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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.

Prime Minister Pushpa Kamal Dahal is keen to conclude the transitional justice process under his leadership—and on his own terms. Ever since he came to power last year, he has been striving to conclude the long drawn-out peace process. Besides trying to bring internal stakeholders on board the process, he has also been trying hard to win support of the international community.

For the same purpose, he registered an amendment bill on the transitional justice Act in Parliament, but he failed to convince the conflict victims as well as the international community. A few days back, he expedited the talks with the Nepali Congress and CPN-UML to forge a consensus on contentious issues of the transitional justice process. He even offered some upper house seats to the main opposition, UML, but to no avail. 

But the reality is that the transitional process is unlikely to move ahead under Dahal’s leadership. The government is preparing to endorse the amendment bill from Parliament from the next session, but it is unlikely due to the position taken by UML and the international community. 

It seems the UML has hardened its position regarding transitional justice. In a recent interview with ApEx, UML Chairman KP Sharma Oli said that since Sher Bahadur Deuba of the Nepali Congress was the prime minister during the insurgency period and Dahal was leading the armed insurgency, one cannot expect a fair and just transitional justice delivery under their leadership.  

Oli went further by stating that the Maoist party aims to conclude the process by neglecting the suffering of the war victims. The key issue, the opposition leader added, lies in addressing the grievances of the victims, ending impunity, and establishing the truth before moving towards reconciliation.

Regarding the contents of the amendment bill, there are concerns from the international community. According to the Human Rights Watch, the bill expands the list of violations covered by amnesties, including those crimes that cannot be forgiven under the international law. 

For example, the bill has proposed a two-year statute of limitations on rape complaints. It also prevents prosecution for cases of enforced disappearance, which became illegal under the Nepali law in 2018. The bill has also failed to address the issue of child soldiers. 

The Nepali Congress, a key coalition partner in the Dahal government, has not shown any eagerness to resolve the transitional justice process, nor does it have any concrete position on the contentious issues of the bill. 

It appears that the fate of the peace process hinges only on the positions taken by the UML and the Maoists.

Over the past year, Dahal has been trying to secure the support of the international community in his plan to conclude the transitional justice process. He even tried to secure the support of UN Secretary-General Antonio Guterres, but the latter reiterated the position of the international community in his address to Nepal’s federal parliament. 

He clearly said that the UN stands ready to support the victim-centered process and its implementation in line with international standards and Nepal’s Supreme Court rulings. “Transitional justice has the greatest chance of success when it is inclusive, comprehensive, and has victims at its heart,” Guterres told the parliament.

The message of the international community is loud and clear: there should not be amnesty on serious human rights violations. But the Nepali leaders, through the use of vague and unclear language and maintaining a strong influence in the transitional justice bodies, are seeking amnesty even on serious violations.

Over the past eight years, two transitional justice mechanisms—Truth and Reconciliation Commission and Commission for Investigation of Enforced Disappearance Cases—have hardly made any progress, except for receiving around 63,000 complaints from conflict victims.  The two bodies are currently without any officer-bearers, which has severely affected their works. 

Although a parliamentary sub-committee was entrusted to hammer out the differences concerning the transitional justice process, it is clear that only the major political parties can take the final call.

Since 2006, political parties of Nepal have been using the transitional justice issue as a bargaining chip to reach to power. The Nepali Congress and CPN-UML have long been using the peace process as a leverage to negotiate power-sharing deals with the Maoists. 

This tendency shows that the basic approach of the major parties towards approaching the transitional justice process is flawed. Instead of delivering justice to the victims of conflicts, major parties are using the peace process as a tool to reach power. 

In case it fails to convince the UML, the Dahal government is planning to endorse the transitional justice amendment bill through a majority vote. But that is unlikely to bring about any positive outcome, as was evident eight years ago. 

The Truth and Reconciliation Commission (TRC) has registered 64,000 complaints from the conflict victims to date. So far, it has managed to conduct preliminary investigations of only around 4,000 cases. Around 3,000 cases have been left in abeyance due to a lack of concrete evidence. 

Similarly, the Commission for Investigation of Enforced Disappearance Cases has received a total of 3,288 complaints. Out of these, 277 were transferred to the TRC, 292 were put on hold, 136 complaints were found to be duplicative, and 48 cases were resolved. Presently, the commission grapples with 258 active complaints.

The year 2023 witnessed a significant movement of Nepali citizens seeking opportunities, education, and a new chapter in their lives. The Central Bureau of Statistics (CBS) has unveiled compelling insights into the diverse reasons and destinations that have shaped the migration trends of Nepalis.

A staggering total of 1,603,836 Nepalis embarked on journeys to different corners of the globe in 2023. What makes this migration wave intriguing is the varied purposes that propelled these individuals to leave the country.

