The government, formed on the strength of the Gen-G movement, which was founded with the main demands of ending corruption and maintaining good governance, has initiated some good works during this period, but has also made some controversial decisions.

Monday marked 67 days since the formation of the interim government led by former Chief Justice Sushila Karki.

Even after more than two months of the formation of the government, the assets of the ministers have not been made public. On the other hand, a situation has arisen where the decisions of the Council of Ministers are being disputed one after another and are reaching the Supreme Court, and the court has issued an interim order to stop them. The Supreme Court has issued an interim order to stop the government's decision to recall the ambassador and abolish the Land Commission.

The decisions of the Ministry of Finance to grant tax exemption to the Dolma Impact Fund, which invested in Nepal through a Mauritius cell company, and to allow the import of Euro 3 vehicles have also been controversial. Savita Bhandari, the legal advisor (Attorney General) of the Karki-led government, has become controversial by acquitting her own investment company 'Hope Fertility' in the crime of egg smuggling. Prime Minister Karki's silence on Bhandari's decision has raised further questions.

The Gen-G movement was sparked by raising serious questions about good governance against the then KP Sharma Oli-led government. The Oli government was ousted by the movement, but the new government has also maintained the old trend of hiding asset details. This contradictory trend of the current government, formed to overcome the political transitional period, has once again raised questions about good governance and transparency in power.

There is a legal provision that officials holding public positions must make their asset details public within two months. In the ten-member cabinet led by Karki, all but two ministers have submitted their asset details to the Office of the Prime Minister and Council of Ministers. Minister for Communications and Information Technology Jagadish Kharel and Minister for Health and Population Sudha Gautam have not yet submitted their asset details.

Prime Minister Karki and the remaining ministers have submitted their asset details to the Office of the Prime Minister and Council of Ministers on various dates. Although it is customary to make that detail public by decision of the Council of Ministers, the government has not made it public and has kept it secret until now. The practice of making asset details public in Nepal has been going on since the time of the then Prime Minister Girija Prasad Koirala in 2048. However, since submitting asset details is only linked to moral issues and is not legally binding, ministers have been hiding their asset details. The then Oli-led government had not made its asset details public for about a year and a half.

Section 50 of the Prevention of Corruption Act, 2059 BS, stipulates that a person holding a public office must submit the details of the assets held in his or her family's name to the designated body and officer within 60 days by publishing a notice in the Gazette. The Gazette, published on 20 Ashad 2075 BS, stipulates that the President, the Office of the President, the Prime Minister, Deputy Prime Ministers, Ministers, Ministers of State and Assistant Ministers must submit their asset details to the Office of the Prime Minister and Council of Ministers.

Although it is customary in countries with democratic systems for those holding public office to make their asset details public twice when they enter and leave office, in Nepal the Prime Minister and members of the Council of Ministers do not want to make their asset details public even once. In 2079 BS, after the then Pushpa Kamal Dahal-led government delayed making their asset details public, the ministers of the Rashtriya Swayamsevak Sangh (RSP) participating in the government wrote to the Office of the Prime Minister and Council of Ministers to make their assets public. Dahal then decided to make the asset details public through the Council of Ministers.

In 2074, when Oli was leading the government, it was decided to make the asset details of the Prime Minister and ministers public. Pradeep Gyawali, who was the Minister of Foreign Affairs at that time, made an exception by making his asset details public twice, when he took office and after he left office. This time, the main issue of the Gen-G movement was to end corruption and maintain good governance. The Karki-led government formed on the strength of that is hesitating even when pressure is put on it to make assets public.

It is customary for some ministers to make their assets public even if the Council of Ministers decides not to make them public. However, no member of the current Council of Ministers has dared to make their assets public. If the assets are not submitted within the 60-day period specified by the law, the law has provided a way for the Commission for the Investigation of Abuse of Authority to investigate the alleged illegal assets in the name of the person and his family.

However, there is no mandatory provision to make the asset details public. Section 50 (4) of the Act provides that the submitted asset details can be kept confidential. ‘The asset details submitted under this section shall be kept confidential,’ the sub-section states. After Karki, Kulman Ghising, Rameshwor Khanal and Om Prakash Aryal became ministers in the first phase on 30 Bhadra. It has been more than two months since they became ministers. In the second phase, Anil Kumar Sinha, Mahabir Pun, Madan Prasad Pariyar and Jagdish Kharel became ministers on 6 Asoj, and in the third phase, Sudha Gautam and Bablu Gupta became ministers on 10 Kartik.

