<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114111144/63721c669c7e80680e0bd48djpeg.jpg" alt="" width="1765" height="903"/><figcaption>A caravan of yaks carrying salt heads south. SOURCE: JAG BAHADUR BUDHA</figcaption></figure>While it is unclear when and how salt was first introduced to Nepal’s culture and cuisine, what is clear is that Tibetan salt was once the foundation of our Himalayan economy and livelihood.From the Walung, Lhomi, Bhote, Sherpa, Byasi Souka, Mugali, Nyinba, Dolpo, and Nisyangba, the ethnicities on Nepal’s Himalayan rimland from Taplejung in the east to Humla and Darchula in the far west have historically shared socio-cultural and religious ties with Tibet.The relationship between the southern flanks of the Himalaya with the Tibetan plateau extended to trade at a time when agriculture and livestock were the main means of livelihood on both sides of the mountains. Before 1850, Nepal imported rock salt, wool, powdered gold, horses and yaks from Tibet, and exported grain, spices, knives, fabric, handicrafts and more.In 1774, Prithivi Narayan Shah’s Gorkha expansion had led to the annexation of regions controlled by Darjeeling as well as the town of Bijaypur in the Limbuwan region which was then ruled by Sikkim.This angered the Tibetans, effectively souring relations and bringing trade to a standstill. This caused a shortage of salt in Nepal, which traders would try to remedy by smuggling it through high Himalayan passes.Nepal and Tibet fought wars in subsequent years over minting coins to trade disputes. But this did not affect the secret crossborder trade since the Nepal-Tibet border was so rugged and remote it could not be fully policed.Nepal and Tibet finally signed a treaty in 1856 to officially resume cross-border trade, allowing free travel and trade to resume.Historian Baburam Acharya in his journal China, Tibet and Nepal notes that Nepali merchants bartered rock salt bought down from Tibet for grain from Nepal’s south. In the absence of common currency, bartering these goods was the main form of trade. This barter system remained in place until 1959, writes Wim van Spengen in his book Tibetan Border Worlds: A Geohistorical Analysis of Trade and Traders.The people of Tibet’s Changthang Plateau were largely nomadic, while Nepal’s ethnicities were more settled into farming and pastoralism in the upper reaches of the Tamor, Arun, Dudhkosi in the east, to Budi Gandaki, Marsyangdi, Kali Gandaki in central Nepal, and Bheri, Karnali and Mahakali in the west.Low agricultural yield in these semi-arid trans-Himalayan valleys meant that the communities traditionally depended on cross-border trade with Tibet.Because merchants would have to be away to engage in trade for long periods of time, they divided roles, particularly among brothers, with some of the family members tasked with transporting and trading salt, and others staying behind to manage their homesteads.For this reason, polyandry was convenient and accepted in Himalayan cultures. One woman married to all brothers meant the family remained together with centralised resources, and the women did not become widows if one brother died during the perilous Himalayan traverses.Austrian anthropologist Christoph von Fürer-Haimendorf spent much of his life in Nepal, studying Nepal’s cross-border trade with Tibet, publishing his book Himalayan Traders in 1988. He explores how the market for Tibetan salt extended from Nepal’s high mountains to the foothills and the southern plains.Read also: <a href="https://www.nepalitimes.com/banner/was-tenzing-a-tibetan-nepali-or-indian-it-does-not-matter/">Was Tenzing a Tibetan, Nepali, or Indian? It does not matter.</a>, Lhakpa Norbu Sherpa<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114111144/63721c699c7e80680e0bd48ejpeg.jpg" alt="" width="960" height="640"><figcaption> </figcaption></figure>The Salt Economy From 1850 to 1959, the indigenous peoples living in the highlands from Taplejung in the eastern Nepal to Humla in the northwest and Mahakali in the far west engaged in the ‘salt economy’ — trading Tibetan salt with the Nepalis across the central hills and the plains.The Walung ethnic group settled on the banks of the Tamor in Taplejung’s Olangchungola, Yangma and Ghunsa regions. Their job was to transport the salt from Tibet down to Maiwakhola, and exchange the goods with the Limbu indigenous groups in the central mountains. The Limbus would then take the salt down to Dharan to barter for grain and cloth.Meanwhile, Nepal’s Bhote and Sherpa put down roots where the Arun river originates in   Sankhuwasabha’s Thudam, Ritak and Topkegola regions. A little further downstream lived farmers from the Lhomi community. The Bhotes and Sherpas would barter salt for the potatoes and grains grown by the Lhomis. Similarly, the Sherpa of the Khumbu region bought and transported rock salt from Tingri in Tibet across the Nangpa La and traded it with the Rai people from down valley of the Dudh Kosi.In western Nepal, <a href="https://nepalitimes.atavist.com/high-and-dry-upper-mustang" target="_blank" rel="noopener noreferrer">Mustang’s</a> Lowa tribe settled along the Kali Gandaki and carried Tibetan salt to  Thak Khola, where they bartered it with the Thakalis who took it down to Pokhara and Kathmandu.Meanwhile, the Nisyangbas of Upper Manang used to trek even lower to trade salt in Pokhara and Baglung, eventually expanding to Calcutta and the British East India Company, and later to even Burma via Darjeeling, Kalimpong and Gangtok.In fact, so impressed was King Mahendra with the Nisyangba traders that he issued special passports to Nisyangba  merchants in 1960, allowing them to expand their transnational trading bases as far as Malaysia, Thailand and Singapore.Read also: <a href="https://www.nepalitimes.com/latest/north-of-the-border/">North of the border</a>, Nabaraj MahataraAfter Prithivi Narayan Shah’s conquest of Kathmandu Valley in the 1770s, Sankhu became also a major trading post, and would remain one until 1967. Tibetan salt from Sankhu Customs was  traded in the markets of Kathmandu from where it would reach the Tarai.The Mughals and Karins settled near the Karnali River and indigenous to Upper Mugu used to travel to Tibet twice a year to import salt and wool. The salt was then exchanged for grain in the lower Mugu and Jumla to the Matwali Chhetris, who would go on to sell the goods in Jajarkot and the Tarai. Communities in northern Humla also traded salt for grain with the Thakuri  in Bajhang and Bajura to the south.The Dolpopa of the Upper Dolpo transported salt and wool on sheep, mountain goats and yaks to exchange for grain in the Tarali Magar village  as well as to the Hurikot and Kaigaun villages in the Tichhurong region. Some of the last of these yak caravans were depicted in Éric Valli's Oscar-nominated film, Himalaya.In the far-west, the Khas Thakuris of the Byasi Sauka, Hikila and Sunsera communities brought salt from Taklakot in Tibet, trading it across Baitadi, Doti and Bajura.The salt economy strengthened ties not only between the people of Tibet and the Nepal Himalaya, but also fostered personal relationships between individual Nepalis and Tibetans, so much so that the exchange of कोसेली presents between Nepalis and Tibetans was as commonplace as the buying and selling of salt.The salt trade also cemented lasting bonds between communities of the high Himalaya and the mid-mountains. The Nyinba tribe of Upper Humla were closely linked to the Khas of Limal, while the people of Upper Mugu had ties with the Khas of Lower Mugu.  