In a candid and thought-provoking interview, Rudra Pandey, a trailblazing entrepreneur and one of the architects of Nepal’s information technology (IT) sector, shares his vision for transforming Nepal into a global IT hub. With a career spanning over two decades, Pandey has founded and sold multiple successful companies, including D2Hawkeye (now Cotiviti in the U.S. and Infinite Software Services in Nepal), Deerwalk (Now CedarGate), also has founded Deerwalk Education group which now has three schools and one college and his current venture, Deerhold. Also — Since joining Hamro Patro as an investor and executive chair about four years ago, Pandey has led the company into multiple business verticals. His contributions have laid the foundation for Nepal’s IT outsourcing industry, but his frustration with systemic inefficiencies—particularly the government’s role—underscores the challenges that threaten Nepal’s tech ambitions. Umesh Poudel of Fiscal Nepal speaks with Pandey, who shares insights into Nepal’s IT landscape, the vital role of education, the challenges posed by restrictive government policies, and the way forward for young entrepreneurs aiming to compete on a global stage. Excerpts:”

You have been a pioneer in Nepal’s IT industry since 2001. Can you walk us through your journey and the impact your companies have had on Nepal’s IT sector?

My journey began in 2001 with D2Hawkeye, a leader in healthcare analytics. That company was sold in 2009, marking a significant milestone for Nepal’s fledgling IT industry. My second venture, Deerwalk, was acquired by Cedar Gate Technologies, and now I lead Deerhold, Harmro Patro, Deerwalk Education Group and other multiple business verticals. When I started, the idea of IT outsourcing in Nepal was unthinkable—people dismissed it as impossible. I took the leap, and today, hundreds of companies are engaged in outsourcing, creating jobs and driving economic growth.

Many of my former employees have gone on to launch their own IT firms, which I see as a ripple effect of my efforts. Through these companies, we’ve built products for global markets, particularly the US, proving that Nepal can compete on the world stage. My contribution, though modest, has been to show that IT can thrive here, despite the odds.

That’s a remarkable legacy. What is your long-term vision for Nepal’s IT industry, and how can it position itself as a global player?

Nepal’s IT future depends on two things: a robust education system and supportive government policies. There are two paths to growth—demand-driven and supply-driven. Demand-driven growth requires us to chase international markets with aggressive sales and marketing, which is resource-intensive. I believe a supply-driven approach is more sustainable: produce a massive, high-quality IT workforce that creates global buzz. Imagine a Nepal where 100,000 or even a million IT graduates emerge annually, skilled and job-ready. That kind of talent pool would attract global companies without us having to beg for their attention.

The problem is, Nepal’s current IT education is woefully inadequate. We produce too few graduates, and many lack practical skills. The government’s failure to regulate education and enforce quality standards is a major barrier.

Universities like Tribhuvan University (TU), Pokhara University (PU), and Kathmandu University (KU) offer a decent theoretical foundation, but affiliated colleges like Islington, Kings and British College are often profit-driven, producing graduates with little real-world knowledge.

The government must prioritize applied education—mandatory internships, for example—to ensure graduates are employable. Without this, Nepal’s IT sector will remain a shadow of its potential, stifled by a government that seems indifferent to the industry’s needs.

You are operating IT companies in Nepal, the US, and Japan. How do you manage operations across these diverse markets, and what unique advantages does Nepal bring to the table?

My operations are concentrated in Nepal, the US, and Japan. In Nepal, we develop products for our US subsidiary, which are then sold in the US market. I rely on strong management teams to handle day-to-day operations, positioning myself as an investor and strategist. Nepal’s key advantage is its cost-effective talent pool and growing English proficiency, thanks to private schools and the shift to English-medium education in government schools. This makes Nepal an attractive hub for IT development, but scaling is a challenge due to limited skilled human resources and bureaucratic red tape.

The US and Japan, on the other hand, offer robust markets with high demand but come with higher costs. Nepal can complement these markets by focusing on development, but only if we address the skills gap and streamline business processes. The government’s restrictive policies—complex tax structures, capital flow regulations, and a lack of investor protections—make it difficult to attract foreign companies or scale operations. Countries like India have thrived by creating business-friendly environments, while Nepal’s government seems content to let opportunities slip away.

