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Champa Devi Karki of CPN (Maoist Center) was almost sure to win the National Assembly election as one of the ruling coalition candidates from Koshi province. But she lost the Jan 25 vote to CPN-UML candidate Rukmini Koirala. 

Maoist leaders now claim that Karki lost because of the betrayal of trust by the Nepali Congress. They say although the Maoist party voted for NC candidate Krishna Prasad Sitaula, there was a significant crossing of the floor  by the NC voters. 

Though the Maoists emerged as the largest party in the NA after the election held to select 19 upper house members, the party is unhappy with the poll outcome from Koshi.

It is said that NC senior leader Shekhar Koirala, who is earnestly working to break the Maoist-Congress alliance, influenced the voting pattern of the NC. Earlier, the Koirala faction had switched to the UML to elect Kedar Bahadur Karki as chief minister after NC President Sher Bahadur Deuba fielded his candidate. It was later revealed that there was a secret understanding between Koirala and Deuba in the appointment of chief minister, which miffed the Maoist party. 

That was the first instance which sowed the seed of discord inside the ruling coalition. The latest election betrayal in Koshi province has deepened the mistrust between the Maoists and NC.  

"We have reached a point where we have to seriously review our alliance with the Nepali Congress,” says Maoist leader Barsha Man Pun. “In every election, we have been voting for NC candidates, and in return, we are being betrayed. The Koshi province election has forced us to think whether the current coalition is beneficial for us.”  

What happened in Koshi province is not the only reason why the Maoist and NC are growing apart. It began with the arrest of senior NC leader and former home minister Bal Krishna Khand in the fake Bhutanese refugee scandal.

Many NC leaders suspect that Prime Minister Pushpa Kamal Dahal of the Maoist Center is weaponing corruption scandals against the NC leaders while overlooking the misdeeds of the leaders within his own party. 

NC senior leader Koirala has always been vocal about changing the current coalition and forging an alliance with the UML. Of late, more and more leaders are joining the chorus. They want to remove Dahal from power because they feel that his government has not been good to the NC. Even though the Maoist Center has only 32 seats in the House of Representatives, making it the third largest party, NC leaders believe the Maoist party is becoming overbearing in the government affairs — even bullying the NC and UML by opening investigation into past corruption scandals involving their leaders.   

Meanwhile, the Maoist leaders claim it is the NC that has been dictating the government’s decision-making process including in the foreign policy realm. A senior Maoist leader says the NC has tied the hands of Prime Minister Dahal, so that he is unable to make independent decisions. 

The Maoist party is particularly displeased with Minister for Foreign Affairs Narayan Prakash Saud from the NC. “The Foreign Minister has failed to strike a balance among the three major powers because he and his party are biased towards India and the US.” 

During his China visit, Prime Minister Dahal made some commitments regarding the Belt and Road Initiatives and other projects, but there has been little to no follow through on those pledges. The Maoists blame the NC-led Foreign Ministry for this. 

Maoist leaders say Prime Minister Dahal wants to sign the BRI implementation plan at the earliest, but the foreign minister has not been cooperative.  

Some NC leaders believe that the only reason the NC-Maoist coalition has not fallen through is because Deuba wants to ensure a smooth transfer of power. They say the party president is of the belief that he can get to power only if Dahal is allowed to remain in power for two and a half years. 

Though there are strong voices inside the NC that the party should not forge an electoral alliance with Maoists in the next general elections, Deuba is of the view that without an alliance the NC alone cannot maintain the status of the largest party. 

However, Deuba does not see the similar prospect in forging an alliance with the UML. He is of the view that there cannot be an electoral partnership between first and second parties. The NC regards the UML, which has a strong organizational base, as a key election rival. 

In the past, the UML had even reached out to the NC, proposing an alliance deal between the two parties to ensure the government’s stability until the next elections. But Deuba was not keen to talk with the UML. 

