Category Archives: Politics

Discretion of “The Honorables”

Regulatory discretion is not something that is unheard in Nepal. The government of Nepal time and again has stepped in and has amended policies, although market disruptive, in its own discretion. These are the some examples-

  • Himalayan Java prices a bottle of water at Rs 130. They get prosecuted (fined Rs. 75,000) for charging high price, although no Act or policy stipulates measure for charging certain amount of fine in such cases.
  • After the crash of Air Kasthamandap’s single engine aircraft, without any further investigation, the government banned operations of single engine aircrafts across the country.
  • Government agencies confiscating Surya cigarettes, for not carrying health-warning message on 90 per cent of the packet, although the Act to Control and Monitor Tobacco stipulates that the warning sign should cover 75 per cent of the packet.
  • Futsal was banned without any notice or warning stating that it promoted drug use, distraction from studies, etc. Futsal was gaining popularity as more and more futsal courts with investments over Rs. 1 crore were being established.
  • In 2008, the government banned registration of private schools because it was growing like mushrooms. Although growing number of private schools are beneficial as it promoted standards and increased choices for students and parents.
  • In 2000, taxi registration was halted with the rationale that there were too many taxis plying on the road. But in reality, the passenger taxi ratio suggested that the number of taxi plying in Kathmandu was not enough.
  • DoTM gave a 15 – day ultimatum to register e-scooters, stating that e-scooty sellers were selling it with false information that no registration, driving license or helmet is necessary for using them. But in reality, there is no law or policy that stipulates that an electric scooter should be registered with DoTM, neither do e-scooter drivers need a driving license. The department has also stated that from now on, the roadworthiness of the scooters will be tested and would be allowed to use on fixed routes only.

These are the instances of regulatory discretion in my mind; I bet there are more than dozens of such cases. But it all boils down to this: the government is not working under any rule of law, but is forming policies in its discretion.

So what difference does it make if our benevolent government practices regulatory discretion? Well, as a consumer and an entrepreneur, it makes a lot of difference. For example, if I were a futsal entrepreneur, seeing that there were profit prospects in this market, I would take loan from a bank, and would establish a futsal court. If, on the day of inauguration of my business, the government bans futsal, how would I repay my loan?

Similarly, as for the consumers, futsal is a popular sport among people of all ages. It is a recreational activity that leads to good health. Well, had it been banned, all of those people would not have been able to exercise and maintain good health, specially in a city like Kathmandu where there aren’t much open spaces to exercise.

All in all, this sort of regulatory discretion does more harm than good. It is because of such unstable business environment the private sector has not been able to become the engine of growth. While politicians and bureaucrats tend to emphasize how private sector will be incentivized to boost our economy, their policies turn out to do the opposite thing. Lets just hope, these sort of regulatory discretion doesn’t happen in the future.

Abyaya Neopane

About Abyaya Neopane

Abyaya Neopane is an independent researcher. He comes from an Economics background.

Published by:

Another empty promise!

Image source:

With load shedding up to sixteen hours a day, it is indeed an energy crisis in Nepal. Government of Nepal (GoN) has done what it does best, make a headline worthy declaration. It has declared “National Energy Crisis Reduction and Electricity Development Decade, 2016 – 2026”. Though this may seem encouraging to us, it is a sad fact that such energy crisis and energy development announcement has been made many times in the past ( 2008, 2011 and 2012), making this plan nothing more than an empty promise, as previous declarations and plans have not delivered any results.

What is this new plan proposing anyway? With this new plan- the energy ministry has claimed that load shedding will end within three years, projecting the demand for electricity will be around 1,837 MW and the supply will be around 2,300 MW after three years. The implication of this being within three years the supply of energy in Nepal will increase three fold (Current supply is 791 MW). This does seem unrealistic, as there are not many projects that are close to completion, capable of supplying total of 1500 MW of electricity.

In the short run importing electricity from India will solve the problem to some extent, provided there is better transmission line. Dhalkebar- Muzaffrapur transmission line can allow us to import up to 600 MW of electricity if charged at full capacity (400 kV), but the transmission line is currently charged at 132 kV which will allow us to import only 80 MW of electricity. Still this plan, provided we import required electricity to get rid of power shedding, will only be a short term remedy. In the long run, it is essential to develop hydropower projects in Nepal to end the energy crisis permanently.

