KATHMANDU: Nepal’s central bank remains without a governor more than a month after the post fell vacant, with political wrangling and internal party dynamics delaying the appointment.
However, the picture is becoming clearer: unless a surprise consensus is reached between Prime Minister KP Sharma Oli and Nepali Congress President Sher Bahadur Deuba, 50-year-old economist Dr. Biswo Poudel appears poised to become the governor of Nepal Rastra Bank.
Dr. Poudel, a seasoned economist with close ties to the Nepali Congress, is being positioned as the party’s candidate for the powerful regulatory post. Although he lost the 2022 general election from Chitwan Constituency No. 1, he is now expected to be rewarded with the governorship — a move that has sparked both optimism and concern in political and economic circles.
A delayed appointment
The position of Nepal Rastra Bank (NRB) Governor became vacant on April 5 following the retirement of Maha Prasad Adhikari. According to the NRB Act, the government should have appointed a successor before the seat fell vacant, but political interference and internal tussles within the recommendation committee have obstructed the process.
The three-member recommendation committee—initially chaired by Finance Minister Bishnu Poudel with members including former Governor Bijayanath Bhattarai and economist Dr. Biswo Poudel—has been plagued by resignations and legal battles.
First, Bhattarai resigned, citing political pressure. He was replaced by outgoing Governor Adhikari, whose inclusion in the committee is now being challenged in the Supreme Court. Meanwhile, Dr. Poudel resigned on Sunday, shortly after Nepali Congress reportedly decided to push his name forward for the governorship. With his departure, the committee has once again been rendered incomplete.
As one government insider put it, “The recommendation committee has become a frog’s nest — unstable, noisy, and ineffective.”
Deuba’s bet on Poudel
Nepali Congress President Sher Bahadur Deuba is believed to have assured Dr. Poudel of the governorship once it was confirmed that the post would be filled from the Nepali Congress quota. Dr. Poudel’s resignation from the recommendation committee appears to be part of a strategic move clearing his path for appointment.
Initially, the Nepali Congress had eyed Dr. Gunakar Bhatta, an Executive Director at NRB, for the position. However, his candidacy was obstructed—first by UML pushback and then by the refusal of Acting Governor Neelam Dhungana to accept his resignation from the central bank. That opened the door for Dr. Poudel’s name to emerge as the frontrunner.
Who is Dr. Biswo Poudel?
A PhD graduate in economics from the University of California, Berkeley, Dr. Poudel is regarded as one of Nepal’s foremost economic minds. He specializes in natural resource economics, labor economics, and development policy.
He has worked as a senior economic advisor to the Ministry of Finance and held prestigious posts, including Vice Chairman of the National Planning Commission, Chair of the Colombo Planning Council, and member of the Board of Governors at ICIMOD.
Dr. Poudel also has international credentials, having worked as an economist at the International Labor Organization (ILO) and served in the Millennium Challenge Corporation (MCC) Nepal office. His academic work has been published in top economic journals such as the American Journal of Agricultural Economics and Applied Economic Letters.
Despite this impressive résumé, his political alignment with the Deuba camp raises questions about his independence and impartiality.
Connections and controversies
Dr. Poudel’s connections to the Deuba family are no secret. He previously served on the board of trustees of ULLENS School, a private institution chaired by Foreign Minister Arju Deuba Rana. His daughter is still a student at the school, and Poudel remains involved as a guardian.
Critics argue that these ties could compromise the objectivity needed in a central bank governor, particularly when regulating the financial sector. His prior role as a board member of Sanima Bank and involvement in a hydropower company have also prompted concerns over potential conflicts of interest.
“Will he be able to take tough regulatory decisions on banks where he has previously held ties?” asked one economist, requesting anonymity. “That’s a valid concern.”
What his appointment could mean
Supporters believe Dr. Poudel’s international exposure and economic insight make him the ideal candidate to stabilize Nepal’s monetary policy amid sluggish growth and high inflation. They argue he is well-placed to navigate complex macroeconomic challenges, restore investor confidence, and coordinate with institutions like the World Bank and IMF.
However, skepticism remains. Dr. Poudel is often seen as favoring liberal, Western-style economic models and is reportedly wary of socialism. This may put him at odds with the country’s socialist-oriented constitution, which prioritizes state-led development and public welfare.
Moreover, his performance at the National Planning Commission did not leave a lasting impression, raising concerns about his ability to innovate or implement impactful reforms.
Nepali Congress’ last hope?
After Dr. Swarnim Wagle’s dramatic exit from the Nepali Congress and shift to the Rastriya Swatantra Party, Poudel is viewed by some within the party as a necessary intellectual figure to maintain credibility in economic discourse.
But as with Wagle, the myth that foreign-educated economists can single-handedly fix Nepal’s economy is being questioned more than ever.
What remains unclear is whether Dr. Poudel will have the political room to operate independently or will be beholden to party interests.
As of now, the recommendation committee remains incomplete, and a writ against the inclusion of outgoing Governor Adhikari is still pending in the Supreme Court. The Council of Ministers cannot move forward until the committee presents three names for consideration, as per the legal requirement.
While Dr. Poudel’s chances seem high, politics remains unpredictable. As one observer noted, “In Nepal, even a final decision isn’t final until it’s executed.”
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