Kathmandu-The process of appointing a new Governor for Nepal Rastra Bank is stagnated , mainly because Finance Minister Bishnu Prasad Paudel hasn’t called a single meeting of the recommendation committee.
Former Governor and committee member Bijay Nath Bhattarai resigned, saying the Finance Minister hasn’t shown interest in moving the process forward. He also said the government is trying to push its own candidate, which makes the committee meaningless. The Governor’s position has been vacant since Maha Prasad Adhikari’s term ended on April 6. Dr. Neelam Dhungana is currently serving as Acting Governor.
The Cabinet had formed the recommendation committee on March 10 with Finance Minister Paudel as coordinator. Members included economist Bishwanath Paudel and former Governor Bhattarai. Now that Bhattarai has resigned, the government needs to appoint another former governor to the committee.
It is reportedly an attempt to appoint outgoing Governor Maha Prasad Adhikari to the recommendation committee, a move seen as favoring UML interests.
According to the Nepal Rastra Bank Act, a new Governor should be appointed at least one month before the sitting Governor’s term ends. But due to ongoing political tensions between Nepali Congress and CPN-UML, the committee hasn’t held a single meeting. The delay is affecting the central bank’s work, especially regulation and supervision.
Sources claim the Finance Minister is waiting until he’s sure a politically favored candidate can be appointed.
His press advisor, Bhuwan KC, denied this, saying Paudel will call a meeting at the right time.
There are reports that Prime Minister KP Sharma Oli and Nepali Congress leader Sher Bahadur Deuba agreed to appoint Dr. Gunakar Bhatta, an executive director at Nepal Rastra Bank. But the committee still hasn’t met, even though member Bishwanath Paudel returned from India to help with the process.
Instead of calling the meeting, Finance Minister Paudel appointed Dr. Dhungana as Acting Governor. Though her role is supposed to be temporary and limited, she’s made major decisions—like allowing loan restructuring for construction companies that haven’t received payments from the government. This decision raised questions, as it benefits a few banks and was previously rejected by the central bank’s board.
She also promoted three executive directors at once, including Ram Sharan Kharel, who is related to Dr. Yubaraj Khatiwada. Kharel was then put in charge of the HR department, replacing the previous head. This happened just as Dr. Bhatta was rumored to be resigning, suggesting it may have been done to stop him.
Dr. Dhungana also named herself Chairperson of the central bank and changed the internal structure, taking control of key departments. Meanwhile, loan mismanagement by banks continues, and the other Deputy Governor is away for personal reasons.
NRB insiders said she’s using her temporary post to act beyond her legal limits, with support from the Finance Minister. The delay in calling a committee meeting adds to concerns.
Although the law allows executive directors to be nominated as Governor without resigning, a court case was filed against Dr. Bhatta based on news reports. Advocate Bishal Thapa filed the case, questioning his qualifications and alleging political influence.
This isn’t the first time legal interpretations have blocked a qualified candidate. Years ago, Dr. Yubaraj Khatiwada was stopped from becoming Governor because of a legal opinion, and Vijayanath Bhattarai was appointed instead. That decision caused problems, and Bhattarai was later accused of corruption.
After some back and forth, Dipendra Bahadur Kshetry and then Khatiwada served as Governors. Khatiwada later held key government roles, including Finance Minister and Ambassador to the U.S. Today, many of his economic policies are still followed.
Some say Dr. Bhatta is equally capable, and filing a court case against him before he’s even recommended is unfair.