Nepal requires real policy changes instead of such empty declarations. Policies that will make an investment in hydropower in Nepal attractive especially FDI (this can’t be emphasized enough in light of Statkraft backing out of 650 MW Tamakoshi III), one stop policy (currently a hydropower project has to deal with 7 ministries, 23 departments and 36 acts) and ending the monopoly of Nepal Electric Authority (NEA) on distribution and transmission, to name a few policy reforms. Without these policy reforms, all promises and declarations no matter how impressive they may sound, energy crisis in Nepal will persist.

Dhruba Bhandari

About Dhruba Bhandari

Dhruba Bhandari is Research Fellow at Samriddhi, The Prosperity Foundation. He joined the Foundation in July 2015. He completed PhD in Development Economics from Oklahoma State University (USA) in 2013. Prior to Joining Foundation, he worked as Research Associate at Oklahoma State University.

Published by:

On Infringing our Right to Earn a Living

The ongoing economic blockade in the country has, in all effect, rendered life excruciatingly difficult for the common mass. Among other things, 220,000 people have been left unemployed, 2200 industries have been forced to close, over 29.75 billion in revenue has been lost in the first 5 months of the ongoing fiscal year and poverty is expected to rise by 7% in the coming year as people are left without access to fuel and food in these harsh cold months. Additionally, medical supplies to Nepal have been affected by at least 50% since most of it came to the country from or via our southern neighbor. In all this, the protests in the Tarai-Madhesh plains have claimed over 50 lives. It is unfortunate that this number could potentially increase as we look at a seemingly unending conflict between party heads. It is time that the state and agitating parties look to finding ways to solve their differences without infringing on our right to earn a living.


Data sources:

Chalise, K. (2015, December 15). Nepal to become poorest in S Asia. Republica Daily.

Customs dept misses revenue collection target by 38.72 per cent. (2015, December 16). The Himalayan Times.

Khalid, S. (2015, November 21). India’s ‘blockade’ snuffs out Nepal’s medical lifeline. Aljazeera.

Labisha Uprety

About Labisha Uprety

Labisha Uprety is a Research and Communications Officer at Samriddhi. She enjoys debating and likes her tea black with a little sugar.

Published by:

Reading Gaige in 2015: Part III (The politics of language)

Photo source:

We ended Reading Gaige in 2015: Part II (The politics of citizenship in the 1950s) with an overview of how citizenship laws were first formulated and how land rights came into being in Nepal, and how both these led to the subsequent Nepalization of the Tarai or at least attempted to do so. This week we shall examine two successive chapters on language, communication and national integration in the Tarai.

Chapters 6 and 7:

Prior to 1951, there had been little or no effort for the implementation of a unified mother tongue in Nepal. With over 100 ethnicities, Nepal had and has incredible variety in language and dialects. Post-1951 however, Nepali-speaking democratic leaders were eager to establish Nepal as a nation with its own linguistic identity. With the establishment of the National Education Planning Commission in 1954 and the subsequent release of its report ‘Education in Nepal’ in 1956 came the first attempt to unify language in the country. The report recommended that Nepali be the primary language of instruction in schools beginning from the third grade. The recommendation was justified by stating points such as the need to give status to a language spoken by the majority, the need for a lingua franca and to adopt a national language which was easier to learn than Hindi among other reasons. Additionally, there was also mention of how no truly Hindi speaking populace was part of Nepal.

Though the proclamation of this particular recommendation did cause considerable controversy, it was from 1951 itself that the Nepal Tarai Congress had begun being vocal about wanting Tarai to become an autonomous state with the recognition of Hindi as a state language. Since local administration had weakened considerably in 1951 because of the revolution, the Tarai found courage to make such demands but with the re-establishment of power stemming from Kathmandu as early as 1953, the demands for an autonomous Tarai was dropped from the party manifesto. This will make for an interesting historical reference for all those who believe that the demand for an independent Madhesh is recent.

