With just under two months remaining till the end of the current fiscal year, the<a href="https://nepalitimes.com/news/nepal-government-changes-again"> Nepal government</a> this week is set to announce its budget for the year 2025/26.&nbsp; Nepal’s budget has grown steadily over the past decade, from Rs618 billion in the fiscal year 2014/15 to Rs1.79 trillion in 2022/23. But this upward trend tells only half the story, as the total expenditure has consistently fallen short of the planned budget.&nbsp; Short of flamboyant promises and populist schemes, successive Nepali governments, regardless of party, have consistently failed to utilise the allocated budget. This year, Nepal spent just 36% of the allocated development budget. Such recurrent underspending diminishes the government's ability to simulate the<a href="https://www.econlib.org/library/Topics/Details/aggregatedemand.html#:~:text=What%20Is%20Aggregate%20Demand%3F,%2C%20services%2C%20and%20capital%20goods." target="_blank"> aggregate demand</a> and slows economic growth.&nbsp; The country’s current annual average total expenditure shortfall is just over 20%, largely due to bureaucratic and institutional inefficiencies that continue to hamper budget implementation. Furthermore, poorly-made project proposals, shoddy planning, slow-moving procurement activities, quick turnover of technical staff, and inefficient inter-ministerial coordination contribute to a limited capacity to administer development across Nepal.&nbsp; This has led to a culture of frantic, &nbsp;last-minute budget spending on Nepal, with <a href="https://internationalbudget.org/wp-content/uploads/Nepal-Budget-Credibility-and-the-Sustainable-Development-Goals.pdf" target="_blank">40</a>% of the allocated development expenditure spent on the final month of the fiscal year, leading to a misuse of resources and poor project results. These inadequacies are compounded by the lack of coordination between federal, provincial, and local governments, especially as capacity constraints at the subnational level have been a long-standing issue. Experts express particular concern over provincial and local governments, where staff are often short on technical skill and administrative know-how required for budget implementation.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250528030544_6eb2a05152532fbffd1ec32f130b0d030baf2b46963be269b68bc50417d1a814.png" data-media-id="editor_3" data-image-id="20250528030544_6eb2a05152532fbffd1ec32f130b0d030baf2b46963be269b68bc50417d1a814" data-rendition-name="original" width="512" height="485" loading="lazy" alt="Budget NT"> </figure>  For instance, provincial governments spent just 34% and local governments spent 24.4% of its budget in the fiscal year 2022/2023, which suggests a persistent deficit in planning, implementation, and resource management. &nbsp;&nbsp; A breakdown of the recurrent and capital expenditures reveals even deeper dysfunctions and gaps between the allocated and actual spending of recurrent and capital expenditure. Recurrent expenses are government spending to maintain <a href="https://nepalitimes.com/opinion/comment/nepals-uncivil-servants">public services</a> and administration, including interest, pensions, salaries, social security, and subsidies. Meanwhile, <a href="https://nepalitimes.com/news/till-debt-do-us-part">capital expenditure</a> involves investing in long-term assets such as development programs, equipment, and <a href="https://nepalitimes.com/banner/climate-smarter-himalayan-infrastructure">infrastructure projects </a>to expand the productive capacity of the <a href="https://nepalitimes.com/banner/now-the-economy-stupid">economy</a>. As it stands, Nepal’s recurrent expenditure is staggering compared to capital spending. <a href="https://scispace.com/papers/relationship-between-capital-and-recurrent-expenditure-with-hpoenzfmk4" target="_blank">Studies</a> show that the money spent on recurrent expenditure tends to have a stronger and more immediate effect on the GDP.&nbsp; In the fiscal year 2022/2023, Rs1.18 trillion was allocated for recurrent spending, while Rs380 billion was earmarked for capital expenditure. However, actual spending fell short of allocations in both expenditures, with recurrent expenditure falling short by an annual average of 14.7% and capital expenditure by a much larger average of 35.30% over the last nine years. &nbsp;&nbsp;&nbsp; This consistent underspending in capital expenditure is particularly alarming, and has direct impacts on the macroeconomy. It also plays a crucial role in creating economic momentum through the proper business <a href="https://nepalitimes.com/news/why-invest-in-nepal">investment </a>climate and business confidence.&nbsp; When capital expenditure falls short, aggregate demand contracts result in fewer<a href="https://nepalitimes.com/banner/few-jobs-created-by-nepal-employment-drive"> employment opportunities</a>, reduced household consumption, and delayed infrastructure projects that discourage business investment.&nbsp; Meanwhile, the dominance of recurrent expenditure driven by rising administrative and social security expenditures continues to crowd out funds for capital investment, perpetuating a cycle where budget numbers grow, but transformative development fails to take shape. &nbsp; The core challenge in Nepal's budget execution can be explained by the <a href="https://www.sciencedirect.com/topics/social-sciences/principal-agent-theory" target="_blank">principal-agent</a> problem theory - an economic theory that explains the misalignment of conflicting incentives between two parties. In the context of Nepal, the Ministry of Finance is the principal authority that allocates the budgets and resources, while the line ministries are the agents assigned to propose and execute the budget.