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Urban forests, parks, and ponds could lower Kathmandu’s temperature by as much as 1.6°C if implemented strategically, according to a new study published in the journal Urban Climate. The research represents the first of its kind to closely examine how different types of blue-green spaces help cool down areas across the Kathmandu Valley.

The study, carried out by an international team from seven institutions, looked at 301 parks, 130 urban forest patches, and 26 ponds within the valley’s high-density urban areas using satellite-based information and Machine Learning algorithms. The study shows that Swoyambhu forest stayed cooler at 31.9°C, while nearby city areas reached 36.0°C—a difference of 4.1°C. At UN Park, the temperature was 34.3°C, compared to 38.2°C in the surrounding buildings, a difference of 3.9 °C. A traditional pond, Na Pukhu, in Bhaktapur measured 39.6°C, while the nearby urban area hit 42.5°C, the study found. 

The number represents the highest cooling effects recorded over five summers, highlighting how much these blue-green spaces can help during the hottest times. It is important to note that the satellite temperature estimates give an idea of the ground temperatures but still need to be confirmed with actual measurements on the ground. However, the differences they show help us understand important cooling patterns.

Overall, urban forests provide the greatest cooling effect, lowering temperatures by up to 1.2°C on average. Parks come next, cooling by up to 0.9°C, and ponds can reduce temperatures by up to 0.85°C.  But how well these spaces cool depends a lot on their surroundings. In vegetation-dominated areas, blue-green spaces can cool temperatures by as much as 1.6°C, while in densely built areas, the cooling effect drops to just 0.3-0.6°C. 

Lead researcher Saurav Bhattarai, a PhD student at Jackson State University, USA and an ORISE fellow, said the findings show that effective cooling strategies should be tailored to specific urban contexts. “Just adding green spaces is not enough; they need to be carefully designed and well integrated with the surrounding city environment,” he explained.

This study comes at a time when the Kathmandu Valley is getting steadily warmer, with temperatures rising by 0.38°C per decade since 1976. 

The study also found that soil moisture in the valley has dropped by an average of 2.1 percent over the past decade, with some central urban areas experiencing reductions as high as 35 percent.

Dr Rocky Talchabhadel from Jackson State University stressed the need for urgent action. “Our study shows that Kathmandu’s high-density areas are at greater risk from extreme heat. Without immediate action, these urban heat islands will only get worse,” he said.

Urban forests demonstrated the strongest relationship between their size and cooling effect—when the forest area doubles, the cooling effect increases by about 30 percent.  Parks showed moderate connection between size and cooling, but how well they cool depends more on how they are designed inside, not just their size. 

Park landscape design reveals that tree canopy coverage proves most critical for cooling effectiveness. In small parks, a one percent increase in high canopy area corresponded to an approximate 0.99°C increase in cooling effect. For the largest parks, high canopy coverage demonstrated substantial impact, with a one percent increase linked to a 1.76°C increase in cooling effect.

Prof Vishnu Prasad Pandey from Tribhuvan University noted that strategic placement and design of blue-green spaces can maximize cooling benefits even in space-constrained urban areas. “This isn’t just about planting more trees. The internal composition of parks—the ratio of tree canopy, grass and impervious surfaces—determines their cooling effectiveness more than their size alone,” he said.

The research team recommends different approaches for different urban zones. For dense urban cores, priority should be given to water features and rooftop solutions, including cisterns, reflective pools, green roofs and rooftop farming, while safeguarding existing mature trees. For transitional areas, the focus should be on expanding forest patches and designing parks with high, contiguous tree-canopy cover to maximize shade. In vegetation-dominated zones, conservation of current forests and green buffers can prevent future urban heat island formation.

Dr Prajal Pradhan from the University of Groningen, Netherlands, stressed the global applicability of the findings and methods. “Cities globally can learn from our findings based on the Kathmandu Valley. We provide a framework for assessing cooling potential that can be applied anywhere and used to plan cities to adapt to urban heat,” he said.

Dr Nawa Raj Pradhan from the US Army Engineer Research and Development Center warned that if no action is taken, increasing temperatures will put pressure on public health systems, increase energy demands for cooling and disproportionately hit vulnerable communities the hardest. The study estimates that implementing comprehensive cooling strategies could reduce urban cooling energy demands by 15-25 percent, potentially saving significant electricity costs while improving public health outcomes.

It has been more than two months since the inauguration of the World Expo in Osaka, Japan, but Nepal’s pavilion remains unopened. The expo, which began on April 13, will continue until October 13.

Construction was delayed due to negligence on the part of key line ministries, namely the Ministry of Industry, Commerce and Supplies, and the Ministry of Foreign Affairs. The delay stems from a protracted dispute between government agencies and the contractor. Despite selecting a private company for the project two years ago, poor coordination and unresolved issues have prevented its timely completion.

A government official described the situation as an embarrassment for Nepal, noting that 157 of the 158 participating countries have already opened their pavilions and are actively engaging with visitors and investors. “This has exposed Nepal’s governance failure on the global stage,” the official said, adding that preparations for the pavilion had started two years ago. Government officials put blame on the Ministry of Foreign Affairs for the entire delay. 