In terms of primary language of instruction in the Tarai, because there were few Nepali-speaking qualified teachers in Nepal, most teachers had to be recruited from across the border. The controversy for primary language of instruction however was taken to new heights with Prime Minister K .I. Singh issuing a directive that Nepali was to be the primary language of instruction in all schools, and that all teachers, within 2 years, had to demonstrate Nepali language usage in classrooms and they were also to furnish proof of Nepali citizenship within six months. The directive led to an outcry in the Tarai, with the move been seen as another way to force ‘hill culture’ on the Madhesh. It was also seen as a move to bar Tarai citizens from using the language that they were most familiar with. There were little or almost no plains representatives in the parliament then and thus the move was seen as severely curtailing their democracy which only aided to increase the distance between the hill and the plains. Post the decision, the Nepali Tarai Congress decided to launch a ‘Save Hindi’ campaign which managed to include in itself other major parties’ support. While the movement gained considerable momentum in 1957, it began to lose steam as parties began to prepare for national elections in 1958 and align themselves with more pressing issues. Eventually, the need for all teachers to have a valid Nepali citizenship was scrapped as it would mean having to close down many schools in the plains entirely dependent on Indian teachers.

An examination here then on whether Hindi really was the dominant language of the Tarai is warranted. The 1952/43 census stated that only 3% of the Tarai population spoke Hindi as their mother tongue. The census put a number of dialects one would assume as Hindi such as the mid-western and far-western plains dialects under Awadi. The 1961 census in fact reduced the number of the Hindi speaking population from 80,181 (in 1952/54) to 2,867 speakers.

It is interesting to note the 1961 Indian census put Awadi as one of the dialects under the Eastern Hindi category.  Hindi may not be the mother-tongue of many in the Tarai but is certainly the language they use when engaging in trade and commerce and is an important second language. According to Gaige’s calculations, at least 63 percent of the Tarai population spoke Hindi as a second language in 1961. Additionally, it should be noted that census takers assumed second language faculties of households based on their questioning of men alone and often did not question women members. This was a mistake if one takes into account marriage ties the Tarai has across the border. Nepali was assumed to be understood by most of the population and was spoken as the mother tongue by at least 6% in 1961 but Gaige calculates a mere 25 to 30 percent of the plains population speaking Nepali as a first or second language (based on the population of native speakers, the hill people they came in contact with and the students who studied in the language). This percentage still much lower than the Hindi speaking population who use the language as a first or second language.

In 1961, another report from the King appointed National Education asked for Nepali to be the language of instruction in all schools but it was to be implemented in stages as opposed to the previous blanket provision. Elaborating this issue, King Mahendra stated that the medium of education was to be Nepali in all schools but that teaching and examination of papers could be in a language other than Nepali. This statement is vague and contradictory considering that the medium of education is in fact teaching and examination. As Gaige puts it, this and other attempts to Nepalize the Tarai was a ‘pointed assertion of national consciousness.’

It is agreed while there is need for a lingua franca for a nation to help communicate with ethnicities of all kinds and as an official language, it seems almost hypocritical to first allow for the flourishing of trade and culture between the open borders and then dissuade the additional ‘carry-overs’ (such as language) that come into play when engaging in the same.

The literacy rate in Nepal in 1952/54 was only 4 percent and thus communication through the written word was tricky. Mail service had also not been fully developed and newspapers from India, in English and in Hindi, were read by many as opposed to the state paper – Gorkhapatra alone. The state thus relied on the radio as a better alternative to information dissemination. The radio was considered a symbol of wealth then and it was common to see people huddled around solitary radios in compounds of those who could afford the device. However, the plains people were avid listeners of All India Radio than Radio Nepal because of two primary factors – language and content. All India Radio broadcasted programs in diverse languages such as Bhojpuri, Maithili and even Nepali (from its Kurseong point) while Radio Nepal lay unwilling to validate regional languages. This cost the Nepalese government to lose out on tapping on its regional audiences in that time period. Furthermore, because the state published its announcements in ‘highly Sanskritized Nepali’, it became difficult for the plains to discern official announcements, having possibly to rely on Nepali-educated peers.

As Nepal government began to press for school language reform pushing for books in Nepali to be taught at all schools, this began to pose a problem with translations because as Gaige puts it, Nepali as a language (a by-product of culture) had no technological orientation in its development. In later years however, due to integration over time, schooling became an important tool for Nepalizing the plains further.

Find the link to Part I of the series here.

Labisha Uprety

About Labisha Uprety

Labisha Uprety is a Research and Communications Officer at Samriddhi. She enjoys debating and likes her tea black with a little sugar.

