A fresh opportunity for good governance
Naturally, Nepal is beautiful, geographically Nepal is landlocked and politically Nepal is always unstable. But after the March 5 election, the term unstable will be stable—that’s our hope—with a new political party set to form the government. Nepal has just seen a political earthquake. In the recent election, the Rastriya Swatantra Party (RSP), led by Balendra (Balen) Shah, has secured a historic majority in the federal parliament, with around 182 seats out of 275. The so‑called big parties of yesterday have been pushed far behind. Many of their senior leaders have lost. Only former Prime Minister Pushpa Kamal Dahal has managed to return to parliament from Rukum East, while other familiar famous faces have disappeared from the front line. This result is not a small change; it is a clear message from the people that they were tired of the old way of politics and new one to be corrected in present and future with the hope not to be repeated from this wave too.
Nepal has long struggled with hung parliaments, unstable governance, and never-ending positional negotiations. The people’s lives remained unchanged despite the government’s repeated changes in leadership. Rather than being influenced by the general welfare, policy decisions were frequently influenced by personal interests, political agreements, and corruption. Like in the past, basic government services remained cumbersome, slow, and rude. People believed that even basic tasks required bribes or political ties. Due to their inability to obtain good services, health care, or education at home, young people from villages and small towns continued to migrate to cities and other nations. A ‘tsunami of votes’ was made possible by this lingering discontent.
Why did this tsunami of votes come for RSP and Balen Shah? There are several reasons. First, young people, especially the GenZ generation, had already shown their anger through protests and social media campaigns against corruption, nepotism, and the lifestyle of the political elite. They were tired of seeing leaders’ children enjoying luxury while ordinary youth stood in queues for passports and labor permits. Second, Balen presented itself as a clean, new force with a strong anti‑corruption message and a modern style of communication. Balen Shah’s own image as an engineer, rapper, and independent thinker who had already shaken the old parties in Kathmandu’s mayoral politics gave people hope that a different kind of leadership is possible.
Third, voters punished the old parties because they failed to provide stable and honest governance after the federal republic was established. Leaders kept making coalitions only to save their chairs, not to serve the people. They talked about socialism and equality, but the gap between their words and their actions became too big. In this election, people decided to clean the field. This is not just a victory for one party; it is a warning that any party can be thrown out if it betrays public trust.
Now, with a clear majority, the biggest hope is political stability. For the first time in many years, one party has enough seats to form a government without being hostage to small coalition partners. This creates an opportunity and a big responsibility. The question is: what should this new government do first, so that people feel their vote was not wasted?
The first duty of the new government is to restore ‘trust’. Trust will not come from speeches; it will come from concrete actions that people can see and feel in daily life. The government’s first decisions should focus on cleaning the system and improving basic services. A strong first move could be to announce a national “Good Governance and Service Reform Plan” with clear, time‑bound targets. For example, the government can declare that key services such as citizenship, social security, passports, driving licenses, land registration and business registration must be delivered within a fixed number of days, through a simple process, with transparent fees. There should not be rules office and employee wise.
To make this real, there should be a public “Revised Service Charter” in every office, and a system for citizens to complain easily if offices delay work or demands. Complaints should go to an independent mechanism that can take action quickly on responsible officials. If people see that the government seriously protects them against harassment in offices, their hope will grow.
The second urgent duty is to fight against growing corruption at all levels in political leadership, civil service, and the private sector. Corruption has become like cancer in Nepal. To control it, the new government can follow some guiding steps:
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Establish the mechanism of investigating assets of public holding
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Give real independence, resources, and technology to anti‑corruption bodies so they can investigate big cases without political pressure
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Protect whistle‑blowers who expose corruption in government offices, public enterprises, or private companies doing public work
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Introduce e‑procurement and open data for all major contracts, so that the public and media can see who is getting which contract, at what price, and with what results
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Revise government office and employee numbers and provide plenty of tasks to the employee
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Enforce strict punishment for proven corruption, even if the person belongs to the ruling party
Importantly, the new government must apply the same standard to its own members. If RSP protects corrupt people inside its own ranks, the moral authority of this “change” will collapse. People voted for RSP to break the old culture, not to repeat it with new faces.
