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Nepal Rastra Bank Finally Has a Governor. Or Does It?

by Khatapana

May 21, 2025 - 11 min read

Nepal Rastra Bank Finally Has a Governor. Or Does It?

Nepal Rastra Bank finally has a governor. But legal drama, political deals, and looming writs may unravel it all. Explore the real story that’s just beginning.

After weeks of headlines, high-level meetings, and hushed political bargaining, Nepal Rastra Bank finally has a new governor.

On May 20, the government officially appointed economist Dr. Bishwo Nath Poudel as the 18th Governor of Nepal Rastra Bank.

You’d think this would mark the end of all the chaos, right?

Well, not so fast.

Because if you’ve been following this saga (and if you haven’t, trust us, it’s juicier than half the shows on Netflix), you’ll know this isn’t your typical “new appointment” story. This is more like the intermission, not the climax.

Behind the smiling photo-ops and congratulatory tweets lies a legal and political drama that might still upend everything.

The appointment is done. But the war? It might just be getting started.

And here’s why:

Quick Recap of The Drama

If you're wondering how we got here, let’s rewind just a bit. No need to rewatch the whole season. Here’s the “Previously on Nepal Rastra Bank” moment:

The term of former governor Maha Prasad Adhikari ended on April 4.
As per Section 25 of the Nepal Rastra Bank Act, a new governor should’ve been appointed one month before the post became vacant. Spoiler: that didn’t happen.
A three-member recommendation committee was formed in March, but it never held a single meeting. The committee had following members:

Finance Minister Bishnu Paudel
Economist Bishwo Nath Poudel
Former Governor Bijaya Nath Bhattarai

But the committee failed to meet even once while the possible names of candidates ranging from recently resigned CEO of Nabil Bank to current Executive Directors of the Nepal Rastra Bank started doing the rounds in the media. One committee member, Bijaya Nath Bhattarai, got so frustrated, he just walked out.
Meanwhile, Deputy Governor Dr. Neelam Dhungana Timilsina stepped in as Acting Governor. But the twist was, she also wanted the top job.
Gunakar Bhatta, a strong candidate, resigned from his post to qualify, but guess who had to accept that resignation? Dhungana herself.
She didn’t. The game paused.

Click here for the full story of how this saga came to be

And just when things were getting too messy to follow, a new name emerged: Prof. Dr. Bishwo Nath Poudel.

A respected economist. A former planning commission vice-chair. And wait for it…a member of the very committee supposed to recommend the next governor.

So what did he do?

He resigned from the committee. And within days, his name made it to the top of the shortlist. Smooth, right?

Then came May 13, when a writ petition was filed at the Supreme Court, arguing that Bishwo Nath Poudel shouldn’t be considered because of his political ties with Nepal Congress.

But technically, since he hadn’t been appointed yet, the court said, “No case to hear, you can’t file a writ petition against someone simply based on speculation.”

So, the petition against Bishwo Nath Poudel was refused to be registered.

Fast forward to May 20, and boom: Dr. Poudel is officially Nepal Rastra Bank's new governor.

If you’re breathing a sigh of relief, thinking the game is finally over,

You couldn’t be more wrong.

This is where things actually get even more interesting.

There are two possible writ petitions in circulation. And each one, if upheld, could challenge the appointment of Prof. Dr. Bishwo Nath Poudel as the 18th Governor.

Let’s explore that.

Writ 1: Political Affiliation Question

.Let’s zoom in on one line from the Nepal Rastra Bank Act, 2058 (2002). Short but sharp, and now incredibly relevant:

Section 21(a) of the NRB Act basically says:

“A person shall be disqualified to be appointed as Governor if such person is a member or official of any political party.”

That’s it. One clean clause. No grey area.

The Governor of Nepal Rastra Bank cannot be politically affiliated, period.

Now let’s talk about facts.