As the Maoist-NC coalition teeters on the brink, the UML watches from the sidelines. UML Chairman Oli, who had previously made his mission to win a single party majority in the 2027 general elections, has been hinting at mid-term elections in recent days. Oli senses the simmering tension within the ruling coalition.

Prime Minister Dahal is likely to face more political challenges from his own coalition partner and the opposition in the days ahead. The UML and Rastriya Prajatantra Party are already planning to hit the streets against the government. The last thing Dahal wants is an unruly coalition. 

The Rastriya Prajatantra Party, which has 14 seats in the federal parliament, is planning to organize a series of street protests from February. However, the royalist party, advocating for the restoration of the monarchy and Hindu state, has yet to clarify whether this is going to be their decisive movement for what they call correcting the course of Nepali politics.   

Ever since the country abolished the centuries-old monarchy in 2008 and decided to adopt a federal republic set-up, the RPP has been batting for the return of the king, reinstatement of Hindu state and dissolution of federalism. RPP Chairman Rajendra Lingden told a group of editors on Tuesday that the current crop of leaders, who has been in the driving seat of the government for the past three decades, have completely failed.

He said the party’s protest plans for “course correction” means adopting a new system of directly elected prime minister, ceremonial monarchy and scrapping the federal structure. Lingden also proposed granting more power to the local level as well as slashing down the number of elected representatives both at the center and the local level. 

The RPP does not have a strong presence in parliament, nor does it have enough public support to push their cause. The party’s position in national politics has been middling at best; it hasn’t garnered more than 25 parliamentary seats after the restoration of democracy in 1990. 

The party is aware of this reality. Political observers say RPP has announced its protest plans to create a favorable public opinion of the party at a time when the vast majority of the people are frustrated with the major political actors—Nepali Congress, CPN-UML and CPN (Maoist Center). 

“Public frustration is boiling up as the country’s economy is in doldrums. Capital flight is increasing, there are no jobs and corruption is entrenched. To resolve all these issues we need to forge a new political agreement,” said Lingden.  

But major political forces are unlikely to make any compromise with the RPP, unless the party manages to mount a massive street protest. While the general public may have deep grievances and anger towards the big parties, political observers say the people will agree with the RPP’s agenda of dismantling the current system brought by the constitution of 2015. 

Lingden does not agree with this narrative. He said that his party is not trying to take the nation backward. “We are championing a democracy with monarchy. We want to limit the role of monarchy to that of a guardian,” he said. “There are several examples of monarchy existing even in advanced democracies.”

Lingden is of the view that the country cannot wait until the next general elections of 2084 BS (2027) to bring changes. “Economic crisis, corruption and bad-governance are bringing the country to its knees, but the major parties and their leaders have not realized this,” he added.

The RPP, however, has not clarified how the party’s “new political agreement” is going to address the problems facing the country. His proposition is that the same set of parties should continue ruling over the country, with a monarch serving as the head of the state instead of president.  

Only royalist supporters are likely to be buoyed by the RPP’s proposition. The moderate mass gathered by businessmen turned political activist, Durga Prasai, in Kathmandu a few months ago has certainly struck a chord among many monarchy sympathizers. And it won’t be far-fetched to say that the RPP is confident that it will succeed in drawing the same—if not more—number of supporters.  

This is not to say that major parties won’t be feeling anxious. They are aware of the public anger and frustration against them. No wonder, both ruling and opposition parties share a similar view whenever forces like the RPP or a one man-driven initiative like that of Prasai challenge the system.

Top leaders of major parties claim that there is an “invisible force” backing the royalist parties to reverse the current political system. Lingden laughs off such a claim. “We are for the political system backed by the people, without any external interference,” he said.  

What Lingden cannot deny is the fact that the royalist supporters are extremely divided into various camps. Over the past three decades, the party has undergone multiple splits. Currently there are two sets of Rastriya Prajatantra Party: Lingden’s RPP and the Kamal Thapa-led Rastriya Prajatantra Party Nepal (RPPN). The two camps held separate programs to celebrate the birth anniversary of King Prithvi Narayan Shah on 12 January. Even the last monarch, Gyanendra Shah, seems to have his own preference, given his frosty relationship with Thapa and closeness with Lingden.  