The Tarali Magars and Matwali Khas people of Dolpo, as well as the Lowa and Thakali of Upper Mustang had strong family bonds. The Sherpa of Khumbu similarly built relationships with the Sunwar and Rai communities to the south, as did Taplejung’s Walung with the Limbu community.Read also: <a href="https://www.nepalitimes.com/banner/there-are-muslims-in-tibet-too/">There are Muslims in Tibet, too</a>, Duksangh Sherpa<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114111144/63721c6c9c7e80680e0bd48fjpeg.jpg" alt="" width="1500" height="1069"><figcaption> </figcaption></figure>Rubbing Salt By 1959, with China’s annexation of Tibet and later with the Panchayat system in Nepal, there were stricter border controls and the salt trade started declining. In addition, the activities of Khampa guerrillas based in Nepal who launched cross-border raids on the Chinese military led to tighter controls at the border.There was also an imposition of high taxes and quotas on the production of salt making it an expensive commodity. The popularity of Tibetan salt also waned when awareness spread that the lack of iodine in it led to goitre and cretinism among Nepalis.The Salt Trading Corporation was established in 1963 which coincided with the spread of new roads and airports. Gradually, salt imported from India replaced Tibetan rock salt in Nepal. Indeed, sea salt from India reached Nepal’s mountains faster and was cheaper than rock salt, and its transport by road and even aircraft was subsidised by the state.The loss of the salt trade dealt a heavy blow to the economy, and ultimately changed the socio-economic status of the trans-Himalayan regions. Traders and their families were forced to migrate or  take up alternative occupations. In Olangchunggola in northeastern Nepal, the decline of the salt trade destroyed the local economy, impoverishing families.Read also: <a href="https://www.nepalitimes.com/banner/gift-a-goat/">Gift a goat to Tibet nomads in Nepal</a>, Nepali TimesThe salt trade disruption caused a mass exodus of Nepal’s Himalayan communities to Taplejung, Dhankuta, Kathmandu and even Darjeeling. The Thakalis of Mustang  moved to Kathmandu and engaged in international trade.  The Sherpas of the Khumbu region found alternative employment in mountaineering and tourism, while some communities in Dolpo and Mugu clung to the declining salt trade.The end of the Nepal-Tibet salt trade also stopped cross-border community and family links. The cessation of the trade also led to a loss of skills, art forms, livelihoods and traditions like the salt-carrying yak and sheep caravans. Now, there are motorable roads in most places where the caravans used to traverse.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114111144/63721c6f9c7e80680e0bd490jpeg.jpg" alt="" width="1162" height="1438"><figcaption> </figcaption></figure>Some former salt traders now rear livestock, but the closure of pastures in Nepal and Tibet have affected herders on both sides of the border.  This in turn has resulted in the decline of wool production and traditional apparel like bakkhu and docha, leading to a loss of knowledge, skills, craft, art forms and festivals, particularly among younger Nepalis.The Nepal government could have introduced alternative livelihood programs to offset the effects of the termination of the salt trade, made worse by the Himalayan barter economy being affected by monetised trade. Communities have not had time to adapt, since many of these changes came within a generation.The Himalayan region, which used to export grain to Tibet in the past, has now been reduced to importing rice and other food items from Tibet. Himalayan self-reliance has been replaced by dependency and hyper-consumerism. Gone are vestiges of the salt-economy and the socio-cultural ties it fostered.Read also: <a href="https://www.nepalitimes.com/banner/fixing-the-broken-parts-in-nepal-china-ties/">Fixing the broken parts in Nepal-China ties</a>, Kanak Mani Dixit(Jag Bahadur Buda is a student of anthropology. Adapted from the <a href="https://www.himalkhabar.com/news/128848">original</a> in the March issue of Himal magazine by Shristi Karki.)

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The salt of the earth

<h2>Tibet’s Muslims settled in Nepal in waves, but they all have one thing in common: Ramadan</h2><figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107101156/6368d6d79c7e80680e0314aajpeg.jpg" alt="" width="1500" height="1000"/><figcaption>Ahmed Dulla with his 20 month old daughter Meherin, enjoying his iftar meal after fasting all day. Pic: Bikram Rai</figcaption></figure>Mention Tibet, and the first thing that comes to mind is the Dalai Lama and Buddhism. However, Muslims have been as much a part of the fabric of Tibetan culture as their Buddhist counterparts.It is hard to distinguish <a href="http://archive.nepalitimes.com/article/Nepali-Times-Buzz/Tibetan-muslims-celebrate-ramadan,1505" target="_blank" rel="noopener">Muslim Tibetans</a> from their Buddhist compatriots since they share the same language, food, clothing, culture and heritage. Tibetan Muslims have also contributed to the preservation of Tibetan culture wherever in the world they have settled. It is only their faith that sets them apart.Historically, Muslim traders from Kashmir and Ladakh settled in Tibet in the 17th century, during the time of the fifth Dalai Lama. They were granted permission to build mosques and have burial ground along with other privileges such as being able to buy land and continue their trade. They started marrying Tibetan Buddhist women, who later converted to Islam. As the community expanded, it later included Tibetans of Nepali origin.Lhasa still has four mosques, the first of which Bada Masjid was built in 1716 with a smaller one built in the 1920s. The remaining two mosques are in Gyangda Linka, where the burial ground is located. There are two more mosques in Xigatse and Changdu.Tibetan Muslims in Lhasa were always allowed to freely practice their religion. But after the Chinese annexation in 1950, most Muslims migrated to Nepal and lndia with the Dalai Lama and other Tibetans.