As Nepal transitions through the Bikram Samvat year 2082, the nation's parliament continues to grapple with a relentless barrage of corruption scandals that have deepened public disillusionment and strained the ruling coalition under Prime Minister KP Sharma Oli, who was forced to step down on September 9 following the Gen Z protest. These cases, spanning illegal land deals, bribery schemes, procurement irregularities, and now a sprawling cooperative fraud mega-scandal, highlight a systemic culture of impunity among political elites, where anti-corruption rhetoric often yields to protective alliances.
With opposition parties like the CPN-Maoist Center and Rastriya Swatantra Party (RSP) intensifying their scrutiny—ironically, amid allegations against RSP's own chair—the government's reluctance to pursue independent probes has further undermined institutions such as the Commission for the Investigation of Abuse of Authority (CIAA). This updated analysis examines the evolving developments in key scandals as of late August 2025, their political fallout, and the wider threats to Nepal's democratic stability and economic health.
Patanjali Yogpeeth Nepal Land Scam
Former Prime Minister Madhav Kumar Nepal remains embroiled in the Patanjali Yogpeeth land scam, accused of enabling an illegal land acquisition during his 2009-2011 tenure. The case centers on his cabinet's approval for Patanjali Yogpeeth Nepal—linked to Indian yoga guru Baba Ramdev—to acquire government land in Kavre district beyond legal limits, purportedly for herbal production and a hospital, resulting in alleged state losses through subsequent swaps and inflated sales.
In June 2025, the CIAA charged Nepal and 92 others with corruption at Kathmandu's Special Court, seeking a Rs 185.85 million fine (about $1.35 million) from him. On June 25, 2025, the court released him on Rs 3.5 million bail, and as of August 2025, the trial is ongoing, along with his prior entanglement in the Lalita Niwas scandal. This case has amplified calls for accountability, with critics noting it exemplifies how political influence shields high-profile figures from swift justice.
The 2025 Bribery Scandal: Resignations and Lingering Impunity
New Govt’s Commitment to Curb Corruption
The year's most incendiary scandal erupted on July 14, 2025, with a leaked audio allegedly capturing Federal Affairs and General Administration Minister Rajkumar Gupta soliciting a Rs 7.8 million bribe (around $58,000) for a Land Commission appointment. The recording also implicated Land Management Minister Balaram Adhikari in related bribe discussions concerning land allocations for squatters. Amid public outrage and opposition pressure, Gupta resigned on July 15, 2025, during Oli's fourth term, which had pledged anti-corruption reforms via a seven-point coalition agreement. However, Adhikari refused to resign, pledging to face consequences if proven guilty. Analysts view this as emblematic of selective accountability, risking further fractures in the UML-Nepali Congress alliance and fueling perceptions of cronyism.
Resurfacing Shadows: The Wide-Body Aircraft Procurement Fiasco
The 2018 Nepal Airlines Corporation (NAC) procurement of two Airbus A330-200 jets, marred by alleged Rs 4.356 billion in corruption (approximately $32.5 million) through inflated prices and procedural violations, saw limited progress in 2025. The Parliament's Public Accounts Committee (PAC) had previously implicated NAC officials and Oli-linked figures, with Airbus's 2020 $4 billion U.S. fine for global bribery adding scrutiny.
The Giribandhu Tea Estate Controversy: Land Grabs and Political Entanglements
Prime Minister Oli faces ongoing accusations in the Giribandhu Tea Estate scandal, involving illegal land limit exceedance and the diversion of public assets to private interests, tied to UML's party office funding. In July 2025, the Supreme Court overturned a prior government land-swap decision, deeming it unlawful. Lawmakers criticized a new land bill as potentially benefiting scandal participants, intensifying parliamentary debates. Contempt proceedings initiated in January 2025 against Oli and Minister Adhikari highlight the judiciary's role in checking executive overreach, yet the case remains unresolved, exposing the nexus of politics and business.
The Cooperative Fraud Mega-scandal: Cross-Party Entanglements and Public Outcry
Dominating parliamentary sessions throughout 2025 has been the nationwide cooperative fraud crisis, involving the embezzlement of billions in savers' deposits from institutions like Supreme Savings and Credit Cooperative, Sahara Chitwan, Swarnalakshmi, and Sano Paila. Total misappropriated funds have ballooned to an estimated Rs 49 billion, affecting over 2 million depositors and sparking widespread protests demanding restitution. A parliamentary inquiry committee, formed in 2024 and reporting in mid-2025, recommended action against dozens of individuals, including politicians from multiple parties, for facilitating or benefiting from the frauds.
At the center is RSP Chair and former Home Minister Rabi Lamichhane, arrested in October 2024 and facing charges in at least five cooperative cases as of August 2025. Accusations stem from his time as managing director of Gorkha Media Network, where funds—allegedly diverted by fugitive businessman GB Rai from cooperatives like Supreme (Rs 1.38 billion embezzled)—were used for media operations. Lamichhane is charged with fraud, money laundering, and organized crime; in the Sahara Chitwan case alone, he allegedly authorized Rs 480 million in expenditures with sole signature authority. Courts have repeatedly denied bail, with the High Court rejecting his latest plea on August 27, 2025, and the Rupandehi District Court extending custody on August 11. His offer to repay funds for bail was interpreted by ruling parties as an admission of guilt, further polarizing debates. Lamichhane escaped from prison on September 9 amid vandalism following the Gen Z protest.
The scandal transcends RSP, implicating figures from other parties: Nepali Congress (NC) Vice President Dhanraj Gurung was probed (though cleared in the Miteri Cooperative case), while his ex-wife faced charges; UML's Rishikesh Pokharel, PAC Chair, is accused in the Umagouri cooperative fraud worth millions; and RPP's Gyan Bahadur Shahi has demanded GB Rai's arrest amid cross-party calls for accountability. Four lawmakers have been suspended over related corruption charges, highlighting the crisis's grip on parliament. Ongoing investigations have led to 411 arrests and 212 court cases, but critics argue political protections delay justice, exacerbating public fury and eroding trust in the cooperative sector.
A Cascade of Other Scandals Fueling Discontent
• Lalita Niwas Land Scandal: This ongoing fraud involving over 100 ropanis of prime Kathmandu land implicated former Prime Ministers Madhav Kumar Nepal and Baburam Bhattarai. In March 2025, the CIAA appealed Special Court acquittals, and in July, the Supreme Court issued show-cause notices to Nepal and Bhattarai. The CIAA sought Rs 185.5 million in restitution from 93 individuals, echoing ties to Patanjali entities.
• Fake Bhutanese Refugee Scheme: Exposed in 2023, this scam defrauded 875 Nepalis with fake U.S. resettlement promises. Former Home Minister Balkrishna Khand's hearing occurred on August 12, 2025, while former Deputy PM Top Bahadur Rayamajhi, arrested in 2023 and denied bail in 2024, faced a hearing on August 3, 2025, remaining in custody amid charges of treason and fraud.
Broader Ramifications: A Democracy at Risk
These scandals, particularly the cooperative fraud's cross-party reach, have exacerbated coalition strains, bolstered anti-establishment sentiments despite RSP's internal contradictions, and deterred foreign investment. Ultimately, 2025's corruption crises underscore Nepal's democratic vulnerabilities: reform aspirations thwarted by vested interests. Without robust measures—like empowered independent commissions, CIAA independence, and bipartisan commitment—the nation faces heightened instability, with accountability as the perennial victim.
