Looking back at 2024: Pessimism reigned, hope scattered

In 2024, Nepal experienced significant turbulence both domestically and in foreign relations. In July, CPN-UML Chairperson KP Sharma Oli assumed the Office of the Prime Minister for the third time, supported by the largest party, Nepali Congress (NC). Despite forming a numerically strong government, the coalition has struggled to instill hope for stability. Doubts persist about the government’s longevity, despite leaders from both NC and UML insisting it will last until the 2027 national elections. Economically, Nepal’s struggles continued, showing little improvement. While external economic indicators improved slightly, domestic challenges remained unaddressed.

 Relations with China and the US remained stable, but ties with India deteriorated. Nepal’s engagement with long-standing development partners progressed steadily. The Oli administration promised economic reforms, improved service delivery, job creation, and fostering optimism among youth. Additionally, NC and UML pledged to amend the constitution based on lessons from its implementation. However, progress on these fronts remained limited.

Economic stagnation persisted, with some gains in the stock market overshadowed by poor revenue collection and low capital expenditure. The continued practice of last-minute expenditure resulted in inefficient investment and inflationary pressures. The real estate sector, a significant revenue source, remained in decline, with annual revenues dropping from Rs 70bn pre-covid to Rs. 46bn. In contrast, tourism rebounded robustly. Data from Nepal Tourism Board revealed that 1,104,702 tourists visited Nepal in 2024, returning the industry to pre-pandemic levels.

Despite these improvements, general pessimism grew as thousands of youths sought opportunities abroad for education and employment. Public services showed little improvement, leaving citizens disillusioned. Promised constitutional amendments remain stalled, with NC and UML yet to form the joint mechanism required to initiate the process. The government’s slow progress on its commitments is fostering doubts about its ability to deliver.

The coalition faced a major test in September when floods and landslides ravaged the country, causing over 250 deaths and infrastructural losses worth billions. While Prime Minister Oli attended the 79th United Nations General Assembly in New York, his administration’s inadequate disaster response undermined public trust. Effective coordination could have saved lives, but the government’s failure in crisis management became a defining moment of its tenure, eroding its credibility.

Domestically, the arrest of Rastriya Swatantra Party (RSP) President Rabi Lamichhane for alleged involvement in cooperative fraud, money laundering, and organized crime dominated headlines. Police filed charges in the Kaski district court, but opposition parties, including CPN (Maoist Center) and Lamichhane’s RSP, labeled the arrest politically motivated. Meanwhile, the government faced criticism for shielding NC and UML allies accused of corruption while targeting opposition leaders.

Within the ruling UML, former President Bidya Devi Bhandari’s return to active party politics sparked internal debate. Her participation in party programs signaled a comeback, with some leaders encouraging her involvement. The NC saw internal discussions on future leadership, with Shekhar Koirala campaigning for the presidency while the party President Sher Bahadur Deuba remained silent. NC General Secretary and president hopeful Gagan Kumar Thapa announced his candidacy, intensifying the contest. Similarly, the Maoist Center debated whether to reintegrate former Vice President Nanda Kishor Pun Pasang into its ranks.

Transitional justice saw a rare consensus among major parties on the need for a new bill, earning international praise. However, the government failed to appoint officials to transitional justice mechanisms, stalling progress. On the foreign front, Prime Minister Oli’s visit to China in December garnered significant attention. Marking a departure, he chose China for his first foreign visit, as he had in 2016 after awaiting considerable time for an invite from India. During the trip, Nepal signed a framework agreement for Belt and Road Initiative (BRI) cooperation, identifying 10 projects for implementation. China’s lobbying for swift action on these projects underscored its growing influence in Nepal.

Relations with India remained strained. Although bilateral engagements continued, Oli received no invitation to visit India. A notable achievement was a trilateral agreement among Nepal, India and Bangladesh to trade 40 MW electricity, allowing Nepal to sell electricity to a third country for the first time. Despite expectations of improved ties, relations between Oli and the Indian establishment remained lukewarm. Nepal’s relationship with the US remained stable as American officials visited Kathmandu to deepen engagement. However, the perception of US influence in Nepal’s domestic affairs continued to provoke mixed reactions.

Public sentiment grew increasingly pessimistic. Many youth believe the country’s trajectory will worsen, fueling frustration with major political parties. Anti-constitution forces have started gaining traction, exploiting public discontent. Despite their pledge to ensure stability, NC and UML face mounting skepticism about their ability to deliver meaningful change.