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The judiciary in Nepal has been under increased criticism in recent years due to claims of political meddling, corruption and incompetence. Historically seen as the last bulwark of justice and the last judge of constitutional norms, the court has revealed weaknesses in its defenses. These cracks expose a deeply ingrained misconception: that Nepal’s court is completely impartial and impervious to corruption. In actuality, Nepal’s judiciary’s independence is still a complicated illusion that is influenced by both internal and foreign factors. It should serve as a check on authority, a defender of the law, and an upholder of justice, as is the case in many democracies. But in Nepal, a number of issues make it less successful, which makes people wonder if it really reflects these principles or if it is just a façade. The independence of a court is essential for upholding the rule of law. 

However, political interests frequently exert pressure on Nepal's court, undermining its independence. Appointments and decisions can be influenced by political parties and their leaders, raising questions about potential bias. A conflict of interest arises when judges are chosen based more on their political connections than their qualifications, raising questions about their capacity to make unbiased decisions.

Political appointments

Political meddling in the selection of judges is the main grievance directed at Nepal’s judicial system. Although political forces frequently exert excessive influence, the constitution has procedures intended to guarantee neutrality in appointments. There is a contradiction of independence inside dependency since the Judicial Council, which is in charge of nominating judges, has members who are also chosen by political players. This system, which is supposed to maintain a balance of power, unintentionally makes it possible for political objectives to influence the court. The politicization of Nepal’s court is another mistake. 

Decisions that are influenced by politics undermine the justice and impartiality that the legal system is supposed to provide. Politicians frequently have excessive control over judicial nominations, guaranteeing that their supporters hold important posts. As a result, judges may feel pressured to support the interests of those who made their appointment possible, which undermines their capacity to act impartially and independently.

Myth vs reality

One of the main myths that is still spread is that corruption does not exist in Nepal’s courts. Although the court is generally regarded with respect by the people, persistent allegations of bribery and corrupt activities cast doubt on its impartiality. Subtle and pernicious corruption spreads through a number of avenues, from lower courts to higher judicial seats. The rule of law is allegedly undermined and public faith is eroded when judges are accused of favoring parties with financial incentives or influence.

Justice fatigue

The widespread backlog of cases in Nepal’s courts is another serious problem. Despite the basic right to a fair and prompt trial, many litigants must wait a long time for justice. Overwhelming caseloads, little resources and a shortage of staff are problems for courts. Some call this ‘justice fatigue’—a situation when litigants completely lose trust in the legal system—is brought on by the procedural delays. The idea that justice postponed is still justice is erroneous; in actuality, it is justice denied.

Obstacles to reform

Political opposition and bureaucratic delay have made Nepal’s judiciary reform a difficult process. Because of entrenched vested interests and a lack of political will, several attempts at structural transformation have failed. Constitutional clauses intended to protect judicial independence have been construed selectively, frequently in a way that benefits the powerful. Enacting significant change is difficult since it involves not just changing the legislation but also the culture in which the judiciary functions.

Restoring trust

Systemic reforms are necessary to rebuild public trust in Nepal's judiciary. Important initial measures include tackling corruption openly, ensuring that judge appointments are made on the basis of qualifications rather than political ties, and implementing technology to expedite case handling. More accountability, which may be attained by open audits and supervision, may also lessen the likelihood of corruption and rebuild confidence.

In summary, Nepal’s judiciary is at a turning point as it struggles with the myths of independence and incorruptibility. Both institutional change and a change in public opinion are necessary to achieve an independent and equitable legal system. Only until these ingrained misconceptions are confronted and dispelled by an unshakable dedication to justice and openness will Nepal’s judiciary be able to live up to these values. Significant obstacles confront Nepal’s court, undermining its function in the democratic process. Public trust is undermined by problems with accountability, independence and openness as well as political meddling. The judiciary must distance itself from political influence and make a commitment to impartiality and openness in order to operate efficiently. Nepal’s judiciary cannot genuinely become a pillar of justice until these changes are implemented.