Among the migrants, 70,915 Nepalis chose to make a new home abroad, embracing permanent residency. This group, comprising 36,663 males and 34,251 females, reflects a growing desire for stability and long-term settlement beyond their homeland. Political instability, poor economy and lack of job and business opportunities are driving many individuals and families to migrate. 

The pursuit of employment opportunities also led a significant number, 808,415 to be exact, to venture abroad under employment visas. Notably, 271,088 Nepalis landed in the United Arab Emirates (UAE), signaling the lure of job prospects in the Middle East. While these migrant workers are an integral part of Nepal’s remittance-reliant economy, their departure also reveals the sorry state of rural Nepal, where villages are either empty or populated only by women, children and elderly citizens. 

Government ministers and politicians boast of road, education and electricity access in far-flung regions of the country, but the reality is that the number of beneficiaries is fast dwindling. Excess migration has also caused the farmland in many parts of the country to go uncultivated.   

Besides job opportunities, education is another key catalyst that is prompting Nepali youths to visit abroad, with 108,542 Nepalis opting for student visas. The surge in applications for no objection letters for overseas studies suggests a growing appetite for educational pursuits beyond national borders. It is important to note that until and unless the government creates career opportunities at home, foreign educated youths are less likely to return to the country. 

The top destinations for Nepali migrants in 2023 spanned across India, Qatar, Malaysia, Saudi Arabia, Australia, Japan, the US, the UK, Kuwait, South Korea, Thailand, Canada, China, and Hong Kong. This diverse list underlines the global footprint of Nepali citizens seeking opportunities that are not available at home.

The 2021 census reveals a notable shift, with the number of women migrating abroad increasing by a remarkable 71 percent over the past decade. Out of the 2,169,478 Nepalis residing abroad, 404,103 are females, reflecting a changing trend in gender dynamics among migrants. This also comes with its own sets of challenges, particularly concerning trafficking of women. 

Stories about Nepali women getting trafficked to an unknown country and getting abused and tortured are all too common. Human trafficking rackets under the guise of overseas job agencies have long been supplying Nepali women, mainly to the Middle East, by luring them with the promise of well-paying jobs. 

A closer look at the data reveals a spike in Nepalis heading to countries like Poland, Malta, and Portugal. The allure of permanent residency has drawn 10,638 Nepalis to Portugal, 5983 to Malta, and 5834 to Poland. Recently, there have been reports about Nepalis paying exorbitant amounts of money to the so-called foreign employment companies and agents to enter Europe and North America. 

Reports have also emerged about Nepalis being recruited in Russia's army in its conflict with Ukraine. The numbers indicate that 1,795 Nepalis visited Russia, with the majority under visit visas, since the war broke out in February 2022. Additionally, 95 Nepalis ventured to Ukraine during these tumultuous times. Nearly a dozen Nepalis have lost their lives in the war and many more are said to be injured or missing, but the government has done little to investigate their whereabouts and bring them back home. 

The 2023 migration trend paints a stark reality of Nepal, a country caught in a deep mire of corruption, poor economy, political instability and unemployment. It also paints a complex tapestry of dreams, challenges and aspirations of its citizens. 

In Nepal’s bicameral parliament, the National Assembly or the upper house consists of 59 members. Of them, 56 members are elected through the electoral college and three, including at least one woman, is nominated by the President on the recommendation of the government. 

Ideally, the NA is distinct from the lower house, which is dominated by politicians. It serves as an eclectic council of experts and scholars that advise the lower house or the House of Representatives during the lawmaking process. It plays a vital role in holding the HoR and the government to account. The upper house is also a permanent body, and the term of its member can last for a maximum of six years. One-third members retire every two years and elections are held accordingly.  

As election for 19 seats in the NA is set to take place on Jan 25, the major political parties—Nepali Congress, CPN-UML and CPN (Maoist Center)—are engaged in an intense horse-trade to secure positions for leaders who couldn't find their way into the lower house. They have turned the upper house into a platform to accommodate the leaders who lost the election or did not get a chance to enter the lower house under the proportional representation category. 

Instead of appointing experts as envisioned by the constitution, the major political parties have hijacked the upper house and turned it into a losers’ club. As politicians are getting elected under the expert’s quota, the NA is failing to perform its true duty, and the political parties are endorsing controversial bills.

On Monday, the cross-party leaders registered their candidacy for the NA election. The Nepali Congress has fielded its senior leader Krishna Prasad Sitaula for one of the seats. Sitaula, who played a vital role in Nepal’s peace process, lost the 2022 parliamentary elections against Rastriya Prajatantra Party Chairman Rajendra Lingden. His candidacy has drawn criticism both inside and outside the party.

Some critics are of the view that it is wrong to field somebody in the NA election who had lost the general election just a year ago. Others are calling out the Congress party for repeating the same old leaders, instead of introducing fresh faces. 