The Prime Minister still has seven ministries under his belt. The government, which is supposed to operate by balancing geopolitical balance in the country’s fluid political transition, has not yet been able to bring in a minister in a ministry like Foreign Affairs. Prime Minister Karki, who should be busy creating an electoral environment, has even taken on the responsibility of the Ministry of Foreign Affairs herself.

Another controversial issue regarding this government has been created by the Attorney General. The Karki-led government's legal advisor (Attorney General), Savita Bhandari, has become controversial after acquitting her own investment company 'Hope Fertility' in the egg smuggling case. Bhandari was appointed as the first female Attorney General on 29 Bhadra. It was expected that she would not take such a decision in the background of the controversy over previous Attorney Generals granting immunity in cases of political interest. However, she has decided not to prosecute a case that directly concerns her.

After the Attorney General's Office decided not to prosecute a case on 31 Asoj despite the police investigation confirming that 'Hope Fertility' was extracting eggs from teenagers and selling them at high prices, there have been demands for Bhandari's resignation. Bhandari has a 23 percent founder's share in 'Hope Fertility' based in Babarmahal. The head of Hope, Dr. Swasti Sharma, who has been dragged into the investigation by the Central Investigation Bureau (CIB), is Bhandari's daughter, Sanima.

Bhandari's daughter Dr. Pratyusha Baral also works at Hope. The police had also investigated Hope's Dr. Malina Chaudhary, Ashmi Adhikari, Justina Pradhan and Alisha Oli. However, the Attorney General's Office decided not to prosecute them, saying there was no law. Following this decision, a writ petition has been filed against Bhandari in the Supreme Court.

The CIB had started an investigation into the crime of egg smuggling against 'Hope Fertility' on 26 Ashad. Middlemen used to pay 10,000 each to girls and take them to 'Hope Fertility' to extract their eggs illegally. The police investigation revealed that the eggs were being sold for up to 2 million rupees. The parents were not informed about the extraction of eggs by giving the girl hormones 'injections' from the third day of menstruation to 10 days.

Another issue that has raised questions about good governance against the government is the recall of the ambassador. The government's decision to recall the ambassador in a 'pick and choose' style has also been controversial. The Karki government recalled 11 ambassadors on 30 Asoj. The Supreme Court, hearing the writ petition filed against it, issued an interim order on 16 Kartik, stating that the government should focus on the election and not take decisions that would have far-reaching importance and diplomatic impact. The next day, the government wrote to the ambassadors to appear at the ministry, which further complicated the issue.

Four of the recalled ambassadors have resigned, saying they do not find it appropriate to continue in their posts. Two are not in contact with the Ministry of Foreign Affairs, while the remaining five ambassadors have been leaving after notifying the Ministry of Foreign Affairs in the ‘Ambassadors’ Room’. For this reason, a contempt petition has been filed against Prime Minister Karki. Advocate Prem Silwal has filed a contempt petition alleging that the decision to recall the ambassadors has not been complied with. The hearing of the petition has been scheduled for 7 Mangsir.

This is the first contempt petition against Karki, who is also a former Chief Justice. The elected government has been widely criticized for maintaining a foreign policy without an ambassador and for not even being able to appoint a foreign minister.

The Supreme Court has also put a stop to another issue. Another decision of the government that the Supreme Court has blocked through an interim order as being unconstitutional is the abolition of the Land Commission and its district structure. Former Supreme Court Justice Anil Kumar Sinha is currently the Minister for Land Management, Cooperatives and Poverty Alleviation. The Council of Ministers had decided to abolish the Land Problems Resolution Commission and its district committees on 23 Asoj.

Against this, Commission Chairman Hari Prasad Rijal filed a writ petition on 9 Kartik, naming the Office of the Prime Minister and the Council of Ministers as the defendants. In the writ petition, on 11 Kartik, a bench of Justice Meghraj Pokharel issued an interim order calling both parties for discussion, while on 13 Kartik, a bench of Justices Kumar Regmi and Shantisingh Thapa stayed the implementation until the case is decided.

Also, Home Minister Om Prakash Aryal issued a press release on 9 Asoj, informing that a commission of inquiry has been formed to investigate the physical and human damage caused during the Gen-G movement of 23 Bhadra and the protest of 24 Bhadra, and that regular legal action will not be taken until the commission's report is received. This decision was opposed by the government, saying that it was trying to grant immunity instead of bringing those involved in crime and destructive acts to the purview of criminal action.