Published by:

Reading Gaige in 2015: Part II (The politics of citizenship in the 1950s)

Photo source:

We ended Reading Gaige Part I with the understanding of a general commentary on the geo-politics of the Tarai, border issues with our southern neighbor and how migration into the Tarai began. This week, I shall outline a sketch of Gaige’s research on the politics of citizenship in the Tarai.

Chapter 5: The Politics of Citizenship

Citizenship has been a sensitive issue in Nepal since its determination in the country. After Prithivi Narayan Shah’s 1769 conquest of Nepal inclusive of the Tarai, came the need for defining roles and responsibilities for the plains. Minor government posts and zamindarita (land-lordship) were granted in 3 levels; with first preference being given to the ‘hill folks’, second to ‘those settled with family in the tarai’ and who were rich, faithful and from respectable ancestry’. Third preference was given to Indians, with Indians being defined as a plains person residing in the Tarai without his family. This separation was because there were no citizenship laws before 1964 and identification was made as such. Before the Citizenship Act of ‘52, there was an absolute lack of administrative mechanism to determine a person’s status as Nepalese or Indian. Thus, both Tarai residents and Indians were required to obtain a passport from Birgunj before they were allowed entry into Kathmandu, except for on Shiva Ratri – when Indians were allowed to make pilgrimage to Pashupatinath. These passports were checked at Chisapani Garhi and the procedure was not abandoned completely until 1958. As Gaige notes, before 1951, nationality depended heavily on use of the primary language, meaning Nepali (as spoken in the hills) and thus these people required no such form of identification when entering from the eastern or western hills into the capital.

When the Nepalese political revolution began in 1951 and there was a need to draw up a voters’ list, there had still been no formal definition of citizenry in the country. Hence, the Public Representation Act of 1951 affirmed that any person who had resided in a constituency for at least 60 days would be allowed the right to vote. This liberal approach to voting may have been influenced by India’s influence on Nepal’s political matters, considering that Nepalese leaders were far from policy drafting experts and required help from India in such an arena. The ’51 Constitution was subsequently seen as an adaptation of the then newly formulated Indian constitution. The results of the general election of ’59 can however give an indication of the bonds that the hill and tarai leaders had with each other. Of those elected in the Parliament from Nepali Congress, 12 were plains people and 11 were hill folks, who had strong ties with the plains and included leaders such as B.P. Koirala and Subarna Shamsher. As Gaige puts it succinctly, ‘there was a time when the men of the hills and plains worked, fought, and occasionally died together and, when the struggle was over, they governed together’.

The 1952 Citizenship Act formed the basis for citizenship laws, which was later reiterated in the 1962 Constitution, barring for difference in naturalization requirements. Article 8, Section 2 of the Constitution of Nepal (1962), qualified a foreigner for citizenship based on whether he/she could speak and write in Nepali and was residing, and engaged in an occupation in Nepal. He/she should have also already taken steps to renounce the citizenship of the other country in question. Additionally, in case the person was of Nepalese origin, he should have resided in Nepal for a period of less than two years and in case he was not of Nepalese origin, he should have resided for at least 12 years inside the country’s territory. Gaige’s examination of said clauses reveal the following: that requiring the population to also write Nepali as part of the citizenship acquirement when the literacy rate of the entire country was 4 percent in the 1950s made very little sense. Provisions for a language test for testing the same was also absent, calling for little or no enforcement.

While the other clauses can be understood as commonly administered citizenship rules, the fourth clause is a little misleading with no concrete definition of said ‘Nepalese origin’, leaving two interpretations, whereby one would be being born inside the political border of Nepal (including the Tarai) or culturally, a person born in the hills of Nepal alone (which was then referred solely as Nepal).

Citizenship soon became an important identification in Nepal when it was associated with the right to own property in the country. Though neither the 1964 Lands Act/Rules explicitly stated the need, its details were required when acquiring land. The cause for this ambiguity was to potentially avoid India’s furious reaction. According to the 1950 Indo-Nepal Treaty, citizens living in either countries were allowed to own property in the other. Though initially signed with motives of maintaining peace and friendship, the treaty has been continually resented by Nepalese as a way of India’s way to interfere with Nepal’s sovereignty. Though attempts were made in the past by the Communist parties of Nepal to nullify the agreement, the pact is yet to be scrapped.