Kathmandu: Nepal has requested Russia not to recruit Nepali youths in the Russian Army.

Nepal’s Minister for Foreign Affairs Narayan Prakash Saud made this request in the meeting with Deputy Foreign Minister of the Russian Federation Sergey Vershinin, on the margins of the 19th NAM Summit that took place in Uganda.

A statement from the Ministry of Foreign Affairs says: "Foreign minister raised the issues related to Nepali nationals in the Russian Army, including the request not to recruit Nepali nationals, release those who are already recruited, repatriation of mortal remains of the deceased and compensation.”

The Russian deputy minister stated that efforts will be made to resolve the issues raised by the Nepali side.  There are no bilateral provisions on recruitment in the Russian forces, but reports suggest that Nepalis are serving alongside the Russians and fighters from several other countries lured by certain ‘incentives’.

Moscow has not responded to Nepal’s repeated requests for information about the Nepalis in the Russian army, though the government has said that hundreds of Nepalis have been serving the Russians, more than 100 have gone missing and 11 Nepalis have died in the war so far.

According to Saud, 115 families of Nepali youths, who have joined the Russian army, have submitted a request to the ministry calling for their early repatriation. We have asked Russia to repatriate the Nepalis serving its army and compensate the families of those killed in action, he said.

Nepali Congress leader Krishna Prasad Sitaula is looking to make a political comeback by securing a National Assembly seat. Having lost two consecutive general elections of 2017 and 2022, the former home minister seems eager to wear the parliamentarian’s tag. 

The election for 19 new upper house members is set to take place next week and Sitaula’s victory is almost certain, thanks to a strategic electoral alliance within the ruling coalition. Sitaula, whose influence in national as well as party politics has been waning of late, managed to clinch the NA candidacy due to his closeness with the NC President Sher Bahadur Deuba. 

Despite differing opinions within the NC on the election candidates, consensus among top leaders of the ruling parties solidified Sitaula’s position in the upper house. Even Deuba’s rivals in the Congress party, Gagan Kumar Thapa and Shekhar Koirala, are rallying behind Sitaula, hailing it as an exceptional decision. Earlier, Thapa and Koirala were critical of Sitaula’s candidacy. They were in favor of fielding new faces, preferably experts on some fields, to honor the spirit of the NA as envisioned by the Constitution of Nepal, 2015.  

The buzz is that Sitaula’s entry into the federal parliament is not just a personal victory; it’s a strategic move made by the NC leadership to fortify the constitution against mounting challenges from royalist and anti-federal forces.

Whispers of Sitaula taking the reins as the chair of the upper house are also getting louder. Sources say that both CPN (Maoist Center) and CPN (Unified Socialist) have thrown their support behind Sitaula, putting an end to their claims for the coveted position. The term of incumbent NA chairman, Ganesh Prasad Timalsina, is ending in April.

Sitaula’s bid to enter the national assembly despite previous election setbacks has piqued the interest of many. After losing the 2017 and 2022 general elections to Rastriya Prajatantra Party Chairman Rajendra Lingden from Jhapa constituency 3, Sitaula was relegated to the margins of national politics. Though he enjoyed the title of a senior leader within the Congress party, his role and influence were limited.

Afraid that he could completely lose his relevance inside the party and national politics, Sitaula, who once harbored the ambition of leading the NC, got close to the party president, Deuba. In the meantime, he continued to maintain a good rapport with the top leaders of other major parties, mainly Prime Minister Pushpa Kamal Dahal of the Maoist Center. 

According to Sitaula, his candidacy is all about ensuring the complete implementation of the new constitution and safeguarding the rights of the people. 

Starting as a low-profile figure in the party after the restoration of democracy in 1990, Sitaula emerged as a key player during the peace negotiations with Maoist rebels. His alliance with then NC President Girija Prasad Koirala catapulted him into the national political arena, eventually leading to roles as deputy prime minister and minister for home affairs.