You’ve highlighted the shortage of skilled IT professionals in Nepal. How are you addressing this challenge in your companies, and what steps are needed to build a talent pipeline for a global IT hub?

Finding quality talent is a persistent hurdle. At Deerhold, we’re fortunate to have strong brand recognition—when we post 10 job openings, we get 300 applications. But the reality is, many applicants lack the practical skills needed to contribute immediately. We often spend six months training new hires, which is inefficient and costly. The root issue is Nepal’s education system, which prioritizes rote learning over applied skills. Abroad, students get three-month summer internships each year, gaining a full year of work experience by graduation. In Nepal, the academic calendar runs year-round, leaving no room for internships.

The government must mandate a nine-month academic year with a three-month internship period to bridge this gap. Additionally, it needs to crack down on substandard colleges that churn out unqualified graduates. While TU, PU, and KU produce graduates with solid theoretical knowledge, many affiliated colleges—like Islington, British College, and King’s College—are essentially degree mills, selling credentials without substance. The government’s inaction allows these institutions to undermine Nepal’s reputation in the global IT market. If we want to compete with countries like India, which graduates millions of IT professionals annually, we need a complete overhaul of our education system.

You’re also involved in education initiatives in Nepal. How can vocational and theoretical education be bridged to support the IT sector, and what challenges do you foresee?

Vocational education could revolutionize Nepal’s IT sector, just as it has for trades like plumbing or electrical work. A one- or two-year IT training program after Grade 12 could produce job-ready professionals, but Nepal’s cultural obsession with academic degrees stifles this approach. People view vocational training as inferior, associating it with “uneducated” trades. The government should promote vocational IT programs and incentivize companies to offer internships, creating a pipeline of skilled workers.

Looking ahead, the relevance of traditional undergraduate education is under threat. The rise of artificial intelligence (AI) is automating tasks that once required years of study. In 20 or 30 years, the value of a four-year degree may be questionable if AI continues its trajectory. Nepal’s education system must adapt by integrating emerging technologies like AI and blockchain into curricula. Unfortunately, the government’s slow response to these global trends leaves Nepal unprepared. Without proactive reforms, we risk producing graduates who are obsolete before they even enter the workforce.

Speaking of emerging technologies, how can Nepal capitalize on trends like AI, blockchain, and cryptocurrency, and what policy reforms are needed to support these innovations?

Entrepreneurs drive innovation, but they need a supportive environment to succeed. Look at Dubai or the US—AI, blockchain, and other technologies are thriving because starting and scaling businesses is straightforward. Tax policies are flexible, allowing deductions for legitimate expenses, and raising capital is hassle-free.

In Nepal, the opposite is true. Tax authorities scrutinize every deduction, and valuations for startups are met with suspicion. If I start a company with $200 and it’s valued at $10 million the next day, no one in the US questions it. In Nepal, tax officials demand explanations, stifling growth.

The government must liberalize corporate structures, simplify tax policies, and ease restrictions on capital flow. For example, allowing startups to deduct expenses and streamlining foreign investment processes would attract global capital. Instead, Nepal’s bureaucracy punishes entrepreneurs, with officials often viewing success with disdain. The lack of a reliable judicial system further deters innovation—investors fear fraud because courts are slow and susceptible to corruption. Until the government creates a policy framework that empowers entrepreneurs, Nepal will lag behind in AI, blockchain, and other cutting-edge fields.

Nepal’s startup ecosystem is still developing. As an investor and entrepreneur, what are the biggest gaps, and how can the public and private sectors address them?

Nepal’s startup ecosystem is, frankly, a work in progress. Investors lack basic protections, unlike in countries where investor rights are prioritized. In Nepal, moving capital in and out is a bureaucratic nightmare—endless paperwork and visits to multiple offices discourage foreign investment. The judicial system is another weak link; cases can drag on for years, and corruption erodes trust. Without a reliable legal framework, investors won’t take risks.