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107101156/6368d6da9c7e80680e0314abjpeg.jpg" alt="" width="1500" height="1000"><figcaption> </figcaption></figure>“Business was always good in Tibet, and it was booming even during the Cultural Revolution. The political tension did not hamper our trade, but we moved out of Tibet because of concern for our religion,” recalls Abdul Rehman (pictured above), 68, who was born in Lhasa but moved to India in the 1960’s. After university, he moved to Kathmandu 28 years ago to start his own jewellery business in Thamel.Returning from the afternoon prayers at Jame Masjid, as he settled down in his antique jewellery boutique, Rehman echoed the feeling of most Tibetan Muslims in Nepal: "In all these years, I have never ever been made to feel like an outsider here in Nepal. The tourist business is good, and the people too are very friendly."There are about 120 Tibetan Muslim families in Kathmandu, of which some like Rehman are of Kashmiri ancestry who moved to Kathmandu for trade and business. Tibet, Nepal and India have always shared a special connection because of interlinked trade which translated into new communities such as Tibetan Muslims who trace their ancestry mainly to Kashmir and Ladakh.Tibetan Muslims in Nepal are further categorised as 'Khache' (from Kashmir and hold Indian passports) and 'Khazar' (who have Nepali ancestry and nationality). The only difference between the two is that the Khache regard the Dalai Lama as the Tibetan leader and mark his birthday. Most of them have now intermarried, blurring the distinction between the two.<a href="http://archive.nepalitimes.com/article/Nepali-Times-Buzz/Dulla%20,345" target="_blank" rel="noopener">Ahmed Dulla</a>, 30, born in Nepal, belongs to the ninth generation of Tibetan Muslims. His family moved from Lhasa to Kathmandu in the 1970's, because their ancestors were from Nepal. Dulla studied in India and returned eight years ago to start a shoe business. His wife Bushra Yusuf is a Tibetan Muslim of Kashmiri ancestry.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107101156/6368d6dd9c7e80680e0314acjpeg.jpg" alt="" width="640" height="427"><figcaption> </figcaption></figure>"We Tibetan Muslims have relatives all over. We still have family in Lhasa, Ladakh, Kashmir, and in Kalimpong and Darjeeling. It is only geographically that we are apart, otherwise we are all the same, culturally and religiously," Dulla tells us.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221107101156/6368d6e09c7e80680e0314adjpeg.jpg" alt="" width="640" height="427"><figcaption> </figcaption></figure>Dulla's uncle Karimullah, 55, was born in Lhasa and moved to Kathmandu in 1969. His grandfather was a Nepali Hindu who worked at the Nepal Consulate in Lhasa, and grandmother was a Nepali Buddhist. They both converted to Islam while in Tibet and mingled with the Tibetan Muslim community.Despite being a small group, Kathmandu’s Tibetan Muslims are a strong, tightly-knit community who this month are observing Ramadan like Mulsims all over the world, not eating all day and breaking their fasts after sundown with a feast."The purpose of Ramadan is to purify your thoughts and have control over yourself. It helps bring self awareness within us," says Dulla as he breaks his fast with customary dates, followed by a great variety of kebabs, curries and desserts like sewai and kheer.Read also: <a href="http://archive.nepalitimes.com/news.php?id=19550#.Wwb7_TSFN0w" target="_blank" rel="noopener">Ramzan Kareem</a><a href="http://archive.nepalitimes.com/news.php?id=2047#.Wwb7lDSFN0w" target="_blank" rel="noopener">Nepali Muslims</a><a href="http://archive.nepalitimes.com/article/nation/assimilating-generations-of-Newari-muslims,2937" target="_blank" rel="noopener">How to braid two cultures together</a>

There are Muslims in Tibet, too

There were two Bhutans on display during Narendra Modi’s visit this month. The first: a trusted partner, modernising rapidly with Indian support, inaugurating hydroelectric projects, and signing healthcare deals. The second: a nation that <a href="https://www.fmreview.org/gazmere-bishwo/#:~:text=In%201990%2D91%2C%20about%20a,are%20therefore%20not%20Bhutanese%20citizens.">ethnically cleansed 17% of its population </a>and has never been held accountable.
Modi chose to see only the <a href="https://kuenselonline.com/news/pm-modi-concludes-bhutan-visit-with-prayers-for-peace-and-prosperity">first </a>during his <a href="https://economictimes.indiatimes.com/news/india/india-announces-rs-4000-cr-concessional-credit-line-to-fund-energy-projects-in-bhutan/articleshow/125253915.cms?utm_source=contentofinterest&amp;utm_medium=text&amp;utm_campaign=cppst">11-12 November visit</a>, granting $450 million in credit, offering birthday tributes to Fourth King Jigme Singye Wangchuk, and inaugurating another hydropower project.
New Delhi has opted for strategic silence on Bhutan’s systematic persecution of the Lhotshampas in the 1990s. The displaced remain scattered across the world and in refugee camps in Nepal, their property seized, their citizenship revoked.&nbsp;
Now, on that same contested land Bhutan is building the <a href="https://nepalitimes.com/here-now/small-bhutan-dreams-big">Gelephu Mindful City (GMC)</a>, a megaproject intended to <a href="https://kuenselonline.com/news/pm-modi-announces-inr-40-billion-credit-line-new-rail-links-and-land-for-bhutanese-temple-in-varanasi">connect directly to Indian infrastructure</a>. The victims are gone, and democratic India’s values remain conspicuously absent.&nbsp;
With no Lhotshampas left to challenge the official narrative and India unwilling to raise it, Bhutan continues to suppress dissent with impunity.&nbsp;
Earlier this year, social media influencer Raghu Pati Subedi was arrested on the Assam side of Gelephu after returning from a visit to relatives in India. His family members reportedly came under intense pressure, including threats of arrest, accusing them of hiding his whereabouts. After his arrest, he was transported to Thimphu and imprisoned.
This was not an isolated incident. It is part of systemic repression that first gained international attention in the 1990s, when over 100,000 Nepali-speaking Lhotshampa were systematically stripped of their citizenship and forcibly exiled. This mass expulsion, which human rights organisations have characterised as ethnic cleansing, created a decades-long refugee crisis that continues to define the regional political and human rights landscape.&nbsp;
EXODUS
The Lhotshampa crisis of the 1990s was not a spontaneous event but the culmination of years of state-led discrimination. Through a series of legislative acts, notably the 1985 Citizenship Act and the 1989 Driglam Namzha, the ‘One Nation, One People’ policy, the Bhutanese state systematically dismantled the rights of its Nepali-speaking citizens.&nbsp;
The use of the Nepali language was suppressed, the traditional dress of the ruling ethnic group was mandated, and citizenship was revoked en masse, rendering a significant portion of the population stateless in their own homeland.
The new manuscript I am editing has harrowing accounts by the authors of those atrocities. The parallels with what happened to Subedi recently are striking and troubling, showing that even after 35 years the regime has not changed its spots. The methods may have evolved, but the repression against dissidents remains disturbingly consistent.