After that, the commission of inquiry itself issued a press release stating that the commission's work would not have any impact on the criminal investigation. The Nepal Bar Association and various human rights organizations opposed the government's decision. The press release issued by the Ministry of Home Affairs was criticized for encouraging impunity. The bar claimed that the information received from the Home Administration was against the provisions of the Civil Penal Code, 2074 BS and the Code of Civil Criminal Procedure, 2074 BS.

Similarly, the decision to appoint the chairman of Nepal Airlines Corporation has also been in dispute. Prime Minister Karki, who is also in charge of the Ministry of Culture, Tourism and Civil Aviation, had appointed Bikram Rai as the chairman of the corporation on 17 Kartik. Rai, who was the chairman of Prasadi Academy, Lalitpur, had earlier been appointed as a member of the board of directors by the then Tourism Minister Sudan Kirati.

The corporation is burdened with a debt of at least Rs 52 billion due to its four jet aircraft. In such a situation, there was an opportunity to bring qualified and capable leadership to the corporation. According to the company's law, there is a provision to make the secretary of the taluk ministry the ex-officio chairman and hold an open competition for the post of general manager. This structure was considered more necessary in the transitional situation. But Prime Minister Karki appointed Rai as the chairman without taking such a process forward.

In the international market, Nepal Airlines has to compete with big companies like Qatar, Turkish, Cathay, and Singapore, but its market share is currently less than 20 percent. In this situation, a person who understands the international aviation market and is experienced in business expansion was needed. But Rai is a person focused on the teaching business, and also runs the travel business only part-time.

Due to the weakness of the corporation's laws, political appointments are becoming board members again. However, the corporation's employees are concerned about whether the people who come in this way have the capacity to take tough decisions such as debt management, revival of declining market share, the crisis that has led to the closure of domestic flights, and paying at least 1 billion rupees in arrears, including 420 million rupees for engines leased to an Israeli company.

Similarly, the corporation has advertised for 15 days for the appointment of a general manager. A selection committee has been formed under the leadership of Tourism Secretary Hari Prasad Mainali. However, the decision to include controversial pilot and Rastriya Matrubhumi Party leader KB Limbu as an 'expert' member in the committee is being heavily criticized. This again shows the repetition of political interference.

At least 10 commission and committee reports have been prepared for the corporation's reform. According to a board member of the corporation, if Prime Minister Karki had adopted professionalism and transparency in selecting leadership based on the report's suggestions, the corporation could have found a way out of the current financial crisis. But the government's decisions have also missed that opportunity.

The decision made by the Ministry of Finance has also been controversial. The government had made a controversial decision to grant income tax exemption to a company that brought investment to Nepal through a ‘cell company’ in the ‘tax haven country’ Mauritius. After the decision of the Council of Ministers was controversial, opinions have now been sought from the Ministries of Foreign Affairs and Law. The government had resorted to a treaty with Mauritius to grant tax exemption to the Dolma Impact Fund, which had invested in 16 companies in Nepal. However, this decision appears to have been controversial as the Supreme Court’s interpretation shows that the treaty is not above the law. Now, along with the decision to grant tax exemption to Dolma, the government has also revoked the treaty.

The government has taken the opposite path in the decision-making process to grant tax exemption to Dolma. It was even more doubtful when the government sought opinions on whether it could do so just two weeks after the decision to exempt Dolma from the 25 percent tax on capital gains and to terminate the agreement with Mauritius. Since Dolma will make a profit of Rs 1.17 billion when she sells her 2.6 million shares in Makar Jitumaya Suri Hydropower Company, a potential capital gains tax of Rs 294.4 million will be incurred. However, based on the instructions of the Ministry of Finance and the Department of Internal Revenue, the Internal Revenue Office had decided that Dolma will not have to pay capital gains tax based on the agreement with Mauritius.

After the dispute, Prime Minister Karki had sought information from Chief Secretary Ek Narayan Aryal about the decision. Aryal had informed that the decision of the Council of Ministers would not be immediately verified. After discussing with the Prime Minister, the Chief Secretary has the practice of verifying the decision of the Council of Ministers. Finance Minister Rameshwor Khanal and Director General of the Department of Internal Revenue Madan Dahal, on the other hand, have been claiming that the decision to grant tax exemption to Dolma was in accordance with the law.

