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Political interference, financial mismanagement, and the lack of accountability toward public spending on the part of decision-makers have contributed to the conflict of interest across all three branches of governance and created a fertile ground for corruption. Government officials and political leaders with conflicting interests such as personal gain or loyalty to certain groups or individuals are more likely to engage in corrupt practices, such as bribery or nepotism. Such a situation leads to policies and decisions that serve the interests of decision-makers rather than the public good and/or policies and decisions that favor the commoner. This leads to erosion of public trust in government institutions under political patronage. As a result, they cannot function autonomously for the public good, leading to morally unjust behavior, political instability, and unrest. Addressing both the causes of conflict of interest and effects of corruption in governance is crucial for promoting transparency, accountability, good governance and community welfare. This requires robust combating measures like anti-graft and corrupt practices and red-tape laws, independent oversight and enforcement mechanisms, and transparency in decision-making processes. Factors behind unabated graft  Several factors are contributing to corruption in state bureaucracy in Nepal, major ones being political interference, inefficient bureaucracy, fiscal abuse, ineffective parliamentarians, and the subservient nature of bureaucrats. Politicians using their powers to influence bureaucratic decisions or engaging in patronage networks to advance their own interests is all too common. This is exemplified by the appointment of unqualified or corrupt officials, and the misuse of public resources for personal gain. Inefficient and inept bureaucracy enhances state corruption, as bureaucratic processes become slow and less transparent, opaque even, to most people. This concomitantly creates opportunities for officials and intermediaries to demand bribes or engage in graft and other corrupt practices to manipulate decision-making processes. The subservient nature of bureaucrats in Nepal is also abetting corruption. In many cases, bureaucrats may be serving the interests of political leaders or senior officials, helping create and promote a culture of deference and obedience, where officials prioritize loyalty to their superiors over their duties to the public. Civil Service cadres in Nepal are influential because of unionization along political party lines and patronage networks. In such an environment, bureaucratic appointments and transfers, which often come at the expense of merit-based appointments and transfers, promote a culture of favoritism and political loyalty, thereby consolidating power and rewarding supporters. This is one of the major problems that has wreaked the civil service in Nepal and rendered the system of governance almost dysfunctional, failing even to deliver public goods to the commoner. Corruption in governance calls for combat measures that increase transparency, accountability, and professionalism. Also, an effective fight against corruption requires a long-term process accompanied by sustained efforts and commitment from all stakeholders. Measures to fight graft: Nepal needs measures like strong legislations, rules and regulations that deal with the root causes of the conflict of interest and the operating environment that fosters corruption. Anti-graft and anti-red tape laws, promotion of transparency and accountability and measures that build public trust in government institutions can go a long way. Below are some measures that can help curb political, financial, and judicial corruption: Anti-graft laws and strong legal institutions: Nepal needs a robust legal framework that criminalizes corruption and awards harsh penalties to those found guilty. The government must enforce these laws strictly and impartially. For this, Nepal needs strong Anti-Graft and Corrupt Practices and Anti-Red Tape Laws that can play a crucial role in the fight against corruption. Laws should be applied across all segments of the society and institutions to punish the corrupt without exceptions and to reduce possible conflicts of interest. Effective implementation of Anti-Graft and Corrupt Practices and Anti-Red-Tape Laws will require autonomous Anti-Corruption Commission (ACC) and the Commission for the Investigation of Abuse of Authority (CIAA). They need to be strengthened to ensure their independence, impartiality, and effectiveness. Anti-corruption agencies should be given sufficient legal powers, resources, and authority to investigate and prosecute graft and other corrupt practices as this move can play a vital role in dealing with this cancer in governance. Senior officials tasked with running this institution must be selected on merit basis. The candidates should have impeccable track records along with relevant work experience as well as a non-political background.  The selection process must include open discussions on the candidates, and a public voting process for picking the candidates with stakeholders like representatives of civil society organizations as voters.   Increasing transparency and accountability: Nepal needs to promote transparency and accountability in its governance processes, including public procurement, budgeting (not only as a yearly event without open debate), and accountable fiscal management. Transparency and accountability are key to fighting corruption. Nepal can increase transparency by making government processes, budgets, and transactions publicly available and accessible. The government should implement a system of performance auditing and measures to ensure that public officials are held accountable for their action as well as inaction. For this purpose, laws should be enacted to safeguard the freedom of information, and programs launched with the citizens’ participation to promote inclusive governance and transparency by following international best practices. This must precede with the audit of “Beruzu” (yearly arrears amounting to billions of rupees in Nepal) accounts and a performance auditing system for financial