This refugee exodus was an immense and unasked-for burden on Nepal. Despite being a country grappling with its own political instability and limited resources, Nepal accommodated them on humanitarian grounds. Nepal has consistently advocated for a durable solution centered on the refugees’ right to safe, voluntary, and dignified repatriation.
For years, it engaged in bilateral talks with Bhutan, culminating in a joint verification process. However, these efforts ultimately foundered on what Nepal described as ‘continued rigidity and non-implementation of the agreed decisions by the Bhutanese side’.
Nepal fulfilled its moral and humanitarian duty, but the international community largely failed to hold Bhutan accountable. Bhutan’s rulers deflected global attention with the masterful narrative of Gross National Happiness (GNH), while the grim reality in the refugee camps persisted.&nbsp;
Ultimately, with repatriation proving impossible, Nepal acquiesced to a third-country resettlement program led by a group of eight countries, including the United States, Canada, and Australia. From 2007 to 2016, more than 113,500 Bhutanese refugees were resettled in <a href="https://www.unhcr.org/media/nepal-factsheet">one of the largest group resettlement programmes globally</a>, though 6,365 remain in refugee camps in eastern Nepal.
While this solution provided a lifeline for thousands, it was a tragic capitulation to Bhutan’s ethnic homogenisation project. The refugees’ right to return to their homeland has been denied. It is a cautionary tale about the limits of international diplomacy in the face of state intransigence.
Bhutan’s global brand is one of its most successful exports. The <a href="https://www.gnhcentrebhutan.org/">Gross National Happiness </a>doctrine, which promotes holistic well-being over just economic growth, has captivated the Western imagination and policymakers. It offers a vision of a mindful, environmentally conscious, and peaceful Himalayan kingdom. This carefully cultivated image has historically aimed to shield Bhutan from the level of scrutiny applied to other nations with similar human rights records.
The GNH facade, however, cracks under the weight of documented evidence. The same kingdom that champions ‘happiness’ has, for decades, maintained a justice system that human rights groups allege relies on torture, coerced confessions, and draconian laws to silence opposition.
The 1992 National Security Act, with its vague definitions of ‘treasonable acts’ against the Tsa-Wa-Sum (King, Country, and People), has been a primary tool for suppressing political dissent, particularly from the Lhotshampa.
Overlooked by the international community and ignored by global powers including India, in responding robustly to the ethnic cleansing of the 1990s sent a clear message to Thimphu: such actions could be undertaken with impunity. The monarchy emerged unscathed, its reputation burnished rather than tarnished.&nbsp;
This historical impunity now echoes in the case of Raghu Pati Subedi and the <a href="https://www.cijnepal.org/new-list-of-political-prisoners-expected-to-set-off-discussion-on-bhutans-human-rights-record">continued imprisonment of dozens of political prisoners</a> of conscience. The global community’s reluctance to challenge the GNH narrative has, in effect, become a form of complicity.
The arrest and sentencing of a social media influencer demonstrates how old tactics have been adapted for the digital age. Subedi, 40, was a new kind of threat to the state-controlled narrative and he had to be made an example of.&nbsp;
As the founder and administrator of the popular Facebook page ‘The Don of Asia’, he bypassed traditional, state-influenced media to speak directly to about 78,000 followers. His content, informational and satirical videos on rural poverty, corruption, and the GMC project, was the kind of social media activism that was deemed intolerable.
Subedi was arrested in early 2025 and sentenced to 24 years in prison. The charges allegedly stemmed from Subedi’s social media criticism of the GMC, a flagship project of Nepal-born Bhutanese fifth King Jigme Khesar Namgyel Wangchuck.&nbsp;
For <a href="https://thenewamericansmag.com/2024/11/18/the-kings-gelephu-mindfulness-city/#:~:text=Ganga%20Lamitare%2C%20who%20owns%20four,ancestors%20in%20building%20the%20nation.">Bhutanese refugees like Gangaram Lamitare</a>, the GMC represents a bitter irony, a development rising on their confiscated ancestral lands.&nbsp;
Gangaram, who owns four acres where the GMC’s international airport is now under construction, says: “Many people from villages fled at night in 1990, leaving everything behind to escape oppression. Now, the Bhutanese king and ministers are spreading falsehoods worldwide, calling this land vacant, which actually belongs to those forced to leave the country.”&nbsp;
There are signs that international support that has benefited Bhutan may be waning. The United Nations has become increasingly vocal and last year the <a href="https://www.ohchr.org/sites/default/files/documents/issues/detention-wg/opinions/session101/a-hrc-wgad-60-2024-bhutan-advance-edited-ve.pdf">UN Working Group on Arbitrary Detention</a> said the detention of several Bhutanese political prisoners was arbitrary and illegal under international law.&nbsp;
In April 2025 from a group of six UN human rights experts raised grave concerns about the use of torture, denial of fair trials, and the ‘severe chilling effect’ of Bhutan’s legal framework on civic space. These developments owe much to the consistent advocacy of the Hague-based Global Campaign for the Release of Political Prisoners in Bhutan (GCRPPB) since its formation.
However, they also reflect broader shifts in international human rights scrutiny. This places Bhutan’s key international partners, particularly the European Union, in a critical position. Bhutan enjoys lucrative benefits under the EU’s ‘Everything but Arms’ trade scheme, which grants developing countries tariff-free access to the EU market contingent on respect for human rights.&nbsp;
The EU is also a significant provider of development aid to Bhutan which provides it with substantial leverage. In April 2025, members of the <a href="https://bsky.app/profile/saskiabricmont.bsky.social/post/3lmrn5mkmrs2q">European Parliament formally called on Bhutan</a> to release all political prisoners. This action signals a growing recognition that trade and partnership cannot be divorced from human rights obligations.&nbsp;
“Bhutan’s international partners and investors, including the EU, should make it clear that they expect Bhutan to comply with its human rights obligations and release them without further delay,” says Meenakshi Ganguly, of Human Rights Watch.&nbsp;
Bhutan stands at a crossroads. Its desire for deeper global economic integration is colliding with its unresolved history of human rights abuses. The international community now has a choice: either continue being charmed by the myth of a happy shangri-la or insist that the kingdom adheres to democratic values it professes to the world.&nbsp;
Nepal’s recent Gen-Z uprising offers a lesson to Bhutan. In September, when authorities attempted to ban 26 social media, Nepali youth took to the streets and, within hours, toppled the entire pro-establishment political apparatus. Their message was clear: in an age of digital connectivity and mass mobilisation, authoritarian tactics such as detaining social media influencers are both unjust and ultimately unsustainable.