The KP Sharma Oli-led administration is striving to improve its ties with New Delhi but has yet to achieve substantive results. Despite repeated attempts to mend relations, ruling party leaders and foreign policy experts suggest that bilateral relations between Nepal and India may be deteriorating rather than improving. A series of unresolved issues and missteps on both sides seem to have created a widening gulf.

During his earlier tenure and as an aspiring prime minister, Oli believed that the so-called ‘Delhi Durbar’—referring to India's political establishment—was obstructing his political aspirations. However, in a strategic political maneuver, Oli secured the premiership with the support of the Nepali Congress, a traditional ally of India.

Once in office, Oli took a series of initiatives aimed at establishing a cordial relationship with New Delhi. Like many of his predecessors, Oli hoped to receive an immediate invitation for an official visit to India as a gesture of goodwill. However, this invitation never materialized. Reports from Indian media suggest that New Delhi was initially open to welcoming Oli in August or September. However, India later withdrew the invitation, allegedly due to Oli’s insistence on preconditions—specifically, his demand that India announce steps to resolve the ongoing border dispute.

The border dispute, commonly referred to as the “map row,” stems from competing territorial claims over areas such as Kalapani, Limpiyadhura, and Lipulekh. While Oli has consistently advocated for progress on this issue, New Delhi appears reluctant to prioritize it, viewing it as a sensitive topic better deferred. Diplomats note that this impasse has fueled mistrust and contributed to the stagnation of bilateral relations.

A meeting between Prime Minister Oli and his Indian counterpart Narendra Modi on the sidelines of the 79th UN General Assembly in New York was seen as an opportunity to break the ice. However, according to diplomatic insiders, the meeting failed to yield any significant breakthrough. Analysts suggest that this outcome is emblematic of deeper issues in the relationship.

The unresolved border dispute is not the only factor straining ties. Another contentious issue is the fate of the Eminent Persons Group (EPG) report, finalized in 2018. The report, a collaborative effort by experts from both countries, was intended to recommend ways to enhance Nepal-India relations. However, India has shown little interest in accepting or even acknowledging the report, a stance that has frustrated Nepal.

Since becoming prime minister, Oli has repeatedly highlighted the importance of the EPG report in his speeches and public appearances. He has even used public platforms, such as the launch of former Foreign Minister Kamal Thapa’s book on the Indian blockade, to criticize India’s handling of the issue. During the event, Oli remarked, in a satirical tone, that Indian leaders seem too busy to formally receive the report.

This persistence, according to analysts such as Chandra Dev Bhatta, may have further irritated New Delhi. India, for its part, appears to view the EPG report as an unwelcome complication, and this view is shared by several Nepali political parties, including the Nepali Congress, the CPN (Maoist Centre), and Madhes-based parties. Despite this, Oli’s UML continues to push the issue, creating additional friction in bilateral ties.

Adding to the tensions is Nepal’s decision to align with China’s Belt and Road Initiative (BRI), a global infrastructure development strategy. The agreement, signed under Oli’s leadership, has been a point of contention since its inception. India has long opposed the BRI, citing sovereignty concerns, particularly because certain projects under the initiative traverse disputed territories.

Foreign Minister Arzu Rana Deuba’s recent visit to India seemed aimed at clarifying Nepal’s stance on the BRI. However, her trip failed to achieve its objectives. Indian leaders declined to meet her, reportedly due to either scheduling conflicts or dissatisfaction with her role in supporting the BRI framework agreement. This chilly reception was in stark contrast to her earlier visit in August, during which she was warmly received and even handed over an invitation from Oli to Modi for a visit to Nepal. Modi accepted the invitation but deferred setting a date, suggesting it would be decided through diplomatic channels.

The cooling of ties is not limited to Oli’s government. A senior Nepali Congress leader, speaking on condition of anonymity, acknowledged that even the relationship between the NC and India has soured. According to the leader, India was displeased with the NC for forming a coalition government with the UML. Additionally, India reportedly disapproved of the NC-led government’s decision to sign the BRI agreement with China.