In 2022, Dr. Bishwo Nath Poudel didn’t just flirt with politics, he jumped right in. He contested in the House of Representatives elections from Parbat-1. He was an official candidate of the Nepali Congress. This isn’t gossip or some backroom rumor. It’s all out there in the open. Posters, party endorsements, everything.

He’s also known to have close ties with Dr. Arzu Rana Deuba (currently the Foreign Minister), a senior Congress leader, having served on the board of the Ullens Foundation, where she plays a key role.

So, we’re not just talking about a one-time candidacy here. It’s a political connection with depth, and it’s hard to ignore when the law clearly says the Governor of Nepal Rastra Bank must steer clear of party affiliations.

So what does that mean?

Legally, it places him squarely within the disqualification scope of Section 21(a).

Now sure, some may argue he’s not currently active in politics. But the law doesn’t say “currently.” It says “member or official.” And candidacy, especially under a party ticket, strongly indicates formal affiliation.

So Why Did the Court Refuse to Register the Earlier Writ?

If the law says you can’t appoint someone with political affiliation, then why did the Supreme Court reject the registration of the earlier writ?

Well, let’s be clear: the court didn’t say Dr. Poudel was clean. It simply said he hadn’t been appointed yet, so there’s nothing to challenge.

The writ was thrown out not because the argument was weak. It could not be registered because the appointment hadn’t happened yet. The court essentially said: “You can’t challenge an appointment that hasn’t even been made”

But now that the appointment is real and official?

A fresh writ petition is not just likely, it’s almost guaranteed. Someone is probably drafting it as we speak.

And when it arrives, the court will have to hear it.

If that happens?

The Supreme Court could issue an interim order, temporarily suspending him from office while the case is heard.
Or worse (for Poudel), the court could eventually rule that his appointment violated Section 21(a) and declare it invalid.

Let’s play this out for a second.

The current recommendation committee already submitted a ranked list of three candidates:

Dr. Bishwo Nath Poudel
Dr. Neelam Dhungana Timsina
Dinesh Bhattarai

So let’s say the court pulls the plug on Dr. Poudel’s appointment. What happens then?

It’s logical to assume that Dhungana would take the seat. After all, she was second on the list.
But hold up. That’s not how it works.

There’s no rule in the Nepal Rastra Bank Act that says the runner-up automatically becomes Governor.

In fact, Section 26 is crystal clear: if the Governor’s post becomes vacant before the term is up, the government must go back and appoint someone using the same process as before.

Now here’s where it gets a little murky. If disqualified, this may not be seen as a mid term vacancy but the continuation of the current Governor appointment process.

Therefore, if the court rules his appointment invalid, the 2nd candidate recommended by the selection committee, i.e. Deputy Governor Dhungana would most likely get the top job and become the first woman Governor of Nepal.

There’s also another writ petition pending at the Supreme Court that could flip the game entirely, and we’ll talk about that shortly.

The Irony of Oli’s Original Bet

Politics is a lot like chess. Except the pieces move themselves, the board changes shape every five minutes, and somehow, everyone thinks they’re winning.

And the game that played out at Nepal Rastra Bank? Oh, it’s dripping with irony.

Let’s go back to the start. Not too far, just a few twists ago.

From what we’ve heard, Prime Minister KP Sharma Oli had a clear favorite for the Governor’s post: Neelam Dhungana Timilsina.

She checked every box you could want in a central bank chief:

A long-time central banker
Technically sharp
And best of all (from a political standpoint), she had connections across both major parties, UML and Congress

Basically, a safe, sensible choice who wouldn’t ruffle feathers.
But Congress wasn’t feeling it.

They pushed back and floated their own pick: Dr. Bishwo Nath Poudel, a respected economist and their former election candidate.

Now Oli, not wanting to start a political tug-of-war over one appointment, played the compromise card. He backed off. Congress got their pick. Bishwo Nath climbed to the top of the list, and boom: got appointed Governor.

But here’s where things get deliciously ironic.

Now that Dr. Poudel’s appointment is under legal fire with a potential writ petition looming that could disqualify him over his political affiliation, the spotlight is slowly circling back to Dr. Neelam Dhungana.