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20250528030544_3b3b12a4065ae34b9703e848ff91f40ff570ce4b771e44d4338c4b134054f42e.png" data-media-id="editor_12" data-image-id="20250528030544_3b3b12a4065ae34b9703e848ff91f40ff570ce4b771e44d4338c4b134054f42e" data-rendition-name="original" width="512" height="377" loading="lazy" alt="Budget NT"> </figure>  However, a disconnect in incentives between the Finance Ministry and line ministries often leads to budget misallocations, which in turn cause inefficiencies and poor budget outcomes. &nbsp; One of the key dimensions of the problem is asymmetric information. The Line ministries possess detailed information of their needs and priorities in projects that are unavailable and unverifiable to the MOF. This information gap further incentivises ministries to propose higher budgets than actually needed.&nbsp; This is common behavior and expected in budget negotiations, as ministries compete for limited funds and seek to maximise their budget. Consequently, funds may be disproportionately allocated to ministries that lobby more effectively or exaggerate needs rather than those that would deliver the greatest public benefit. &nbsp;&nbsp; Read also: <a href="https://nepalitimes.com/news/nepal-in-the-red">Nepal in the red</a>, Ramesh Kumar This budgetary misallocation distorts not only priority projects &nbsp;but also induces &nbsp;inefficiencies in implementation. Where funds flow into inefficient use as a result, the government cannot deliver effective services or complete development projects within scheduled deadlines. This results in delayed spending, wastage of resources, and underperformance, which undermine economic growth and confidence in government. &nbsp; Closing the persistent gap between allocated total budgets and total expenditures and between the allocated and actual recurrent and capital expenditures requires the Finance Ministry to strengthen its <a href="https://ieg.worldbankgroup.org/what-monitoring-and-evaluation" target="_blank">monitoring and evaluation</a> to appropriately administer resources after the budget announcement.&nbsp; For this, the Finance Ministry must ensure effective monitoring of how line ministries spend their allocated funds throughout the fiscal year, so that it can hold the other ministries accountable and identify bottlenecks or time delays in budget implementation. This can be achieved through periodic reporting of progress, linking budget release with performance, and using combined financial management information systems. In addition, linking future budget allocations to ministries’ past performance in budget utilisation would create stronger incentives for responsible and efficient spending. When ministries know that their ability to secure funds in the next fiscal year depends on how well they manage and execute their current budget, they are more likely to submit realistic proposals and prioritise timely implementation. Doing so would help to synchronize the incentives of the Finance Ministry and line ministries in order for Nepal to effectively execute the budget and direct resources toward projects aligned with our national priorities, ultimately minimising the country’s budget deficit. Siddhartha Rayamajhi holds a BA in Economics from Kathmandu University.

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How Nepal can budget wisely

<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20230208140212/63e39fed9c7e80680e0d7013jpeg.jpg" alt="" width="960" height="640"/>Bishnu Poudel has inherited the Finance Ministry at a time when the country’s finances are in a shambles because of ill-advised and inept policies of his predecessor.The Nepal government is living beyond its means. Expenses are not in line with revenue. As of 11 January, the total expenditure of the Nepal government in the current fiscal year stands at Rs559 billion against revenue of only Rs398.7 billion. This year’s budget projected a 21% increase in revenue from last year. However, data as of November 2022 shows that revenue collection has actually decreased by 20%.Revenue therefore has not kept pace with increases in government salaries, allowances, and bonuses. If this trend continues, the newly elected 7-party opposition-less coalition government will be in serious trouble.Nepal’s imports decreased by 20.17% in the last five months compared to the same time period last year due to the Nepal Rastra Bank’s ban on luxury items to sustain dwindling foreign exchange reserves.Read also:<a href="https://www.nepalitimes.com/editorial/nepals-political-economy/"> Nepal’s political economy</a>, EditorialWith year-on-year inflation reaching 8.08%, ordinary citizens’ demand for goods and services has fallen sharply. Meanwhile, increased interest on loans to more than 15% as a response to rising inflation has discouraged investment.Nepal’s primary sources of revenue are remittances, tourism, and export. Tourism is still not back on track post-Covid due to the Russian invasion of Ukraine, and the country’s exports in the last five months decreased by 34.61% as compared to the same time during the last fiscal year. This country is running just on remittance money that Nepalis abroad send home — either through official banking channels or hundi.But Nepal cannot depend on remittance forever, especially as we need workers at home to stimulate the agriculture sector, manufacturing, construction and tourism, which in turn will create more domestic jobs.Moreover, in his third term at the finance ministry, doubts as to Bishnu Poudel’s