Appointment falls into limbo amid intensifying political bargaining, court battles and lobbying from private sector
KATHMANDU, April 22: Nearly a month after the government was supposed to initiate the process to appoint a new governor of Nepal Rastra Bank, the position remains vacant — tangled in political bargaining, legal battles and powerful lobbying efforts by various interest groups.
Under Section 25 of the Nepal Rastra Bank Act, 2058, the government is required to appoint a new governor at least one month before the incumbent’s term expires. But when Maha Prasad Adhikari completed his five-year tenure on April 6, 2025, no successor was named. Instead, Deputy Governor Neelam Dhungana Timilsina was handed the reins in an acting capacity, while the search for the next full-time governor has stalled.
The process formally began on March 24 with the formation of a Governor Recommendation Committee, led by Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel. Former governor Bijay Nath Bhattarai and former Vice Chairman of the National Planning Commission Bishwo Paudel are among the members of the panel. Yet, almost a month later, the committee has failed to forward names for consideration.
Insiders say the committee is holding back — waiting for a 'green signal' from top political leaders before making a move.
As per Section 15 of the Act, the committee must recommend three candidates—seasoned figures from the fields of economics, banking, commerce, management, law or among NRB’s deputy governors—to the cabinet. But political negotiations, coalition calculations, court interventions and an increasingly noisy public debate have all but hijacked the process.
Speculation is rife that the committee is looking toward Nepali Congress (NC) President Sher Bahadur Deuba and Prime Minister KP Sharma Oli for final instructions. Meanwhile, a legal hurdle has added a fresh layer of uncertainty.
The Finance Ministry’s decision to scrap the 65-year age limit for public office holders triggered a legal challenge and the Supreme Court intervened. A single bench of Justice Nityananda Pandey issued an interim order, temporarily halting the appointment. This, according to sources, made the ruling parties look for alternative candidates.
The appointment process has been further complicated after a supplementary petition filed a few days later challenged the eligibility of Dr. Gunakar Bhatta, seen as Deuba’s favored candidate. As per the agreement to allow NC to pick a new NRB governor, Prime Minister Oli has reportedly given his consent to Dr Bhatt for the appointment.
A fresh uncertainty has shrouded the governor appointment process as the SC is delaying its verdict on the supplementary petition that challenges the eligibility of Dr Bhatt to become a new NRB governor. The apex court has already deferred hearings for two consecutive days, leaving the matter hanging.
According to Section 20 of the Act, the central bank governor must be a Nepali citizen of high moral standing, possess at least a postgraduate degree in a relevant field and have a minimum of 10 years’ professional experience.
Earlier on Thursday, NC President Deuba had reportedly told party officials that the appointment would be finalized within "two to three days." Sources say that Deuba and Oli had reached a tentative agreement to appoint Dr. Bhatt, who had resigned as Executive Director at NRB to make way for his elevation.
But politics intervened again. Before the appointment could be finalized, Deuba left for Thailand with his family. Monday’s cabinet meeting came and went without touching the issue. Now, the process awaits Deuba’s return on April 25 — and crucially, the SC’s verdict on the pending writ petitions.
Meanwhile, business houses, aware of the power the central bank wields over monetary policy and financial regulation, have reportedly continued intensifying their lobbying, pushing for the appointment of a governor aligned with their interests.
With no clear end in sight, the appointment of the next central bank governor has become a case in how political indecision, legal uncertainty and vested interests can paralyze even the most critical institutions.