Despite these challenges, certain aspects of Nepal-India relations remain functional. Bilateral mechanisms continue to operate, with regular meetings and consultations taking place. Nepali ministers frequently visit India, and there has been a noticeable strengthening of military ties between the Nepal Army and the Indian Army.

However, a senior Indian academic who closely follows bilateral relations noted that while India remains committed to engaging with the Nepali public, it has grown wary of working with Oli. “Oli’s strategic agreements with China could have implications for India’s security. I don’t foresee a cordial relationship between him and New Delhi in the near future.”

This situation bears similarities to the events of 2020 when the map row first escalated. After a prolonged communication breakdown, India sent Samant Kumar Goel, the chief of its intelligence agency RAW, as a special envoy to meet Oli. The visit facilitated a wide-ranging discussion of bilateral issues and temporarily eased tensions. However, subsequent political instability in Nepal, including Oli’s dissolution of Parliament, derailed progress.

Diplomats and political leaders now suggest that both governments should consider employing a combination of official and back-channel diplomacy to rebuild trust. Despite Oli’s recent efforts to use track two channels to resolve disputes, these initiatives have so far failed to deliver results.

For Nepal and India, the path to repairing relations will require addressing both long-standing disputes and emerging challenges. Progress will depend on a willingness to engage in meaningful dialogue and a mutual commitment to preserving and strengthening a historically close relationship that remains vital for both nations.

Nepal participated in 324 out of the 392 negotiation meetings it was expected to attend during the 29th Conference of Parties to the United Nations Framework Convention on Climate Change (UNFCCC) (COP29) held in Baku, Azerbaijan, from Nov 11 to 22. At an event titled ‘Reflection on Nepal’s Participation in COP29 and the International Court of Justice’, organized by the Ministry of Forests and Environment (MoFE) in Kathmandu on Thursday, Ministry Secretary Deepak Kumar Kharal explained that COP29 featured negotiations on 14 agenda items and 96 sub-agendas, totaling 392 meetings, of which Nepal missed 68.

Each of these 14 thematic agendas was attended by Nepali negotiation teams, led by joint-secretaries specializing in the respective topics. Despite criticism at home over the size of the Nepali delegation sent to COP29, Secretary Kharal attributed the missed meetings to an insufficient number of negotiators. He emphasized that the ministry had learned valuable lessons and would aim for better preparation at COP30 and beyond. “We need to establish a dedicated and permanent negotiation team with clear standards and procedures for inclusive participation, involving national delegates, technical experts, and relevant stakeholders,” Kharal said. He also stressed the importance of capacity building for national delegates and technical experts to enhance negotiating skills.

Manjeet Dhakal, a Nepali negotiator and Advisor to the Chair of the Least Developed Countries (LDC) for the multilateral process under the UNFCCC, highlighted the significant improvement in Nepal’s participation in COP over the years, both in terms of quantity and quality. “In the past, Nepal was represented at COP by a very small team from MoFE. However, these days, representatives from other ministries, such as the Ministry of Foreign Affairs and the Ministry of Finance, as well as private sector actors and civil society organizations, also join the discussions, contributing their expertise as needed.” 

Dhakal added that Nepal’s focus has expanded from a limited set of priorities, such as climate finance and adaptation, to a broader range of thematic areas. “For instance, this year alone, we actively participated in discussions across 14 thematic groups, including carbon emissions reduction, loss and damage, and mitigation. This demonstrates that both the quantity and quality of our participation have improved significantly.”

Nepali officials’ inclusion in various global committees also reflects the country’s growing negotiating power. Dhakal pointed out that Maheshwar Dhakal, joint-secretary at MoFE, serves on the Loss and Damage Fund, while Naresh Sharma, under-secretary at MoFE, is a member of the Adaptation Fund. “Through these committees, Nepal is making meaningful interventions.” 

