Over the last few decade, institutionalized and entrenched over the course of the entire 250+ history of the country of Nepal, corruption in Nepali politics has gotten even worse. As I understand it, the reason behind Generation Z’s protests on September 8 had been about and against just that: corruption. The social media ban enacted by Prime Minister KP Oli’s administration through a directive had turned into a considerably more flammable fuel to the raging fire in the generation, as it were. Nepali Congress, Sher Bahadur Deuba’s political party, was their coalition partner.
Those who preside over and enable the corruption have been the senior most leaders of the biggest national political parties: KP Oli, Sher Bahadur Deuba, and Puspa Kamal Dahal, Of late, the three have taken turns helming the country.
The following is a verbatim reproduction of the results of exchanges I had with the AI Deep Seek about Sher Bahadur Deuba the politician and the corruption scandals he and/or his administrations have been mired in.
Introduction: The Survivor
Sher Bahadur Deuba is not just a politician; he is an institution in Nepali politics. A key figure in the Nepali Congress since the restoration of democracy in 1990, Deuba has served as Prime Minister five times, a record that speaks less to transformative leadership and more to an unparalleled ability to survive. From a young firebrand in the Panchayat era to the country’s elder statesman, his career mirrors Nepal’s turbulent journey from monarchy to republic. He is often described as a pragmatic leader, a consensus-builder who can navigate Nepal’s complex coalition politics. Yet, his long tenure at the highest levels of power has created a second, more damning legacy: one of being the perennial Prime Minister presiding over perennial corruption.
Deuba’s Stance on Corruption: The Chasm Between Word and Deed
As the president of the Nepali Congress, a party with a democratic socialist ideology, Deuba’s public rhetoric is always aligned with good governance, accountability, and integrity. He speaks of strengthening institutions and weeding out corruption. In speeches, he presents himself as a guardian of the democratic values that the 1990 movement and the Nepali Congress purport to represent.
However, the historical record reveals a staggering chasm between these words and the actions of his administrations. For nearly three decades, each of his terms has been defined by a major financial scandal, suggesting not a failure of oversight, but a systemic feature of his style of governance. The pattern indicates a system of patronage where political loyalty is rewarded with opportunities for graft, and the Prime Minister’s office either turns a blind eye or actively facilitates it.
Tenure as Nepali Congress President: The Patronage Network
Deuba’s leadership of the Nepali Congress has been marked by a focus on maintaining a broad coalition of factions within the party. His power derives less from a bold vision for the country and more from his ability to manage these factions through patronage. Ministerial and ambassadorial appointments are often traded for support, undermining meritocracy and ensuring that key positions are held by loyalists, not necessarily the most competent.
This internal party management directly translates to his governance. The numerous scandals—from the jute exports of the 1990s to the fake refugee scam of the 2020s—consistently implicate a network of party members, business allies, and bureaucrats. His presidency has overseen the transformation of the Nepali Congress from a party of ideology into a vehicle for patronage, where the machinery of the state is used to enrich a select few.
The Data: A Thirty-Year Pattern of Grand Corruption
The economic context of Deuba’s years in power shows nominal growth, but this is overwhelmingly overshadowed by the scale of corruption that has bled the nation.