This incident echoes the prophetic warnings of Devi Bhakta Lamitare, Bhutan’s first-generation democratic leader, who died in exile in India in 2022. In his seminal 1970 book
Dankindo Bhutan, Lamitare chronicled the systematic suppression of people’s rights and envisioned a path toward liberation.
Before his death, I worked with him to update and edit this work, which the Bhutan Media Society published posthumously in 2023. In a December 2020 interview I conducted for the book on the Ganga riverbank in Haridwar, Lamitare laid out a stark three-front offensive: political mobilisation from within India to awaken resistance inside Bhutan itself, relentless pressure on New Delhi to champion democracy, and a global ‘pamphlet war’ waged by resettled Bhutanese in the West.&nbsp;
Only through such sustained action, he argues, can Bhutanese citizens win the right to choose their own rulers, a principle India, the world’s largest democracy, should be championing, not abandoning.
Binod Dhungel is the Nepal correspondent for Reporters Without Borders.
<a href="http://linkedin.com/in/dhungelbinod" target="_blank">linkedin.com/in/dhungelbinod</a>, @BinodDhungel

Bhutan imprisons social media influencer

We often see ourselves reflected in the other. For someone who grew up in Kathmandu Valley in the eighties and nineties, this maxim comes alive with an even greater force. Nepal’s media ecosystem was dismal, the school curriculum was narrow and did not provide opportunities for creative expression. Perhaps that is why I became obsessed with MTV videos and Bollywood films. I saw my developing self reflected in these story-lines and razzmatazz. When the media and education system do not engage the public and reflect myriad interests, aspirations and lifestyles of the population, citizens get detached and disconnected from their roots. I left for America for further studies, and was somewhat determined to never return to Nepal. It was a country full of potholes and black-outs. But foreigners have been fascinated with our country for decades. In the early 19th century, Francis Buchanan-Hamilton led a pioneering expedition and documented more than a thousand species of plants native to the region. Almost a century later, in 1905, Frenchman Sylvan Levi published ‘the first attempt to produce a comprehensive study of Nepal’, drawing on not just indigenous but available Chinese and European sources as well. After Nepal opened up in the 1950s, different kinds of foreigners have traveled here -- most notably, cold-war era spies disguised as diplomats, and later came the hippies. I returned to Nepal in 2013 and was primarily struck by two major demographics - the artists and the expats. Energised by the recent revolution, the creatives were making vibrant, powerful works. The expats, on the other hand, demonstrated a different way to navigate life in Kathmandu Valley. These two groups of people re-introduced Nepal to me and I began seeing my country and my hometown with a renewed perspective. Which is why one particular image from Giovanna Caruso’s ongoing show at the <a href="https://www.instagram.com/thekalasalon/?hl=en" target="_blank">Kalā</a><a href="https://www.instagram.com/thekalasalon/?hl=en" target="_blank"> Salon</a> curated by <a href="https://nepalitimes.com/review/facades-and-flowers-from-nepal-to-italy" target="_blank">Sophia L Pandé</a> instantly caught my attention -- rather, it called out to me, as if it was composed for me, framing a key moment from my own life. Its title is, coincidentally, 2013. Like most of her other works, the pen-and-ink drawing is punctuated by an explosion of watercolour: a woman standing confidently in front of a Newa-style house, a leg arched up, as if she is fixing a strap around an ankle before stepping out on an adventure. The watercolour depicts a rainbow streaming out of a pot through a second-floor window. The rest of the details are rendered in realism – clusters of garlic and onion hanging to dry from the rafters, and further down a stack of corn. There are towels drying, even an old water pump.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251201121216_f440de5b5402fe0877dc46d94f41647bd46b00035b61241d46fc9f7ffbd87d0f.jpg" data-media-id="editor_3" data-image-id="20251201121216_f440de5b5402fe0877dc46d94f41647bd46b00035b61241d46fc9f7ffbd87d0f" data-rendition-name="original" width="4032" height="3024" loading="lazy" alt="art review Kala Salon"> </figure>  When I walked over to this artwork with Caruso, she chuckled, “Ah, this work is a celebration of my 30 years in Nepal.” It was while trying to calm a restless group of students during her teaching days in Italy that Caruso first came across an iconic image of Kathmandu Darbar Square. She had found an old box of slides and while projecting images from the Himalaya to engage her students, the artist was determined to travel to Nepal. The first flat she rented was close to the square and the view from her rooftop was the same as the one she had encountered inside her classroom. She has been traveling to Nepal every year since. Some of her favourite drawings depict Khokana in morning fog. From 1993-2006, she drew murals at Ram Mandir and Pashupatinath, asking sadhus to guide her and correct her depictions. Caruso received a classical education, which means she was trained to focus on perspective and geometry while capturing mainly portraits and still lives. She is influenced by M C Escher and his explorations of mathematics and symmetry. No wonder she finds the Darbar Square architecture so compelling. She also names as inspiration Gustave Dore, whose style is different from Escher’s and I can see how she has fused these influences in her body of work: Escher’s austerity complimented and slightly dislodged by Dore’s comics and caricatures. “Before starting, the painting needs to be complete in my mind,” she explains as we pass a series of portraits titled Saraswati, Lakshmi, Kali Dancing, and Durga dominated by a roaring tiger. “These are all real people, I ask my friends and family members to sit for me.” The Kali in the drawing has the artist’s fiery copper red hair and she is dancing, surrounded by various men with flowing hair. The artist seems to have experimented here, drawing the revelers from above, and indulging in playful abandon. Depictions of Nepal are often in danger of being exoticised. But Caruso is familiar with her subjects, knows our alleys and temples intimately. Her colours and compositions are passionate and dense. In an essay, Anirudh S Chari writes the artist’s work is splashed with rapturous energy and most drawings have a carnivalesque element. ‘Kali Dancing’ illustrates this idea perfectly in that she has turned Kali’s usual fearsome portrayal on its head by depicting and embracing another feminine principle - the capacity to celebrate and create joy. Apart from drawing inspiration from Hindu goddesses and Nepal’s multi-colored rituals, Caruso has also drawn the Sumerian Ianna and Lillith and the Egyptian Nut. She enjoys drawing Nataraja, and says it is because “Shiva is a good husband”. We stand another painting titled 100 Days a Lion. “There is a saying in Italian, Better one day as a lion than a hundred days as a sheep, but I thought why not 100 Days a Lion?” This sentiment captures this nomadic artist’s spirit spanning four decades, in which she has captured urban energy as well as the sacred imagery of ‘life diaries on canvas’. From Venezia to Kathmandu and Journeys In Between Giovanna Caruso The Kalā Salon Chhaya Centre Mall, Thamel Till 12 December 10am- 8pm

