<figure><img width="800" height="1200" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53759c7e80680e052351jpeg.jpg" alt=""/><figcaption>Photos: BIKRAM RAI</figcaption></figure>If this is the state of the streets in the capital, imagine what it is like in the rest of the country.Exactly a year ago this week, Home Minister Ram Bahadur Thapa assured Parliament’s Good Governance Committee that the government would “coordinate with stakeholders” to fix <a href="https://archive.nepalitimes.com/article/nation/Sinkhole-politics-in-Nepal,3837" target="_blank" rel="noopener">roads in the capital</a>. “Due to the negligence of contractors, development projects have not moved ahead and efforts have been made to get them going in coordination with concerned ministries to improve the conditions of roads in Kathmandu,” Thapa was quoted as saying by state news agency RSS on 14 August 2018.A year has passed. And like most government promises, it was never kept. Kathmandu’s roads this monsoon are in an even worse state than <a href="https://www.nepalitimes.com/here-now/political-quagmire/" target="_blank" rel="noopener">last year</a>. Streets dug up for laying water mains or sewers are abandoned like booby traps, like this pit in Sanepa (above). After locals along the Boudha-Jorpati stretch blocked the street earlier this year in protest, the government hurriedly started repairs. But the monsoon turned the road into a quagmire again.<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53779c7e80680e052352jpeg.jpg" alt="" width="1000" height="1500"><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a537a9c7e80680e052353jpeg.jpg" alt="" width="1000" height="1500"><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a537d9c7e80680e052354jpeg.jpg" alt="" width="1500" height="1000"><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53819c7e80680e052355jpeg.jpg" alt="" width="1500" height="1000"> <figure><img width="1400" height="933" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53849c7e80680e052356jpeg.jpg" alt=""><figcaption>A scene at Teku bridge this week.</figcaption></figure><figure><img width="2000" height="1500" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53899c7e80680e052357jpeg.jpg" alt=""><figcaption>A landslide this week on Sanfe-Martadi road is preventing big four wheel vehicles from travelling in and out of Martadi. The road is the main connection to the remote mountain district of Bajura. Photos: MONIKA DEUPALA</figcaption></figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a538c9c7e80680e052358jpeg.jpg" alt="" width="2000" height="1500"><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53909c7e80680e052359jpeg.jpg" alt="" width="2000" height="1500"><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53949c7e80680e05235ajpeg.jpg" alt="" width="2000" height="1500"><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022110814110/636a53989c7e80680e05235bjpeg.jpg" alt="" width="2000" height="1500">It is worse in the hinterland, where not only are the roads never repaired but new ones are being dug through the mountains <a href="https://www.nepalitimes.com/opinion/nepals-fatalistic-ke-garne-culture/" target="_blank" rel="noopener">just to spend budgets</a>, unleashing rockfalls on farms and settlements below.Read also: <a href="https://www.nepalitimes.com/?p=31532&amp;preview=true" target="_blank" rel="noopener">Driving Nepal deeper into debt</a>, Ramesh KumarGovernment SUVs drive along roads that are in poor shape because the budgets to repair them have been spent on expensive cars. Our investigation shows that in the past three years, federal and provincial governments spent a massive Rs250 million on buying SUVs. This may be an absolute majority government, but it has been an <a href="https://www.nepalitimes.com/editorial/own-worst-enemy/" target="_blank" rel="noopener">absolute failure in service delivery</a>. Meanwhile, the federal government this fiscal year spent 2.45% of its total budget on buying vehicles even though most infrastructure is abandoned or half complete after private contractors with political protection absconded with money.

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Disrepair

<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.”