accountability. Enhancing public awareness: Encouraging citizens’ participation in decision-making process and creating channels for feedback and grievance redressal can help prevent corruption. Educating the public about harms of corruption, identifying and reporting the instances of corruption will be equally crucial. These measures can play an important role in the fight against corruption. The government, civil society organizations, and the free media can play a key role in raising awareness and promoting a culture of zero-tolerance toward corruption. Strengthening judicial independence: Judicial independence is critical in any democracy for ensuring the rule of law and fighting corruption. Selection of judges should be transparent, and on merit basis, and appointees must have relevant work experience with impeccable track records. The candidates should be non-partisan; they should have no political affiliation whatsoever. The government should take measures to ensure that the judiciary is free and independent and capable of providing fair and impartial justice. Strengthening bureaucracy: The bureaucracy can play a crucial role in the fight against corruption. No single institution can stop corruption on its own. It requires a collaborative effort from all segments of society to create a corruption-free Nepal. The bureaucracy in Nepal needs to be strengthened with competent and well-trained staff by making sure that they are adequately compensated financially and protected from political interference. A merit-based recruitment system will help reduce corruption in recruitment and promotion processes. Whistleblower protection mechanism: Raising awareness among employees and civil society organizations about the impact of corruption on the society and promoting civic education can go a long way in building a culture of accountability and transparency. Whistleblowers can play a vital role in exposing corruption. Nepal should put a mechanism in place to protect whistleblowers from retaliation and ensure their anonymity. Implementing e-governance: e-governance can help reduce corruption by increasing transparency, reducing human interaction, and improving efficiency. Nepal should invest in e-governance infrastructure to ensure that government processes are streamlined, and corruption is minimized. This should start with reforming the government procurement process with a focus on quality, timely delivery, and sustainability rather than cost-effectiveness. Strengthening party finance regulations: Political parties are often the leading source of conflict of interest and cause of corruption. Nepal should strengthen regulations around political party finance, intra-party consultation process, and electoral system reform to ensure inclusivity and transparency in their deliberations and management of party affairs, funding, finances, and abide by the culture of ethics in democratic functioning of political party. Implications: Toward a failed state? The parliamentary system of governance has failed to deliver on people’s expectations of sustainable economic development due to conflicts of interest in the system of governance. Governance operating modules and instruments appear to have been favorable to elected officials seeking to fulfill vested personal interests vis-a-vis power, financial gains, etc. Apparently, the officials prioritize their own interests over those of the constituency and the nation they are supposed to represent. There have been several instances of conflict of interest among parliamentarians and decision makers representing the state organs. Long-term implications of such dismal performance of the governance system in this republic are hard to predict. For one thing, this inefficient system will have a negative bearing on the commoner’s aspirations for prosperity and progress. Performances of successive governments seem to indicate that this nation might become a failed state of the 21st century, instead of graduating to the club of middle-income countries as a sustainable economy in the coming years.

Transparency International’s 2021 Corruption Perceptions Index (CPI) has listed Nepal as one of the most corrupt countries in South Asia and among the top 15 most corrupt countries in Asia. Corruption is a well-documented issue in Nepal, and several government institutions as well as individuals have been implicated in corrupt practices. According to the CPI 2021, Nepal is at the 117th position among 180 countries and territories covered in the global index. Several reports suggest that the Nepalis perceive the government, the judiciary, security agencies, health care system, education sector, public transport and public procurement regimes to be corruption-plagued. Political interference in the appointment of judges and handling of high-profile cases; police force’s accepting bribes and engaging in other corrupt practices in relation to traffic violations and land disputes; public procurement process lacking transparency and accountability, absence of performance auditing and collusion of interests; financial mismanagement in the procurement of medical supplies and equipment, in the allocation of scholarships and the appointment of teachers and the lack of proper accounting of approved budgetary allocations authorized for disbursements toward the end of a fiscal (Beruzu account).These examples show corruption thriving under successive governments. Sources of major conflicts of interest seem to have emerged prominently and openly in public domain with Nepal’s switch to a federal democratic republic and the rise of political oligarchs in the name of a federal democratic system of governance. A certain level of conflict of interest could have been expected because of ages-old inequalities entrenched in a society with diverse ethnicities, cultures, and conflicting traditions. This is because these issues remain trapped within the confines of intergenerational poverty and feudal mindset for want of critical thinking and awareness of functional education and prefer political interference at all levels of governance. Such a landscape can provide fertile ground for radicalization of population in the socio-political context, further weakening governance modules by giving