On Friday, former prime minister Pushpa Kamal Dahal posted a message to his official TikTok account @cmprachandaofficial. He wished a Happy Dasain to all Nepalis, and wished them good health and continued progress. But almost exactly a year ago, his own Maoist-Nepali Congress coalition government <a href="https://nepalitimes.com/news/rattled-by-criticism-nepal-bans-tiktok">banned the app</a> claiming that it ‘disrupted social harmony’. By then, TikTok had seen a meteoric rise and media surveys showed it had overtaken Facebook. &nbsp; The real reason for the ban was that the established parties were spooked by <a href="https://nepalitimes.com/editorial/nepal-populist-party-balenist">newer, alternative leaders</a> and <a href="https://nepalitimes.com/news/street-politics">pro-monarchist forces</a> using the platform and social media to gather followers. But in June this year, the Maoists were ousted from government, the UML joined the Nepali Congress coalition. K P Oli was appointed prime minister for the third time, and in August he unbanned TikTok as suddenly as it was banned. Since then, TikTok has not wasted any time to make up for lost ground in Nepal. Last week it held a pre-Dasain ‘Grow with TikTok: A Masterclass for SMBs’ at the Marriott Hotel in Kathmandu aimed at helping small and medium business enterprises to grow their business. “Humour works best on TikTok, it leads to crazy engagement,” one presenter advised the rapt audience. “Write scripts, have a strong opening, and stand in front of a window sideways for good lighting.” He stressed the need to upload frequently and experiment widely to find out what works for any particular brand.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20241014081036_b86a6707bdb76b2776c24807e1973360e4f891be2c114b35f534191f4db23d82.jpg" data-media-id="editor_3" data-image-id="20241014081036_b86a6707bdb76b2776c24807e1973360e4f891be2c114b35f534191f4db23d82" data-rendition-name="original" width="1000" height="666" loading="lazy" alt="TikTok in Nepal"> <figcaption>The conference was attended by business owners and TikTok influencers</figcaption> </figure>  While TikTok is mostly used by Nepalis to lip-sync or dance to song-snippets, one of the tips at the conference was the need to be authentic: to take a trend and make it work for users and their businesses. “I started out by just making videos about what was really happening in my life, and people liked it,” admitted Anjana Aryal, whose achar business sells thousands of jars every week of 22 pickle varieties, employing 15 women. At last count, Aryal had 608,000 followers, and posts every day, mixing content about her pickles with videos of her dancing, shopping, or just talking. Aryal was in a panel of four successful Nepali TikTokers slash business owners, all female, who spoke about how to sell well on the app. A fashion business, makeup studio, and an online store were the other presenters. All four have been using TikTok since 2020 and had the same advice: be consistent, figure out your niche, be genuine, do not take internet hate personally, and find your voice. Taranidhi Regmi runs the Tokha bookstore KitabKiro and has used TikTok for the last two years, reviewing books on video and encouraging people to read. He takes orders through a website and Whatsapp, and has shipped Nepali books to more than 48 countries. “Initially, I didn’t like TikTok, I thought it was quite degenerate,” admits Regmi. “I was annoyed when my nieces were on it, but then I realised the benefits of the app by staying away from the nonsense.” The conference also had a session on how TikTok handles safety issues, moderating content that may be mature and inappropriate, and how it deals with addictive and dangerous activities or products. TikTok executives admit that theirs is a relatively new platform, and they are still learning as they go along. They tried to deflect some of the harder questions about balancing moderation and free speech, and about flagging videos as problematic that would be completely fine in a Nepali context. TikTok says it is implementing ‘community guidelines’ without going into detail about how that works.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20241014081040_e6b9e3ca5ce842810d5fbbf190471e4fa8cdf6f7770514abb933f09fa84b7b3f.jpg" data-media-id="editor_4" data-image-id="20241014081040_e6b9e3ca5ce842810d5fbbf190471e4fa8cdf6f7770514abb933f09fa84b7b3f" data-rendition-name="original" width="3000" height="2000" loading="lazy" alt="TikTok in Nepal"> <figcaption>There were sessions on video creation, security guidelines, and expert panels.</figcaption> </figure>  “For the nine months that TikTok was banned in Nepal, we could not &nbsp;really get clarity on it except the official explanation that it disrupted social harmony,” says Imad Jaffer of TikTok South Asia during a visit to Kathmandu last week. “We were more than open to dialogue, but the government was not responsive at all.” Nepal was not the first to ban TikTok. India has banned it, and it has been closed temporarily in Pakistan four times. US President Joe Biden signed a bill that could lead to a nationwide ban on TikTok unless its Chinese parent company ByteDance sells it to an American entity by 19 January 2025. The main reason is geopolitical, and sensitivity about personal data getting into Chinese hands “In the Pakistan case, we understood that they had concerns about vulgarity on the app,” says Jaffer. “But the Nepal ban was the strangest. We got no explanation for it even though the public sentiment towards the app was overwhelmingly positive.” Despite the ban, about half the Nepalis <a href="https://nepalitimes.com/opinion/comment/tiktok-ban-won-t-stop-nepali-netizens">TikTok users</a> just continued posting through VPNs. In some ways, the app is a victim of its own success — it is highly addictive algorithm that can create a feedback loop of content that <a href="https://nepalitimes.com/editorial/jail-the-messenger">has strong political influence</a>. Nepal’s <a href="https://nepalitimes.com/editorial/democracy-s-discontents">populist anti-establishment politicians</a>, monarchist and Hindu nationalist RPP were using the app successfully to gather support, and spread the word about their rallies just before the ban. The Maoist-NC coalition could have felt threatened. After the coalition switch, the Cabinet earlier this month reinstated TikTok &nbsp;under four conditions: <ol> <li>Help promote Nepal’s tourism</li> <li>Invest in digital literacy&nbsp;</li> <li>Support public education system&nbsp;</li> <li>Be ‘mindful’ of content &nbsp;</li> </ol> Experts say that the government has no grounds to make these demands to TikTok, and the conditions are as vague as the original reason for the ban. Yet, the other side to it is that many Nepalis are <a href="https://nepalitimes.com/here-now/huge-uptick-in-tiktok-during-nepal-lockdown">hooked to the platform</a> which at one point before the ban consumed one third of all internet traffic. Young Nepalis were matchmaking through TikTok, it was <a href="https://nepalitimes.com/here-now/nepalis-dying-in-someone-elses-war">used to recruit Nepali mercenaries for the Russian Army</a>, and despite age restrictions young people are exposed to graphic content. But bans and restrictions never work. The TikTok ban was seen as an <a href="https://nepalitimes.com/news/talking-about-tiktok">effort by the government to encroach on freedom of expression</a>. It was like parents taking away internet privileges from their children, which actually ends up increasing the attraction for its content.