In terms of citizenship procurement in the 1950s and 1960s, the procedure was laced with considerable bureaucracy. For citizenship by birth, one had to provide proof that one was born inside the political border of Nepal. Birth registration was scant expect in a few hospitals in Kathmandu, and officials were generally ready to accept hill people to have been born in the country. On the other hand, a plains person had to find one or two prominent people from the Tarai to vouch for him/her. Unfortunately, these people usually engaged in asking for financial compensation for the task, greatly disadvantaging the poor of the plains, thereby causing most to forgo citizenship acquirement.

There is some commentary at the end of the chapter on how anti-Indian sentiments were at its peak in Nepal during the promulgation of the ’62 Constitution of Nepal with it re-instating the King’s power as the monarch. With the promulgation of the new 2015 Constitution of Nepal, the sentiments have hardened and continue to threaten bilateral relations between the two nations.

The next part on Reading Gaige will cover the politics of language and communication among other things.


Labisha Uprety

About Labisha Uprety

Labisha Uprety is a Research and Communications Officer at Samriddhi. She enjoys debating and likes her tea black with a little sugar.

Published by:

Reading Gaige in 2015 – Part I (A synopsis of a 1975 study on the Tarai)

Photo credit: Himal Southasian

A lot has been said about the on-going Madhesh protests and burgeoning silent conflict between us and our southern neighbor. A lot more surely will. Numerous attempts to map the initiation of this quagmire and comment on its exiting state has filled many papers. In this light, the following article aims to aid the understanding of the general populace of the geo-political history of the Tarai based on a certain 1975 research by Frederick H. Gaige named ‘Regionalism and National Unity in Nepal’. Though the research is old by at least four decades, few will argue its significance in explaining the blooming of the Tarai as we know it now better than Gaige. This is thus a simplification of all that Gaige found on his thorough research on namely six districts of the Tarai – Jhapa, Mahottari, Dhanusha, Bara, Kapilbastu and Kailali, in terms of the economic, political and social set up of said area with the hills and India.

Chapter I – Geopolitics of the Tarai

We begin with a general examination of religion, language and caste in the hills and the tarai. Hinduism was and largely is, the primary religion in both the hills and the tarai yet there are stark differences between the cultures of the two. Hill Hindus, as a result of frequent interaction with Tibetan Buddhism, became more ‘modern’ and less severe in their channeling of religious nuances. Plains Hindus, as Gaige terms them, had in turn more interaction with the Muslim community across the border and subsequently began adopting their ‘parda’ (veil) system. Banke had the highest reported Muslim population in Nepal with no forest in the south of the district to restrict migration from North UP. While the hill Hindus have about a dozen castes, there were reportedly 59 castes in the Terai when researched. They are also some marked differences in their treatment of the same caste, such as the Sonars, who are seen as the highest of the craft castes in the plains but are seemingly worse than blacksmiths in the Hills.

Chapter II – Economy of the Tarai

Moving on to economy, Gaige begins with the inference of how Indian timber contractors and hill laborers logged the Tarai forests to supply for Indian railroads. Between the 1890s and 1930s, the Rana government encouraged settlement into the Tarai in order to increase land revenue but those in the hills disliked the intensely hot weather of the Tarai and it was left for zamindars (landowners) to exploit this land and induce tenant cultivators out of those living in the plains. Tarai was well understood as being extremely fertile and was the bread basket of the country. In 1965, Nepal was the fifth largest rice exporter in the world, with exports of 348,000 metric tons to India alone. Indian currency heavily dominated transactions in Nepal and the Tarai in particular in 1960s. The surplus of Indian currency was used by the Ranas to purchase real estate and/or invest in industries in India. Because Indian currency had been largely embraced in the Tarai for dealings with the border – this prevented the state from exercising monetary control over that economy in later years. A barrier rose between the hills and the Tarai as monetary transactions began to be conducted in two currencies: the Nepalese and the Indian.

In terms of business, the upper – caste plains Hindus dominated these dealings even though the area was traditionally thought to be middle – caste. Early industrial development in the Tarai was financed to a large extent by Indian capital. For instance, a certain Radha Kissen Chamaira, a Marwari crucial in Calcutta’s jute processing and exporting business, was largely responsible for establishing Nepal’s largest jute mill in 1936. Biratnagar became a major jute-growing area by 1930s and Chamaira persuaded his friend, Juddha Shamsher (the PM of that time), to jointly set up a holdings company. Chamaira along with his partner was successful in establishing Biratnagar’s first rice mill, and a cotton and sugar mill in the area by 1946.

