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Business of traditional sweet, Chaku, made from jaggery molasses is now experiencing the bitter taste of a shortage of workers which in years might widen the gap between demand and supply. Rohit Shrestha (19) is the fourth generation within his lineage to continue the business of Chaku (molasses) in the ancient town of Tokha in the outskirts of Kathmandu but things are going to change from his generation onwards. “I am the fourth generation who has been working on this family business of Chaku (molasses) making. I started assisting in the factory from an early age. I recently have completed my intermediate level (+2) and haven’t enrolled in the Bachelor’s level (Graduation). I want to go to foreign country after completion of my studies, where as of now am planning to continue promoting the molasses,” Shrestha told ANI while taking a break from his work at the factory.

The rising trend of flying abroad in search of better opportunities and education has been rising in the country. The majority of those flying abroad are youths and earning age groups queuing up at the airport ready to take off leaving the elderly behind.

The aroma of boiling stacks of sugar lumps filling the air around the Tokha is fading out in Tokha which is popular for first-class molasses which has high demand in the market. However, the making of molasses is seasonal and the industry only works full-fledged for just two months in a year with production made sparsely based on the demands.

Tokha, an ancient settlement inside Kathmandu Valley, is believed to have been in existence from the Malla Period, long before the unification of Nepal by Prithivi Narayan Shah and currently has around 15 molasses-making home-based industries.

The word ‘Tokha’ has an appendage from a Newa word ‘Tyokha’ meaning sweet and molasses were the main product of this place which has continued over the centuries. The Newa community of Kathmandu valley consumes a high volume of Chaku (molasses)—confectionery made from concentrated sugarcane juice, jaggery, ghee and nuts which holds significance on Maghe Sakranti—the first day of the 10th month as per the Lunar calendar.

This process involves melting jaggery, stirring it continuously and then cooling it in clay pots. It is then whipped, slapped, and stretched until it turns dark brown. The confectionery is then weighed, topped with nuts, and packaged. The whole process takes two to three hours.

Shrestha’s factory which used to employ about 20 people last year now is hosting 11 struggling to keep afloat the business. The current number also includes his family members who are now assisting in the factory work to continue the business. The situation in coming years can be dire for the small-scale industries that exist in this ancient town within the valley provided the steep rise in immigration culture that is brewing among the youths and active population group. With this, the sweet business of molasses is now experiencing the bitter taste of a shortage of workers which in years might widen the gap between demand and supply.

“Every year the demand for the Chaku (molasses) is continuing to rise but the shortage of the staff to work in the factory is resulting in the downfall of the supply. Many of the youths are now vying from foreign countries (the Gulf, Australia, Europe and the US) which has resulted in a shortage of staff to work in the factory which has cut the supply in terms of demands,” Buddha Shrestha, the Vice-Chair of the Tokha Traditional Chaku (Molasses) Conservation Society told ANI.

Kathmandu is beautiful. Tourists are fascinated by the myriad things you can do here, from cultural walks and temple visits to one-day hikes and hilly getaways. But for those of us living here, things can become a bit mundane, especially if you don’t have a full day to indulge in activities. This week, we bring to you four things you can do when you are bored and need a little something to cheer you up but only have a few hours at your disposal

Attend the evening aarati at Pashupatinath

The Pashupatinath temple is a really nice place to go to when you want to spend some time by yourself or immerse yourself in some spiritual or religious activities. There’s a lot of space and a lot of things to do in the area. The evening aarati in Pashupatinath riverbanks which in winter takes place from 6:00 pm to 7:30 pm every day is something everybody must witness. It’s a special puja that priests do to worship Lord Shiva and the entire environment comes alive with the sights, sounds, and smells of prayer and worship. Those who have seen it confess to wanting to attend it whenever they can. It’s a sight that slowly calms you down and fills you with a sense of peace. Make sure you go a little before time so that you get a nice place to sit as it can get a bit crowded.