Sitaula and his party is eyeing for the post of the upper house chair, as the incumbent NA Chairman Ganesh Prasad Timalsina’s term is ending in April. Inside the party, Sitaula’s candidacy has been criticized by leaders including the general secretary duo, Bishwa Prakash Sharma and Gagan Kumar Thapa. 

“There are many others who are eligible to become members. There are leaders who have made a lot of contribution to the party and the country,” said Sharma. He noted that the party has failed to implement the provision of inclusion in its truest sense.

Thapa also expressed dissatisfaction over the party’s NA election candidates. “Our constitution has envisioned the representation of under privileged groups and experts in the National Assembly. The party’s decision goes against the standard that we set ourselves,” he said. 

The Nepali Congress is not the first and the only party that has failed to honor the spirit of the upper house. The incumbent Deputy Prime Minister and Minister for Home Affairs Narayan Kaji Shrestha from the CPN (Maoist Center) is another notable political figure to enter the NA after an electoral loss. Similarly, senior political leader Bam Dev Gautam, formerly of the UML, is also serving as an upper house member after losing the HoR election. 

The current ruling alliance, including the Congress, Maoist Center and CPN (Unified Socialist), has forged an electoral alliance, while the main opposition, CPN-UML, has decided to fight alone. The ruling coalition is likely to win almost all the seats. Although Prime Minister Pushpa Kamal Dahal wanted to accommodate the UML, his attempt did not yield any result due to the objection from some coalition partners. 

Regarding the appointments to be made by the President, the parties are unsurprisingly preparing to recommend more politicians, instead of the experts. Since its formation in 2018, there has been rare appointment of experts in the upper house. With politicians ruling the roost, the NA is no longer the conscience keeper of parliament. It has failed to function independently due to the excessive influence of the government and political parties.  

The key functions of NA

• Providing expert service
• Promulgation of laws
• Holding government accountable
• Regulation and issuing directives
• Conducting parliamentary hearing

India’s Minister for External Affairs S Jaishankar is arriving on Thursday for a two-day official visit to Nepal. The main objective of his visit is co-chairing the 7th meeting of India-Nepal Joint Commission, the highest body mandated to review the entire issues concerning bilateral partnership and direct the concerned authorities to remove the bottlenecks, if any.

Though established in 1987, the commission remained largely inactive till 2014. It resumed the work thereafter, albeit irregularly. Foreign ministers of the two countries co-chair this mechanism. The commission is set to review the overall state of bilateral relations and various areas of mutual cooperation between Nepal and India, according to the Ministry of Foreign Affairs.  

Jaishankar will also meet President Ram Chandra Poudel, Prime Minister Pushpa Kamal Dahal and other prominent political leaders during his stay. Regarding the visit, India’s Ministry of External Affairs has said that Nepal is a priority partner of India under its Neighborhood First Policy and that the visit is in keeping with the tradition of high-level exchanges between two close and friendly neighbors.

The commission meeting is expected to be instrumental in further enhancing the economic and development partnership between the two countries. 

The Indian external affairs minister visiting Nepal also holds political and diplomatic significance. Though India still has a deep influence in Nepal’s internal politics, over the past few years, it has been maintaining a low-profile regarding Nepal’s internal political situation. As the Dahal-led government—backed by India—is becoming unpopular and there are strong voices inside the Nepali Congress for a change in government, Jaishankar will also try to read the pulse of Nepali politics during his sojourn. Prime Minister Dahal wants the continuation of New Delhi support to keep the current coalition intact.

Jaishankar is arriving on the heels of a flurry of visits mainly from the US and China.  In 2023, there was a series of visits to Nepal by high-level US officials and the representatives of Communist Party of China. Compared to the US and China, visits from and to New Delhi were few. The Narendra Modi government naturally has geopolitical and strategic concerns, given the interests shown to Nepal by Washington and Beijing of late.

New Delhi is wary of growing Chinese influence in Nepal and is closely watching Kathmandu’s relationship with Beijing. It is also concerned over the Kathmandu-Washington ties, even though India and the US share similar interests with Nepal, particularly countering China’s influence.  

India’s ruling Bharatiya Janata Party and its sister organizations, including the Rashtriya Swayamsevak Sangh, also have a special interest in Nepal at a time when some political parties and groups are campaigning for the reinstatement of Hindu state.

Development and economic partnership between Nepal and India is gaining momentum after Dahal’s ascension to power. During Dahal’s India visit in May last year, there was notable progress between Nepal and India on energy cooperation. India has agreed to purchase Nepal’s electricity and also allow import to Bangladesh via India. Several connectivity projects between the two countries, including Raxaul-Kathmandu railway, also made significant strides.  

Former Ambassador and political analyst Bijaya Kanta Karna says Jainshankar’s visit should be taken as a continuation of Prime Minister Dahal’s India visit.