budget discipline are not exactly unfounded. Despite the country’s inability to spend, Poudel during his first term as Finance Minister in 2015 introduced a budget that was 28% larger than the previous fiscal year and passed it through ordinance. And during his second tenure in 2020, he revealed a budget that was 12% bigger than the previous one.Read also: <a href="https://www.nepalitimes.com/banner/nepals-opposition-less-parliament/">Nepal's opposition-less Parliament</a>, Shristi KarkiAlthough the minister may have inherited a country facing financial ruin from his forerunner, his own record is not particularly stellar. He is also known for recklessly increasing spending by increasing salaries and social security allowances during his terms in office.But the finance ministry and the minister think they are beyond reproach and criticism.It might seem like a given, but the finance ministry needs to take the initiative to reduce the wasteful government expenditure. Minister Poudel must work towards bridging the communication gap formed between his ministry and Nepal Rastra Bank during Janardan Sharma’s tenure. Unlike his predecessor, Poudel cannot interfere with the central bank’s autonomy on monetary policies.Too many parties in this coalition government means that there are too many hands on the budgetary honeypot. This will not make the minister’s job easy— but he will now have to navigate the will of seven political parties and their affiliated special interest groups and not be swayed by unreasonable demands from all sides. In fact, the Minister needs to be prepared to go against the coalition in order to prevent any misuse of the budget.Read also: <a href="https://www.nepalitimes.com/banner/prospects-of-nepals-tourism-in-2023/">Peak tourism in 2023</a>, Ramesh KumarAs finance minister, Poudel also bears the responsibility of raising the morale of business institutions and people to encourage investment and stimulate the economy.All of this is not to say that there have not been positives. Nepal’s foreign reserves increased by 2.5% from July 2022 to November 2022, following the embargo on the import of luxury items — even as there had been fears that Nepal would become ‘the next Sri Lanka’.Likewise, Nepal Rastra Bank’s recent amendment of the Working Capital Loans Guideline to increase investment might ease the strain on the economy.But embargoes and directives can only take the economy so far. Now, Poudel needs to work not just towards undoing and repairing the mismanagement of the ministry, but actively work towards policy reforms in order to get Nepal’s economy back on track.The minister must thus focus on good governance, refuse to buy into the demands of special interest groups, and facilitate the protection and appropriate use of state resources.Read also:<a href="https://www.nepalitimes.com/editorial/new-year-challenge-to-new-government/"> New year challenge to new government</a>, EditorialRamesh Kumar

Now the economy, stupid

<figure><img width="640" height="370" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109121140/636b92619c7e80680e06f145jpeg.jpg" alt=""/><figcaption>Tata's Nexon EV series lines up its 5-seater. electric-powered SUVs, the most popular electric car in India this year, and soon to be launched in Nepal.</figcaption></figure>Electric car importers are preparing to meet a post-pandemic demand for electric vehicles after the Nepal government in its new budget scrapped <a href="https://www.nepalitimes.com/latest/nepal-takes-3-steps-back-on-e-cars/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/latest/nepal-takes-3-steps-back-on-e-cars/&amp;source=gmail&amp;ust=1623653648829000&amp;usg=AFQjCNFYlNmJFW4Nf2GDTZoi3-VpVdwjwg">taxes imposed last year</a>.The new budget presented by Finance Minister Bishnu Paudel on 29 May has <a href="https://www.nepalitimes.com/latest/new-nepal-budget-sparks-electric-comeback/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/latest/new-nepal-budget-sparks-electric-comeback/&amp;source=gmail&amp;ust=1623653648829000&amp;usg=AFQjCNHiTOH3wA_f6Uhx78O65Lzz8aLXSQ">completely repealed excise duty</a> on battery operated cars, while cutting customs duty down to the earlier 10%. Earlier <a href="https://www.nepalitimes.com/here-now/plug-ins/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/here-now/plug-ins/&amp;source=gmail&amp;ust=1623653648829000&amp;usg=AFQjCNHWqGQrv3SikN7Z6JfANYPn7kZsuA">tax cuts in 2016</a> had increased affordability and, combined with improved range of battery cars, had made them gain popularity in Nepal.Importers of electric vehicles are now rushing to cash in on an <a href="https://www.nepalitimes.com/banner/electri-city-cars/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://www.nepalitimes.com/banner/electri-city-cars/&amp;source=gmail&amp;ust=1623653648829000&amp;usg=AFQjCNHbj5a27VragINFKdTBxJFSdWTqEQ">expected rise in customer demand</a> once the lockdown is lifted. In addition to the brands that have a head start in e-cars in Nepal like Hyundai, Kia, Mahindra, MG, India’s TATA Motors is planning an aggressive promotion of its electric Nexon model after its launch soon.