Sitaula’s moment to shine came as one of the chief negotiators of peace with the Maoist rebel group. His role in bringing the Maoists into mainstream politics was widely praised.  

After the success of Janaandolan-2, Koirala appointed Sitaula as deputy prime minister and minister for home affairs which further elevated his profile in national politics and inside the party. This also increased his political ambition and started projecting himself as the Koirala’s successor, ahead of other senior leaders including Deuba, Sushil Koirala and Ram Chandra Poudel. He even contested for the position of party president, only to lose the election with a huge margin.

It is no secret that Situala, who has lost his influence and supporters in the party, has only managed to maintain his relevance with Deuba’s support. Now Deuba’s support is set to land him the post of the upper house chair.

Nepal has reasserted its commitment to Non-Alignment Movement’s (NAM) objectives and principles at the Ministerial Meeting of the 19th Summit of the Non-Aligned Movement being held in Kampala, Uganda. Addressing the meeting, Foreign Minister NP Saud said the constitution of Nepal itself embraces NAM principles as a basis for its foreign policy.

“We always conduct independent, objective, balanced, and non-aligned foreign policy. We never join any military alliance and never accept to be a part of the security pact of any country,” he said, hinting at the security and strategic pacts of major powers mainly of China and the US.

Over the past few years, there has been a debate in Kathmandu about America’s Indo-Pacific Strategy and State Partnership Program, and China’s Global Security Initiatives. Minister Saud’s statement is in line with Nepal’s commitment to not joining any strategic or military alliances. 

Of late, countries in the Global South, including Nepal, are facing increasing pressure from big powers, mainly the US and China, to choose their sides. Most of the time, they have stayed out of the great-power rivalry.  

The NAM summit is taking place at a time when the world is confronting multiple challenges, from the ongoing Russia-Ukraine war to escalating tensions in the Middle East and China-Taiwan dispute.  

“We are witnessing the worst nightmare in Gaza. We all have been bearing the brunt of the Russia-Ukraine war. To our dismay, geopolitical competition and polarization have resurfaced as defining features of our global political order,” said Saud. He stressed that NAM principles have become more significant than ever.  

Over the past few months, there is a growing debate in Nepal about the revision of non-alignment policy. Some politicians and experts are of the view that in the changing context, the principle of non-alignment is becoming irrelevant. Some have proposed the policy of multi-alignment without elaborating what it entails.

Many of them provide the example of India, which is sending a low-key representation to the NAM summit. But the current government led by Prime Minister Pushpa Kamal Dahal has reasserted the importance of non-alignment policy. Dahal himself is attending the conference to demonstrate Nepal’s commitment.

Minister Saud said that NAM, as a strong bloc with 120 countries representing around 60 percent of the world’s population, holds “both majority and moral strengths to devise solutions to global problems that we face today, from conflicts to climate change; economic injustice to social inequality; the digital divide to debt distress, and hunger to disease.”

“NAM must play a pivotal role in promoting multilateralism, defending the UN Charter and international law, finding peaceful solutions to disputes, reforming the global financial architectures, creating a just global economic order for shared affluence,” he added.

Saud also said that NAM should focus on the achievement of SDGs and other Internationally Agreed Development Goals, including the Paris Agreement, in the spirit of leaving no one behind, embracing the power of technology to drive progress for all, and ensuring climate justice for vulnerable countries and regions. 

“We anticipate a robust cooperation framework and renewed partnership with all our development partners and fellow members of NAM, for investment, resources, capacity-building, and technologies in the true spirit of North-South, South-South, and Triangular Cooperation,” he said. 

Nepal is a founding member of the Non-Aligned Movement, which was formally established at a summit held on 1-6 Sept 1961 in Belgrade, Yugoslavia. 