Chapter – III Nepal-India Border Problems

An examination of the Indo-Nepal border now begins with the classification of border problems into 4 categories: border demarcation disputes (fights over forest area and demarcations as dictated by natural resources such as the Gandak that overflowed on particular years and seemingly left more land on the Indian side every time), political terrorists (outlaws on either side who used the other side of the border as a hiding place), smuggling (goods that came in as aid were smuggled back to India for cheaper prices than their existing market rates; for instance in 1951, Nepal experienced a massive cotton and yarn shortage which was provided for by India sans excise tax, making it cheaper in Nepal than in India) and migration of settlers from one country to another. These goods eventually found their back into India via smuggling. The shortage became so high that Nepal passed a ‘The Mill Made Cotton Yarns and Cloth Anti-Smuggling and Anti-Black Marketing Act’).

It is interesting to note that the establishment of stainless-steel and synthetic-textile factories in the Tarai aided smuggling. By mid-1969, there were seven stainless-steel factories in Nepal. This was a result of Nepal’s industrial-licensing policies, excise-tax benefits and the opportunity to buy raw materials from overseas in mostly Indian rupees. By 1968, these factories were exporting large quantities to India and were cheaper there despite their protectionist import duties. Indian businessmen were beginning to lose money and thus protested heavily with the Indian government. Eventually, the Indian government obtained a promise from Nepal that they would restrict production of goods manufactured from raw materials imported abroad. Despite this promise, India began stalling shipments of these products saying that they exceeded quotas as agreed upon by the two governments. The stalled goods then were black-marketed and began snaking its way into Indian markets. India then continued to try and get Nepal to strengthen its smuggling laws but Nepal resisted on grounds that it would harm its economy. Eventually, Nepal began discouraging the import of luxury goods from overseas and converted all but two of the 17 stainless-steel and synthetic-textile factories into plants that would manufacture goods from domestic materials.

Chapter IV-Migration into the Tarai

The Nepali-speaking Sen Kings of Palpa and Makwanpur gained control of mid-west Terai in the 15th-16th century. They saw the malarial forests of the area as their best defense against the India and colonial British and thus did not do away with it. When the Shah Kings (in 1970s) were blossoming in their reign, they allowed some settlement in the area. In the 1860s, the Ranas began to turn to diplomacy when dealing with the British and subsequently, Jung Bahadur Rana encouraged Nepali slaves to settle in the Tarai by giving them the title of free men. Tharus were indigenous to the forest of the tarai and eventually cowherds and loggers became among the first settlers into the plains. Between 1860s and 1951, the Nepalese government tried to encourage hill-people to settle into the Tarai but they were reluctant considering the Tarai’s hot-malarial climate. The state thus content itself by letting in migrants from India to develop the economy of the Tarai.

Degradation of the existing forest and land resources in the hills and blooming trade across the border eventually pulled in hill people for settlement into the Terai. More than anything the eradication of malaria in 1950s by the Nepalese government in cooperation with the WHO and USAID in the Terai acted as a strong pull-factor for potential settlers. Most hill settlers into the Tarai belonged to the ‘higher-castes’ while plain settlers were mostly considered ‘low-caste’. Because local administration in the Tarai was controlled by Nepali-speaking officials, hill people in the Tarai found it relatively easier to access economic and political power compared to the less-literate plains people in the Terai. They began settling thus in areas where the plains people were less knowledgeable about matters of land and resources.  The state was also approving of this Nepalization of the Terai. In 1972, the government began giving ownership certificates to those who had recently cleared forest land and begun settling. The government also aimed to vigorously make hill people settle into the Tarai for further national integration but there were no trained personnel to manage these resettlement projects. These projects were also not pursued actively because it may have invited India to react to same nationalist sentiments to migrants from Nepal heavily located in areas like Sikkim.
The following chapters dealing with citizenship rights, language and other aspects of the Terai shall be dealt with in a follow-up blog post.


Labisha Uprety

About Labisha Uprety

Labisha Uprety is a Research and Communications Officer at Samriddhi. She enjoys debating and likes her tea black with a little sugar.

Published by: