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The banking sector is witnessing a steady rebound in credit growth, buoyed by rising foreign trade and increased loan demand across key sectors. According to a recent report from the Nepal Rastra Bank (NRB), private sector credit from banks and financial institutions grew by seven percent, reaching Rs 5,534.77bn, during the first nine months of the current fiscal year 2024-25. This reflects a credit disbursement of Rs 361.3bn between mid-July 2024 and mid-April 2025.

Credit growth had stood at 5.1 percent in the same period of the previous fiscal year, pushing the total credit portfolio to Rs 5,167.17bn in mid-April last year. On a year-on-year basis, credit disbursement grew by 8.3 percent in mid-April.

This uptick marks a turnaround from the sluggish loan expansion seen in recent years, which had eroded bank profitability. Amid a deposit surge and subdued credit growth, the banking system was left with excess liquidity, pushing interest rates to historic lows. In mid-April, the average interest rate on loans from commercial banks fell to 8.22 percent, down from 10.55 percent a year earlier. Development banks and finance companies saw similar declines, with average lending rates dropping to 9.59 percent and 10.40 percent, respectively.

Slow credit expansion in previous fiscal years was largely attributed to the phased rollback of covid-era relief measures, including loan moratoriums and subsidized interest rates, by the central bank. As the economy stabilized, these supports were withdrawn, leading to cautious lending practices and tepid credit demand from businesses.

However, the latest data signals renewed momentum in credit expansion. Foreign trade has surged, with merchandise exports rising by 65.5 percent to Rs 188.2bn, and imports increasing by 12.2 percent to Rs 1.309trn in the nine-month period. This has triggered a spike in demand for import loans, which grew by a robust 60.6 percent by mid-April. Working capital loans and margin-based loans also recorded strong growth of 17 percent and 37.8 percent, respectively. In addition, credit expansion was driven by increased borrowing in real estate, stock market investments, and vehicle purchases.

Credit flow to the production sector rose by 9.6 percent, construction by 11.4 percent, transportation, communication and public services by 10.2 percent, and service industries by 8.6 percent. During the review period, term loans increased by 4.9 percent, margin nature loans by 37.8 percent, trust receipt (import) loans by 60.6 percent, hire purchase loans by 4.1 percent, cash credit loans by 5.2 percent and real estate loans (including residential personal home loans) by 4.9 percent.

Despite the rebound in credit activity, banks continue to grapple with excess liquidity. The banking system recorded a 5.7 percent increase in deposits, totaling Rs 368.47bn, while remittance inflows rose by 10 percent to Rs 1,191bn during the same period. This has left banks and financial institutions with a stockpile of loanable funds.

The NRB absorbed a total of Rs 17,186.15bn from the market, comprising Rs 2,212.05bn through deposit collection auctions, Rs 14,974.1bn via the Standing Deposit Facility (SDF) and Rs 2.7bn utilized under the Overnight Liquidity Facility, over the first nine months of the current fiscal year. In contrast, the central bank had absorbed Rs 766.19bn in net liquidity through various monetary operations in the same period of the previous fiscal year.

Nepal is stuck in a dangerous cycle. Corruption is increasing, and the gap between the rich and the poor is getting wider every day. Many people have lost trust in the government because they feel ignored, cheated and left behind. Even though Nepal has become a democracy and given more power to local governments, real control still lies with a small group of wealthy and powerful people. Most citizens, especially the poor and those living in rural areas, continue to struggle just to survive.

Corruption is present at every level—national, provincial, and local. Money meant for important services like schools, hospitals and roads often disappears due to theft, misuse or waste. Politicians and officials make big promises, but many development projects are only started to make money for themselves and their friends. Budgets are often made larger than needed, so that extra money can be secretly siphoned off. Contracts for construction are not always given to the most qualified companies, but to those with political connections. This leads to weak, unsafe buildings or projects that are never finished.

Even when work begins, a large amount of money is lost before it reaches the people. It is believed that only about 35 percent of the capital budget is used properly. Corrupt politicians, dishonest contractors and some government employees devour the rest. Because of this, roads break apart within months, schools lack basic furniture and qualified teachers, and hospitals do not have enough doctors, medicine or even potable water.

This situation hurts poor people the most. Many laborers working on these projects are paid very low wages—and sometimes, they are not paid at all. Their problems are ignored, and they have no real way to raise their demands or seek justice. Meanwhile, rich people keep gaining more power by using their money to influence politics and business. This unfair system keeps poor people stuck in poverty and gives the rich even more control over the country’s future.