If Poudel is booted out by the court, many would expect Dhungana, who was second on the recommendation list, to be the obvious choice.

But there’s no legal provision for a direct handover. The government would still need to make a fresh appointment, possibly from the same recommendation pool.

In this scenario, Dhungana would be the most likely pick. But not the guaranteed one.

So after all that push and pull, if the legal system says “sorry, not valid,” then Oli might end up getting what he wanted in the first place: Neelam Dhungana as Governor.

Not by lobbying.
Not by winning the argument.
But by sitting back and watching patiently.

Just like in a game of chess, sometimes in politics, you don’t have to make the right move. You just have to wait for the other side to make the wrong one.

The Other Writ That Might Be Bigger Than You Think

Now let’s talk about the second potential legal bombshell.

When the first committee failed (two of the three members resigned), the government scrambled to form a new one on May 14. That new committee included:

Finance Minister Bishnu Paudel
Economist Posh Raj Pandey
Former Governor Maha Prasad Adhikari

But the issue was:
Maha Prasad Adhikari just finished his term as governor, and then immediately joined the panel to choose his own successor.

Doesn’t that sound a bit strange?

Even though the Nepal Rastra Bank Act doesn’t directly forbid this, the entire spirit of Section 15 of the Nepal Rastra Bank Act is about an independent, neutral committee recommending the best candidate, not one influenced by internal legacy dynamics or potential personal biases.

Now imagine this second writ argues:

“Including the outgoing Governor in the recommendation panel violates the intent of the law and compromises the independence of Nepal Rastra Bank.”

If the Supreme Court agrees?

The entire list of recommended candidates, including Bishwo Nath Poudel, Neelam Dhungana, and Dinesh Bhattarai, becomes invalid.

And that means:

The government must form a completely new recommendation committee
The whole process starts from scratch
And we could be heading toward months of legal limbo, once again leaving Nepal Rastra Bank without a stable hand at the wheel

And at the center of this entire chessboard sits Dr. Bishwo Nath Poudel, a man whose qualifications are unquestionable, but whose political history may be his undoing.

Who is Bishwo Nath Poudel? A Man Between Merit and Membership

Let’s be clear about one thing:
Dr. Bishwo Nath Poudel is not just highly qualified, he might just be overqualified.

He’s the kind of candidate whose résumé makes most economic advisors look like interns.

So instead of listing a thousand titles, let’s break it down:

Academic Foundation: The Global Scholar

PhD in Agricultural and Resource Economics from UC Berkeley, USA
Master’s in Economics from Illinois State University
Bachelor’s in Engineering (initial years in Shanghai, China)
Early academic pivot: while studying in China, he was nudged by peers to explore economics. That curiosity turned into a global academic journey.

Teaching & Research: The Policy Educator

Professor at Kathmandu University (School of Arts, Economics)
Published in national and international journals on topics like:
- Natural resource economics
- Labour market dynamics
- Political economy and economic history
Frequent media contributor (you’ve probably read his pieces in Kantipur, Setopati, and elsewhere.)

Policy & International Development: The Global Consultant

Vice-Chairperson of the National Planning Commission (2021–2022)
Short-Term Consultant at the World Bank
Economic Advisor at the International Labour Organization (ILO)
Consultant for the Millennium Challenge Account Nepal (MCA-N)
Policy engagements with UNDP, ADB, ILO, and regional think tanks on economic integration and sustainability

Boards & Institutions: The Trusted Strategist

Former Director of Sanima Bank
Board of Trustees at Ullens Education Foundation
Director, Sanima Tamor Hydropower Limited
Former Chair, Colombo Plan Council, and member of regional economic bodies
Chair of the International Centre for Integrated Mountain Development (ICIMOD) board, leading South Asia’s premier climate and sustainability think tank

Prof. Dr. Bishwo Nath Poudel’s Vision:

In interviews and public speeches, Dr. Poudel comes off as more than just a technocrat. He often speaks about long-term structural reforms, the importance of economic independence, and pushing Nepal beyond “donor dependency.”

