately face the challenge of addressing the <a href="https://nepalitimes.com/news/rough-road-ahead-for-new-nepal-rulers">impact of the West Asia war,</a> including rising petroleum prices and a shortage of cooking gas. Sita Badi, who was elected through the PR system, is Minister for Women, Children and Senior Citizens. She was born and brought up in the underserved and marginalised Badi community in Surkhet and has been advocating for the rights and welfare of women, children, and minority communities. Other ministers include RSP spokesperson Pratibha Rawal as Minister for Federal Affairs and General Administration as well as Land Management, and Gita Chaudhary as Minister for Agriculture, Sunil Lamsal is Physical Infrastrucutre, Transport, and Urban Development Minister, Khadka Raj (Ganesh) Paudel as Tourism and Civil Aviation Minister. Dipak Sah is the Labour and Employment Minister, and Bikram Timilsina is Communication Minister.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_b67c2d199d4897031583a5b7ec7ce43e88771167696e6161665eeb5fca25d3ed.jpg" data-media-id="editor_8" data-image-id="20260327090324_b67c2d199d4897031583a5b7ec7ce43e88771167696e6161665eeb5fca25d3ed" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> </figure>  Meanwhile, RSP vice-chair DP Aryal, who many thought would be home minister because of his proximity with Rabi Lamichhane has been proposed as Speaker of the House.&nbsp; Aryal previously served two brief stints as the Minister of Labour when RSP was part of the RSP’s coalition governments in 2023 and 2024. As minister Aryal came <a href="https://nepalitimes.com/editorial/skeletons-in-the-cabinet-k5x6py1v">under scrutiny </a>for his involvement in an employment agency that was investigated for illegal acquisition of wealth in 2020. If appointed House Speaker, Aryal will be expected to play a neutral and non-partisan role in Parliamentary affairs. &nbsp; With the full Cabinet announced on Friday, Prime Minister Shah and his team now have their work cut out for them. &nbsp;The government’s first priority will be ensuring the safety and long-term security of the almost two million <a href="https://nepalitimes.com/here-now/migrant-workers-in-wartime">Nepalis living and working in the Gulf</a> amid the ongoing conflict in the region, and taking steps to cushion Nepal’s economy from the Israel-US war on Iran. The new leaders will also be tasked with implementing the findings of the Karki Commission report on the September violence that paved the way for the election and the rise of the RSP. &nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_69b36bc62737e44ade4080be36688f9c2f92201356e1df2072cef8ecc6a9be5d.jpg" data-media-id="editor_11" data-image-id="20260327090324_69b36bc62737e44ade4080be36688f9c2f92201356e1df2072cef8ecc6a9be5d" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> <figcaption>Snapshots from PM Balen Shah's swearing-in ceremony</figcaption> </figure>   <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_69b36bc62737e44ade4080be36688f9c2f92201356e1df2072cef8ecc6a9be5d.jpg" data-media-id="editor_12" data-image-id="20260327090324_69b36bc62737e44ade4080be36688f9c2f92201356e1df2072cef8ecc6a9be5d" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> </figure>   <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_8646d490883154f696bcdc6e2375084419f2eefaaf0ef0c7e2710aa6e2d94a8a.jpg" data-media-id="editor_13" data-image-id="20260327090324_8646d490883154f696bcdc6e2375084419f2eefaaf0ef0c7e2710aa6e2d94a8a" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> </figure>   <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327090324_89d17d6584593be1eb23eb1d4872c3b7c600e1620f3aca48dbff4838364a1e3c.jpg" data-media-id="editor_14" data-image-id="20260327090324_89d17d6584593be1eb23eb1d4872c3b7c600e1620f3aca48dbff4838364a1e3c" data-rendition-name="original" width="1440" height="960" loading="lazy" alt="Balen Shah swearing in NT"> </figure>  &nbsp;Full list of ministers: Prime Minsiter: Balendra Shah Home Minister: Sudan Gurung Finance Minister: Swarnim Wagle Foreign Affairs Minister: Shishir Khanal Law, Justice and Parliamentary Affairs Ministry: Sobita Gautam Energy, Water and Irrigation Minister: Biraj Bhakta Shrestha Education Minister: Sasmit Pokharel Physical Infrastrucutre, Transport, and Urban Development Minister: Sunil Lamsal Communication and Information Ministry: Bikram Timilsina General Administration Minister: Pratibha Rawal Women, Children and Senior Citizens Minister: Sita Badi Health and Population Minister: Nisha Mehta Agriculture Minister: Gita Chaudhary Culture, Tourism and Civil Aviation Minister: Khadka Raj (Ganesh) Paudel&nbsp; Labour Minister: Dipak Sah