There have been improvements in some of the economic indicators in recent times. Inflation came down to 4.95 percent in mid-December 2023 compared to 7.38 percent a year ago, according to Nepal Rastra Bank . Foreign exchange reserves continue to grow and the interest rate has also gone down. Finance Minister Prakash Sharan Mahat has said that the economy is showing signs of recovery and is optimistic about further improvement. But the business community and ordinary people continue to feel the pinch of the struggling economy. Here’s what you need to know about the current state of economy:

What is the current state of the global economy?

As the world nears the midpoint of what was intended to be a transformative decade for development, the global economy is set to rack up a sorry record by the end of 2024—the slowest half-decade of GDP growth in 30 years, according to the World Bank’s latest Global Economic Prospects report. By one measure, the global economy is in a better place than it was a year ago: the risk of a global recession has receded, largely because of the strength of the US economy. But mounting geopolitical tensions could create fresh near-term hazards for the world economy. Meanwhile, the medium-term outlook has darkened for many developing economies amid slowing growth in most major economies, sluggish global trade and the tightest financial conditions in decades. 

Global trade growth in 2024 is expected to be only half the average in the decade before the pandemic, the World Bank report says.  Meanwhile, borrowing costs for developing economies—especially those with poor credit ratings—are likely to remain steep with global interest rates stuck at four-decade highs in inflation-adjusted terms. The World Bank report says that global growth is projected to slow for the third year in a row—from 2.6 percent in 2023 to 2.4 percent in 2024, almost three-quarters of a percentage point below the average of the 2010s.

What is the economic status of South Asia?

The World Bank says growth in South Asia (SAR) is estimated to have slowed slightly to 5.7 percent in 2023, yet it remains the fastest among emerging market and developing economy regions. This is largely attributed to a robust expansion in India, which accounted for more than three-fourths of the regional output in 2023. Excluding India, however, activity was more subdued. The World Bank outlook says that growth in SAR is expected to edge slightly lower to a still-robust 5.6 percent pace in 2024, before firming to 5.9 percent next year. Domestic demand, including public consumption and investment, will remain major drivers of economic growth. A pickup in external demand, albeit still subdued, is also expected to contribute to growth.

What is the situation of Nepal’s economy?

According to the recent report released by the International Monetary Fund, Nepal’s post-pandemic rebound, fueled by a credit boom, ended last year as growth slowed markedly. Low domestic demand helped resolve external pressures but also deflated government revenue and led to a widening of the fiscal deficit despite expenditure control. Inflation is declining. Growth is expected to recover to 3.5 percent in the fiscal year FY 2023/24, which is below potential, led by increased domestic demand, new hydroelectric capacity and a continued recovery in tourism.  

External sector risks dominate Nepal’s outlook given its high remittance income and dependence on imported goods. Domestically, further deterioration in bank balance sheets or lack of progress in addressing the deficiencies identified by the Asia Pacific Group of the Financial Action Task Force (FATF) could create financial system stress.

What is the current status of inflation?

Surprisingly, inflation came down to 4.95 percent in mid-December 2023 compared to 7.38 percent a year ago. Though people have not felt it, a report prepared by Nepal Rastra Bank shows that inflation has heavily gone down. Food and beverage category inflation stood at 5.10 percent, whereas non-food and service category stood at 4.84 percent in the review months. Similarly, year to year wholesale price inflation stood at 2.63 percent in mid-December 2023 compared to 9.15 percent a year ago.

What is the current flow of remittance?

Remittance inflows increased 27.6 percent to Rs.613.25bn in mid-December 2023 compared to an increase of 23.0 percent in the same period of the previous year. In the US dollar terms, remittance inflows increased 24.5 percent to $4.62bn in the review period compared to an increase of 13.1 percent in the same period of the previous year. 

A report published by Nepal Rastra Bank says, “In the review period, the number of Nepali workers, both institutional and individual, taking first time approval for foreign employment stands at 173,555 while those applying for renewed entry approval stands at 104,037. In the previous year, such numbers were 236,779 and 115,948 respectively.”

What is the current situation of foreign exchange reserves?