Vishad Raj Onta

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Taking back TikTok

Baburam Aryal, Advocate, 
Digital Freedom Coalition 
The Nepal government’s decision to ban TikTok is irresponsible and unlawful. Nepal’s Constitution guarantees freedom of expression and the right to information, both for print and online. So this ban is against the spirit of the Constitution. 
 
Kamal Dev Bhattarai, Editor, 
Annapurna Express 
TikTok has good things going on too and one of them is how small entrepreneurs have found success using this platform. This ban has had a damaging impact on these businesses. 
TikTok has also provided space to up-and-coming youth who have been ignored by the mainstream media. The platform has allowed them to unlock their talents and they have gained popularity nationally and internationally. 
 
Smriti Shrestha, Founder, 
Akarsan Skin and Hair Clinic 
Any business requires marketing tools and ours is social media platforms such as Facebook, Instagram, Google, TikTok and Youtube. But unlike other platforms that require you to spend dollars to boost or advertise your business, TikTok doesn’t cost you money. I make content that could go viral and lead to an increase in business without me being required to spend any money. 
TikTok has a viral reach like no other. Earlier this year, Gosainkunda was busy like Asan bazaar because clips of the place were going viral on TikTok and trekkers were visiting in droves as a result. So this ban will also hamper the tourism sector.
Read Also: <a href="https://nepalitimes.com/opinion/comment/tiktok-ban-won-t-stop-nepali-netizens">TikTok ban won’t stop Nepali netizens</a>, Saniaa Shah 
 
Tanka Aryal, Chair, 
Digital Rights Nepal 
The government seems to have taken it as just banning a private company. &nbsp;But it is against the right to information and freedom of speech enshrined by our Constitution. At the same time, people were using &nbsp;TikTok to promote their businesses, the platform has been crucial for the tourism industry and for entrepreneurship. 
As such, this is an ad hoc bad with a very weak excuse that TikTok was creating social disharmony. Is TikTok the only one doing so? Even then, as per our &nbsp;Constitution, we cannot shut down any media platform but we can regulate the content given that hate speech, mis- and disinformation are quite prevalent these days. The state can also work on digital literacy instead of taking this easy route which is a regressive step. 
The ban therefore is against the prevalent law and Constitution of the land. &nbsp;This is also impractical in today's world where technology is an integral part of everyday life. 
 