The private sector must foster mentorship and collaboration, but the government’s role is critical. It needs to simplify business registration, protect investors, and reduce red tape. Programs like Nepal’s version of ‘Shark Tank’ are well-meaning but often superficial, showcasing “entrepreneurs” who are merely traders importing goods from China or selling cars. True entrepreneurship—creating products like software or hardware locally—is rare because the government fails to differentiate between traders and innovators. Policies must target genuine innovators with incentives like tax breaks or access to global markets. Until then, Nepal’s startup culture will remain underdeveloped.

For young Nepali IT entrepreneurs with global ambitions, what advice would you offer to help them break into international markets?

Going global requires patience, persistence, and partnerships. I believe in the 10,000-hour rule—five years of consistent effort to master any field. For Nepali IT entrepreneurs, the key is finding global partners who understand the target market’s culture and sales dynamics. Technology alone isn’t enough; you need someone who can sell your product in the US, Japan, or Europe. Setting up an office abroad or partnering with local executives is essential. Nepal’s small size and proximity to India make branding a challenge, but with the right partnerships and a focus on quality, Nepali startups can carve out a niche.

The government could play a role by funding trade missions or creating platforms to connect startups with global investors, but such initiatives are nonexistent. Young entrepreneurs must also focus on building a strong brand—Nepal’s lack of recognition in global IT markets means extra effort is needed to stand out. Consistency and strategic partnerships are the keys to success.

Nepal’s proximity to India, with its millions of IT professionals, poses a challenge. How can Nepal differentiate itself and attract global companies?

Nepal’s proximity to India is both a challenge and an opportunity. India’s IT industry is a juggernaut, producing millions of graduates annually. Nepal, with its smaller population and weaker education system, struggles to compete. Big companies won’t come here if we can’t provide a skilled workforce. The government’s failure to regulate education quality is a major issue—affiliated colleges– are essentially degree mills, selling credentials that don’t hold up globally. Only a few institutions, like Pulchowk Campus under TU, maintain some credibility.

To differentiate, Nepal must focus on quality over quantity. Producing 100,000 skilled IT graduates annually, backed by practical training and internships, would create a compelling value proposition. The government should also promote Nepal as a cost-effective alternative to India, with streamlined policies to attract foreign investment. Right now, bureaucratic inefficiencies and a lack of trust in institutions make Nepal unattractive. Without bold reforms, we’ll remain in India’s shadow.

You’ve built and sold successful companies in Nepal, yet you seem deeply frustrated with the system. What keeps you here, and how do you navigate these challenges?

The system in Nepal is broken, and I’m beyond frustrated. Let me share a personal example: my company, Deerwalk Auto Services, was fined 5,000 rupees for a fraudulent VAT bill issued in our name, despite no involvement. The tax office dismissed our evidence, forcing us to pay and pursue a court case that’s dragged on for three years.

When a journalist investigated, officials mocked us, saying, ‘Go tweet Rudra Pandey.’ This arrogance is pervasive—government officials often view entrepreneurs as criminals, not contributors. The bureaucracy is a labyrinth, with endless hurdles for basic processes like repatriating profits.

I stay because I love Nepal. I grew up here, and I believe in its people. Nepalis are hardworking and resilient, but they’re held back by a government that prioritizes control over progress. Navigating this system requires patience and workarounds—relying on strong management teams and building a brand that attracts talent despite the chaos. But it’s exhausting. Every entrepreneur I meet shares this frustration, and many are tempted to leave. My hope is that by continuing to build and innovate, we can pressure the government to change, but it’s an uphill battle.

What specific reforms should the government prioritize to unlock Nepal’s IT potential and support entrepreneurs like yourself?

The government must shift from being a gatekeeper to a facilitator. First, reform the education system to produce skilled IT graduates through applied learning and internships. Second, liberalize tax policies—allow deductions for legitimate expenses and stop questioning startup valuations. Third, simplify capital flow regulations to attract foreign investment. Fourth, strengthen the judicial system to protect investors and ensure swift action against fraud. Countries like Dubai and the US thrive because they make it easy to start, scale, and close businesses. In Nepal, every step is a struggle.

The government’s inaction is a betrayal of Nepal’s youth and their aspirations. If it fails to act, the brain drain will worsen, with talented Nepalis leaving for better opportunities abroad. The stakes are high—Nepal has the potential to be a global IT hub, but only if the government stops hindering progress and starts empowering its entrepreneurs.

@Fiscal Nepal