<a href="https://cars.tatamotors.com/suv/nexon" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://cars.tatamotors.com/suv/nexon&amp;source=gmail&amp;ust=1623653648829000&amp;usg=AFQjCNEnJAYTtlCWAsW8S3SccRE-wAHevQ">Petrol and diesel Nexons</a> are already a familiar silhouette in Nepal’s roads since they were launched in 2017, and TATA hopes to repeat here the success it has in India with the electric version of the compact SUV. More than 4,000 electric Nexons have been sold in India since its launch in January, with the slowdown only because of the second wave lockdowns. This makes the Nexon India’s best-selling electric vehicle with 64% market share already.The redesigned <a href="https://nexonev.tatamotors.com/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://nexonev.tatamotors.com&amp;source=gmail&amp;ust=1623653648829000&amp;usg=AFQjCNE6oijZeLG82VSIq1wEKbKxFghzsA">Nexon EV SUV</a> with its Ziptron powertrain looks identical to the fossil version, except for its blue highlights, snazzy looking projector lights and aerodynamic front grill. Potential buyers in Nepal will be looking at ground clearance because of the country’s notoriously bad roads, and here the e-Nexon scores better than its Korean and Japanese counterparts with 205mm clearing underneath (compared to 177mm in the MG, for instance). <img width="640" height="232" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109121140/636b92649c7e80680e06f146jpeg.jpg" alt=""><img width="640" height="238" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109121140/636b92669c7e80680e06f147jpeg.jpg" alt="">The Nexon comes with all the accoutrements of its petroleum-burning cousin, including the ZConnect that allows owners to remotely keep track of the status of the car. The electric motor packs quite a punch in the torque department, giving the Nexon formidable acceleration (0-60km in 4.6 seconds) that will come in handy while overtaking a line of overloaded trucks on the Prithvi Highway. Charging is also quite impressive, with its lithium ion batteries (8 year warranty) to get 80% recharge in 1 hour with DC fast charge, and 100% all night home AC recharge with a 15amp plug. A petrol Nexon needs Rs5,500 to fully top up its 44l fuel tank, while it will cost less than Rs500 in the electricity bill for a complete charge.  <img width="640" height="444" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221109121140/636b92699c7e80680e06f148jpeg.jpg" alt="">The only downside of the Nexon with its 30.2kWH battery pack is perhaps its range which, at 312km on a full charge, is slightly less than the Kia Niro (455km) and the Hyundai Kona (482km) both of which have 64kWH batteries — but then those models cost more. Both ranges depend on AC use. Still, the Nexon's range is more than enough to get from Kathmandu to Pokhara on a single charge even with AC.This is what is making makes all electric vehicles financially attractive over the long term. Nepali consumers who had turned away from battery cars in the past year because of the higher taxes, will now find both the upfront cost and the energy savings will make e-vehicles much more competitive compared to fossil fuel cars.<a href="https://assured.sipradi.com.np/" target="_blank" rel="noopener noreferrer" data-saferedirecturl="https://www.google.com/url?q=https://assured.sipradi.com.np&amp;source=gmail&amp;ust=1623653648829000&amp;usg=AFQjCNEizaM9cIGMcEhfi--1Qwvgcs_KEw">Sipradi</a>, the TATA distributors in Nepal have not yet announced the price of the electric Nexon, but it is suggested that it will be less than the Rs 4.9 million price tag of the petrol Nexon. This compares favourably to its nearest rival in the performance range, the smaller Mahindra eKUV which could sell for approximately Rs 4million after the tax revision.Nepal has announced it will stop selling petroleum cars by 2031, and this is only because neighbours India and China have also announced that they will only be making electric or hydrogen-fuel cars by that time.Other electric cars in the market include the Kia Niro which had stopped being imported after last year’s budget hike that took its price tag to a whopping Rs 12.5 million. But with the new budget revision, the price is down to Rs7 million again. Similarly, the Hyundai Kona is priced at Rs5.6-Rs7.1 million depending on the capacity, while its Iconiq electric sedan is Rs 5.7 million. MG’s Chinese made eZS was also quite popular till the budget hike last year, with dozens of its vehicles stuck at customs because they arrived after the tax increase. The price of these SUVs compare well with the Niro and Kona at Rs 5.1 million.The pioneer of electric vehicles in Nepal is the Mahindra e2O, and is still the most popular for city driving with a range of 120km, a ground clearance of 170mm and a price that has now come down to Rs2.6 million for the 4-door model. Needless to say, all these are approximate, as most dealers are still in wait-and watch mode and have not announced the exact prices yet. Despite the excise and import taxes being scrapped, customers will still have to fork out 13% VAT, and the government has kept Finance Minister Yubaraj Khatiwada’s increase in road tax for electric cars.E-vehicle owners paid no road tax from 2016 till last year’s budget. Since then, it has gone up to Rs15,000 per year for battery cars in the 50-125kW range, Rs20,000 for e-vehicles of 126-225kW and Rs30,000 for cars in the 226-and above range. Khatiwada last year slapped excise duties on e-vehicles of 30-80% depending on their capacity, and levied customs duty of 60%. He justified it saying electric SUVs were luxury items, and the government needed to augment revenue to fight the Covid-19 pandemic.This pushed e-vehicles out of the market at a time when sales had just started to pick up, and various brands of electric vehicles were gaining popularity because of their expanded range. But Khatiwada’s move  spiked prices of electric vehicles by 120-140%, making them less competitive vis-a-vis fossil-fuel alternatives.  Finance Bishnu Paudel’s move appears to be geared to reducing the petroleum import bill, and also to increase electricity consumption as Nepal’s new hydropower plants come online this year, giving an energy surplus.