The government is blaming the contractor for the delays. Japanese and international media have begun reporting on Nepal’s lagging progress. Although the contractor, who had halted work, resumed construction just a week ago, it is still unclear when the pavilion will be completed.

This week, the Japanese Association for International Expositions confirmed that construction of Nepal’s pavilion has resumed. Japanese media report that work was suspended in January due to non-payment. Nepal has now assured the Japanese side that construction will be completed within a month.

Two months into the expo, ticket sales are rising steadily. Organizers say daily visitor numbers are increasing, with the reservation website often crashing around midnight due to high demand for slots at popular pavilions and events. Unfortunately, Nepal is missing out on this vital window for exposure and engagement. Since opening on April 13, the expo has sold approximately 3.75m tickets, which is nearly 30 percent of the 13.44m total sold since ticket sales began in November 2023 through June 6. 

The Donald Trump administration is yet to decide the fate of the ongoing projects under MCC. 

Issuing a press statement, the US Embassy in Kathmandu said:  “In February 2025, the Secretary of State approved a specific exception to the 90-day pause on US foreign assistance for the MCC Nepal Compact, while the US government review on US foreign assistance continues.” 

Under this exception, the MCC Nepal Compact is authorized to continue with full implementation. MCC and the US mission in Nepal continue to engage stakeholders in support of a constructive outcome of the review, the statement said.

The US. Embassy added MCC is working closely with the Ministry of Finance and MCA-Nepal to ensure that the activities undertaken or initiated under the compact, including potential new obligations, are aligned with US and Nepal’s priorities and ensure transparency, sound governance, effective delivery, and prudent risk management.

The US Embassy also reaffirmed America’s commitment to its bilateral relationship with Nepal and supporting the Nepali people through efforts that promote prosperity and long-term economic resilience. 

Recently appointed Governor of Nepal Rastra Bank, Biswo Poudel, has raised concerns over the concentration of bank and financial institution loans among a limited group of individuals and business households. Speaking during a discussion on the Bank and Financial Institutions (First Amendment) Bill in the Finance Committee, Governor Poudel emphasized the growing debate around the unequal distribution of banking loans and the need to clearly separate the roles of bankers and businesspersons.

A key concern is that a significant share of financial sector loans is directed toward high-income individuals and households, while low-income groups and rural communities remain largely underserved. This disparity has reignited calls to reform the banking structure, including proposals to limit the overlap between those who run banks and those who borrow from them.

Although the number of banks and financial institutions in Nepal has decreased—largely due to the central bank’s push for mergers and acquisitions since 2010—branch expansion has continued nationwide, increasing visibility at the local level. This expansion has intensified competition in the banking sector, often with a strong focus on profit.

On the surface, banks appear to be serving various segments of society. However, credit access remains skewed, with banks primarily extending loans to urban elites, established industrialists, and salaried employees—while collecting deposits from rural areas. Governor Poudel publicly stated this disparity, noting that banks are not providing adequate financial support to farmers, low-income earners, and those lacking formal documentation.

The consolidation of banks through mergers has enabled them to set interest rates at their discretion, which in some cases has led to unhealthy competition or even informal agreements that exclude weaker borrowers. While banks continue to report ample liquidity, reluctance to lend—especially to small and medium enterprises (SMEs)—is contributing to economic stagnation and job loss. Many such businesses, key drivers of employment and production, are struggling to access credit.

This lending imbalance has also contributed to a rise in non-performing loans. Currently, bad loans account for around five percent of total bank lending. The inability of the lower economic class to access institutional credit has pushed many into the hands of informal lenders charging high interest rates, commonly referred to as ‘meter interest’. This, observers argue, is a result of institutional failure to provide inclusive financial services.

Nepal has long been recognized as one of South Asia’s most unequal economies. Over the past four decades—alongside the growth of financial institutions—economic inequality has widened. While banks have helped the wealthy manage and grow their assets, they have done little to address the financial needs of the poor. Critics argue that those with control over banks are often selected from elite business circles, giving preferential treatment to their close associates when it comes to loan disbursement.

In this context, the proposed amendment to the Bill—to separate the roles of bankers and businesspersons—has gained renewed attention. Although discussions have stalled in the past, Governor Poudel’s recent remarks have brought the issue back into focus.

According to data from Nepal Rastra Bank, the total number of deposit accounts in banks and financial institutions has reached over 511,000—exceeding the population. However, this figure does not indicate universal financial access, as many individuals hold multiple accounts. Significantly, only about four percent of account holders have access to credit, while the remaining 96 percent do not, often due to a lack of collateral or financial literacy.

Governor Poudel’s comments underscore the need for more equitable access to financial resources, particularly for those who contribute through remittances or small rural deposits but remain excluded from formal credit. While some bankers have generated substantial profits, returns for shareholders remain modest, prompting questions about wealth distribution within the sector.

Ultimately, the broader concern is that economic development and poverty reduction will remain out of reach unless financial access is expanded equitably. Past assumptions—such as increased bank branches equating to increased financial inclusion—are misleading. What matters more is who controls capital and who benefits from credit distribution. Most banks are overseen by businesspersons, and those within their networks often enjoy easier access to loans.