By Dr. Janardan Subedi--------------------
In a healthy democracy, power flows through visible institutions—parliaments, courts, public offices—guided by laws and public mandates. But in Nepal, the democratic façade hides a complex system of informal and deeply entrenched power: the deep state. More than just a conspiracy or shadow entity, Nepal’s deep state is a sophisticated collusion of actors across politics, business, bureaucracy, security, media, and foreign interests. It quietly shapes every aspect of public life, from who wins elections to who gets jailed—or protected.
The deep state in Nepal is not one institution but a parasitic ecosystem. It comprises senior political leaders—most notably KP Sharma Oli, Sher Bahadur Deuba, and Pushpa Kamal Dahal (Prachanda)—who have converted political power into personal estates. These leaders no longer represent ideology or public service but operate as gatekeepers of a cartelized state, where decisions are made not in parliament, but in private drawing rooms.
At the core of this ecosystem lies the incestuous relationship between big business houses, political parties, and the banking sector. A few major conglomerates dominate Nepal’s construction, energy, finance, import-export, and real estate industries. Their owners maintain direct ties with top political leaders, often funding electoral campaigns in exchange for favorable contracts, tax waivers, or legislative loopholes. These businesses are not just economic actors—they are political agents.
Take, for instance, the explosion of hydroelectric projects and infrastructure tenders awarded to politically connected contractors, many of whom double as lawmakers. The economy is not open; it is captured. Licensing, market entry, and even access to loans are controlled by a closed circuit of elites. The daily economic lives of Nepali citizens—from the price of cement and fuel to the quality of roads and public services—are all shaped by this deep alliance.
The banking sector, too, is enmeshed in this deep structure. Prominent bankers sit on government advisory panels, influence monetary policy, and finance the campaigns of preferred candidates. Their influence has been visible in the periodic liquidity crises and regulatory rollbacks, which always seem to benefit a select few. Nepal Rastra Bank, meant to be an autonomous institution, often bends under political and business pressure.
A case in point is the current appointment of the Governor of Nepal Rastra Bank, who is a known cadre of the Nepali Congress. He previously ran for parliament representing Sher Bahadur Deuba and his wife Arzu Rana Deuba. His loyalty lies not in upholding institutional autonomy or regulatory integrity, but in serving his political and business patrons. Far from being an independent governor, he functions as a humble and loyal servant of his masters—symbolizing how even the nation’s central bank has been compromised by the deep state.
This control extends to the media. The so-called “free press” in Nepal is largely owned or influenced by business houses aligned with major parties. A handful of media owners set the national discourse, shielding powerful actors from scrutiny while manufacturing consent for elite decisions. Critical journalism is either co-opted through patronage or silenced through intimidation and character assassination. Headlines are not news; they are negotiations.
One of the most tragic elements of the deep state is the role of Nepal’s intellectual class. Instead of standing as a moral compass, many so-called public intellectuals have become ideological mercenaries. Their columns, lectures, and speeches serve those in power, not the public good. Some lobby for ambassadorial or academic positions; others tailor their research and advocacy to suit donor priorities or political masters. In essence, they function like intellectual prostitutes—educated, and eloquent, but ethically compromised.
These intellectuals inspire others not toward public service or academic honesty, but toward strategic opportunism. The reward system in Nepal no longer favors knowledge or truth; it rewards loyalty, sycophancy, and the ability to navigate elite networks. This undermines the soul of education and destroys independent thought—the lifeblood of any democratic society.
Even civil society is not spared. While NGOs and INGOs were once vehicles of empowerment, many now act as extensions of donor agendas or elite interests. They conduct “dialogues” and “capacity building” exercises that rarely translate into structural change. In many cases, they absorb the most energetic youth into bureaucratic routines, away from activism and toward technocratic compliance.
One must also recognize that the deep state in Nepal is upheld not just by political and business actors, but by the highest levels of the state’s coercive and administrative machinery. Top officials in the Nepali Army, Nepal Police, and Armed Police Force—as well as senior bureaucrats—are key members of this network. These individuals are expected to serve the constitution and citizens, yet they often act on instructions from political patrons rather than uphold institutional integrity. Instead of protecting national interests, they enable the preservation of elite impunity. Whether it’s suppressing protests, manipulating investigations, or stalling reforms, their allegiance lies with the deep state structure, not the people they are meant to serve.
The judiciary, another crucial pillar of democracy, is equally compromised. High-profile cases involving top leaders—whether it’s the cooperative scam, the refugee trafficking scandal, or the Baluwatar land grab—have either stalled or quietly disappeared. Judges are appointed not solely based on merit, but based on party quotas or loyalty. Selective justice and impunity have become normalized.
Intelligence agencies, too, serve political interests more than national security. Surveillance is directed not at foreign threats, but at internal dissenters, journalists, whistleblowers, and opposition figures. Intelligence files are often used as tools of blackmail or bargaining. The absence of legislative oversight ensures these agencies operate in opacity.
The impact of Nepal’s deep state is profound and multi-dimensional:
- Erosion of public trust in democratic institutions and legal processes
- Youth alienation, as many feel politics is irredeemably corrupt and seek migration instead
- Policy paralysis, where short-term populism overrides long-term planning
- Judicial compromise, as seen in politically influenced verdicts and selective prosecutions
- Stifling of reform movements through co-optation, surveillance, or intimidation
Challenging the deep state requires more than slogans. It demands a multi-pronged strategy:
- Strengthen democratic institutions with independent appointments, fixed tenure, and public oversight
- Enforce anti-corruption laws uniformly, especially against high-level political figures
- Promote investigative journalism and protect whistleblowers
- Reform the intelligence sector, establishing parliamentary oversight and civilian control
- Reclaim civil society by promoting citizen-led movements, not donor-fed compliance
- Restructure party financing, banning corporate donations and improving transparency
- Reinvigorate public education and critical thinking in universities and schools
Nepal’s democracy is not only weakened by visible corruption but also by invisible power structures that operate through collusion, manipulation, and moral compromise. The deep state in Nepal is not a fantasy—it is a structural reality, enabled by elite impunity, foreign interference, business capture, and intellectual servitude.
To reclaim the democratic promise of 1990, and again of 2006, we must expose, critique, and dismantle the hidden architecture of unaccountable power. Until then, our elections will change leaders, but not the system.
A democracy ruled by invisible hands is no democracy at all. It is time to confront the deep state—before it buries the republic entirely. @with PW