Gross foreign exchange reserves increased 14.8 percent to Rs.1767.04bn in mid-December 2023 from Rs.1539.36bn in mid-July 2023. In the US dollar terms, the gross foreign exchange reserves increased 13.6 percent to $13.31bn in mid-December 2023 from $11.71bn in mid-July 2023.

What is the current state of interest’s rate of banks?

According to Nepal Rastra Bank, the average base rates of commercial banks, development banks and finance companies stood at 9.64 percent, 11.64 percent and 13.14 percent respectively in the fifth month of FY 2023/24. The average base rate of commercial banks was 10.69 percent in the corresponding month a year ago.

Why is the current growth of GDP ?  

The National Statistics Office (NSO) has estimated a 3.2 percent gross domestic product (GDP) growth at basic prices in the first quarter of the current fiscal year compared to the same quarter of the previous fiscal year. However, the seasonally unadjusted data suggests that the growth could be down by 1.4 percent compared to the fourth quarter of FY 2022/23. The government has set a 6 percent growth target in the current fiscal year.

Which sector is witnessing the largest growth ? 

The NSO data indicates that the largest growth is anticipated in the mining and quarrying sector, with an estimated growth of 15.8 percent compared to the first quarter of the previous fiscal year, thanks to increased quarrying activities. Increased mining activities ensured easy availability of construction materials and provided a significant boost to the construction sector. On this basis, the NSO estimates a 11.4 percent increase for the construction sector. However, seasonally adjusted numbers project contractions of 5 percent and 7.8 percent in these sectors respectively, compared to the data of the last quarter of FY 2022/23.

The NSO estimates a 13.2 percent growth for the financial and insurance sector in the first quarter of the current fiscal year due to factors like deposit and credit growth, changes in inter-banking lending rates and rising insurance premiums. Seasonally adjusted growth rate of this sector, however, is only 6.7 percent compared to data of the fourth quarter of the previous fiscal year.

Similarly, accommodation and food services activities are projected to register a growth of 11.7 percent compared to the first quarter of the previous fiscal year due to a rise in foreign tourist arrivals. Seasonally adjusted growth rate of this sector, however, is only 2 percent compared to data of the fourth quarter of FY 2022/23.

What is the state of growth in agriculture ? 

The growth of the agriculture, forestry and fishery sector is projected at 1.4 percent compared to the first quarter of the previous fiscal year, mainly due to the growth in paddy production.

What about the impact of the import ban in the economy? 

Wholesale and retail trades are estimated to contract by 1.2 percent, indicating that trading activity, which was hit hard by the government ban on certain imports in the previous fiscal year, is yet to revive. Seasonally adjusted growth rate of this sector is estimated to be 8 percent negative compared to the fourth quarter of FY 2022/23. 

What are the current states of 18 sectors of economy? 

Out of 18 sectors of the economy, 12 recorded growth in the first quarter of the current fiscal year compared to the last quarter of FY 2022/23 after seasonal adjustments, while six may have contracted, according to the periodic report of the NSO. Water supply, sewage and waste management is forecast to grow by 7.3 percent, public administration and defense by 5.5 percent, compulsory social security by 5.5 percent and human health and social work activities by 3.4 percent. Similarly, information and communication, and real estate activities are forecast to grow by 3.8 percent and 2.2 percent respectively.

Today (27 Poush of Nepali calendar) is the 302nd birth anniversary of King Prithvi Narayan Shah, widely regarded as the creator of modern Nepal. For a long time, the country celebrated this date as a national unity day until it was discontinued following the abolition of monarchy in 2006.

There are divergent views among political parties regarding their view of Shah. During the insurgency period, it was one of the key contentious issues within the Maoists that was waging an armed rebellion against the state ruled by monarchy. Even though the Maoist fighters demolished the statues of kings, including that of the unifier, the party supremo, Pushpa Kamal Dahal, acknowledged the contributions made by Shah. His second-in-command at the time, Baburam Bhattarai, however, was against all things monarchy. 

But of late, there is a growing consensus among all political parties—not just the Maoists—that Shah deserves the credit and acknowledgement for bringing together dozens of tiny warring states under a single banner. On 25 September 1768, Shah officially announced the creation of the Kingdom of Nepal with Kathmandu as the national capital.