E-vehicles prepare for post-lockdown boom

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a539b9c7e80680e05235cjpeg.jpg" alt="" width="1400" height="933"/><figcaption>Photo: BIKRAM RAI</figcaption></figure>In the past three years, federal and provincial governments spent a massive Rs216.5 million on vehicles. If we add the budget allocated to vehicles this fiscal year, it adds up to more than Rs250 million, not including the budgets for cars of local governments and projects.All three spheres of government are ignoring their own declaration to minimise expenses, and are wasting money on frivolous items. And the irony of it all is that the <a href="http://archive.nepalitimes.com/article/Nepali-Times-Buzz/SUV-nada-auto-show-2015,2586" target="_blank" rel="noopener">SUVs are driving along roads that are in advanced stages of disrepair</a> because the money has all gone for expensive cars.Read also: <a style="background-color: #ffffff; font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/?p=31531&amp;preview=true" target="_blank" rel="noopener">Disrepair</a>Though the government has been <a href="https://www.nepalitimes.com/banner/dangerous-driving/" target="_blank" rel="noopener">slow to provide development and service delivery</a>, vehicle-related expenses have grown six-fold since 2013. The federal government is the biggest spender: provincial governments accounted for just Rs20 million spent on cars in the past three years.This fiscal year the federal government spent 2.45% of its development budget on vehicles. While it is perennially unable to fully disburse that budget, it spent four times more on vehicles than the amount allocated, even transferring money from other budget lines to do so.“Using <a href="https://www.nepalitimes.com/opinion/nepals-fatalistic-ke-garne-culture/" target="_blank" rel="noopener">unspent development budget</a> to buy vehicles is just an unnecessary expense,” says former government secretary Purna Chandra Bhatttarai. Other experts say that it is not just elected representatives, bureaucrats are also draining state resources.According to the 56th report of the auditor-general, among the 800 vehicles in the 22 Singha Darbar-based ministries, only 622 are operational. Some are not being used even though they are in running condition — new vehicles are being bought before old ones are phased out. After an order from the PM’s office, 201 vehicles were handed over to various organisations this year, including many that were still in working order.Read also: <a href="https://www.nepalitimes.com/here-now/no-shame/" target="_blank" rel="noopener">No shame</a>“Buying new vehicles involves kickbacks, so the tendency to buy new vehicles is increasing,” says former finance secretary Rameshwar Khanal.Four new Scorpios were bought for deputy attorney-generals last July, not because they were necessary but because the existing five-year-old vehicles were considered too old. At the end of the last fiscal year, 16 Scorpios were purchased for the chiefs of the House of Representatives and National Assembly, displacing 10-year-old vehicles.The National Inclusion Commission bought five vehicles costing at least Rs4 million for its chief and 4 members. But to date the commission has only one member — the others have not yet been appointed. The vehicles are covered and stored on the office premises. Many other new commissions have already bought vehicles for their yet-to-be appointed members.Read also: <a href="https://www.nepalitimes.com/editorial/a-klepto-republic/" target="_blank" rel="noopener">A klepto republic</a>, Editorial<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a539c9c7e80680e05235djpeg.jpg" alt="" width="809" height="442">According to the auditor-general’s report, there are 1,323 officer-level officials in the Ministry of Agriculture, and 1,577 vehicles in operation. There are 174 vehicles for 90 officers in the Finance Ministry and 151 vehicles for 94 officials in the Prime Minister’s Office (PMO). Many senior officials are accused of having separate vehicles for home and office use.According to a guideline issued by the Finance Ministry, new vehicles should be bought only for newly-established organisations. Other offices should buy new vehicles only every 15 years. This guideline is considered legally binding, so ministries and other bodies are actually breaking the law. Only officials at joint secretary level and above are supposed to get vehicles, but today deputy secretaries and even junior officers are riding in government vehicles. Some officials have even acquired the habit of buying a new vehicle immediately after they are promoted or transferred.Joint Secretary Binod Kunwar of the PMO says the office has made efforts to have an inventory of vehicles in working order, but hasn’t succeeded because of lack of cooperation from government entities.Read also:<a href="https://www.nepalitimes.com/here-now/the-business-of-politics-undermines-nepals-democracy/" target="_blank" rel="noopener">The business of politics undermines Nepal's democracy</a>, Ramesh Kumar<a href="https://www.nepalitimes.com/here-now/nepal-has-to-curb-corruption-before-wooing-investors/" target="_blank" rel="noopener">Nepal has to curb corruption before wooing investors</a>, Ramesh KumarThe Ministry of Finance does have guidelines on the capacity of vehicles that can be bought, but they are routinely ignored. Even money allocated to build public infrastructure is being spent on vehicles.Repair and maintenance of vehicles is another area full of irregularities, including money being allocated for the upkeep of vehicles that have been in storage for years. Kunwar says the vehicles have become a long-term burden on the state.The Ministry of Finance continues to dole out huge sums of money to keep officers happy, and the government has taken no steps to regulate it, despite the fact that the Finance Ministry has issued guidelines to reduce operating costs. This includes a rule that government vehicles should not have private license plates, but this is also ignored.The government also has a <a href="https://www.nepalitimes.com/banner/20-electric-by-2020/" target="_blank" rel="noopener">policy of going electric</a>, but continues to buy fossil fuel vehicles. Former Finance Secretary Rameswhor Khanal, who himself drives an <a href="https://www.nepalitimes.com/banner/electri-city-cars/" target="_blank" rel="noopener">electric Kia Soul</a>, explains:  “There are fewer dealers of <a href="https://www.nepalitimes.com/banner/nepals-electric-transport-future-is-here/" target="_blank" rel="noopener">electric vehicles</a> in the market, so there are less kickbacks in their purchase. Besides, you cannot make up fake bills of repair and maintenance of electric cars, which is why they are less popular.”

Driving Nepal deeper into debt

Who is accountable for teacher-student relationships?

