The 18th Governor – Not Who, But What Kind Matters Most

The five-year tenure of Mahaprasad Adhikari, the 17th Governor of Nepal Rastra Bank (NRB), is set to conclude on Chaitra 24, 2081 (April 7, 2025). As his term nears its end, speculation and curiosity about who will succeed him as the 18th Governor have intensified. Aspirants have begun their lobbying efforts, and the race is heating up. However, the critical question is not who will take the helm, but what kind of leader is needed. At a time when Nepal’s economy teeters on the brink of crisis, the appointment of the next governor must transcend political horse-trading and focus on delivering a visionary leader capable of steering the banking sector and the broader economy toward stability and growth.

The Nepal Rastra Bank Act, 2058 (2002) outlines a clear process for appointing the governor. The Council of Ministers forms a recommendation committee, chaired by the Finance Minister, comprising a former governor and an expert in economics, monetary policy, banking, finance, or commercial law. This committee nominates three candidates for the Cabinet’s final decision. On Falgun 21 (March 4, 2025), the government authorized the Ministry of Finance to form this committee. However, as of now, the committee remains incomplete. Names like former Governor Bijaya Nath Bhattarai and expert Dr. Bishwa Poudel have surfaced, but both have clarified that no formal invitation has been received, leaving their inclusion uncertain.

Past precedent suggests potential delays. In 2076 (2019), when then-Governor Dr. Chiranjibi Nepal’s term ended on Chaitra 5, his successor, Mahaprasad Adhikari, assumed office only on Chaitra 24—nearly three weeks later. A similar lag this time could push the new governor’s appointment to Baisakh 24 (May 7, 2025). Sources within the Ministry of Finance indicate indecision over committee members, stalling the process. Yet, with the constitutional deadline to present the budget by Jestha 15 (May 29, 2025), the government faces pressure to expedite the appointment to ensure coordination between fiscal and monetary policies.

The list of contenders for the governorship is long and diverse. Current Deputy Governors Neelam Dhungana Timsina and Bam Bahadur Mishra are strong candidates, as the NRB Act allows deputy governors to be considered. Meanwhile, rumors swirl that Gyanendra Dhungana, former CEO of Nabil Bank, resigned to pursue the role, signaling his ambition. Other seasoned bankers and economists are reportedly active behind the scenes.

With the ruling coalition of the CPN (UML) and Nepali Congress in power, political influence over the appointment is inevitable. Analysts speculate that the governorship might fall to Congress’s quota. However, this must not devolve into a mere political handout. The Act prioritizes expertise in economics, monetary policy, banking, finance, or management, and the selection must reflect these criteria. Allowing partisan interests to overshadow merit risks weakening the central bank’s leadership at a critical juncture.

Nepal’s economy is grappling with formidable challenges. High interest rates, liquidity shortages, declining private-sector investment, and rising unemployment have strained the banking sector and the broader economy. During Mahaprasad Adhikari’s tenure, efforts to manage the COVID-19 fallout and stabilize banking showed some success, but structural weaknesses—such as sluggish revenue growth and dependence on loans—persisted unresolved. The incoming governor must confront these issues head-on with bold, actionable strategies.

The governor’s primary tool, monetary policy, is pivotal in reviving economic momentum. This requires not just technical expertise but also the ability to operate independently of government pressure. Past governors have faced criticism for yielding to political directives, diluting the NRB’s autonomy. The next governor must possess the resolve to prioritize economic imperatives over short-term political agendas, ensuring policies that foster stability and growth.

Former governors have rightly emphasized competence and vision over personality—a stance that deserves applause. The 18th Governor must prioritize banking reforms, monetary stability, and economic expansion. The recommendation committee should rise above political pressures, basing its choices on experience, expertise, and leadership potential. Transparency and timeliness in the process are equally critical; delays breed uncertainty, which the economy can ill afford.

The new governor must also pursue long-term reforms. Strengthening the tax system, formalizing the informal economy, and expanding digital banking could boost revenue and fortify economic foundations. These steps demand courage and innovation—qualities the next leader must embody.

The identity of the 18th Governor is secondary; what matters is the caliber of leadership they bring. This appointment is inextricably tied to Nepal’s economic future. A misstep could deepen the current crisis, while a wise choice could set the stage for recovery. The recommendation committee and the government must treat this opportunity with the gravity it demands. If a capable leader is selected promptly, the economy stands a chance to regain its footing. Otherwise, the quagmire of stagnation and debt will only deepen. The next governor should not merely occupy the office—they must transform it into an engine of change.