rise to destructive forces. It can have an adverse impact on political, social, and economic development prescripts, fairness and good governance. Mother of graft? Conflicts of interest occur when an individual or organization has competing interests that interfere with its ability to act impartially or in the best interest of others. This creates opportunities for corrupt behavior, such as when public officials use their positions for personal gain or when businesses use their influence to secure favorable treatment. Conflicts of interest are not always inherently corrupt, and many organizations have policies and procedures in place to manage them properly. Additionally, corrupt behavior can occur even in the absence of a conflict of interest, so it is important to address corruption through a range of measures, including transparency, accountability, and effective law enforcement. Issues of public concern Root causes There are some common causes that perpetuate competition over ‘incompatible desires’. They can morph into a conflict over varieties of issues like money, resources, time, power and authority to satisfy their own needs at all levels of social and economic spheres. They impact operating modules that can result in widespread corruption to malfunctioning of democratic norms of governance. A contextual comprehension of such situations requires deeper understanding and recognition of socioeconomic compact and political-environmental construct together with associated evolutionary trends in people’s psyche. Political power: Different political parties and factions within the government modules have conflicting interests in terms of gaining and maintaining power. Nepal has had a long history of political instability and conflict, with different political parties and groups competing for power through means like political violence, protests, and strikes. These forms of protest bring learning institutions, civil organizations and state-owned enterprises to a halt, throwing life out of gear. Checks and balances between the power centers are required in a functioning democracy for effective functioning of institutions and ensuring delivery of services for greater goods of the public. Sadly, political parties’ obsession for power at all costs for petty gains has severely undermined this principle. Ethnic and regional identities: Nepal is a country with diverse ethnic and regional identities, though it does not have a huge population like in countries like India and Nigeria. Conflicts flare up easily when diverse groups feel that the government is not safeguarding their interests. Sometimes, ethnic groups may have conflicts with each other on issues related to language, representation in government and allocation of resources. Apart from increasing awareness of ethnic identities and socioeconomic isolation, silent and unnoticed tensions arising from in-migration could result in conflicts in different parts of the country. Religious conflict: Though a predominantly Hindu country, Nepal is also home to sizable Buddhist and Muslim populations, and a growing number of Christians. Several media reports of the past have covered tensions between Hindus and Buddhists over issues like religious practices and festivals, class identity and ethnicity. Resource allocation and economic inequality: Conflicts may arise over sharing of natural resources like land, water, forests and minerals and state revenues. According to World Bank data, Nepal, one of the poorest countries in Asia, has the highest tax rate in terms of GDP per capita in the sub-continent. This points at the possibility of conflicts over resources, such as land and water and state subvention to support different tiers of governance structure. It is clear that government policies and development projects can also lead to conflicts of interest with local communities. Corruption in governance: In Nepal, financial and political corruption is a major obstacle in delivering good governance. In such a context, conflicts may escalate when individuals or groups seek to exploit government resources or their clout for personal gains. Successive governments are mired deep in scams and irregularities like the medical supplies procurement scam involving OMNI, mismanagement of the Melamchi Water Supply Project that has resulted in cost overruns and delayed the completion of the project, the graft case involving Lalita Niwas land acquisition and Nepal Airlines Corporation’s violation of Public Procurement Act while purchasing and/or leasing airplanes. These cases are enough to show the extent of corruption in Nepal, all at the expense of the taxpayer. Foreign relations and regional conflicts: Nepal's relationship with its powerful neighbors—India and China—is likely to remain as a constant cause of conflict, particularly in terms of trade and border disputes, despite repeated claims of friendly relations coming from successive governments. This fraught relationship has Nepali peoples themselves pitted against each other. With such a divided mindset, how can Nepal become a vital, dynamic bridge connecting the two major world powers? In fact, the country can become such a bridge without compromising its sovereignty. All it needs to do is to pursue its ties with the neighbors by safeguarding its national interests in diverse spheres by maintaining its strategic autonomy. These spheres include trade, education, tourism, transport, infrastructure, manufacturing, supply chain, information technology, water resources, climate adaptation and mitigation. Socio-economic issues: A high level of poverty, low wage and income, out-migration of productive age groups for education and job opportunities, a falling production of basic food commodities, lack of skills development and productivity, absence of affordable quality healthcare, transport and sustainable infrastructure development could lead to conflicts of interest within different tiers of governance, socioeconomic strata, and community due to competing interests and priorities over resources and funding. The author, a former staffer at the UNHCR, is a founding board member of Nepal Policy Institute, an independent, non-political international think tank. He can be reached at: [email protected]