Looking at Nepal from Venice

The COP30 climate summit in Brazil ended this week <a href="https://nepalitimes.com/opinion/cop30-to-cop31">without tangible commitment</a> from countries to reduce fossil fuel emissions. Its impact will be felt halfway around the planet here in Mustang which is already seeing weather extremes.&nbsp; Geographically, Mustang is on the Tibetan Plateau, north of the main Himalayan chain. It is in the rainshadow, and a high altitude desert. Winter snow has failed for eight of the past ten years, unseasonal blizzards, and frequent glacial collapse leading to floods. The Kali Gandaki Corridor follows one of the deepest gorges in the world between Annapurna and Dhaulagiri, the world’s seventh and tenth highest peaks. Lush pine forests cover the southern flanks of these mountains, but within a few kilometers the vegetation undergoes a dramatic change to a landscape of red, brown and grey cliffs.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_c66ade5e32d20530003abba893869426d75b42d10e4725c28361d738b402721f.jpg" data-media-id="editor_1" data-image-id="20251129021144_c66ade5e32d20530003abba893869426d75b42d10e4725c28361d738b402721f" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> </figure>  It gets more arid the more north you go. Snow and rain in Upper Mustang used to fall mostly in winter, but now there are cloudbursts and blizzards at other times of the year.&nbsp; In the ancient walled city of Lo Manthang, elderly men have gathered at a local tea shop to drink the salted butter tea. Some sip home-made liquor infused with medicinal herbs.&nbsp; The sun has set, the temperature plummets, and the wind howls outside. Everyone agrees it does not snow like it used to any more. Read also: <a href="https://nepalitimes.com/here-now/comings-and-goings-in-mustang">Comings and goings in Mustang</a>, Shrijan Pandey  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_ffaabf00a533984cadf160b2e56734cddb6f64d1a660401417d2982a3818f161.jpg" data-media-id="editor_3" data-image-id="20251129021144_ffaabf00a533984cadf160b2e56734cddb6f64d1a660401417d2982a3818f161" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> <figcaption>The flat mud roofs are leaking because rain is now falling where there used to be snow.</figcaption> </figure>  “The weather has changed drastically over the years,” says Lopsang Tsomfel Bista, Chair of the Lo Dekhar Municipality. “It doesn’t snow in winter, and it falls when it is not supposed to.”&nbsp; Lack of snow means that in spring, the pastures where nomadic herders graze their yaks and goats do not have enough grass. Previously, winter snow on the meadows would seep slowly into the soil with the spring thaw, bringing out fresh grass shoots. &nbsp; In recent years, even if there is winter precipitation, it falls as rain. The soil is not able to soak in rain as efficiently, and torrential downpours increase the risk of soil erosion and floods.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_93ca69bec63577c5f6cbff8db809c11bce2d8fe01469d3374c20a6f20a7c93f1.jpg" data-media-id="editor_4" data-image-id="20251129021144_93ca69bec63577c5f6cbff8db809c11bce2d8fe01469d3374c20a6f20a7c93f1" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> </figure>  “There used to be up to 1,500 mountain goats in every village, but now they have stopped keeping livestock,” says Bista. This is due to lack of grass and new lowland diseases moving up the mountains. Mustang has lost 28% of its population between the census in 2011 and 2021, and outmigration also means there are fewer people left to carry on a pastoral lifestyle.&nbsp; “Herders have asked for vet services in their communities because there are new insect-borne diseases,” says Yangchen Dolker Gurung of the Lo Gyalpo Jigme Foundation. Read also: <a href="https://nepalitimes.com/opinion/winds-of-change-sweep-mustang">Winds of change sweep Mustang</a>, Jagannath Adhikari  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_902593732af83db5792128be5a3bd87c00e0c62ff894afa4c98bffde64e96d26.jpg" data-media-id="editor_6" data-image-id="20251129021144_902593732af83db5792128be5a3bd87c00e0c62ff894afa4c98bffde64e96d26" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> <figcaption>The mud walls of monasteries and homes are crumbling because of unseasonal rainfall. </figcaption> </figure>  Mustang is flanked to the east and west by mountains that rise up to 6,000m, and glaciers on their slopes are melting fast, turning into lakes. With the rising temperature, the risk of Glacier Lakes Outburst Floods (GLOFs) has also risen.&nbsp; At the rate global average temperatures are rising, scientists say that the Himalaya will lose up to two-thirds of the remaining ice caps. When glaciers melt, it not just raises the risk from GLOFs but also affects water supply downstream.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2025112903114_1a6af68965ded5f23897a623bec2e2bed0da4c6663f0af5b5bf79883f2a11c9f.jpg" data-media-id="editor_7" data-image-id="2025112903114_1a6af68965ded5f23897a623bec2e2bed0da4c6663f0af5b5bf79883f2a11c9f" data-rendition-name="original" width="1022" height="767" loading="lazy" alt="Mustang map NT"> </figure>  FLOODS Ringzin Sangbo Gurung in Chumjung village recalls the devastation caused by a GLOF on 8 July this year that swept away a newly inaugurated bridge. The floodplain is now strewn with boulders and sand brought down by the flood which caused damage worth Rs28 million. The flood also damaged the irrigation canals that feed riverside farms where locals grew potato, buckwheat, millet and spinach. Nyima Wangmo Gurung runs a homestay in Nyamdok village, and says: “We don’t have water when we need it. And there is too much when we don’t need it.”&nbsp; Read Also: <a href="https://www.nepalitimes.com/banner/mustang-forced-to-adapt-to-climate-crisis">Mustang forced to adapt to climate c</a><a href="https://www.nepalitimes.com/banner/mustang-forced-to-adapt-to-climate-crisis">risis</a>, Ronan Wallace and Yungdrung Tsewang Gurung  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_7ae98274ea20e910311ec4431ba0aa3ecd9fe92caaed029a33c185198b33d0d2.jpg" data-media-id="editor_10" data-image-id="20251129021144_7ae98274ea20e910311ec4431ba0aa3ecd9fe92caaed029a33c185198b33d0d2" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> </figure>  With warming temperatures, farmers in Mustang are growing lowland vegetables which was not possible before in plastic greenhouses. The farms depended on snowmelt in spring to irrigate their fields, but there is less snow to melt in past years. “The last heavy snowfall in winter was about eight years ago, since then we have got little or no snow,” says Tashi Norbu Gurung, Chair of Lo Manthang Rural Municipality. “This affects farmers during the April planting season.”  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_010e09f4e9335f39c62f4d6027489c86423b3d10ddfb83558820f6a7a56a477b.jpg" data-media-id="editor_11" data-image-id="20251129021144_010e09f4e9335f39c62f4d6027489c86423b3d10ddfb83558820f6a7a56a477b" data-rendition-name="original" width="1000" height="1500" loading="lazy" alt="Too little snow, too much rain NT"> </figure>  It is not just lack of snowfall that is a problem. Springs have gone dry, and some villages like Dhey have been forced to relocate because life became &nbsp;impossible without water.