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

Visit Nepal in the monsoon

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

Flouting rules caused Saurya tragedy

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

Nepal’s bubble economy

French citizen Louis arrived in Nepal for the first time earlier this year, planning to <a href="https://nepalitimes.com/banner/the-abcs-of-a-winter-trek-in-nepal">trek the Annapurna Circuit </a>before heading down to Bardia to hopefully catch a glimpse of some<a href="https://nepalitimes.com/news/nepal-counting-its-tigers"> tigers</a>. Before he began his journey from Besisahar, Louis (who only revealed his first name) had imagined breathing crisp mountain air, and following the melodious gurgle of the Marsyangdi.&nbsp; Instead, he had to breathe fumes and dust all the way to Chame. Louis says he masked his face with a handkerchief: “It was not what I expected, this is not right.”  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2025080304080_f03fce1527cf8a63178e4e82589a1a7096c8cfa28893ca4a5f7fe82d91a6e38a.jpg" data-media-id="editor_2" data-image-id="2025080304080_f03fce1527cf8a63178e4e82589a1a7096c8cfa28893ca4a5f7fe82d91a6e38a" data-rendition-name="original" width="2419" height="1814" loading="lazy" alt="Manang trails NT 1"> </figure>  Many other trekkers are similarly disappointed as roads have been built along what used to be <a href="https://nepalitimes.com/banner/a-walk-back-in-time-chandragiri-hatiban">walking trails</a>. Manang and Humla are the last remote regions in the Himalaya to be connected to the national road network. &nbsp;Construction of the 87km Besisahar-Manang road began in 1994, but was stalled during <a href="https://nepalitimes.com/news/14-years-after-conflict-no-closure-in-nepal">the Maoist conflic</a>t, and finally finished in 2012.&nbsp; Most of it has not yet been blacktopped, and sections have been carved out of vertical cliff faces, making them treacherous. But it has allowed road access to Manang, a journey that previously took a week on foot.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2025080304084_32b3ca875a0df9f1dd42dbe915e6f6a2cd4f2e53f1cf2d3ee5cbdb3435905000.jpg" data-media-id="editor_5" data-image-id="2025080304084_32b3ca875a0df9f1dd42dbe915e6f6a2cd4f2e53f1cf2d3ee5cbdb3435905000" data-rendition-name="original" width="2400" height="1505" loading="lazy" alt="Manang trails NT 1"> </figure>  While the <a href="https://nepalitimes.com/opinion/the-road-out-of-nepal">road has improved access</a>, it has impacted on<a href="https://nepalitimes.com/here-now/trekking-in-the-time-of-climate-change"> trekking tourism </a>— the mainstay of Manang’s economy. The number of tourists visiting the scenic valley behind the Annapurnas grew from 21,245 in 2023 to 30,866 in 2024. The Annapurna Circuit is known for unique sights like <a href="https://archive.nepalitimes.com/news.php?id=9194">Tilicho</a>, one of the highest lakes in the world, the Thorong La pass that connects Manang to Mustang, and the valley’s own rich cultural heritage. Thorong La at 5,416m is the highest hiking pass in the world, and was used by locals for trade with Mustang before it became a <a href="https://nepalitimes.com/opinion/comment/lift-restrictions-on-upper-mustang">popular trekking route</a>. &nbsp; “For guests, the excitement of reaching Thorong La is now overshadowed by their disappointment of having to journey through dusty roads to get there,” says Manang lodge-owner Ongma Gurung. “That is the complaint we get the most.” <a href="https://nepalitimes.com/banner/tourism-that-treads-lightly-on-the-land">Local tourism </a>operators are trying to get the government to build alternative foot trails. But there have been delays due to a lack of budget.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2025080304084_c5f76e398182785bb17846a148e3ca89de5687b4623580f8e2d725a7a287edfa.jpg" data-media-id="editor_11" data-image-id="2025080304084_c5f76e398182785bb17846a148e3ca89de5687b4623580f8e2d725a7a287edfa" data-rendition-name="original" width="2419" height="1762" loading="lazy" alt="Manang trails"> </figure>  The Naso Rural Municipality has identified other routes along the Annapurna Circuit in Chyamche, Tal, and Khotro so trekkers can bypass heavy vehicles involved in the construction of the Manang-Marsyangdi Hydropower Project. “But the local government cannot do everything,” admits the chair Dhan Bahadur Gurung. “And for leaders in Kathmandu, Manang is out of sight and out of mind.” Munindra Jung Gurung represents Manang in the Gandaki Provincial Assembly, and says he has raised the issue in <a href="https://nepalitimes.com/news/pokhara-s-tourism-woes">Pokhara</a>. He is hopeful there will be a hearing. To be sure, the road is not all bad news. Locals benefit, the number of visitors has grown, and trekkers can now also save time and use it to explore <a href="https://archive.nepalitimes.com/news.php?id=5960">side valleys in Manang</a>, visiting the villages like Nar and Phu. Annapurna Conservation Area (ACA) chief Rabin Kadariya concedes that the road to Upper Manang was crucial to connect the remote region with the rest of Nepal, but adds: “We have built an alternative trail connecting Talgaun, and we will consult local communities about their priorities on other hiking trails.”&nbsp;

suvs

Disrepair

Driving Nepal deeper into debt

Visit Nepal in the monsoon

Flouting rules caused Saurya tragedy

Nepal’s bubble economy

Trailing off in Manang