Another big problem is how government jobs are given. Instead of hiring people based on education, skills or experience, jobs often go to relatives, friends or political supporters. This means that many important offices are run by people who are not qualified for the jobs at hand. As a result, government services become slow, unfair and ineffective. Honest and capable people are often pushed aside, which creates frustration among the youth. Many young people lose hope in the system and choose to leave the country to find better opportunities abroad. This “brain drain” is a big loss for Nepal, as it loses skilled and educated workers, who could have helped develop the country.

Even the institutions that are supposed to fight corruption are failing. Organizations like the anti-corruption commission and other watchdogs are often under the grip of powerful leaders. They are not truly independent, and they rarely investigate or punish those in high positions. When corrupt leaders go unpunished, it sends a message that stealing public money is acceptable. This creates a culture where corruption becomes normal and expected.

The seriousness of this problem can be seen in the numbers. According to OXFAM, Nepal’s Gini coefficient—which measures income inequality—rose from 0.49 in 2010-11 to 0.58 in 2019. This shows that the gap between the rich and the poor is growing quickly. Another number, the Palma Ratio, shows that the top 10 percent of the population earns three times more income than the bottom 40 percent. This level of inequality is dangerous for any country.

Inequality is not just about income. It also affects access to good education, healthcare, housing, justice and job opportunities. Poor families cannot afford to send their children to private schools or pay for treatment at private hospitals. The legal system is slow and expensive, and poor people often cannot afford lawyers or do not have the connections needed to get justice. Over time, this creates anger, hopelessness and frustration, especially among young people, who feel their future has been stolen.

When people believe that the system is unfair and corrupt, they stop trusting democracy. They stop voting, stop getting involved and stop believing that change is possible. This weakens society as a whole.

Corruption also hurts Nepal’s economy. Investors, both local and foreign, are unwilling to put their money into a country where bribes are expected and laws are not enforced. Small businesses—which create most of the jobs—cannot survive if they are constantly blocked through unfair rules, heavy taxes or competition from companies that enjoy political protection. As a result, unemployment increases, and more and more young people leave the country to find work abroad.

If this situation continues, Nepal is most likely to face serious problems in the future. Poverty may rise, social unrest could grow and public services may collapse. Protests and instability could become more common, and more people could lose hope in the idea of a better future.

Solving this problem is not easy. Passing new laws alone is not enough. Real change needs to happen in how the system works and how leaders think. Government offices must be honest and open about how they spend money. Public jobs should be given to people based on their skills, not their political connections. More importantly, citizens need to be able to ask questions, demand answers and take part in decision-making.

The media, civil society and youth movements can play an important role in the fight against corruption. Educating young people about honesty, fairness and responsibility can help build a new generation that refuses to accept corruption as normal. Technology can also help by making government systems digital and easy to track, so that money is not stolen as easily.

In conclusion, corruption in Nepal is not just one problem. It is the root cause of many other problems, including poverty, poor public services, slow development and a weak democracy. If we don’t take it seriously, the rich will keep getting richer, the poor will suffer more and Nepal will fall even further behind. The country needs honest leaders, strong institutions and active citizens who work together to build a fairer and more hopeful future.

The new leadership at the Nepal Electricity Authority (NEA) has launched a renewed effort to collect long standing disputed dues related to dedicated and trunk power lines. On Friday, the Authority issued a public notice calling on customers with outstanding dues to file appeals by June.

The NEA stated it aims to resolve the disputes—which have remained unresolved for nearly a decade—by addressing misunderstandings from a new perspective. The decision to move forward was made at a Board of Directors meeting on May 4. According to the NEA, total disputed dues now amount to Rs 23.44bn.

To facilitate dispute resolution, the NEA has amended Sub-regulation 2 of Regulation 55 under its 2021 Electricity Distribution Regulations. Under the revised provision, five percent of the billed amount can be submitted either in cash or via a Class A bank guarantee valid for one year.

The dispute began in 2016 after NEA introduced new tariffs for dedicated and trunk lines. In 2018, approximately nine months after load-shedding ended, NEA sent backdated bills covering two years and seven months. Industrialists contested the charges, arguing they had received trunk line facilities without formal notice and were billed as though load-shedding continued. Most only paid regular bills, rejecting the additional charges.

NEA regulations stipulate that customers seeking 20 hours of uninterrupted electricity via trunk lines during extended load-shedding must apply in advance, with service granted only after NEA Board approval. Customers are also required to provide Time-of-Day (TOD) meter data, which the NEA must verify.

To address the dispute, NEA formed a task force which submitted its findings. In 2019, the parliamentary Accounts Committee also intervened. A subcommittee recommended that the Commission for the Investigation of Abuse of Authority (CIAA) probe NEA officials for failing to enforce tariff regulations, leading to revenue losses. The subcommittee also urged NEA to implement provisions requiring payment within 35 days of billing or disconnection after 60 days of non-payment.