In addition to thematic meetings, COP29 included sessions of the Subsidiary Body for Scientific and Technological Advice (SBSTA), the Subsidiary Body for Implementation (SBI), the Conference of the Parties serving as the meeting of the Parties to the Paris Agreement (CMA), and the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol (CMP). These also included 48 coordination meetings of the Least Developed Countries (LDC) Group and ‘G77 and China’, seven plenary sessions, 10 head-of-delegates meetings, and 115 daily thematic coordination meetings, bringing the total to over 500 meetings in which Nepal needed representation.

Buddi Sagar Poudel, the joint-secretary heading the Forest and Watershed Division at the MoFE, also serves as a negotiator representing Nepal at climate conferences. Leading Nepal’s efforts on the ‘Enhanced Transparency Framework’ and ‘Global Stocktake’ themes, he noted that while Nepal has actively engaged in significant negotiations, missing less-priority meetings is inevitable due to the simultaneous nature of numerous sessions. “However, the fact is that we have weak negotiating power. The meetings are multilateral, not bilateral, and sometimes, we feel intimidated in front of hundreds of representatives from powerful countries. There’s a fear of appearing uninformed if we make a mistake. If we fail to communicate our stance clearly and convincingly, we risk offending others or being misunderstood.”

Before COP29, Nepal undertook extensive preparations, including forming thematic groups, conducting consultations and council meetings, training negotiators, organizing a National Climate Summit, and drafting Nepal’s position paper. During COP29, Nepal not only participated in official meetings but also organized side events in pavilions and held bilateral discussions. However, Nepal did not have its own pavilion this time and relied on borrowing space from other countries. This limitation underscored the need for greater logistical and strategic investment in Nepal’s future participation.

To address multilateral challenges, Poudel stressed the importance of building a robust pool of negotiators. “We need individuals with strong research and expertise on the topics being negotiated, but Nepal has very few such resources.” He proposed several measures to strengthen Nepal’s negotiation capacity, including institutional memory and the development of a consistently trained negotiation team. “For instance, if a meeting involves cross-cutting issues related to climate change and energy, we need informed representatives from the Ministry of Energy, Water Resources, and Irrigation, or experts from the relevant field. The same applies to other sectors, like finance.” 

To enhance both the quantity and quality of negotiators, Poudel recommended early training and practical exposure. “Institutions must invest in their negotiators by organizing model COPs and offering practical sessions. Negotiation is a continuous learning process—after attending two or three COPs, a negotiator becomes experienced and can engage more effectively,” Poudel said. Practical exposure would also help build confidence among negotiators when dealing with representatives of more powerful nations.

At COP29, Nepal coordinated thematic presentations and advocated for its position at the LDC meetings. In the G77 and China meetings, Nepal presented the LDC position while also lobbying for its own priorities. According to government officials, Nepal was successful in doing so.

Nepal also participated in other key events, including the Hindu Kush Himalaya Environmental Ministers’ Meeting organized by Bhutan and the High Ambition Coalition Meeting hosted by the Marshall Islands. There too, Nepal got a chance to press its Mountain agenda. Such participation helped Nepal raise awareness about the unique challenges faced by mountain regions, bringing attention to the importance of including mountain-specific strategies in global climate policies.

On the sidelines of COP29, Nepal held numerous bilateral meetings with key stakeholders, including the Secretary-General of the United Nations (UN), the President of the World Green Economy Organization (WEGO), the President of the Maldives, the UN Assistant Secretary-General, and the Executive Director of the Loss and Damage Fund, among others. These discussions provided Nepal with a platform to build alliances and secure commitments for support in addressing climate vulnerabilities. Secretary Kharal noted that UN Assistant Secretary-General Elliott Harris expressed strong support for Nepal’s climate efforts, pledging to provide remarks on behalf of the UN Secretary-General at any event organized by Nepal, provided adequate notice is given. “He was very pleased with Nepal’s commitment to combating the climate crisis, and this is a result of our extensive meetings, negotiations, and efforts on achieving national and global goals.” 