Irrespective of the government’s position, royalist parties to this day celebrate Poush 27 as the National Unity Day. Last year following pressures from the Rastriya Prajatantra Party, the government of Pushpa Kamal Dahal decided to mark the day as the National Unity Day. Prime Minister Dahal and the leader of CPN (Maoist Center) naturally drew flak from the supporters of the republic and his own party members for the decision.

This year the government has not announced any special day to commemorate “the Great King”. But it has not deterred the royalist forces from doing so. In fact, they have become more louder in their demand for the restoration of monarchy.   

The Rastriya Prajatantra Party is set to host a tea reception to mark the birth anniversary of Shah today. The party has invited political leaders and individuals from all walks of life to the event.

While there may be divergent views among political parties and citizens about King Prithvi Narayan Shah, his outlook on Nepal’s external relations cannot be disregarded. How prescient was he when he said: “Nepal is a yam between two boulders.” This adage is still relevant today when talking about Nepal’s foreign policy, particularly concerning India and China.  

In his journal article published by the Nepal Army in 2022, Manish Jung Pulami says: “The origin of ‘yam’ as a discourse emerged amidst the turmoil in the Indian sub-continent and Nepal under the Himalayan belt. The problematic situation in which Nepal developed as a nation-state in the Indian sub-continent under the Himalayas has also led Nepal to be portrayed as a ‘yam’.”

Pulami goes on: “‘Yam’ as a theory comprises the elements of cautiousness, gradualism, peaceful co-existence, and friendliness in foreign policy. The theory incorporates the strategies for the major power politics in the region and outside the region.” 

“It also provides Nepal with the diplomatic and foreign policy strategy for the survival and sustenance in the geopolitical sphere with competition, antagonism, and cooperation. This theory also provides in light of the Dibya Upadesh about the military, strategic, economic and internal policies of Nepal.”

What’s in Dibya Upadesh?

In his deathbed, King Prithvi Narayan Shah is said to have imparted his counsel on various topics ranging from nation to nationality and governance, which is better known today as Dibya Upadesh (Divine Teachings). 

The provenance of ‘yam between two boulders’ can be traced back to Dibya Upadesh.     

Under the title of, ‘External Relations,’ it states: “Whereas, this state (Nepal) is like a yam (gourd) between two stones. Keep a strong friendship with the Emperor of China; one has to maintain a friendship with the Emperor of the sea (English Emperor) in the south. But he is very clever. He is occupying Hindustan.

He is eyeing the plane area (of Nepal also). When Hindustani (Indian) people will wake-up (not tolerate them) he may find it difficult to stay there. He might have been searching for a safe fort and there is every possibility that he may come here at any day. Therefore, we have to find out our Sandhisarpan (weak points) and we also have to change them into strong forts. We have to create obstacles on the way they try to enter. Mind it they may arrive here anytime.

Do not go there (down) to fight with them. Let them come here (hilly region) and fight with them. If we could do so, they could easily be beheaded at the crossings of the Chure Hills. If we could do so we will be able to collect arms and ammunition which would suffice for our Four to Five Generations. And we will be able to extend our border up to the Ganga River.

If they could not fight with us they will try to come here utilizing Lolo Poto (tricks) or any other types of conspiracies. This is a Thakhat (suitable place/natural fort) of Nepal. If they (Englishers) get this fort they will win over all the Four Emperors of the world. This state itself is a fort created by the God himself. It does not need any human touch on it. Prepare seven strong forts in these places namely Shivapuri-1, Phulchowki-1, Chandragiri-1, Mahadevpokhari -1, Palung-1, Dapcha -1 and Kahule-1.”Still relevant today

In the words of Prof. Surya P. Subedi, Prithvi Narayan Shah’s description of Nepal as “a yam between two boulders” refers to the Celestial Empire of China to the North and the Emperor to Seas to the South, i.e., British Raj on the Indian subcontinent. It sums up Nepal’s position at the time. 