Evening stroll at Patan Durbar Square

A mini vacation is just what we need after a hectic work week. It’s a great way to relax and recharge for another busy week. But a weekend getaway isn’t always possible or practical. This is when a visit to any one of the Durbar Squares in Kathmandu Valley comes in handy. It’s like a mini getaway. There is so much to do and see at the Durbar Squares. Patan Durbar Square is one of our favorites. From quaint little eateries and tea shops to various kiosks selling all sorts of knickknacks, a stroll at Patan Durbar Square makes you feel like a tourist in your hometown. You can just sit on one of the benches at the center of the square and take in the surroundings. It’s especially beautiful at night when all the lights come on. Be sure to bargain if you decide to do some shopping as the vendors tend to hike the prices at random.

Enjoy some delicacies at the farmer’s market at Le Sherpa Restaurant

There are many farmer’s markets in Kathmandu these days. Some happen during the weekdays while others are up and running on the weekends. Our favorite is the one at Le Sherpa that takes place every Saturday from 8:00 am to 1:00 pm. People can be seen just basking in the sun, indulging in some hot tea or coffee or some cold beer too. There are all sorts of stalls with various kinds of food available here to suit your taste. From Biryani and Pad Thai to cakes and cheeses, you can take your pick depending on what you are in the mood for. You can also shop for jewelry, perfumes, handicrafts, home decor, etc. Gather your friends and family and spend a lovely Saturday morning catching up with them at the market while you buy your week’s worth of groceries. You will also be supporting local businesses so it’s a win-win situation.

Spend a few hours at a bookstore

There was a time when Kathmandu didn’t have good bookstores. Now, the book industry is trying to change that. There are many new bookstores coming up and even the ones that have been in business for years have revamped their spaces and services to make shopping for books a fun affair. Ekta books at Thapathali, Kathmandu, spread across three expansive floors, is a nice place to hunt for your next read. They have recently opened a cafe too so you can even have a drink and grab a bite to eat while you read a few pages. Books Mandala in Baluwatar, Kathmandu, is another great place to visit. Here, you are very likely to find the book you have been searching for as they stock all sorts of titles, from popular authors to lesser known writers. Wisdom Books and Aroma Center in Bhanimandal, Lalitpur, can be your go-to place to browse through books, buy some cool notebooks, incense, candles, stationery items, and handicrafts. They have recently opened a small cafe of sorts where you can get some tea, coffee, and homemade food.

Shanti Silwal is a burn violence survivor. She is the mother of a seven-year-old who, she says, makes her happy to be alive. At 41, she’s braved life’s roughest storms but she says it’s not made her bitter, and for that she is grateful to “her spirit that refuses to give up”.

“I don’t want people to look at me and feel sorry for me. I want them to look at me and see a strong, determined woman,” says Silwal, who suffered above 40 percent burn when her husband set her on fire following an altercation 13 years ago.

The scars have healed. The pain remains. It’s something she will never forget. It’s limited the opportunities she would have gotten had she not had debilitating scars on her face and body. But Silwal is brave enough not to let her scars define her.

Under Inara, a social enterprise by Astitwa Nepal, an organization that supports and rehabilitates survivors of acid and burn violence, she has participated in multiple trainings to pick up skills that can help her create a good life for her son and herself. What caught her interest was jewelry making, she says. A few years ago, she participated in a workshop where she learned how to make earrings and bracelets.

“I can make 50 simple bracelets or 10 pairs of earrings in an hour,” she says, the pride evident in her sparkling eyes. It wasn’t always so easy though, she adds. A handmade earring might look simple but you need to know how to use the tools and have good hand-eye coordination to make a decent pair. Also, two pieces in a pair need to be exact replicas of each other and that is difficult to achieve.

Trisha Pradhananga, program and operation officer at Inara, says Silwal is extremely talented as well as quick and eager to learn. She is able to complete orders that take others a week or more in just a day or two. Her attitude and approach towards her work is inspiring, says Pradhananga.

Silwal says she can function on very little sleep if she has work. She is driven by her need to do more and to do better. It has always been like that. Work, she says, is worship. Even as a child, Silwal was a go-getter who had to excel in the simple tasks her guardians asked her to do.

Driven by the motto that no work is small and that everything you do must be done with passion and a sense of gratefulness at being able to use your mind and body, Silwal tackles work with commendable zeal. She goes to bed at midnight and wakes up at six in the morning or even earlier depending on her workload. The early hours are for prayers, chores, and getting her son ready for school. The rest of the day is for working on the orders—making customized earrings and bracelets.