Early on Monday morning, a bus from Pokhara to Kathmandu plunged off the highway in Dhading killing 19 passengers. Two weeks ago, another bus fell into the Tama Kosi in Manthali, killing 12. A few days before that a bus crash in Baitadi killed 13 people.&nbsp; In just the month before Nepal's election, more than 50 people have been killed in road traffic accidents. Most of these cannot be called 'accidents'. They are a direct result of poorly maintained highways and lack of enforcement of traffic discipline. Political parties in Nepal have rolled out their election manifestos, and voters are once again presented with a flood of promises. Page after page, these documents list megawatts and microcredit, highways and airports, jobs and investment. In these manifestos, growth is quantified, projects itemised, revenue forecast — and there are even threats to beat up contractors who do not finish their jobs. But when everything is declared a priority the stale promises are empty. The voter is left confused as to where the party’s loyalties really lie. Will any of these plans and pledges actually ever materialise and help Nepalis live longer, safer, healthier lives? The main job of any accountable government is to protect its citizens, not so much from foreign enemies but from domestic mismanagement. And this means the most basic test the new government should be made to pass is whether it can ensure basic well-being and protection for all its people. The problems of safety, health, and survival remain unresolved for most Nepalis, and are quietly eroding their lives. In the past year alone, the country’s <a href="https://nepalitimes.com/news/roadkill">roads and highways claimed more than 2,300</a> lives. An estimated 41,000 Nepalis die each year directly because of <a href="https://nepalitimes.com/here-now/what-is-invisible-is-more-dangerous">air pollution</a>, and their <a href="https://nepalitimes.com/news/air-pollution-killing-season-starts-early">lifespans are lessened by 3.4 years</a>.&nbsp; <a href="https://nepalitimes.com/editorial/poor-health">Non-communicable diseases</a> now account for well over half of total deaths in the country. And even where survival has improved, deprivation remains. Chronic malnutrition continues to haunt communities in <a href="https://nepalitimes.com/here-now/mass-migration-from-muktikot">Nepal’s western mountains</a> despite progress in maternal and child health.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260223130240_4f4ef83a31c3c4ae36ecdffb33a355e2fa3de9e98244b840a895af2d95c35ac0.jpg" data-media-id="editor_5" data-image-id="20260223130240_4f4ef83a31c3c4ae36ecdffb33a355e2fa3de9e98244b840a895af2d95c35ac0" data-rendition-name="original" width="1024" height="683" loading="lazy" alt="A life-first manifesto for Nepal NT"> </figure>  These are the lived realities of most Nepalis, and it is here that development can deliver its most immediate returns. A rising GDP, in and of itself, does not make roads safer, clean polluted air, or provide enough nutrition to children. Such outcomes demand intentional, granular policies that confront the specific, everyday problems shaping people’s lives.&nbsp; Macroeconomic growth, trade and investment are important, but these alone cannot guarantee improvements health and safety. The word ‘growth’, after all, is also synonymous with malignancy. Economic progress and human protection are correlated only when governance deliberately links them. Impact on life is the unit in which ordinary Nepalis calculate progress. What is needed, then, is a governing philosophy measurable in these same terms: a ‘life-first’ standard where every policy, budget, and reform can be understood and judged by its impact on protecting and extending human life. Such a ‘life-first’ approach would scrutinise three aspects of every policy. First, whether the policy prevents loss of life. A death is termed preventable if better, more coordinated response systems and regulations could have avoided it (vaccines, drugs, road safety, clean drinking water). A newly built six-lane highway <a href="https://nepalitimes.com/here-now/highway-accidents-are-no-accident-in-nepal">can be a death trap</a> due to poor design or lax enforcement of safety rules. If neonatal deaths continue in a district despite hospitals being present, or if malnutrition claims lives in predominantly agricultural regions, they too are failures. Preventable deaths also cluster where accountability is less direct. Just last year, <a href="https://nepalitimes.com/news/suicides-a-pandemic-within-a-pandemic">Nepal recorded 6,866 suicides</a>, with nearly 20 lives lost every day, yet these deaths fail to prompt any serious examination of governance. The same holds for fatalities linked to domestic or communal violence, alcohol and substance misuse, or ‘natural’ disasters, which register as ‘tragedies without remedy’ rather than as outcomes policy can influence. But when avoidable loss of life recurs at scale, isolated incidents become patterns, and patterns reveal systemic neglect. Saving lives, however, is only the first step, and what matters just as much is the quality of years lived. Nepal’s life expectancy now stands at 71 years, yet many citizens spend years in avoidable disability, untreated chronic illness, or mental distress. A life- first government must ask not only whether people live, but whether they thrive. Are citizens able to pursue education, work, and family life without fear of preventable harm? Do communities have access to clean air and water, nutritious food, and basic healthcare? Can a teenager anywhere in Nepal imagine a future not foreclosed by premature marriage, or untreated depression?  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260223130240_157d72b80b82a07699b6bffbb30036b86f0f767a5674cc3db3d5c20343442940.jpg" data-media-id="editor_8" data-image-id="20260223130240_157d72b80b82a07699b6bffbb30036b86f0f767a5674cc3db3d5c20343442940" data-rendition-name="original" width="2529" height="1427" loading="lazy" alt="A life-first manifesto for Nepal NT"> </figure>  Thriving requires policies that prevent suffering and promote well-being in addition to ensuring survival.