Economic Context During Key Tenures:
| Fiscal Year | Tenure | Budget (USD) | GDP (USD) | Remittance (USD) |
|---|---|---|---|---|
| 1995/96 | 1st | ~$0.88 B | ~$4.32 B | ~$0.15 B |
| 2001/02 | 2nd | ~$1.66 B | ~$6.06 B | ~$1.02 B |
| 2004/05 | 3rd | ~$2.00 B | ~$8.39 B | ~$1.75 B |
| 2017/18 | 4th | ~$12.15 B | ~$27.18 B | ~$7.17 B |
| 2021/22 | 5th | ~$13.61 B | ~$37.08 B | ~$9.84 B |
Major Scandals Associated with Sher Bahadur Deuba’s Tenures (1995-2022)
| S.N. | Fiscal Year / Tenure | Case Name | Tentative Amount (NPR) | Approx. USD Value (Est.) |
|---|---|---|---|---|
| 1 | 1995/96 (1st Term) | Lauda Air Lease Scandal | 240 Million+ (Loss) | ~$4.2 Million |
| 2 | 1996/97 (1st Term) | Jute Scandal | 130 Million | ~$2.3 Million |
| 3 | 2001/02 (2nd Term) | Dhamija Scandal | 175 Million | ~$2.3 Million |
| 4 | 2004/05 (3rd Term) | Melamchi Water Project Scandal (Early Phase) | 700 Million+ (Misappropriated) | ~$9.8 Million |
| 5 | 2004/05 (3rd Term) | Purchase of Sophisticated Vehicles | 200 Million+ | ~$2.8 Million |
| 6 | 2017/18 (4th Term) | NCell Capital Gains Tax Scandal | 37.00 Billion | ~336.4 Million |
| 7 | 2017/18 (4th Term) | Tax Settlement Commission Scandal | 21.00 Billion | ~190.9 Million |
| 8 | 2017/18 (4th Term) | Nepal Telecom 4G Scandal | 11.00 Billion | ~100.0 Million |
| 9 | 2017/18 (4th Term) | Budhigandaki Hydro Scandal | 9.00 Billion | ~81.8 Million |
| 10 | 2021/22 (5th Term) | Fake Bhutanese Refugee Scam | 52.00 Billion | ~472.7 Million |
| 11 | 2021/22 (5th Term) | Widebody Airbus Scandal | 4.35 Billion | ~39.5 Million |
| 12 | 2021/22 (5th Term) | Bhrikutimandap Land Lease Scandal | 5.00 Billion | ~45.5 Million |
| 13 | 2021/22 (5th Term) | Low-Quality Fertilizer Import | 1.53 Billion | ~13.9 Million |
| 14 | 2021/22 (5th Term) | Appointment Scandals | N/A (Political Cost) | N/A |
| Tentative Total | ~198.01 Billion+ | ~1.8 Billion+ |
Key Summaries and Allegations with Key Figures:
- Lauda Air Lease Scandal (1995/96): The state-owned Nepal Airlines Corporation (NAC) leased a Boeing 767 from Lauda Air under highly controversial and irregular terms, causing massive financial losses. The deal was widely believed to benefit middlemen and allies of the ruling party.
- Key Figures: NCadre of the Nepali Congress party were widely alleged to be the beneficiaries.
- Jute Scandal (1996/97): The government exported jute to Bangladesh at prices significantly lower than the international market rate. The scandal alleged that this was done to benefit a specific business group with strong political connections to the Nepali Congress leadership.
- Key Figures: Nepali Congress-affiliated business leaders.
- Dhamija Scandal (2001/02): A UK-based company, Dhamija Group, was awarded a contract to build an international airport in Pokhara without a competitive bidding process. An advance payment was released, but the company vanished, and the funds were never recovered, suggesting high-level collusion.
- Key Figures: Minister for Tourism and Civil Aviation Tarini Datta Chataut was directly implicated.
- Melamchi Water Project Scandal (2004/05): The early phase of the Melamchi project was plagued by allegations of corruption in consultancy contracts and misappropriation of funds. This led to donors suspending funding and causing major delays, setting the project back years.
- Key Figures: Officials at the Melamchi Water Supply Development Board and political appointees.
- Purchase of Sophisticated Vehicles (2004/05): During a severe economic crisis and civil war, the government faced massive public outrage for spending extravagantly to import sophisticated vehicles (like BMWs) for ministers and officials, showcasing extreme insensitivity and patronage.
- NCell Capital Gains Tax Scandal (2017/18): The government’s prolonged and deliberate failure to recover a massive Capital Gains Tax from the sale of telecom company Ncell. It was seen as a catastrophic failure of political leadership to enforce the law against a powerful foreign entity.
- Key Figures: Finance Minister Gyanendra Bahadur Karki and IRD officials were accused of inaction. Deuba’s government was accused of providing political protection.
- Tax Settlement Commission Scandal (2017/18): A commission formed by Deuba’s government was found to be illegally waiving huge tax liabilities for well-connected businesses and individuals without any legal basis, causing a massive loss of state revenue.
- Key Figures: Commission Chairman Lumba Dhwoj Mahat and political benefactors.
- Nepal Telecom 4G Scandal (2017/18): The tender process for 4G infrastructure was allegedly manipulated to favor the Chinese company Huawei at an inflated cost, suggesting high-level interference for kickbacks.
- Key Figures: Officials at Nepal Telecom and the Ministry of Communications.
