Although the law allows appointment of a new governor one month before the position at Nepal Rastra Bank (NRB) becomes vacant, the process has been delayed due to a lack of political consensus.
Section 25 of the Nepal Rastra Bank Act states: "The Government of Nepal shall appoint a new Governor in accordance with this Act, generally one month before the vacancy of the post of the incumbent Governor, and shall publish and broadcast a public notice thereof."
Governor Maha Prasad Adhikari is set to retire on April 6 after completing his five-year term. Based on the Act, the government could have appointed a new governor before March 7. However, with only 13 days remaining in Adhikari's tenure, the government formed a recommendation committee to select the next governor only on Monday.
A former governor noted that while the Finance Minister has the authority to select a suitable candidate based on their leadership in economic matters, political interference has hindered an independent selection process.
"The Act grants the Finance Minister the responsibility of appointing a qualified individual as Governor," he said. "However, due to concerns and interference from political leaders, the committee is unable to function independently."
The recommendation committee, chaired by the Finance Minister, includes one government-appointed former governor and another member selected from experts in economics, monetary policy, banking, finance, or commercial law. Finance Minister Bishnu Poudel has appointed former Governor Bijayanath Bhattarai and expert Bishwa Poudel as committee members. The committee will recommend three candidates, from whom the government will appoint one as the next Governor.
Who Are the Contenders?
More than half a dozen names have emerged in discussions about the next Governor. The resignation of Nabil Bank CEO Gyanendra Dhungana, who was already being considered for the post, has fueled speculation about his appointment. According to Nabil Bank sources, Dhungana informed employees of his resignation on Tuesday. He and NRB Executive Director Dr. Gunakar Bhatta are being considered as candidates from the ruling Nepali Congress.
On behalf of the CPN-UML, which leads the government, Deputy Governors Neelam Dhungana Timsina and Bam Bahadur Mishra, along with NRB Director and Planning Commission member Dr. Prakash Kumar Shrestha, are also in the race.
Both Dhungana and Mishra hail from Prime Minister KP Sharma Oli's home district, Jhapa. Among them, Dhungana is said to have the backing of former President Bidya Devi Bhandari as well.
The CPN-UML argues that it should secure the Governor’s position since it holds both the Prime Minister’s office and the Finance Ministry. Meanwhile, the Nepali Congress contends that, as a coalition partner, it should be given the role. The current Governor is considered close to the UML. Although the final decision has yet to be made, candidates with ties to both parties are actively lobbying for the coveted position.
Experts suggest that predicting the next Governor remains challenging, as the appointment requires balancing the interests of the ruling coalition and political leaders.