Pradhananga says the pieces Silwal makes are good. Even though she works fast, she doesn’t compromise on the quality of the products. Inara too wants to ensure the quality is maintained so that those who buy them get their money’s worth. “We want people who shop at Inara to feel like they are supporting a cause as well as investing in really good pieces of jewelry,” she says.

This is how training and workshops have been able to help. Burn violence survivors get to learn different crafts like jewelry making, pottery, macrame, etc. which provides them with income generating skills. Silwal says they have been a boon to her.

“I try to participate in as many workshops as I can so that I can learn new skills and use them to increase my income,” says Silwal as an instructor shows her how to create neat layers on a bead necklace at a recent workshop organized by Inara.

Out of the eight participants, Silwal was the first to complete a five-layered necklace and to do so without having made any mistakes. She then helped other participants, while also berating them for wasting time and resources when they spilled beads on the floor or used excess thread and wire only to eventually cut and toss them in the bin. The two trainers at the event agreed she could very well have been one of them.

“I have always disliked wasteful behavior and believe we must respect the things we have to live a prosperous life,” says Silwal. Having always struggled with not having enough in life, she believes you must make the best of what you’ve got. She’s also a firm believer in the power of hard work. It never goes unnoticed and unappreciated, she says.

However, Silwal admits that she loves the financial freedom her work gives her. As a burn survivor, it’s difficult to get work. They aren’t hired as receptionists or in positions where they have to deal with a lot of people. The society today has a much broader outlook but biases run deep. The changes in people’s attitude towards burn survivors, Silwal says, is superficial. Their scorn is masked by sympathy or rarely empathy.

“So I’m happy to be doing what I’m doing. I love making things and it brings in some money for me to be able to buy what I need and want,” she says. She doesn’t have to ask anyone for money. She is able to eat out when she’s bored of homemade food or doesn’t feel like cooking. She has even managed to save a little and that puts her mind at ease. “Being able to earn has also made me confident. I don’t fear the future like I once used to. I know whatever happens I’ll be able to manage things on my own,” she concludes.

The banking sector in Nepal is currently grappling with a multitude of challenges that have far-reaching implications for the economy. One of the most significant issues is a marked decline in dividend distribution. Historically, banks in Nepal were able to deliver a hefty number of dividends. However, in the last fiscal year, many institutions struggled to provide even a 10 percent dividend, with the sector-wide average falling below five percent. This decline has eroded investor confidence, prompting large investment groups to reconsider their stakes in the sector. The shrinking returns on both capital gains and dividends have exacerbated this hesitancy, underscoring the urgent need for reforms to restore trust and stability.

The decrease in dividend capacity is not a result of NRB policies but stems from the individual banks’ operational challenges. Efficient banks have still been able to distribute dividends, with some banks providing dividends of up to 26 percent, while others have not been able to do so. The banking sector’s struggles are primarily driven by external pressures, including market rumors, which have hindered the functioning of lower-level bank branches. This external pressure has added complexities to the financial ecosystem, and despite the solid capital base of the banks, non-performing loans have risen.

Regulatory changes, particularly the proposed amendments to the Bank and Financial Institutions Act (BAFIA), have further complicated the situation. A contentious provision restricting shareholders who hold more than one percent of a bank’s shares from obtaining loans from other financial institutions has raised concerns among stakeholders. Historically, industrialists have played a pivotal role in establishing banks, but such measures could compel them to liquidate shares or settle loans, leading to market instability. These regulatory changes, coupled with declining demand and operational strain, have stifled the sector’s growth potential. In this context, the Nepal Rastra Bank (NRB) has introduced provisions designed to protect the financial system and avoid a panic scenario. These measures are meant to ensure stability without stifling the long-term viability of the sector.

Economic downturns have also driven a sharp increase in non-performing assets (NPAs), a critical metric for assessing financial health. The average NPA ratio has risen from 1.67 percent two years ago to approximately 4.5 percent, with some ‘C’ category financial institutions reporting NPAs exceeding 10 percent. Even with loan restructuring facilities, NPAs remain near five percent, posing a significant threat to the sector’s stability and the broader economy. Weak loan demand and structural challenges continue to compound these risks, further destabilizing the financial system. This reflects the broader macroeconomic challenges, as well as the unique pressures faced by the banking sector.