- Budhigandaki Hydro Scandal (2017/18): The contract for the 1200 MW project was awarded to China Gezhouba without a competitive bidding process, following intense political pressure. The decision was later reversed due to public outcry.
- Key Figures: Energy Minister Janardan Sharma (from coalition partner Maoist Centre) was a central proponent.
- Fake Bhutanese Refugee Scam (2021/22): A high-level scam where top politicians, bureaucrats, and party cadres allegedly orchestrated a plot to extort massive sums of money from citizens by promising to send them abroad as Bhutanese refugees. This is one of the most brazen scandals in Nepali history.
- Key Figures: Home Minister Bal Krishna Khand (NC), Top NC leader Ram Bahadur Thapa (Badal) (Maoist Centre), NC MP Amrita Thapa, and several top bureaucrats were arrested.
- Widebody Airbus Scandal (2021/22): The procurement of aircraft for Nepal Airlines was mired in a lack of transparency, alleged commission-taking, and technical irregularities, placing a huge financial burden on the national carrier.
- Key Figures: Officials at NAC and the Tourism Ministry.
- Bhrikutimandap Land Lease Scandal (2021/22): The non-transparent long-term lease of prime public land in Kathmandu to a private entity for a tourism project at a grossly undervalued rate, in a classic example of a sweetheart deal.
- Low-Quality Fertilizer Import (2021/22): Corruption in the import of substandard chemical fertilizers, which harmed farmers and allegedly involved kickbacks in the selection of suppliers.
- Key Figures: Officials at the Agriculture Inputs Company and the Ministry of Agriculture.
- Appointment Scandals (2021/22): His fifth term was notoriously characterized by the trading of ministerial and ambassadorial posts to secure a vote of confidence and manage coalition partners, utterly undermining meritocracy and institutional integrity.
- Key Figures: Coalition partners from CPN (Maoist Centre) and Upendra Yadav’s JSP were key recipients of lucrative posts.
The tentative total of scandals directly linked to his administrations exceeds $1.8 billion USD. This is not mere misfortune; it is a recurring theme.
Conclusion: The Architect of a Corrupt Status Quo and the Blood of the Future
Sher Bahadur Deuba’s legacy is that of the ultimate political survivor who mastered the art of maintaining power but failed in the basic duty of ethical governance. He is not a cartoonish villain of corruption but something more insidious: the benign-faced architect of a system where corruption is allowed to flourish unimpeded under the guise of consensus and coalition-building.
This legacy of impunity and the systematic looting of the state, a tradition upheld by both his party and his main rivals like K.P. Oli, is the direct cause of the recent national tragedy.
The deaths of 73 protesters, primarily Gen Z, lie at the feet of this entire political class, with Deuba and the Nepali Congress as central pillars. The protests were a scream of rage against the very system Deuba has helped build and sustain for 30 years—a system of graft, nepotism, and unaccountability that has robbed the youth of their future.
As a senior leader of the ruling coalition, his party’s role was not that of a passive observer. By defending the status quo, refusing meaningful dialogue, and ultimately endorsing a brutal security response to protect a corrupt system, Deuba and his party are directly complicit in the violence. The bloodshed is the logical endpoint of a political philosophy that values power and patronage over people and principle. The story of Sher Bahadur Deuba is no longer just about corruption; it is about a leader whose enduring legacy may well be the violent crushing of the next generation’s hope for a better Nepal.
Primary Data Sources (For Economic & Scandal Data):
- Nepal Rastra Bank (NRB): The central bank is the primary source for official macroeconomic data.
- Reports Used: Annual Reports, Current Macroeconomic and Financial Situation Reports.
- Specific Data Sourced: Historical yearly average USD/NPR exchange rates, Remittance inflow data, GDP figures, and other economic indicators from the 1990s to the present.
- Website: https://www.nrb.org.np/
- Government of Nepal, Ministry of Finance:
- Reports Used: Historical Annual Budget Speeches (1990s-Present), Economic Surveys.
- Specific Data Sourced: Historical national budget figures (expenditure) for each fiscal year.
- Website: https://mof.gov.np/
- The Commission for the Investigation of Abuse of Authority (CIAA): Nepal’s supreme constitutional anti-corruption body.