The third big responsibility is to make the state work for the whole country, not just for the center and own area. People in rural hills, Madhes plains, and remote areas have suffered from poor infrastructure of schools, poor health posts, bad roads, and lack of safe drinking water. Many of them feel that the state only remembers them during elections. The new government must show that it respects every citizen equally. Early budgets should prioritise basic services in the poorest and most neglected areas. Local governments should receive predictable funding and technical support, with clear rules and monitoring, so that funds are not misused on the way.
The government must also speak clearly about inclusion. Nepal is home to diverse communities—Dalit, indigenous, Madhesi, Muslim, Tharu, and others—who still face discrimination and barriers. For them, good governance means being able to enter an office without humiliation, getting justice from police and courts, and seeing people like themselves represented in state institutions. The new leadership should enforce laws against caste and gender discrimination, improve representation in public service, and design targeted programmes for those at the bottom.
Another major challenge is to give young people a reason to stay here. Before this election, unemployment, low wages, and frustration with the system pushed thousands of youths to go abroad every day. If nothing changes, the country will lose its energy and future. The new government must make youth employment a top priority. This can include transparent and fair public service exams, support for small and medium enterprises, skills training linked with technology and green jobs, and encouragement for innovation and start‑ups. At the same time, the government must clean up existing recruitment processes where cheating and favoritism have damaged trust.
To move toward a “Good Governance Country”, the change must be both structural and cultural. Structurally, laws, rules, and institutions have to be improved. Culturally, habits of power, ego, and misuse must be challenged. Political leaders should set an example by living simply, avoiding unnecessary luxury at public cost, and being reachable to citizens. Parliamentary committees should actually question ministers and review policies, not just act as rubber stamps. The media and civil society should be free to criticize without fear.
The first-ever decisions of this new government will be remembered. If they touch the everyday pain of citizens’ corruption, delay, disrespect, unemployment, reducing cost for representatives and government officials, poor service people will feel that a new era has truly begun. If those first decisions are only about positions, protocol, and party interests, people will quickly feel cheated again. The “tsunami of votes” that lifted RSP and Balen to power can, in future, sweep it away too.
Nepal now stands at a crossroads. The old parties have been taught a hard lesson by the people. The party has been given a historic chance. Stability will come not just from numbers in parliament, but from honesty in action. If this government can be brave, humble, and consistent, Nepal can slowly move from a culture of corruption and chaos to a culture of service and dignity. The people have done their part. Now it is the government’s turn to show this time, change is real. And we will feel we are rich in every aspect, where we were always poor. We are ready to wait for some time, understanding that deep reform cannot happen in one single day. But we are also watching carefully. The early days and the first decisions will be remembered for many years, either as the moment when Nepal finally started to respect its citizens or as one more missed opportunity.
Trade imbalance persists despite faster export growth
Nepal’s external trade is expanding at a healthy pace. The country’s total foreign trade expanded by 13.55 percent to reach Rs 1,480.36bn over the first eight months of the current fiscal year. Figures released by the Department of Customs (DoC) show imports are rising strongly and exports are growing faster in percentage terms. However, the overall gap between the two remains stubbornly wide.
In the eight months of fiscal year 2025/26, trade deficit widened by 11.22 percent to Rs 1,098bn, up from Rs 987.39bn in the same period last year. Total imports surged by 12.54 percent to Rs 1,289.25bn, while exports by a notable 20.83 percent to Rs 191.11bn. On the surface, this suggests a positive shift—exports are growing faster than imports. But the reality is more complex.