Multiple committees have since examined the issue. In 2024, a commission led by former Justice Girish Chandra Lal submitted a report directing the government to recover Rs 6.11bn in dues from Feb 2016 to May 2018. NEA’s notice mentions plans to collect this amount as well.

Former NEA Executive Director Kulman Ghising had also attempted to collect these arrears per the commission’s recommendations, but government intervention stalled the effort.

Pokhara, a city celebrated for its shimmering lakes and natural beauty, needs saving from rampant environmental degradation. Pollution has been escalating at an alarming rate, severely impacting the indigenous communities whose livelihoods depend on the lake water. Despite their tireless efforts, a sustainable solution remains elusive, highlighting the urgent need for action to conserve the lakes.

Shobha Shrestha, a resident of Damside on the eastern shore of Fewa Lake, recalls the time when the lake’s crystal-clear waters rippled gently, filling her with a sense of calm. “You could drink the lake water without any worry,” she says. “You can do that now because of pollution.” 

Shanti Pahari, a resident of Khahare, shares similar sentiments. She leads a local women’s group that has been actively involved in the Fewa cleaning effort.“The pollution never stops, no matter how often we clean the lake,” she says. “The lake is turning into a sewage dumping site.”

Lake pollution has also hit the local fishing communities. Mina Jalari, who belongs to a fishing community of Khapaudi, says their daily catch has significantly declined over the years. Just a decade ago she used to catch up to 30 kg of fish in a day. “These days, you are lucky if you catch 5 kg of fish. Our traditional occupation is at risk,” says Jalari.

Deforestation of Panchase Forest, which serves as an important lifeline for Fewa, has also contributed to disrupting the lake’s ecosystem. “Illegal logging, poaching, and wildfires have become common,” says Durga Bahadur Ghale, who is part of a local anti-poaching unit. “Our mission is to protect the forest because it is home to many plant and animal species and plays a key role in maintaining Fewa’s ecological balance.”

Rupa Lake, once famous for its abundant lotus flowers, has also seen a drastic decline in its aquatic flora in recent years.“Lotus plants thrived along the shores just a decade ago, but now they are found in only small patches,” says Ganga Gurung, who presides over Rupa Women’s Group. The loss is ecological and cultural. Locals have been using lotus flowers and plants for traditional remedies. Now, such practices are fading.

The Rupa Restoration and Fisheries Development Cooperative has been working to conserve biodiversity while supporting local livelihoods. However, over the past five years, environmental challenges have taken a heavy toll.

Last year, the cooperative earned Rs 15m from fish sales, but this year, losses have climbed to Rs 4m. Shivraj Adhikari, president of the cooperative, notes that without any revenue, they will be unable to fund projects like pesticide-free farming, women’s economic empowerment, and watershed conservation.“We have dedicated our lives to preserving this lake, but the outcomes are not so promising these days,” he says.

The plight of Pokhara’s lakes reflects a broader environmental emergency—one that threatens not only the natural landscape but also the people whose lives depend on it.

According to a 2020 report by the Gandaki Provincial Government and Pokhara Metropolitan City, Fewa covers 5.7 square kilometers (11,000 ropanis) and has an average depth of 8.4 meters. However, a 1998 survey by the Survey of India recorded Fewa’s area at 22,000 ropanis—double its current size.

Despite continuous cleanup efforts by locals and environmental groups, pollution and encroachment in Fewa continue unabated. 

“I have seen the lake shrink over the years. The areas that were once underwater are now above ground level,” says Khagendra Gurung, a local man.

Unrecognized community sacrifices 

Around 20 years ago, 200 families gave up their farmlands to conserve Maidi Lake, a wetland habitat known for its ducks and herons. The construction of a check dam overflowed the lake, submerging their fields. However, they have yet to receive any compensation. Instead, invasive weeds have proliferated, affecting the lake’s ecosystem. 

“Unwanted weeds have taken over the lake and very little has been done to conserve the wetland,” says Kriti Ballabh Tripathi, who surrendered 14 ropanis of his land for the wetland conservation program. He regrets giving his farmland for which he hasn't been compensated yet. 

In Dipang Lake, locals faced a similar crisis when invasive weeds took over the water. Their call for help went unanswered, so they formed a lake conservation committee and launched a campaign to remove the weeds from the lake. Their campaign lasted for nearly five years, during which they raised around Rs 50m with the help of local individuals, organizations, and institutions to clear the weeds. 