Santosh Sigdel, Advocate, 
Digital Rights Nepal 
The &nbsp;TikTok ban has a direct impact on digital rights. The most important thing when it comes to digital rights is access to the internet, and for most of the Nepalis that was TikTok. And the ban has curtailed their rights. 
TikTok is very user-friendly and doesn’t need a whole lot of technical know-how which was why its users were increasing exponentially, in turn leading to a huge reach. 
The ban has also directly impacted freedom of speech and the right to information online. 
Then there is the right to employment. A lot of small entrepreneurs were using TikTok for their business. Much of their digital content is lost and so is their means of livelihood. In a nutshell, the TikTok ban curtails a whole lot of basic rights. 
 
Chiranjivi Adhikari, General Secretary, 
CAAN Federation 
The decision to ban TikTok because of security reasons is not scientific. &nbsp;Expecting privacy from social media sites we consume for free doesn't really make sense, our content on these platforms is at the very least on their servers. 
More worryingly, with free DNS and VPN we are seeing a massive increase in TikTok users. Free DNS and VPN are not secure and run malicious codes. If these get installed on our phones and laptops, and especially if we use the same devices for offices, they could destroy the whole network in our workplaces. These devices can also access our banking details and can easily do away with monetary losses for us.
Read Also: <a href="https://nepalitimes.com/news/rattled-by-criticism-nepal-bans-tiktok">Rattled by criticism, Nepal bans TikTok</a> 
 
Dinesh Tripthi, 
Senior advocate 
If we are to ban TikTok we will have to ban the whole of social media. We know that FaceBook, YouTube, Instagram, and Twitter have all been misused and more so. As such, the government will have to ban the internet. People also get vulgar, harassing messages on their mobile phones. This means the ban is not the solution. In a democratic society, a remedy shouldn’t be worse than a disease. Any step that the government takes should be based on the Constitution, and not constrict the democratic space like they have done by banning the platform in Nepal.