Nepal made significant strides at COP29 by successfully advocating for the mountain agenda and addressing critical climate issues, according to Kharal. “Mountain is not a formal agenda in COP, but Nepal emphasized the inclusion of mountain-based actions and a mountain-to-marine approach to tackle climate change impacts.” Nepal also played a leading role in coordinating and raising awareness about the common mountain agenda, drawing international attention to the unique challenges faced by mountain regions.

In climate finance, Nepal and other climate-vulnerable countries successfully lobbied to increase annual funding from $100bn to $300bn. The country supported the operationalization of the Loss and Damage Fund, which includes a $1.3trn roadmap from Baku to Belém (Brazil), set to begin in 2025. “We strongly said that we won’t take loans for climate finance,” Kharal said. This firm stance highlighted Nepal’s demand for equity and fairness in accessing climate finance.

Additionally, Nepal highlighted the importance of implementing the National Adaptation Plan (NAP) and operationalizing Article 6 of the Paris Agreement for carbon trading. A bilateral agreement with Sweden for carbon trading marked a key milestone in advancing Nepal’s mitigation efforts. This agreement demonstrated Nepal’s growing capability to engage in meaningful international collaborations.

Nepal also demonstrated progress in transparency and gender inclusion, supporting the launch of the Baku Global Climate Transparency Platform and the ‘Building National Capacities of Nepal to Meet Requirements of the Enhanced Transparency Framework of the Paris Agreement’ (CBIT) Project. The country committed to extending the Enhanced Lima Work Plan for Gender and Inclusion until 2035. High-level political engagement ensured Nepal’s active participation in international dialogues, resulting in Nepal’s election as a member of the Adaptation Fund Board and accreditation for the National Trust for Nature Conservation (NTNC). These achievements underscored Nepal’s commitment to inclusivity and accountability in climate action.

Besides these achievements, Dhakal noted other milestones in Nepal’s climate diplomacy. In May 2024, Nepal hosted the International Expert Dialogue on Mountains, People, and Climate Change, which was attended by a representative from Azerbaijan, the host of COP29. Additionally, Nepal was invited to the pre-COP29 ministerial meeting for the first time in 12 years. “These achievements indicate that Nepal’s voice is being heard on the global stage,” Dhakal said. Such recognition marks a shift in Nepal’s global standing, opening doors for more significant collaborations.

While acknowledging the progress, Dhakal stressed that more work needs to be done. “We are never fully satisfied, but looking back at where we started, we have made significant progress.” However, this progress must be supplemented with more strategic planning and capacity-building initiatives to maximize Nepal’s impact in global forums.

Joint-secretary Poudel proposed hiring international trainers to provide specialized training. “Such training is not only crucial for COPs but also for other multilateral meetings and negotiations,” Poudel pointed out. “Moreover, these training shouldn’t be limited to one or two officials but should involve at least 15–20 officers to build a permanent negotiation team.” 

At Thursday’s event, Foreign Minister Arzu Rana Deuba said that through effective negotiations, Nepal should aim to secure at least $10bn annually in climate finance from the designated $300bn global climate fund. She emphasized the need for Nepal to raise its voice more assertively on the global stage for climate justice, climate finance, and compensation. She highlighted the paradoxical situation where Nepal, despite contributing negligibly to carbon emissions, suffers disproportionately from their adverse effects. This underscores the necessity for Nepal to play a more active role internationally to tackle these challenges and advocate for equitable solutions.

Minister Rana also shared that on Dec 9, her delegation, representing Nepal, made its first oral submission on ‘State Responsibilities on Climate Change’ at an international hearing at the International Court of Justice. During the hearing, she forcefully raised the issue of Nepal enduring consequences for mistakes it never made and stressed the need for responsible developed nations to take equal responsibility in addressing the climate crisis and establishing the principle of climate justice. Such advocacy is critical for amplifying Nepal’s voice on the international stage.