“It is the first major statement on Nepal’s foreign policy which has not only entered the psyche of the people of Nepal but has also guided foreign policy makers,” contends Subedi.

Foreign policy experts agree. With the resurgence of India and China as  global powers, they say King Prithi Narayan Shah’s vision still provides a broader guideline in the conduct of Nepal’s foreign policy.  

“Today, the essence of King Prithvi Narayan Shah’s yam theory can be very reliable for Nepal to deal with the geopolitical vulnerabilities encircling the country,” says Pulami. 

“Similar to the times of King Prithvi Narayan Shah, contemporarily, Nepal has been a ‘yam’ between the two boulders—India and China. The rise of China and India in the neighborhood and the geopolitical and geoeconomic ambitions of both countries makes the ‘yam theory” more relevant than ever.  

Economic growth in South Asia is estimated to have slowed slightly to 5.7 percent in 2023, yet it remains the fastest among emerging market and developing economy regions, according to a new report published by World Bank. This is largely attributed to a robust expansion in India, which accounted for more than three-fourths of the regional output in 2023. Excluding India, however, activity was more subdued.

In India, despite some slowing, a strong performance in 2023 was driven by robust public investment growth and vibrant services activity. Merchandise exports slowed due to weak external demand, but domestic demand for consumer services and exports of business services sustained India’s economic growth, according to the report.

In Bangladesh, growth is estimated to have slowed in the fiscal year 2022/23 (July 2022 to June 2023), as activity was hampered by import restrictions and rising material and energy costs, as well as mounting external and financial pressures. 

Output in Pakistan is estimated to have contracted during the FY 2022/23. Inflation remained elevated, partly reflecting large currency depreciation in early 2023. However, towards the end of 2023, Pakistan's currency exhibited signs of stabilization. 

Output in Sri Lanka is also estimated to have declined in 2023, while there has been progress in sovereign debt restructuring. In Afghanistan, despite declining food prices in 2023, poverty rates remained high, exacerbated by strong earthquakes in October 2023.

Growth in South Asia is expected to edge slightly lower to a still-robust 5.6 percent pace in 2024, before firming to 5.9 percent next year. Domestic demand, including public consumption and investment, will remain major drivers of economic growth. A pickup in external demand, albeit still subdued, is also expected to contribute to growth, the report says.  

In India, growth is expected to edge up to 6.4 percent in the FY2024/25 (April 2024 to March 2025) after softening to 6.3 percent in the FY2023/24. Investment is envisaged to decelerate marginally but remain robust, supported by higher public investment and improved corporate balance sheets.

In Bangladesh, growth is forecast to slow to 5.6 percent in the FY2023/24. Inflation is likely to remain elevated, weighing on private consumption. Import restrictions are expected to continue and impede private investment.

In contrast, growth is projected to pick up in Nepal, with monetary policy easing and the delayed effects of lifting import restrictions, the report says.

The report further says: “The outlook in Pakistan remains subdued for FY2023/24. Monetary policy is expected to remain tight to contain inflation, while fiscal policy is also set to be contractionary. The outlook in Sri Lanka remains uncertain, amid debt restructuring negotiations, particularly with private creditors.” 

Investment related to the tourism sector will support growth in the Maldives, while the commissioning of a new hydro plant in Bhutan is expected to contribute to a pickup in growth in the next fiscal year.

The World Bank has also explored some risks as well. The report says: “Risks to the forecast remain tilted to the downside, with the most pressing concerns revolving around higher energy and food prices caused by an escalation of the conflict in the Middle East and adverse spillovers stemming from larger-than-expected increases in policy rates in advanced economies.” 

In addition, elevated external and fiscal financing needs, the growing frequency and severity of extreme weather events, and sharper-than-expected growth slowdown in trading partners also pose risks to the region. Heightened uncertainty around elections in 2024 in some countries is also a downside risk in the region. However, the implementation of growth-friendly policies after elections could improve growth prospects.