Nepal swears in new Cabinet

Rivers have been the lifelines of civilisations with their dynamic ecosystems providing vital services for human survival and ecological balance through the ages.&nbsp; But accelerating anthropocentric footprints are causing severe, and often irreversible, damage to river systems across the world, including those across High Asia, a region that sustains nearly a fourth of the global population downstream. An example is the <a href="https://nepalitimes.com/here-now/how-the-bagmati-civilisation-is-becoming-uncivilised" target="_blank">Bagmati River</a> that courses through Kathmandu, crosses the Himalayan foothills to join the Ganga in India. A river that once shaped the <a href="https://archive.nepalitimes.com/article/Nepali-Times-Buzz/when-it-comes-to-water-pollution,3196" target="_blank">Kathmandu Valley Civilisation </a>is now a polluted and biologically dead water body constricted by urban sprawl, choked by construction debris, chemical waste and untreated sewage.&nbsp; The loss of a sacred river is tragic enough, but its hazards related to health, life and livelihoods are not limited to the Valley, nor is its enormity fully gauged by the metrics of fatality, income loss, flood return periods, runoffs, embankment failure.&nbsp; It is a systemic collapse of ecological integrity, socio-economic stability and cultural heritage, affecting its downstream users as well. The death of Bagmati is a peril for a population size way bigger than circa 5 million residents of Kathmandu Valley. The degradation started in the 1980s and has accelerated. Why has not enough been done to save this iconic river that runs through Nepal’s capital?&nbsp; The Bagmati River Basin Improvement Project (BRBIP) was designed to make headway in restoring the river with a sewage treatment plant, dams for storing water to support dry-season runoff, recharge groundwater, creation of <a href="https://archive.nepalitimes.com/page/resurrecting-bagmati-the-river" target="_blank">green biodiversity corridors</a> along the river bank to also serve as recreation areas, reduce the urban heat island effect, and also provide cultural continuity. The project also envisages collection of hydrological data for managing Bagmati multipurposewater systems and providing flood forecasts and early warnings aimed at protecting lives and property, among other things. Most importantly, the project takes the integrated water resource management approach, which, in principle, is a holistic and collaborative way of managing all elements of the water cycle to ensure water security, public and environmental health and amenity.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260329040336_9605240fa8c7d649ce49fbe43565130e3187e979338ccf959c4e9b8c581b7a4c.jpg" data-media-id="editor_3" data-image-id="20260329040336_9605240fa8c7d649ce49fbe43565130e3187e979338ccf959c4e9b8c581b7a4c" data-rendition-name="original" width="2126" height="1577" loading="lazy" alt="Bagmati NT"> </figure>  This should pave the way for managing a river as a connected ecological, social, and economic system by enabling coordination across agencies and disciplines, stimulating technological innovation and financial investment. The success of this approach depends on long-term political will and commitment that transcend political cycles, but also needs strong community and civil society in defining issues and proposing solutions, creating and sharing knowledge, taking independent action to inform practice, monitoring and evaluating policies, and participating in public decision-making. Civil society, especially, in making the <a href="https://archive.nepalitimes.com/page/encounter-with-bagmati-river" target="_blank">revival of the Bagmati River</a> a pressing governance issue. The Bagmati Action Plan 2009, a precursor to the BRBIP, was designed in response to lawsuits filed in 2000 and 2004 by an independent legal practitioner of Kathmandu against waste dumping in the river.&nbsp; It took him almost two decades of legal battle for Nepal’s Supreme Court to pass orders for mandatory septic tanks in all homes in Kathmandu Valley, relocation of squatters from Bagmati river banks to government-built houses, and embargo on dumping and burying garbage on the banks of the river and its tributaries. Despite court orders, however, actual results have been unsatisfactory. Restoration of Bagmati barely made it to any political debate or electoral manifesto this time. Treatment plants have not been operational for years, yet no one is held accountable. The population ignores waste segregation or single-use plastic rules to check littering.&nbsp; The current condition of the river therefore seems to have more to do with the lack of public awareness and behaviour change than the failure of various master plans. Why does the deep danger of a dead river fail to arouse widespread civil society concern, let alone action? The apathy is perhaps underlined by an innately anthropocentric understanding of the river as a mere resource to be exploited, rather than the backbone of existence.&nbsp; Such a paradigm shift is possible when river or river systems are understood to be necessary for &nbsp;a harmonious coexistence with human populations. The more pertinent question is not whether a dead river can be restored because there are many examples from around the world where that has been successfully achieved. It is whether we choose to restore our rivers for intergenerational equity. This would require a holistic perspective and political will to revive reverence for a river system so that its symbiotic relationship with human settlements can be restored. Roshni Gurung is Research Assistant, River Basins at the International Centre for Integrated Mountain Development (ICIMOD).