Nepal’s external trade is overwhelmingly tilted toward imports. Even after healthy exports growth in the review period, imports account for 87.09 percent of total trade, while exports make up just 12.91 percent. Over the past decade, imports have nearly doubled, rising from Rs 984bn in fiscal year 2016/17 to Rs 1,804.12bn in the previous fiscal year. The trade deficit during the period remained at Rs 1527.09bn. Nepal imports fuel, vehicles, machinery, and a wide range of consumer goods, including food products, while exporting relatively little in comparison. This trend paints a picture of an economy driven largely by consumption rather than production.
A persistent trade deficit puts continuous pressure on foreign currency reserves. The country relies heavily on remittances sent by workers abroad to finance its import bill. When remittance inflows weaken or external conditions shift, such as rising global fuel prices or slowing demand, this model becomes vulnerable.
In 2022, Nepal faced a sharp decline in foreign exchange reserves, which fell by more than 16 percent within seven months. To arrest the slide, the government imposed restrictions on the import of non-essential goods such as cars, cosmetics, and gold to prevent a balance of payments crisis. While those measures provided temporary relief, they did not address the structural roots of the problem.
Nepal is highly dependent on imports, and the gap between what it buys and sells abroad is still vast. The modest rise in share of exports in total foreign trade indicates that exports are either growing faster than imports or that import growth is beginning to slow slightly. However, the improvement is too small to significantly alter the macroeconomic picture. Also, a bulk of export receipts come from the export of processed edible oils like soybean and sunflower to neighboring India. Nepali importers import crude edible oil from countries as far as Argentina and export it to India after some value addition. If India increases crude import quota for its refineries, Nepal will lose a significant volume of its exports.
One of the major factors behind rising imports and widening trade deficit is Nepal’s weak domestic production base. Limited industrial capacity, high production costs, and low competitiveness have for long affected Nepal’s ability to produce goods for both domestic consumption and export. As a result, the country remains reliant on foreign products even for basic needs. Despite being an agricultural nation, Nepal imports a significant volume of farm products, especially from India. The country imported paddy and rice worth Rs 27.95bn in the first eight months of fiscal year 2025/26. Potato imports also rose to reach Rs 5.73bn during the period.
Experts say traditional export sectors such as carpets, garments, and certain agro-products can perform better. However, this will be only possible if there is policy support aimed at boosting production, diversifying exports, and improving competitiveness. The political leadership should realize that encouraging industrial growth, investing in export-oriented sectors, and reducing reliance on imports are no longer optional—they are essential for long-term stability.
Why constitutional amendment remains an uphill task
The decision by the Balendra Shah-led government to form a task force to prepare a discussion paper on constitutional amendment signals renewed political intent. Yet, despite years of rhetoric and electoral promises, translating that intent into action remains deeply challenging.
At the heart of the difficulty lies the arithmetic of power. Although the ruling bloc—particularly Rastriya Swantra Party—appears to command close to a two-thirds majority in the House of Representatives, this strength does not extend to the National Assembly. Since constitutional amendments in Nepal require approval from both houses, the absence of sufficient numbers in the upper chamber poses a structural hurdle. Even with potential support from smaller parties, securing the required majority in both houses remains uncertain.
Beyond numbers, the lack of political consensus presents an even more formidable barrier. While almost all major parties—including Nepali Congress (NC), CPN-UML, Nepali Communist Party, and RSP—have expressed commitment to amending the constitution, they diverge sharply on what those amendments should entail.
The most contentious issue is the form of governance. The debate over executive power has resurfaced strongly. RSP and Maoist forces are advocating for a directly elected president, arguing that it could ensure stronger and more stable leadership. However, the Nepali Congress has consistently opposed this model, favoring the existing parliamentary system. This disagreement is not new—it dates back to the original constitution-drafting process of 2008 to 2015, when parties ultimately rejected a directly elected presidential system, citing risks for a politically fragile country like Nepal.
Such foundational disagreements make consensus-building extremely difficult. Constitutional amendments are not merely technical adjustments; they involve redefining the structure of the state. Without alignment on core principles like governance models, progress is likely to stall.
Adding to the complexity is the absence of a clear roadmap. The government has formed a task force to draft a discussion paper, but has not yet established a formal constitutional review mechanism. This raises questions about whether the process has sufficient institutional grounding to move forward effectively.