The NRB recognizes these challenges and has been working on regulatory frameworks that aim to ensure the resilience of the banking system. While some banks have faced difficulties in profitability, it is essential to note that the NRB’s measures are intended to safeguard the sector, providing the necessary framework for long-term stability. For instance, while external issues have raised questions about profitability, it is clear that banks cannot operate without profitability, and returns on capital investments are critical for sustained operations. The NRB's efforts are geared toward ensuring that the banks remain operational and sustainable, even amid a challenging environment.

Profitability in the banking sector has significantly declined. The return on equity (ROE), a key indicator of financial performance, fell from 21.94 percent in FY 2021-22 to just 4.80 percent in FY 2023-24. Reduced net interest income, weak loan demand and regulatory constraints on fee and commission income have collectively strained earnings. Operational costs, particularly investments in IT infrastructure and compliance, have added to these pressures. While banks like Standard Chartered Bank and Everest Bank reported relatively higher ROEs, others, such as Nepal Bank, struggled to remain profitable. Despite these challenges, NRB’s approach to banking supervision is aimed at creating a balanced environment where the banks are supported through difficult periods without compromising the sector’s financial health.

Credit expansion has been stagnant these days mainly due to the lack of demand. A mismatch between liquidity and demand further compounds the problem, leaving banks with substantial liquidity but limited opportunities for productive lending. This scenario underscores the need for a balanced regulatory framework that promotes both stability and growth. While the NRB’s policies may limit some aspects of banking operations, they are designed with the long-term health of the sector in mind, ensuring the banking system remains solvent and resilient even during challenging periods.

Nepal’s broader economic structure adds another layer of complexity. The government faces a revenue deficit of Rs 170bn, low capital expenditure and high recurrent costs, all of which highlight fiscal imbalances. Federalism has introduced additional financial burdens without commensurate resources for development. High debt-servicing obligations strain the budget further, forcing the government to issue treasury bills even for routine expenditures. Stagnation in the real estate sector and declining investor morale exacerbate these economic pressures, highlighting the need for systemic reforms.

Leadership in the banking sector is undergoing significant changes. Younger leaders, often with decades of experience, are driving digital transformation and operational efficiency. At leading banks, approximately 80 percent of transactions are now digital, enhancing customer satisfaction and streamlining operations. However, aggressive lending strategies aimed at stimulating loan growth have often compromised profitability. A more sustainable approach that aligns banking operations with national development goals, such as job creation and productive investments, is essential for long-term stability.

While some macroeconomic indicators provide grounds for cautious optimism, the persistent lack of credit demand in productive sectors remains a concern. Stabilized foreign exchange reserves and declining interest rates offer a foundation for recovery. However, a comprehensive review of federalism’s fiscal structure, along with targeted expenditure cuts, is critical to avoid a potential debt trap. Transparent collaboration between the private sector and the state can help restore confidence and drive economic recovery.

To address these challenges, a multi-faceted approach is essential. Regulatory frameworks should be revised to strike a balance between stability and growth. Encouraging productive lending and reducing excessive constraints can create a more conducive environment for banking operations. Establishing high-level commissions to address systemic issues and promote transparent collaboration between the private sector and the state is crucial. Additionally, investments in technology and innovation will enhance operational efficiency and customer satisfaction.

The NRB’s policies are continually evolving to ensure the stability of the banking sector while navigating the external challenges it faces. The regulator remains committed to safeguarding the financial system’s integrity, ensuring that both stability and growth can coexist in the long term. Banks are expected to adapt to the changing economic landscape while continuing to contribute to national development. The NRB’s framework aims to foster a balance between operational efficiency, profitability and financial stability, ultimately enabling the banking sector to thrive in challenging economic times.

In a nutshell, while the banking sector in Nepal faces significant challenges, a concerted effort to implement targeted reforms and foster collaboration between stakeholders can pave the way for recovery and growth. By addressing structural inefficiencies and focusing on sustainable practices, the sector can overcome current adversities and emerge as a cornerstone of Nepal’s economic stability and progress. The path forward requires bold decisions, innovative solutions and a collective commitment to building a robust and resilient financial system that supports the nation’s aspirations for sustainable development.

The author is deputy director at Nepal Rastra Bank