“A lot of people have done a lot to make our country poor and underdeveloped. I feel I can contribute to getting rid of these problems, and that’s what drives me.”

He believes in public sector efficiency, investment-led growth, and leveraging tech and research for Nepal’s economic transformation.

On paper, he’s one of the most qualified individuals ever considered for the job of Governor of Nepal Rastra Bank.

But now, his credentials are at war with the law.

So Why the Controversy?

One line. One decision.

In 2022, Dr. Poudel chose to run for Parliament under the Nepali Congress ticket. He didn’t win. But he became (officially and legally) a political party candidate.

And that’s the sticking point.

That election run, while legal and democratic, may now be the one thing that derails his appointment.

What’s funny (or frustrating, depending on how you look at it), is that this isn’t the first time political ties have stirred controversy at Nepal Rastra Bank.

Back in 2022, during Maha Prasad Adhikari’s tenure, a name “M. Adhikari” appeared on a UML central committee list. Many suspected it was the Governor himself.

The UML quickly claimed it was someone else; a chartered accountant from Biratnagar named Manoj Adhikari. But no one ever saw him. No proof, no profile. Just a name and a city.

And just like that, the issue quietly disappeared. But the pattern of political suspicion around NRB governors is becoming hard to ignore.

Which brings us back to Dr. Poudel.

A brilliant mind, no doubt. But even brilliance must bow to the law.

And if the law says "no politics at the central bank," then the court may soon have the final say.

A Constitutional Crisis in Disguise

You’d think that appointing a Governor for Nepal Rastra Bank, one of the most critical institutions in the country, would be a clean, non-political process.

But what we’ve witnessed instead is a masterclass in how even the most technical appointments can become tangled in political power plays, legal gray zones, and personal ambitions.

Let’s take a step back and ask: Why does this even matter so much?

Because Nepal Rastra Bank isn’t just another government office.
It’s the watchdog of the banking sector. It controls monetary policy, stabilizes inflation, monitors foreign exchange, and essentially guards the financial backbone of the nation.

And that’s precisely why its leadership is meant to be independent, apolitical, and governed strictly by law.

The Act is clear on this:

Section 15 outlines how the Governor must be selected through a neutral recommendation process.
Section 21(a) bars political party members from becoming Governor.
Section 25 says the appointment must be made one month before the previous term ends. Which, of course, did not happen

Curious about how NRB works? Here’s the full breakdown.

But each of these provisions was either stretched, ignored, or brushed aside. And here we are, a highly capable economist sits as Governor, with a looming risk of being removed for legal non-compliance.

That’s not just a personnel issue.

That’s a constitutional problem in disguise.

Because when the law is bent to serve convenience, even with the best intentions, it erodes public trust in the very institutions that are supposed to rise above politics.

And Nepal can’t afford to lose trust in its central bank.

Not when the economy is this fragile.
Not when investors are watching.
And definitely not when budget season is right around the corner.

Is This the End or Just the Beginning?

So here we are.

Dr. Bishwo Nath Poudel is now officially the Governor of Nepal Rastra Bank.
But the courtroom doors haven’t closed. If anything, they’re just opening.

A writ could still challenge his appointment based on political affiliation.
Another could attack the legality of the committee that recommended him.
Both could potentially unseat him, or stall him with an interim order.

And in that case, Nepal Rastra Bank could once again find itself governor-less.

But more than that, this story isn’t just about one seat or one man. It’s a mirror reflecting how politics continues to blur the lines between governance and legality, even in institutions that are supposed to be immune to it.

So, is this the end of the drama?

Maybe.

Or maybe it’s just another chapter in Nepal’s long tradition of turning technical positions into political battlegrounds.

Whatever happens next, one thing’s clear:

The independence of Nepal Rastra Bank is not something to be debated in courtrooms or compromised in committee rooms. It’s a cornerstone of economic stability, and it needs to be protected.