During his India trip, Dahal focused on building trust at the top political level and focusing on economic partnership while keeping the key contentious issues at bay.

 Karna said The energy cooperation in particular has given the message to the international investors that there is an appropriate environment for the investment in Nepal. He added that the visit by the Indian external affairs minister will reinforce the development and economic partnership between the two countries.  

The former Indian ambassador to Nepal said that the key purpose of Jaishankar’s visit is to review the bilateral relationship and, in particular, to strengthen mutually beneficial economic partnership.

The previous six meetings of the commission were held in New Delhi last year. These meetings discussed boundary and border management, connectivity and economic cooperation, trade and transit, power and water resources, and culture and education, among other issues. 

In the last few years, Nepal and India signed around 25 MOUs and agreements in various sectors of bilateral cooperation, including transit, petroleum, capacity building, railways, border infrastructure, education and electricity.

Key issues 

• Long-term power trade 
• Trilateral power agreement 
• Transmission lines 
• Pancheshwar Multipurpose Project 
• Trade and investment 
• Extension of MotihariAmlekhgunj petroleum pipeline in Chitwan and Siliguri 
• Cooperation in the agriculture 
• Boundary
• Air entry point  
•  Problem of flood and inundation
• Small-grant development projects 

The Ministry of Foreign Affairs has confirmed the death of three more Nepali men in the ongoing Russia-Ukraine war. They have been identified as Hari Prasad Aryal of Syangja, Bhar Bahadur Shah of Kailali and Rajkumar Giri of Dhading. Earlier, the government had confirmed the deaths of seven Nepali nationals. 

There is a widespread concern that there could be many more Nepali casualties that have gone unreported. A few weeks back, the government had said that at least 100 Nepalis were missing and scores of others were injured. 

The Nepal government has urged Moscow to urgently provide information about the number of Nepalis serving in the Russian army, stop recruitment of Nepali nationals and facilitate the repatriation of Nepalis killed in the war. A growing number of people have been visiting the Ministry of Foreign Affairs these days, with a request to locate their missing loved ones in Russia. 

So far, Russia has not responded to Nepal’s concern. The Nepal government is partly responsible for this situation. Soon after the war broke out in 2022, the Nepal government didn’t issue any advisory for those planning to visit Russia or Ukraine. Even when news broke out about Nepali nationals fighting in the Russia-Ukraine war, the government showed no urgency to inquire the respective embassies of Russia and Ukraine about the matter. 

The government was compelled to act only after reports about Nepalis dying in the war started emerging through friends, families and social media. Various national and international media also covered these incidents. Soon after, police busted a ring involved in sending Nepalis to Russia on visit visas to fight the war with Ukraine.  

Now, the government is grappling to ascertain the actual number of Nepalis serving in the Russian army and their current status. Recently, Prime Minister Pushpa Kamal Dahal said there could be approximately 200 Nepalis serving in the Russian army, yet officials hint at a possibly higher figure. Compounding the issue is the situation of Nepali hostages held by the Ukrainian army. Bibek Khatri, Siddhartha Dhakal, Bikas Rai and Pratik Pun are among those captured by the Ukrainian army. The talks for their release have hit an impasse. 

The government is now on a frantic mission, attempting to discern the status of its citizens fighting in the Russia-Ukraine war, exacerbated by the lack of cooperation from Moscow. This has prompted a tightening of visit visa rules, with a mandatory No Objection Letter (NoC) for travel to Russia and other transit countries. Shockingly, certain manpower agencies, according to some media reports, persist in training Nepali nationals for enlistment in the Russian army.

Though Moscow says foreigners cannot be allowed to join the Russian army, President Vladamir Putin in 2022 signed a decree making it easier for foreigners to obtain Russian citizenship if they join the army. As reported by the Moscow Times, the decree said: “Foreign citizens or stateless persons who sign a contract to serve in the Russian Armed force… for at least one year and take part in military operations for at least six months, will be eligible for the simplified application procedures.”  

Recently, Putin ordered the country’s military to increase the number of troops by nearly 170,000 to a total of 1.32 million. According to the Associated Press, Putin’s decree was released by the Kremlin on Friday and took force immediately. It brings the overall number of Russian military personnel to about 2.2 million, including 1.32 million troops.

Beyond Nepal, Russia's recruitment of foreign nationals, including those from Cambodia and Cuba, adds a global dimension to the conflict. Reports indicate Moscow's pursuit of formal labor contracts with other nations, underscoring the far-reaching consequences of this recruitment strategy.

Foreign policy experts emphasize the need for high-level communication between Kathmandu and Moscow to resolve Nepal's concerns. As Nepal's Ambassador to Moscow Milan Tuladhar engages in talks, a former foreign minister stresses the need for political leadership to step in. If needed, they say, Nepal should ask big countries such as India, the US, and China to talk with Moscow and Kyiv about Nepal’s concerns.