Prime Minister KP Sharma Oli also vowed that the government would take the lead in managing climate finance to cope with the climate crisis. He emphasized that climate change issues in mountains are not just the concerns of mountainous countries. “Our efforts should be for protecting the mountains to seas,” he stressed. He urged stakeholders to prepare for COP30 through bold negotiations and a thorough evaluation of COP29. 

Key achievements

• Nepal played a pivotal role in highlighting mountain dialogues and drawing international attention to the mountain agenda.
• Successfully coordinated the collective mountain agenda and ensured high-level political engagement.
• Signed an agreement with the Swedish government for carbon trading.
• Nepal was elected as a member of the Adaptation Fund Board and secured accreditation for the National Trust for Nature Conservation (NTNC).
• Launched two climate-related projects in the presence of a Global Environment Facility (GEF) representative.
• Enhanced the capacity of Nepali delegates in climate negotiations and technical discussions.

Commercial banks in Nepal are experiencing a decline in dividend capacity due to weak credit demand and high non-performing loan levels amid a prolonged economic slowdown. Most banks declaring dividends for the fiscal year 2023/24 have reduced their payouts, with some opting not to distribute dividends at all.

Of the 20 commercial banks in the country, 11 have decided to distribute dividends from their earnings in the previous fiscal year, while five have opted not to distribute dividends. Four are yet to announce their decision on dividend payouts. Among the 11 banks which provided dividends to their shareholders, seven have reduced their rates compared to the previous fiscal year.

Himalayan Bank Ltd, Machhapuchchhre Bank Ltd, NMB Bank Ltd, Rastriya Banijya Bank Ltd and Prabhu Bank have announced they would not distribute dividends from last fiscal year’s profits. Among these, Machhapuchchhre had distributed 14 percent dividend in 2022/23 (13.3 percent bonus shares and 0.7 percent cash for tax purposes). Rastriya Banijya Bank had provided 5.5 percent cash dividend last year. Himalayan, NMB, and Prabhu Bank did not distribute dividends last year either.

Four commercial banks—Kumari Bank Ltd, Nepal Investment Mega Bank Ltd, Nepal Bank Ltd and NIC Asia Bank Ltd—are yet to make their dividends announcements. Despite low credit expansion, commercial banks posted a profit of Rs 64.15bn in 2023/24, a 13.4 percent compared to net profit of Rs 56.57bn in 2022/23. However, most banks could not increase their dividend payouts as they had to set aside substantial funds for provisioning for their non-performing loans.

Commercial banks set aside a combined Rs 201bn for provisioning in 2023/24, compared to Rs 147bn in 2022/23. Himalayan, NMB and Prabhu have not distributed dividends for two successive fiscal years. Himalayan is not in a position to distribute dividend because non-performing loans of its merging partner—Civil Bank—was 27 percent at the time of the merger which necessitated provisioning of substantial funds. The two Class ‘A’ banks started joint operation after merger on Feb 24 last year.

Four banks have increased their dividend payouts compared to the previous fiscal  year. Standard Chartered Bank Nepal has announced a dividend of 25.5 percent (6.5 percent bonus shares and 19 percent cash) from its profits of 2023/24 compared to 19 percent cash dividend a year earlier. Payout of Nepal SBI’s dividend payout has increased slightly from 10.55 percent (3.75 percent bonus shares and 6.8 percent cash) to 10.65 percent (3.8 percent bonus shares and 6.85 percent cash). Prime Commercial Bank Ltd and Agricultural Development Bank (LTD), which didn’t provide dividends from the earnings last year, have announced five percent cash dividend and 10.53 percent dividend (three percent bonus shares and 7.53 percent cash), respectively, this year. However, Everest Bank Ltd, Nabil Bank Ltd, Global IME Ltd, Laxmi Sunrise Ltd, Sanima Bank Ltd, Citizens Bank International Ltd and Siddhartha Bank Ltd have reduced their dividend rates.