&nbsp; Finally, governance must consider graceful aging. Elderly Nepalis should not be left to navigate disease, poverty, or isolation alone. Social systems, healthcare, and community support must enable their continued participation and dignified well-being. Adopting this three-layered standard would gradually reorient how success of any new government is defined. Transportation would be judged by fatalities reduced on the roads. Electricity generation would be measured by whether households can switch from firewood dependence to smoke-free electric stoves.&nbsp; Increase in annual rice harvest must translate into better nutrition, reducing the prevalence of chronic diseases like diabetes. Accountability must follow problems rather than stop at Singha Darbar. Only then will politicians and bureaucrats eventually recognise that their work converges on the same human endpoint. Critics will argue that economies are complex, trade-offs are inevitable, and that governance cannot be reduced to a single metric.But, as Acemoglu and Robinson show in their book <a href="https://ia801506.us.archive.org/27/items/WhyNationsFailTheOriginsODaronAcemoglu/Why-Nations-Fail_-The-Origins-o-Daron-Acemoglu.pdf">Why Nations Fail</a>, the key difference between prosperity and poverty lies in inclusive institutions that empower citizens and create broad incentives for well-being.&nbsp; Extractive institutions concentrate power and wealth in the hands of a few while keeping the majority trapped in neglect. Nepal’s governance has remained a striking example of extraction. If lawmakers in the new Parliament continue to resist changes that would save and improve the lives of ordinary citizens, the same systemic rot will persist for generations to come. A life-first mentality can cut through this inertia by clarifying the moral centre of governance and reminding policymakers that behind every policy failure lies human cost. <a href="https://nepalitimes.com/here-now/epicentre-of-hunger">Every mother in Bajura</a> with a child going hungry at night, every farmer in the Madhes unable to afford medical care, and every family that has lost <a href="https://nepalitimes.com/opinion/comment/saving-kidneys-to-save-nepal">a migrant son to kidney failure</a> understands the true <a href="https://nepalitimes.com/multimedia/dirty-dangerous-difficult-and-dehydrating">value of a life saved</a>. Life is the one metric that transcends ideology, ethnicity, and region. Centering governance on this single, focused metric, can shift an election from a contest of rhetoric to a contest of evidence. Which party ensured access to safe water and basic healthcare? Which made work at home and abroad safer and less exploitative. Which measurably extended healthy years of life for ordinary citizens? Health is wealth. By improving the healthy lifespan of citizens economic prosperity would follow naturally. A ‘life-first’ governance model would therefore compel Nepal to address the underlying structural failures across all sectors, rather than merely alleviating their symptoms. The GenZ protest that toppled the government last September was, at its core, a demand for accountability and a rejection of politics as usual. But as the country edges closer to the polls, that clarity has started to dissipate. Parties are now echoing the language of reform, but the public discourse remains dominated by promises that feel disconnected from Nepal’s most immediate and basic priorities. Every preventable death, every hungry child, and every neglected elder becomes a direct failure of governance and a moral debt the state must answer for. It is how we can make sure we keep the next government in check. The writers are Nepali GenZ students of biomedical engineering at the Hong Kong Polytechnic University.

Nepal’s life or death election

Of the nearly 19 million eligible voters in next week’s election in Nepal, an estimated 5 million are abroad and cannot cast their ballots. Many others within Nepal must travel to their home districts, and might decide not to because of the cost.
Flights into Kathmandu these days are full of global Nepalis returning just to vote, but almost as many are leaving for overseas jobs. Most of those coming or going are in the 20-40 age group, and a majority want Nepal to see a change in leadership.
Bangladesh held an election this month in which citizens overseas could vote by mail.&nbsp;
“Bangladesh made maximum use of technology not just for campaigning but also for polling itself. We could have also managed this, so people within Nepal did not have to travel to their home districts to vote,” says Mohna Ansari, former head of Nepal’s National Human Rights Commission who was an election observer in Bangladesh.
A 3-day holiday has been declared so people can travel to their home constituencies to cast ballots. Even if there was not enough time to manage ballots for overseas Nepalis, it could have been done for Nepalis within Nepal.
Former Chief Election Commissioner Bhojraj Pokharel reckons that physical voting in countries with a large Nepali diaspora would have been a logistical nightmare, but in the PR system, using electronic voting machines or paper ballot could have been piloted in some places. It is not possible to manage the entire voting process until we introduce the internet voting system.
“First of all, there needs to be political will to bring the policy and be ready to undertake that level of investment and it is not a one-time cost,” Pokharel says. “A government formed by the GenZ could have atr least issed an ordinance ensuring this right, piloted out-of-country voting where possible, which could have built pressure for the future Parliament and the government. It would have given people hope. It is a lost opportunity.”
All major political parties called for voting rights for global Nepalis in their manifestos, but these very leaders blocked legislation allowing it despite a 2017 Supreme Court ruling out of fear that it would be anti-incumbent.&nbsp;
<h2>Why so late?</h2>
Bangladesh delivered election results in just one day, but the final results of Nepal's last local polls in 2022 including that of Kathmandu constituencies took nearly a month.
Acting Chief Election Commissioner Ram Prasad Bhandari said this week that the results of the First-Past-The-Post (FPTP) ballot counting would “likely” be published within 24 hours of the poll closing at 5PM on 5 March. But many are skeptical.
“I wonder if we lack the capacity or know-how to announce results as quickly as possible,” says Mohna Ansari.