A lifeline becomes liability

On Friday, Balendra Shah is taking his oath of office as Nepal's prime minister in a capital city of which he was a mayor till six months ago.
At 35, he will be among Nepal’s youngest prime ministers. His reticence and reclusiveness have reinforced his brand as a doer rather than a talker. This was a persona he cultivated as mayor of someone who cleaned up the city by managing garbage. But he also chased off sidewalk vendors in an effort to ‘beautify’ the city.&nbsp;
After being elected, Shah did not attend RSP events in official capacity, and he was absent at an MP orientation last week.&nbsp;
His refusal to engage with the press, and even stopping to post on social media, have added to the air of reclusiveness. But as prime minister, he may have to communicate more even if it just to stop conspiracy theories and intrigue.&nbsp;
The people he will now represent would like to know, and have a right to know, what he is up to. Otherwise the feeling will grow that Nepal is entering uncharted territory. Governance, the economy and investment do not like uncertainty.
Political scientist Pyakuryal notes that calling Balen a 'man of few words' may serve as a useful epithet if he governs with quiet efficiency rather than fanfare. "But as Prime Minister, he must engage the nation’s will, not simply manage from above," she says.
She adds: "The real test lies in his choice of style: will he lead exclusively, keeping decisions close, or inclusively, opening space for dialogue and shared ownership of governance?"
Nepal's newly-elected lawmakers were sworn in on Thursday. And once sworn in as PM on Friday, Balendra Shah is set to appoint a ‘minimalist’ Cabinet. Although the Constitution caps the size of the Council of Ministers at 25, the party has decided to stick to maximum 18 and not split ministries to accommodate loyalists as was done in the past.&nbsp;
&nbsp;"The Cabinet must support the leadership of the Prime Minister while ensuring accountability to the Parliament,” notes political scientist Sucheta Pyakuryal. “But the questions that come to mind are: will the RSP MPs readily submit to Balen’s leadership and is Balen’s absence from the party’s official events an unwillingness or hesitation to submit to the party?”
Prime Minister Sushila Karki and her ministers ended their interim tenures this week, and she was lauded for upholding her commitment to hold a free, fair and peaceful election. But her image was tarnished for her reluctance to release the investigation report on the September violence, as well as recommending her Home Minister Om Prakash Aryal for a National Assembly seat, and her personal secretary to the National Trust for Nature Conservation. President Ram Chandra Poudel has put Aryal’s nomination on hold. &nbsp;
The Investigation Commission report leaked on Wednesday said the state failed to stop the firing on protestors by Police on 8 September and blamed the Army for not preventing the arson next day. It recommended the prosecution of prime minister KP Oli, home minister Ramesh Lekhak, and Police chief Chandra Kuber Khapung.
Notable names said to be in consideration for the Cabinet include many who are experts in their fields, and RSP wants a young lawmaker as Speaker. The new government will plunge headlong into the economic fallout of the West Asia war.
RSP, with its near two-third majority, does not have to placate any coalition partner, so Nepal is at long last expected to have a stable government after 35 years. Despite hopes that there will not be the usual horse-trading this time, there is tension between supporters of RSP chair Rabi Lamichhane and Balendra Shah. The two have been negotiating in hotel rooms for Cabinet posts for loyalists.&nbsp;
Shah’s larger-than-life online persona and nationwide appeal delivered the RSP its overwhelming electoral victory this month, and this makes the party’s core leadership beholden to him. To what extent is Shah willing to meet Lamichhane’s demands is the critical question, and we will know the answer by this weekend.
Says Pyakuryal: “Because this election showcased personality politics rather than the regular party politics, the dangers of ego-clashes, power-tussles and intraparty realpolitik become very real and this kind of equation can greatly hamper the spirit of democracy, representation and collective good."