It is common practice to open a company in countries like Mauritius, where there is no specific inquiry into the transparency of the source of investment and the identity of the investor, and invest in various countries through it. Therefore, investors from different countries open ‘shell companies’ in countries like Mauritius, Panama, British Virgin Islands, Cayman Islands, Bahamas and invest in various countries through them as direct foreign investment. For this, shell companies are registered in such countries.

On August 3, 1999, the government explained that since there is a double taxation avoidance agreement (DTAA) between Nepal and Mauritius, there will be no tax on investments from there. Tax authorities have not been able to make such a decision so far, saying that no treaty should be misinterpreted to exempt income earned by utilizing Nepal's resources from tax. Tax administrators were hesitant to give such an exemption because the investment through Dolma was not from Mauritius but from a third country.

Mauritius' investment in Dolma Management, which is registered with an office in Mayawa Tower, Cyber ​​City, Mauritius, is only 0.75 percent. 99.25 percent of the investment was brought to Nepal from various countries through the company in Mauritius. The government has decided to provide such a facility as per the 'lobbying' of Dolma, which has invested in various companies in Nepal, to get a 25 percent tax exemption on the income earned here.

Dolma had been 'lobbying' during the previous government to get exemption from the 25 percent capital gains tax as per the Income Tax Act, 2058 BS. Along with political pressure, discussions had been going on between the Internal Revenue Office and the Ministry of Finance for a long time. The Karki government has also opened the import permit for vehicles of the 'Euro 3' standard, which had been banned in Nepal. The previous government had implemented the Vehicle Pollution Standard 2082 after publishing a notice in the Gazette on 23 Ashad. Along with this, 'Euro 6' was implemented for four-wheeled vehicles and 'Euro 5' for two-wheeled vehicles.

The government had decided to stop the import of vehicles of the 'Euro 3' standard in order to control air pollution. The old standard of 2069 BS was repealed when the Ministry of Forests and Environment implemented the vehicle pollution standard. But after the formation of the new government, the cabinet meeting held on 8 Asoj decided to provide various facilities to the private sector for the revival of the economy. This is also one of those facilities.

Earlier, based on the proposal of the Ministry of Forest and Environment, the then cabinet meeting had decided to issue the Nepal Vehicle Pollution Standard 2082. However, the proposal to grant import exemptions was not taken by the Ministry of Forest and Environment, but by the Ministry of Finance to the cabinet. This also shows the state of good governance of the government. The Ministry of Finance claims that various facilities have been provided for the revival of the economy and that the import of vehicles that were blocked at customs has been opened under that.

What do experts say?

Khemraj Nepal, former chairman of Transparency Nepal, says that even though the government tries to work keeping good governance and corruption in mind, there is haste and immaturity in some places. He comments that the government has become controversial when it makes decisions without understanding or based on someone's words. ‘The Karki government has done a lot of good and good governance work so far, but one or two of them have been controversial,’ he said. ‘It seems to have been done due to lack of experience, haste, and bad advice.’

He commented that it was immature not to investigate the vandals on Bhadra 24 and that the Prime Minister had decided not to investigate them for criminal charges and that he did not fully understand the issue of recalling the ambassador. He opined that the decision to grant tax exemption to the Mauritian company was also immature, but he did not think that the Finance Minister’s intention was wrong. ‘However, the government has taken the right step by deciding against the misuse of security personnel and advisors unnecessarily,’ Nepal said.

Dipesh Ghimire, who is studying and researching good governance and corruption, argued that there are two problems in the Gen-G government. ‘Looking at the dispute between the ambassador and the Attorney General, it was seen that the rule of law was flouted, and it was seen that a conflict of interest was protected,’ he said. ‘There is also a need for a law or a clear definition regarding conflict of interest. He argued that the decision to recall the ambassador, which on the one hand will not be appointed as a foreign minister, and on the other hand, the government should move forward with the responsibility of the election, is not in line with the principles of good governance.

Constitutional scholar and senior advocate Bipin Adhikari claimed that such problems arise because the issue of conflict of interest is not clear in advance. He argued that the same is seen in the case of the Attorney General. ‘There have been disputes in some decisions. It cannot be said that this is bad intention,’ he said, ‘The background of the ministers has not been checked and there is no mechanism to check it, it is not good that questions of good governance have arisen. It used to happen in the past and it still happens now, this is our cultural problem. Such problems should be accepted and corrected.’

Government spokesperson Jagdish Kharel said that if there is any weakness in making any decision, the government will correct it and move forward. He expressed his commitment that the government’s sole objective is to maintain good governance and that it will not deviate from this.