Former Chief Election Commissioner Pokharel says manual ballot paper counting in Nepal is inherently slow because of the large numner of political parties and/or candidates on the ballot, the counting mechanism, the political behaviour of the candidates/parties and some managerial issues during counting.
“Our present policy is to count all the ballot papers at the returning officers' officies, located at the district headquarters. It requires collecting ballot boxes safetly first. This takes time, and there have been cases of ballot boxes being damaged or stolen during transport. In a few highly difficult, geographically remote polling centres, we use a helicopter or transport. But sometimes, accommodating the party and candidates' representatives remains challenging,” explains Pokharel. A solution could be counting ballots at the very booths where they are cast.
Another reason for the delay is simply the number of political parties, and the need for each ballot paper to be examined by booth representatives for consensus. In close races, the smallest difference can lead to tense situations, further delaying results, even though counting centres are protected by metal fencing so there is no disruption.
After this, then it is the turn of Proportional Representation (PR) ballots to be counted. Weeks pass by the time the results of candidates and parties are tallied and verified. But the most common delay is because election officers think ballot counting is a nine-to-five job.&nbsp;
“The efficiency of poll station officers is most important, and they are incentivised for this,” says Ansari, adding that counting can even start within an hour after voting closes.
In remote areas, local resources could be mobilised to make counting quicker, but there is a crisis of trust, adds Ansari.&nbsp;
That could be easily solved with electronic voting which the EC implemented in the 2008 polls but discontinued because political parties felt the machines could be hacked or manipulated.

Nepalis Select Who To Elect

On Saturday, Iran retaliated with missile strikes on Abu Dhabi, Dubai, Bahrain and Qatar, a region where there are an estimated 2 million Nepalis working to send money home. In addition, thousands of Nepalis were preparing to board flights to Kathmandu from West Asian cities this weekend to vote in the 5 March election. Many are said to be stranded at various aviation hubs. A Qatar Airways flight from Doha took off just before the air space was closed, while Air Arabia and Kuwait Airways have diverted or cancelled flights. Nepalis in the West Asian region said things were relatively calm where they were, although some heard loud explosions at about noon local time. In Dubai, some thought they were Ramadan fireworks.&nbsp; In Kuwait, nearly 2,000 Nepalis working in the US military base as security guards and cleaners were evacuated before the strikes. In Bahrain where the US Fifth Fleet naval base is located and which was hit by two Iranian missiles, workers contacted by Nepali Times said the situation was under control and the authorities had told everyone to stay indoors and not use highways. The conflict also coincided with the beginning of Nepal’s trekking and mountaineering season, and tourists were either on their way or planning to leave European and North American cities for Himalayan hikes. Most of them transit through Doha, Dubai or Kuwait and all three airports are closed. Turkish Airlines flights via Istanbul are still operating.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260228130212_ab5e132d56da1df6a3fb1b6919648f845a168ad2c51d79f7587fb85a6e913b97.png" data-media-id="editor_0" data-image-id="20260228130212_ab5e132d56da1df6a3fb1b6919648f845a168ad2c51d79f7587fb85a6e913b97" data-rendition-name="original" width="1864" height="826" loading="lazy" alt="Qatar and UAE airspace closed"> <figcaption>Qatar and UAE airspace closed. Credit: Flightradar24</figcaption> </figure>  However, the main impact for the world could be a spike in the price of petroleum products if the strategic Strait of Hormuz is blocked. China relies on Iranian oil for their refineries, and Nepal could be affected indirectly if the economies of its neighbours are hit. Nepal imports all its diesel, petrol, LPG and aviation fuel from India which sources it mainly from the Gulf, and until recently from Russia. Petroleum makes up 25% of the value of all imports, and that is more than Nepal earns from all its exports. Saudi Arabia this year overtook the UAE as the main destination for Nepali workers, with the number now totalling 400,000. There are said to be as many in the UAE, and another 350,000 in Qatar. There are another 100,000 mostly women in Kuwait, and 50,000 each in Oman and Bahrain.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20260228130220_d24ae633ff84f283835434becdb2f1351f84c415ce87ca34378bd4e2669661b3.jpg" data-media-id="editor_1" data-image-id="20260228130220_d24ae633ff84f283835434becdb2f1351f84c415ce87ca34378bd4e2669661b3" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="West Asia Iran conflict"> <figcaption>Iran retaliated with missile strikes on Abu Dhabi, Dubai, Bahrain and Qatar on Saturday.</figcaption> </figure>  Nepal receives nearly $11 billion a year in remittances from overseas Nepalis (not counting India) through official channels, although the total is said to be much more. &nbsp;This makes up more than a quarter of Nepal’s GDP equivalent — one of the highest proportions in the world. More than half of the overseas remittances to Nepal comes from its workers in the Gulf, and it is the mainstay of the country’s economy. Nepalis in Saudi Arabia, Qatar and the UAE alone send home more than $3 billion a year, much of that helping support their families back home. An average Nepali worker in the Gulf sends home nearly $2,500 a year, and this is spent mainly for household supplies, children’s education and healthcare. There are also an estimated 7,000 Nepali caregivers and healthcare workers in Israel, and most of them are women. The Nepal Embassy has asked Nepalis in Israel to take caution and move to bomb shelters.

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