“We transformed Dipang from a mere pond into a proper lake, but since then, continuing conservation efforts has not been easy,” says Ramji Lamichhane, founding chair of the committee.

Despite their tireless efforts to protect the surrounding wildlife and vegetation, he says no governmental or private entity has shown interest in supporting their conservation efforts.

In Begnas Lake, the local Jalari (fishing) community dedicates one day per week to voluntary labor cleaning the lake. They have also formed a committee for forest and wildlife conservation. But their efforts have gone unrecognized.

In Rupa Lake, plummeting fish stocks have prompted the locals to appeal to all three levels of government for help. But they haven’t received any proper response. “It pains us that even the local government has failed to take an interest in solving our problems,” says Adhikari, the president of Rupa Restoration and Fisheries Development Cooperative. 

Even when programs related to lake conservation are implemented, the local government fails to involve the locals. The Fewa Damside Community Development Organizations has been organizing lake clean-up and tree plantation campaigns for decades now, but its members say they have received little to no support from their local government.

Shrinking lake

Environmental experts estimate that 14,200 tons of silt accumulate in Fewa Lake annually. Rapid spread of water hyacinth in Pokhara’s lakes is clear evidence of pollution. As waste accumulates in the lakes, essential nutrients such as nitrogen and phosphorus increase significantly, disrupting the wetland ecosystem. The excessive presence of these nutrients leads to a decrease in plankton, which is crucial for the aquatic ecosystem. 

A study conducted in 2023 by the Journal of the Nepal Chemical Society found that the average phosphate level in Pokhara’s lakes is 0.0036, while the nitrate level is 27.156—both exceeding the standards set by the World Health Organization (WHO).

“As nitrogen and phosphorus levels rise, the growth of invasive water hyacinth also accelerates, causing an imbalance in the lake’s ecosystem,” says environmentalist Anil Suvedi. 

Water hyacinth reproduces at an alarming rate, doubling in number every week. From a single sapling, around 1,200 offspring can be produced within four months, and in one year, its biomass can reach 18,000 metric tons per hectare.

With a population of around 400,000, Pokhara’s main settlements are intersected by the Firke and Bulaundi rivers, which have turned into major carriers of urban sewage due to rapid urbanization. Carelessly discarded waste flows into these rivers through drains, eventually ending up in Fewa Lake. The use of pesticides in farming, along with chemical runoff, further contributes to the pollution of the lake’s surrounding environment.

Additionally, hotels and houses near the lake have built sewage outlets and septic tanks directly connected to the lake, further worsening the situation, according to environmentalists.

“Unplanned development projects conducted without proper environmental impact assessments have also led to soil erosion, increasing sediment deposition in the lake and affecting both its size and ecological balance,” says Suvedi.

Campaign by civil society

The civil society of Pokhara organizes at least two annual lake clean-up events, during which they remove a minimum of 30 truckloads of water hyacinth and plastic waste from Fewa Lake alone. 

“Yet, the pollution in the lake has not decreased,” says Narendra Man Lalchan, president of Civil Society Kaski. “People still need to understand that polluting the lake directly impacts the entire ecosystem surrounding it.”

A few years ago, this civil society launched a grand campaign for environmental protection. Under this initiative, hundreds of social organizations and groups in Pokhara joined hands to address the problems of wetland areas. Over 1,200 social organizations—including women's groups, community development organizations, various professional associations, governmental and non-governmental bodies, the army, and the police—are involved in this campaign. 

Pokhara Metropolitan City consists of 33 wards. Each fiscal year, the Metropolitan Executive Council approves and allocates budgets for an average of 70 plans (programs) from each ward. However, many wards do not include environmental conservation programs. In the current fiscal year, approximately 2,500 programs have been included in Pokhara Metropolitan City’s ‘Red Book–Plan and Budget Allocation Document’. Among them, only 56 programs—just 2.24 percent—are related to environmental conservation.

Under the environmental promotion program for the current fiscal year, Pokhara Metropolitan City has allocated a budget of Rs 583m for 13 programs. Additionally, under tourism and cultural promotion, around Rs 200m has been allocated for five programs related to environmental beautification. This accounts for only about 1.5 percent of the total budget.

As of mid-February, no contracts for these programs have been awarded, and the tender process has not yet begun. The Urban Development, Tourism, and Environment Division of Pokhara Metropolitan City stated that the Detailed Project Report (DPR) for about 20 percent of these programs is still in progress.

According to Division Chief Bimal Ranjan Karki, the lack of skilled technical personnel and experienced contractors has hindered the implementation of several programs despite the intent to execute them. Since the last fiscal year, the metropolitan city has assigned projects worth less than Rs 5m to consumer committees, while larger projects are handled by contractors.