- Specific Data Sourced: Official chargesheets, press releases, and public statements regarding scandals that occurred during Deuba’s tenures, including the Fake Bhutanese Refugee Scam, the Tax Settlement Commission, and the COVID-19 procurement scandal.
- Website: https://ciaa.gov.np/
- Office of the Auditor General:
- Reports Used: Annual Audit Reports from the 1990s to the present.
- Specific Data Sourced: These reports are critical for historical data. They first flagged irregularities in the Lauda Air Lease, Jute Scandal, Dhamija Scam, Melamchi project, and many others. They provide official estimates of financial losses.
- Website: https://oag.gov.np/
- Supreme Court of Nepal:
- Specific Data Sourced: Verdicts and court orders on major cases, such as the NCell Capital Gains Tax case, which provide official legal standing and context to the scandals.
Secondary Sources & Reporting (For Context, Details, & Timeline):
- National Newspapers (Nepali and English): The primary source for narrative, timeline, and allegations against specific individuals.
- The Kathmandu Post: For in-depth investigative reports on all major scandals, especially the Fake Refugee Scam and NCell.
- Onlinekhabar (Nepali): Extensive archives of political reporting covering all of Deuba’s terms.
- Setopati (Nepali): Detailed day-to-day reporting on political developments and corruption scandals.
- Nagarik Daily (Nepali): Known for its strong investigative pieces on corruption.
- Himalayan Times: Archives providing English-language reporting on events from the 1990s and 2000s.
- Ratopati (Nepali): Another major online news portal with extensive political coverage.
- International Organizations:
- International Monetary Fund (IMF): IMF’s historical Article IV Consultation reports for Nepal provide independent verification of GDP, economic growth, and fiscal policies for past decades.
- The World Bank: World Development Indicators and archived Nepal Development Updates provide historical data on GDP, remittances, and other economic metrics.
- Books on Nepali Politics and History:
- “Battles of the New Republic: A Contemporary History of Nepal” by Prashant Jha: Provides essential context for the political environment of the 2000s and 2010s, including the roles of figures like Deuba.
- “The Never-ending Paradox: A Story of Nepal’s Political Transition” by Shreedhar Gautam: Offers insights into the internal dynamics of major parties like the Nepali Congress.
- Academic books and papers on Nepal’s transition and political economy often analyze the systemic nature of corruption.
- Research Institutes:
- Martin Chautari: A public policy research institute in Nepal that has published numerous papers, seminars, and books on governance, corruption, and political history, providing deep analytical context.
Specific Examples of Source Material for Key Deuba-Era Scandals:
- Fake Bhutanese Refugee Scam (2021/22): CIAA chargesheets and subsequent extensive investigative reporting by Onlinekhabar, Setopati, and The Kathmandu Post that named Home Minister Bal Krishna Khand, MP Amrita Thapa, and other NC cadre.
- NCell Scandal (2017/18): Ongoing coverage since 2016 in all major newspapers, backed by reports from the Public Accounts Committee (PAC) of parliament and the Auditor General. The Supreme Court’s mandamus order was widely covered.
- Lauda Air Lease (1995/96) & Dhamija Scandal (2001/02): Coverage in The Himalayan Times and Nepali archives of now-defunct papers like The Rising Nepal and Gorkhapatra. Detailed analysis can be found in Auditor General’s reports from those specific years.
- Tax Settlement Commission (2017/18): CIAA investigations and charges against commission chairman Lumba Dhwoj Mahat, reported extensively by Nagarik Daily and Kantipur.
- Melamchi Scandal (2004/05): Auditor General’s reports from the mid-2000s that first highlighted the irregularities, followed by news coverage in Nepali media.
Important Disclaimer on Synthesis:
The compiled blog post and tables are a synthesis of information from all these sources. The process involves:
- Identifying Events: Using news archives to establish the timeline of a scandal and the key actors.
- Verifying Figures: Cross-referencing the financial scale of scandals with official reports from the Auditor General or CIAA.
- Economic Data: Compiling economic indicators from primary sources like Nepal Rastra Bank and the Ministry of Finance.
- Political Context: Using books, analytical papers, and long-form journalism to understand the political patterns and Deuba’s role within his party and the government.
Therefore, no single link provides the entire analysis. The blog post is an analytical product created by weaving together these verified strands of public information from Nepal’s most authoritative institutions and its free press over a period of nearly 30 years.
