Nepal Weekly - 2026-05-20
Nepal business, finance and trade news, every Wednesday.
Fourth in Seniority, First in the Robes
Dr. Manoj Kumar Sharma was sworn in as Nepal's 33rd Chief Justice on Tuesday, the completion of an arc from parliamentary hearing to an oath in front of President Paudel to assumption of office in a single day. The Constitutional Council had recommended Sharma on May 7, passing over Acting Chief Justice Sapana Pradhan Malla and two other, more senior, judges, to reach the fourth name on the seniority list, the first time in Nepali judicial history that the order has been skipped so far down. The mechanism that made it possible was PM Balendra Shah's Constitutional Council ordinance, which handed the chairman a tiebreaker veto, and which the President tried and failed to send back. Before Sharma arrived at Ram Shah Path, the court's administration had been refusing to register writ petitions challenging his appointment; Acting Chief Justice Malla put out an order saying that filings needed to be accepted by 1 p.m. that day, and said the refusal was an obstruction “to the path of justice.” The Nepal Bar Association staged a protest while the hearing was running. Sixteen complaints were filed against Sharma before the parliamentary committee unanimously endorsed him anyway.
Read more: The Annapurna Express (oath ceremony), Ratopati (term length, pending caseload), Online Khabar (Malla's writ order), Indianexpress (ordinance mechanism), Khabarhub (timeline)
Four Months to Dodge the Black List
David Shannon has been running mutual evaluations since 2002, is on his 24th, and isn't the kind of assessor who flies in when things are going well. The APG's Deputy Executive Secretary arrived in Kathmandu on Sunday, led Monday meetings at the PM's office with finance, home, law, the attorney general, the central bank, and the security agencies, and then made his dissatisfaction with Nepal's pace of reform unmistakably clear to those present. A confidential APG Secretariat briefing note indicates that this as the final high-level intervention before the September 2026 review that’s going to decide whether Nepal exits the grey list or drops onto the black one. The 15-point action plan that was supposed to demonstrate progress is, per the same note, “not adequately prepared.”
Read more: The Kathmandu Post
Billions Parked but Records Conveniently Missing
Nepal's cumulative public sector financial irregularities reached Rs755.17 billion ($4.97 billion) by the end of fiscal year 2024-25. The Auditor General's 63rd annual report, sent to President Ramchandra Paudel on Friday, audited Rs9.48 trillion of spending by 5,526 public offices and found the government settled Rs63.12 billion in arrears over the year, only to immediately outpace that with new expenses. Auditor General Toyam Raya said that 179 offices worth Rs147.9 billion in expenditure couldn't be audited at all, because records went missing during last September's protests.
Read more: The Kathmandu Post (digital payment reforms), Ratopati (unnecessary ballast spend), myRepublica (179 offices breakdown)
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Auditors Found What Auditors Find
An independent review of 10 commercial banks, commissioned by Nepal Rastra Bank at the IMF's insistence as a condition for the fourth tranche of Extended Credit Facility funding, turned up the usual problems. Evergreened loans, inflated collateral, and provisioning dressed up to keep capital adequacy ratios above the regulatory floor. Average NPLs in the 10 banks was 7.6 percent, and capital adequacy reported to be 11.30 percent. Himalayan Bank, NIC Asia, Prabhu Bank, Kumari Bank, and Rastriya Banijya Bank are looking at capital top-ups to stay compliant. The NRB is asking for clarifications from the banks before telling them how to get their houses in order.
Read more: myRepublica (NPL audit), myRepublica (asset declaration), myRepublica (Rs 4.6B sale), The Kathmandu Post (banker condemnation)
Win an Election Then We'll Talk
Seven weeks into his premiership, Balendra Shah has yet to address the House of Representatives on his government's policy agenda, and the finance minister's response to critics made clear the administration isn't losing sleep over it. Swarnim Wagle told opposition lawmakers this week that if they want their "language, style, and documents" reflected in government policy, they should win the next election. Surya Kiran Gurung, former secretary-general of the parliamentary secretariat, said no prime minister since the 1990 restoration of democracy had remained absent throughout deliberations on the government's own policy document. RSP MP Amaresh Kumar Singh, a six-time parliamentarian, was more direct as he told the House this was the first budget discussion in his twenty-year career held without the finance minister bothering to show up.
Read more: myRepublica (NC protest threat), Ratopati (Wagle election retort), Desh Sanchar (Singh's unprecedented claim), The Kathmandu Post (Speaker's Rule 38), myRepublica (PM's repeated absences)
Chinese Drones Fly While American Drones Wait
Nepal's Home Ministry sent Trump's South Asia envoy Sergio Gor home empty-handed on May 1, refusing a flight permit for the Alta X Gen 2 drone as Gor's team helicoptered into Everest base camp to test it. The ministry's internal memo cited "drone flying procedures" and "security sensitivity." The Americans had hired Seven Summit Treks and arranged local pilots, but the drone never left the ground. DJI's FlyCart 100, an unreleased model given to Nepali operator AirLift Technology before its commercial launch, has been hauling up to 45kg to Camp I in under three minutes this season. China set up that foothold in 2024 with the FlyCart 30; Washington is still waiting on paperwork. While the US team was packing up, the Department of Tourism published a record 492 Everest permits for 2026 on May 8, beating the 2023 record of 479 despite repeated government promises to thin the herd. Chinese climbers topped the list at 109, ahead of 76 Americans and 61 Indians, generating roughly $7.19 million (just over a billion rupees) in permit fees.
Read more: Al Jazeera (geopolitical framing), Snowbrains (waste fee, fatalities)
Congress Plans Its Own Republic Day
The Deuba-Khadka faction is expected to register a new party on May 29, Republic Day, after the Supreme Court's April 17 ruling confirmed Gagan Thapa's group as the official Nepali Congress. Former acting party president Purna Bahadur Khadka, who has been running parallel activities since the ruling, says the party is already "in a fragmented state" and has said the choice was to unite or split. Deuba broke from Congress in 2002 to form Nepali Congress (Democratic); he is now in Hong Kong as the government works on a money-laundering arrest warrant against him and his wife.
Read more: The Kathmandu Post (38-seat losses), myRepublica (Khadka)
Satellite Sees Drought, Cuts Check
A $100,000 insurance payout, the first of its kind in Nepal, arrived in Bajura district after satellites found soil moisture below agreed levels and released funds automatically, with no on-the-ground damage assessment required. The parametric product was built by Global Parametrics with a catalytic grant from the Natural Disaster Fund, backed by the UK's Foreign, Commonwealth and Development Office and Germany's KfW. Tearfund and local partner International Nepal Fellowship used the money to feed 671 households, distribute drought-resistant seeds and tools to 405 people, and install irrigation tanks for 176 households.
Read more: Christiantoday (Tearfund response), Reinsurancene WS (Global Parametrics role)
Spilled Watts Mean a Cooked Dinner
A rural kitchen in Baglung's Badigad municipality apparently became the site of Asia's first green hydrogen cooking demonstration on May 15 (seems hard to believe, but that’s what they’re saying), with Gandaki Province's economic affairs minister on hand to light the flame. The HyHEG project, run by Nepal Energy Foundation and Kathmandu University with backing from Innovate UK and Swiss partners, runs a 5 kW electrolyzer off the GiringdiKhola micro-hydro plant to turn surplus electricity into stored hydrogen. One kilogram is enough to fuel a five-person home for a week, the result of nearly three years of testing on micro-hydro sites under 500 kW that the national grid has made mostly idle.
Read more: Spotlight Nepal
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