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 <video controls src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260327020320_f91bd3e51c1dd198b099a24daac8c52384b408174506e7f5a0ced1db76773824.mp4" alt="" width="100%" height="100%"></video>
 <figcaption>Animation: ANUP TAMU</figcaption>
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Ball in Balen’s court

Nepal’s new government hit the ground running with the arrests of former Prime Minister K P Oli and home Minister Ramesh Lekhak early Saturday morning.&nbsp;
Their dramatic detentions followed an inquiry commission report recommending that Lekhak, Oli, and former Police chief Chandra Kuber Khapung be investigated and prosecuted for negligence in failing to stop the killing of 19 young protesters by security forces during the protests on 8 September.&nbsp;
Interim PM Sushila Karki’s government faced considerable criticism from GenZ activists at the end of her 7-month tenure for failing to release the report and hold the previous UML-NC coalition to account.&nbsp;
Karki had left any decision on the report’s findings to new RSP government, but her government released it after the content was leaked earlier this week, a day before Nepal’s newly elected lawmakers took their oath of office.
By making the arrests of Oli and Lekhak as its first order of business, the new government, and especially Home Minister Sudan Gurung and Prime Minister Balendra Shah, have tried to show that they are decisive and mean business.&nbsp;
It has been hailed by many as signalling that Nepal’s new and young leadership will back up its pledges with action. However, others including the UML and some constitutional experts, say that the arrests have not followed legal procedures. The UML has mobilised its affiliated groups to start nationwide street protests.&nbsp;
The main divide seems to be over the perception that the new government is only interested in justice for the perpetrators of the 8 September Parliament massacre, and not against those who organised arson and vandalism of government buildings, homes of politicians, businesses and the media the next day.&nbsp;
While some celebrate what they see as the beginning of justice for the victims and survivors of the September violence, political analysts and legal experts express alarm over a lack of adherence to the rule of law.&nbsp;
K P Oli has a lot of experience being behind bars. He was jailed a dozen times in 1970s by the Panchayat regime for his extreme left activism and then spent 14 years in prison between 1974-1988.
Critics argue that the former leaders were denied due process and label their arrest a “political vendetta."
RSP supporters had made similar arguments in October 2024 and April 2025 that the arrest of party chair Rabi Lamichhane over misappropriation of funds from numerous cooperatives were &nbsp;politically motivated.
‘What is happening is unacceptable,’ wrote former minister and diplomat Nilamber Acharya wrote on Saturday morning. ‘Such acts of revenge and crackdowns do not bode well.’
In response to accusations of the arrests being partisan and politically-motivated, Home Minister Sudan Gurung took to social media, saying that the new government is fulfilling its promises: ‘No one is above the law,’ he wrote. ‘This is not revenge, it is the beginning of justice. I believe now that the nation will now take a new direction.’
There is also concern the new leadership has jumped the gun to implement the findings of the inquiry commission, which has itself been criticised in some quarters for concentrating on the events of 8 September rather than investigating the perpetrators of the anarchy on 9 September.&nbsp;
The first meeting of the Council of Ministers made the immediate implementation of the GenZ Movement Inquiry Report its first priority.
But there are questions as to whether the execution of the report will be impartial. Home Minister Gurung will now dictate how the recommendations &nbsp;will be conducted, since he is himself referenced in the report in connection with the unrest on 9 September.&nbsp;
In fact, the report also outlines how supporters stormed Nakhu Prison on 9 September to organise Rabi Lamichhane’s jailbreak. Will Minister Gurung also go after his own party's leadership? &nbsp;
With the UML already calling for nationwide protests against the detention of its leaders, there is concern that Nepal is plunging straight into turmoil instead of stability.
The UML leadership has been unrepentant about the 8 September events. Oli has defiantly blamed infiltration and outside forces for the killings, and unlike the Nepali Congress the UML has not managed its own leadership changeover.&nbsp;
The NC under Gagan Thapa as well as the Nepali Communist Party of Maoist leader Pushpa Kamal Dahal have so far been silent about the detentions even though former Home Minister Ramesh Lekhak is from the NC.
Oli and Lekhak’s arrests will now be challenged in the courts. But their detention also signals to Nepal’s political old guard that the tables have turned: legacy leaders cannot be complacent and assume they will disappear from national consciousness for past deeds without being held accountable for what happened during their watch.
The RSP government under Prime Minister Balendra Shah seems determined not to let bygones be bygones. But while that is all and well, it remains to be see whether the party can deliver on the need of the electorate for tangible governance reform.
The danger is that the new rulers may be defined by the same tactics of political revenge as its predecessors in the name of meting out justice.

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