&nbsp; Villagers of Samjung also <a href="https://nepalitimes.com/news/climate-migration-is-already-happening">migrated</a> to Namashung, near a river when water sources dried up. But now the new settlements are threatened by GLOFs. Karma Gurung, who runs a lodge in Choser, remembers the big flood of 35 years ago which swept away farms and covered them with debris. There have been more frequent, but destructive floods since then in Kagbeni, Lubra and other valleys. Read also: <a href="https://www.nepalitimes.com/banner/mixed-blessings-in-mustang">Mixed blessings in Mustang</a>, Mukesh Pokhrel  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_da2212bc1ad49c17d126e24bbd92d3fca18e3e6bdd58ac61df14c962deb2edcd.jpg" data-media-id="editor_14" data-image-id="20251129021144_da2212bc1ad49c17d126e24bbd92d3fca18e3e6bdd58ac61df14c962deb2edcd" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> </figure>  MUD WALLS Because snowfall has been replaced by rain, Mustang’s traditional mud-wall architecture is now in <a href="https://nepalitimes.com/here-now/leaky-roofs-on-the-roof-of-the-world">danger of collapsing</a>. The homes here are closely packed, have flat roofs stacked with juniper branches for firewood. With rain in place of snow, the roofs now leak.&nbsp; Women in Thinkar village say their walls are falling apart. Some homes have collapsed, and families forced to move out. Yangchen Dolker Gurung of the Lo Gyalpo Jigme Foundation says locals need plastic sheets, cement walls and corrugated roofs to cope with the rain.&nbsp; But this would mean that Mustang’s villages would lose their traditional architecture style.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_59c475cdde3bee8d03ed05e9038c0cf36f1acd31e3d3596f145469e5b4404d9d.jpg" data-media-id="editor_16" data-image-id="20251129021144_59c475cdde3bee8d03ed05e9038c0cf36f1acd31e3d3596f145469e5b4404d9d" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> </figure>  The ancient 1.5m thick mud walls around Lo Manthang built 600 years ago, the king’s palace, and monasteries are also at risk. “Changes in precipitation patterns, altering the intensity, frequency, and timing of rainfall and snowfall, have damaged traditional and cultural infrastructure, particularly mud-built private and public buildings as well as religious and heritage sites,” explains Bhawani Pandey at the Lo Gyalpo Jigme Foundation. “With the rain, and because the monuments and stupas are made from mud, they have eroded. There is leakage, and the monuments are in a dilapidated condition.” Read also: <a href="https://www.nepalitimes.com/banner/climate-smarter-himalayan-infrastructure/" target="_blank">Climate-smarter Himalayan infrastructure</a>, Sonia Awale  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251129021144_dfc8c93a0a8619893f0d97076d1f9cbba3818e1cc716a903ff9908dbb8939ef6.jpg" data-media-id="editor_18" data-image-id="20251129021144_dfc8c93a0a8619893f0d97076d1f9cbba3818e1cc716a903ff9908dbb8939ef6" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Too little snow, too much rain NT"> </figure>  The Lo Manthang Rural Municipality along with Lo Gyalpo Jigme Foundation, are working on a Local Adaptation Plan of Action and the Disaster Preparedness and Response Plan, which the Nepal government has made mandatory for every municipality. “We took a bottom-up approach and collected data from each village, they know best the impact of climate change and what their needs are,” says Yangchen Gurung. To address the hazards of climate change, local communities and municipalities are adapting through their own resources, without waiting for outside help to improve water conservation, control soil erosion and protect from flood.&nbsp; Says Pandey, “We are returning to conserving traditional drought-resistant crop varieties, organic pest and disease control, cultivating high-value crops and fruits, and practicing sustainable pasture management through rotational grazing. We have also developed new building codes for homes that incorporate water-resistant coating for mud roofs and walls.” &nbsp; Additional Reporting by Tashi Wangyal. &nbsp;

Too little snow, too much rain

The September protests and worry about what is in store for Nepal in 2026 have added more uncertainty to a <a href="https://nepalitimes.com/here-now/nepal-needs-to-use-its-money-better">struggling economy</a>. Real estate transactions are stagnant, industries are operating below capacity because of declining domestic demand, the construction sector is slack, and investors are in wait-and-watch mode. In contrast, total bank deposits increased by Rs124 billion in the month before mid-October to Rs7.4 trillion. Official remittance inflows hit a record $13 billion in the past year. Nepal’s banks are flush with cash, with nowhere to put it. &nbsp; “The economy has flatlined. Non-performing assets are up, and real estate is at a standstill,” said Ashoke SJB Rana, CEO of Himalayan Bank.“There is excess liquidity in the market, with not many places to invest.” The main reason seems to be that both <a href="https://nepalitimes.com/here-now/relocate-reallocate-recover">domestic and foreign investors were spooked</a> by the targeted violence of 9 September, and are so worried about the runup to elections in March that they are holding on to their wallets. Not just businesses, the political uncertainty is keeping individuals &nbsp;from making big financial decisions.&nbsp; Sujeev Shakya, author of the <a href="https://nepalitimes.com/review/retrofitting-nepal-for-future-shocks">newly-released book Nepal 2043</a>, notes that the current doldrum is due to Nepalis playing it safe with their money. &nbsp; “People are holding on to their assets, and keeping their cash,” he says. “They are not investing in real estate, and avoiding buying gold because it is so volatile.”&nbsp; One sector in which banks have a lot of exposure is hydroelectricity, but even here recent floods have shown that this investment is <a href="https://nepalitimes.com/here-now/global-warning-bell-in-belem">increasingly at risk from climate breakdown</a>.&nbsp; Nabil Bank, with its focus on sustainable banking, for instance, has financed 56 hydropower projects with an installed capacity of 3,000MW.&nbsp; Says Nabil CEO Manoj Kumar Gyawali: “We cannot ignore unpredictable rainfall, increased glacier melt, more frequent glacier lake outburst floods, and landslides. These risks mean that while hydropower is essential, Nepal must diversify its energy mix." &nbsp;&nbsp; An open secret in the banking sector is that much of the liquidity is supected laundered money. Banks also have close ownership links with big businesses, and this means that even with a slow economy, banks lend to themselves or to each other to keep transaction volumes up.