Talking about Tiktok

Unnerved by the rise of rightwing religious groups, Nepal’s coalition cabinet decided Monday to clamp an immediate ban on TikTok, saying the social media platform is spreading social discord. The popularity of the Chinese social media platform rose dramatically in Nepal since the Covid lockdown, rivalling the reach of Facebook, and political pressure groups had started using it to multiply their reach. “The cabinet decided to ban TikTok because of its impact on social harmony,” Minister of Communication and Information Technology Rekha Sharma said. “We are overseeing the prompt implementation of the closure.” Sharma, who is also the government spokesperson, said, however, it could take some time to shut down the platform in a smooth manner. The announcement was obviously timed for the Tihar holiday period, when the government might have expected criticism of the move to be muted. However, most of the immediate reaction on social media (and also on TikTok itself) was of outrage and ridicule with most commentators seeing it as a sign of a shaky coalition that has been spooked by the rise of the religious right and pro-monarchy forces. The last<a href="https://nepalitimes.com/here-now/nepal-s-interface-with-information"> media survey</a> conducted by Sharecast Initiative in 2022 showed that 56% of a sample group of Nepalis who were on the Internet said they used TikTok. The platform was launched by the Chinese technology company ByteDance in 2016, and saw a spurt in users in Nepal after the pandemic lockdowns. “TikTok’s aggressive algorithm makes it highly addictive, and that is the reason for its rapid spread in Nepal,” explains Sharecast Initiative’s Madhu Acharya. “But there has been concern about cultural invasion through its content, and the government appears to be worried about it being used by those opposed to the secular and republican &nbsp;constitution.” Acharya is preparing a new media survey this year, and extrapolates TikTok’s user base to have now grown to 85-95% to rival Facebook and YouTube.&nbsp; Many critics of the move have seen the TikTok ban as the first step in what they see as a government design to muzzle freedom of expression and an independent media in Nepal, which is currently the most open society in South Asia. "TikTok represents freedom of expression. Banning it is to curtain freedom of speech. How will the government be accountable if there is no criticism?,” says Constitutional law expert Bipin Adhikari. “As long as there is no incitement to violence or criminality, or encourage religious strife, the government has no right to ban free expression.” Opposition parties have been scathing in their criticism of the government move, saying it exposes the fragility of the 8-party coalition government led by Prime Minister Pushpa Kamal Dahal of the Maoist Centre with the Nepali Congress and other smaller parties.&nbsp; Even some dissident members of the Nepali Congress have taken to social media to voice their opposition to the TikTok ban announcement. ‘If you have a boil on your neck, you don’t chop off your neck,’ wrote Bishwa Prakash Sharma of the Nepali Congress who is with a faction opposed to party president Sher Bahadur Deuba. ‘Identify those who are misusing the platform. But shutting down TikTok is undemocratic.’  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231113131112_b7c68b593d4d601406a2fb754d6010db8d03fa17fee17b9129cd6c576fc9f370.png" data-media-id="editor_1" data-image-id="20231113131112_b7c68b593d4d601406a2fb754d6010db8d03fa17fee17b9129cd6c576fc9f370" data-rendition-name="original" width="1192" height="676" loading="lazy" alt="tiktok"> </figure>  Another NC General Secretary Gagan Thapa said the TikTok ban reeked of authoritarianism: "This is a sign that the government wants to clamp down on freedom of expression. The government has taken a wrong step." <div class="embed-block"><div style="max-width: 550px;"><div style="left: 0; width: 100%; height: 0; position: relative; padding-bottom: 56.25%;"><iframe src="//cdn.iframe.ly/api/iframe?app=1&url=https%3A%2F%2Ftwitter.com%2Fthapagk%2Fstatus%2F1723976965810688154&key=87ca3314a9fa775b5c3a7726100694b0" style="top: 0; left: 0; width: 100%; height: 100%; position: absolute; border: 0;" allowfullscreen></iframe></div></div></div> A spokesperson of the independent RSP which is also in the opposition said that if there was a problem with TikTok it could be regulated, and an outright ban was overkill. One immediate concern that the government had appears to be over businessman Durga Prasai who has mounted a vocal campaign on TikTok against mainstream parties for the reinstatement of a Hindu monarchy in Nepal. He had made a call for 100,000 people to rally in Kathmandu on 21 November. Prasai, who is heavily in debt after having borrowed to start a hospital in eastern Nepal, has also been leading a public campaign to refuse to pay back bank loans. Many see his anti-establishment political stance as a way to magnify his movement. Nepal is not the first country to ban the app. India imposed a nationwide ban on TikTok in 2020. Along with a looming ban in the US, other countries including Australia, Belgium, Canada, Denmark, New Zealand, and Norway among others have also banned the app on government devices.&nbsp; While for many of these countries, the issue seems to be the Chinese ownership and user data security, the Nepal government has cited social harmony as the main reason for the move.&nbsp; The ban closely follows the recently introduced ‘Directive on the Operation of Social Networking 2023’ which says that social media platforms operating in Nepal now have to establish offices in the country. It also has a list of 19 things users are not allowed to do on social media including creating and engaging through fake IDs, posting media or text that spreads animosity against any community, caste, gender, religion, indulging in hate speech and defaming others. To be sure, internationally as well as in Nepal, Tiktok has become a breeding ground for hate speech. There have been <a href="https://www.tandfonline.com/doi/abs/10.1080/1057610X.2020.1780027">studies</a> on how TikTok is being used to spread racist, sexist and homophobic content.&nbsp; There are instances in Nepali Tiktoksphere where clips of individual users who have made <a href="https://www.tiktok.com/@chhabilalsubedi.official/video/7298021488991522050">questionable comments around certain communities</a> have gone viral starting a thread of spat between the communities. Some have also indulged in morally questionable behaviour including a recent case of a female CPN Maoist Centre cadre exposing herself during a TikTok live. It has also emerged as a platform for online gambling, and the app’s rising popularity also means that it has become a medium for spreading fake news, misinformation and disinformation. But it is difficult to say the same does not happen or has not previously happened on other social media apps. &nbsp; Instead of regulating what technology a person uses or how they choose to use it, critics say a more nuanced approach like addressing specific issues and promoting digital literacy is required. A more creative way would be to utilise TikTok itself to tackle the extremist ideologies in collaboration with the social media platform and foster dialogue both on and offline.&nbsp; Even when developing and enforcing legal frameworks, it is important to ensure that these are in line with international human rights standards and do not infringe upon or restrict freedom of expression.&nbsp; Says advocate Baburam Aryal of the Internet Governance Institute, "Today it is TikTok, tomorrow it could be Kantipur, the next day it could be Onlinekhabar, there is a danger that all media will be muzzled. This is how authoritarianism begins."

Rattled by criticism, Nepal bans TikTok

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

Visit Nepal in the monsoon

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

Not poor, but not rich

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

Nepal’s bubble economy

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