Political ambiguity further complicates the process. Many parties, including NC and UML, have acknowledged the need for amendments but have refrained from specifying concrete proposals. Even parties with clearer positions, such as RSP—which has advocated for a directly elected executive and a fully proportional electoral system—may face pressure to moderate their stance in the post-election political environment.
Electoral reform is another sensitive issue. While concerns have been raised about the current system’s inability to produce stable single-party governments, recent electoral outcomes have somewhat weakened that argument. This reduces urgency and consensus around reforming the electoral framework.
Finally, broader ideological issues—such as secularism—could emerge as flashpoints during the amendment process, further complicating negotiations.
In sum, constitutional amendment in Nepal is not just a legislative exercise but a deeply political process requiring broad consensus, institutional clarity, and numerical strength across both houses of Parliament. The current scenario reveals gaps on all three fronts. As a result, despite renewed momentum, the path toward amendment remains uncertain and fraught with challenges.
PM Shah’s unconventional premiership signals a break from the past
Prime Minister Balendra Shah’s early days in office have signaled a striking departure from traditional governance. From his restrained public presence to his assertive administrative reforms, Shah’s approach suggests an attempt to redefine how executive power is exercised.
One of the most visible shifts has been his communication style—or the lack thereof. Unlike previous prime ministers, who typically engaged with the media immediately after assuming office, Shah has remained notably silent. He has neither addressed the press nor issued public statements, signaling a preference for action over rhetoric.
Even celebratory political norms were curtailed; his party instructed lawmakers not to organize victory rallies, and Shah himself kept his sole appearance brief and speechless.
Diplomatic conventions have also been disrupted. Traditionally, ambassadors from major nations meet a newly appointed prime minister within a day of the oath-taking ceremony. Shah, however, has limited such engagements, meeting diplomats only during the official ceremony. By avoiding customary congratulatory exchanges, he has maintained an unusually quiet Prime Minister’s Office.
At the same time, Shah has embraced symbolic gestures rooted in tradition. He followed Hindu rituals during his oath-taking and conducted a special pujabefore entering the official residence in Baluwatar.
Structurally, Shah moved quickly to streamline the government. He reduced the number of ministries from 24 to 15, emphasizing efficiency. He also directed government secretaries to either accelerate their work or step down, demonstrating a results-oriented approach.
Policy-wise, Shah’s administration has taken bold steps. The government issued a public apology to Dalits and historically marginalized communities—an acknowledgment of centuries of systemic oppression. This commitment is part of a broader 100-point governance reform agenda approved by the cabinet.
On the day of his swearing-in, the arrest of former Prime Minister KP Sharma Oli by the Ministry of Home Affairs sent shockwaves through the political landscape, underscoring Shah’s willingness to maintain accountability.
Further reinforcing this stance, the cabinet decided to form a high-level commission to investigate the assets of public officials dating back to 1990.
Perhaps the most significant break from the past lies in cabinet formation. Shah has prioritized merit and professional expertise over political compromise, resisting pressure from party insiders. Senior leaders expected to secure ministerial positions were sidelined as Shah asserted his authority to choose his team independently. This has allowed him to maintain tighter control over his cabinet and demand greater accountability.
In a positive sign for legislative stability, he has begun reaching out to other parties in Parliament. He has consulted with lawmakers across the political spectrum to gather their views on the budget and the government’s priorities.
Furthermore, as the Rastriya Swatantra Party pledged to amend the constitution in its election manifesto, the government has formed a committee led by Ashim Shah, the PM’s chief political advisor, to prepare a foundational document for constitutional amendment.
Balen Shah’s premiership is marked by a blend of administrative assertiveness, cultural symbolism, and political independence. While his opaque style and limited communication may invite criticism, his decisive actions and reform-oriented agenda set him apart from his predecessors. Whether this unconventional approach will yield long-term stability remains to be seen, but it has already redefined leadership expectations in Nepal.