&nbsp; This is one reason for a high default rate. In the first three months of this fiscal year, 4.86% of bank loans were non-performing, meaning one out of about every 20 borrowers had defaulted. A year ago, this figure was 4.04%. Banks are therefore reluctant to lend, dampening the overall investment climate. &nbsp; Ironically, the high default rate is keeping mainstream newspapers in Nepal afloat at a time when the media business is also in crisis. Even as they suffer from a massive drop in advertising revenue, most daily newspapers often add pages to fit notices to borrowers about repayment, or announcements of bank auctions of collateral property. “While banks may be making a much smaller percentage of income compared to a few decades ago, they are still making a profit,” notes Shakya. “And so they are actually quite happy to be in this low-risk situation. Banks are conservative organisations after all.”&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20251128041136_b33dd18d7ce221e273bd18d8a5c4ba4c9196f762b95b87fd24c60df6c2426065.jpg" data-media-id="editor_4" data-image-id="20251128041136_b33dd18d7ce221e273bd18d8a5c4ba4c9196f762b95b87fd24c60df6c2426065" data-rendition-name="original" width="1500" height="1022" loading="lazy" alt="Banks"> <figcaption>Illustration: BHANU BHATTARAI / NEPALI TIMES ARCHIVE</figcaption> </figure>  Among the most striking videos of the September protests that was shared globally by tens of millions of people was the Hilton and Hyatt hotels and the Ncell building burning. That recognisable international brands were targeted did not just cause huge losses to owners, but also damaged Nepal’s overall investment climate. Looting Bhat-Bhateni and homes of businessmen also sent a negative message, spurring capital flight.&nbsp; “That was very bad optics for potential investors, you simply worry about the security of your investment when you see things like that,” says Himalayan Bank CEO Ashoke SJB Rana.&nbsp; Nepal will graduate to Middle Income Country status next year, and donors are set to move from aid to private investment. While this could reduce misuse of money, it could dry up grants and soft loans to the health and education sectors.&nbsp; But the harm may go deeper than just the aftermath of the September events. The recent<a href="https://nepalitimes.com/news/double-trouble-with-taxes"> double taxation issue</a> involving the Dolma Impact Fund, and an earlier controversy over Ncell’s capital gains tax have also put Nepal’s business climate in negative spotlight internationally.&nbsp; The banking sector is firmly on the side of investors. Says Ashoke Rana at Himalayan Bank: “This is a tax regime, it is absurd to order the payment of these taxes retrospectively. When investors see that the rules of the game can change arbitrarily, they won’t really want to put their money here. ” &nbsp; One of the positive changes in the ways Nepalis are using money is digital transactions through QR codes and mobile banking. With smartphones making up 70% of all mobile phones, QR transactions are easy and have become a part of daily life. ONLINE BANKING&nbsp; Most businesses and ride shares have this feature on board, and people do not need to carry a lot of cash or multiple bank cards. But as digital payments become the norm, the days of free transactions may be coming to an end.&nbsp; “Right now these transactions are free for the most part. This is a subsidy by the banks, because of course, it does cost something to make sure the payments go through,” says Rana at Himalayan Bank. “However, as income decreases, banks may have to look for ways to make money, so they may charge small percentages on each QR transaction.”&nbsp; Rapid digitisation has changed not only how customers use money, but also how banks think about their offices. Himalayan Bank’s new Thamel branch, for example, has cancelled plans to redesign the office for 20 tellers.&nbsp; “We realised that people were able to do so much of what they wanted digitally that we plan to have only four tellers,” says Rana.&nbsp; But cutting down on facilities and staff has not always made for a better customer experience at some bank branches.&nbsp; Economist Sujeev Shakya conducts ghost customer experience checks for banks which involves decoys entering banks to evaluate what it is like for somebody to set up a bank account.&nbsp; The stealth missions found that standards of service have regressed, with banks having a working environment reminiscent of government offices.&nbsp; Shakya points out that the general experience of going to the bank should be much better. “Sometimes it’s a knowledge issue -- banks may try to ask for non-disclosure contracts even when they don’t know why they want them,” he says.&nbsp; Despite digitisation, many banks still require paper-based forms and documents. Bankers and customers alike note that it feels archaic, almost absurd, to have to carry multiple copies of documents, sometimes only in Nepali lokta paper, across several family members and fill out what seems to be the same form over and over even though digital files exist. That could soon be changing as well. As more and more Nepalis adopt the National ID, banks have adopted pilot programs that use it to create bank accounts, replacing the myriad documents that customers had to previously present to officials, making all banking transactions more efficient and less of a hassle for the customer.&nbsp; DIGITAL SECURITY As Nepalis move their cash online, digital infrastructure needs to become more secure as well.&nbsp; Bankers spend quite a lot to make sure necessary digital security infrastructure is in place, but some banks could be using pirated software which are not trustworthy.&nbsp; There has to be better regulatory oversight to prevent phishing and fraud as online payments and digital banking spread across Nepal.&nbsp; Banks must also be innovative and ambitious. Says Shakya: “Nowhere else in South Asia are bank loans such a high ratio of the nation’s GDP. &nbsp;This actually points to a well-developed financial system and we have to take advantage of it."&nbsp; Shakya also notes that many bank executives in foreign countries, like Myanmar are actually Nepali, and that banks from Nepal could use their staff and know-how to partner with or acquire banks overseas.&nbsp; While these innovations are all welcome, it is unclear how Nepal's banking sector can jumpstart economic activity in the country. Nepal’s political future looks uncertain and stability is not a guarantee.&nbsp; In the face of continuing progress in hydro electricity and the IT sector seems to be the way forward to stimulate the economy.&nbsp; The GenZ movement was a wakeup call also to financial institutions and the need for greater transparency. Nabil Bank CEO Manoj Kumar Gyawali says the September protests sent a clear message that young Nepalis want an end to corruption, good governance, and real opportunities at home: "The banking sector has a &nbsp;responsibility to direct more lending toward the real economy, sectors that create jobs, build productivity, and strengthen long-term growth," he says.&nbsp; Despite a subdued investment climate, Gyawali is optimistic. "I do see early signs of improvement. Lower interest rates are beginning to restore public and business confidence. Rising remittances provide a safety net and fresh investment capacity for households," he says. "If government capital expenditure continues to improve, it will boost private sector activity."&nbsp;

trade-route

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Looking at Nepal from Venice

Too little snow, too much rain

Cash rich, but poor