Investors in Panic as Crackdown Continues
June 19, Kathmandu – About a month and a half ago, Anjan Shrestha, the newly elected president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), remarked, “If the world’s richest person Elon Musk worked in Nepal, he would end up in jail.” This statement came as the government began cracking down on countless industrialists and entrepreneurs on various charges, causing concern within Nepal’s largest private sector organization. Investors were initially very optimistic following the formation of a strong government backed by nearly two-thirds majority of the Nepali Rastriya Swatantra Party. However, this enthusiasm was shattered in a very short time. Even after the government’s first 100 days, the entire private sector remains fearful.
Following the government’s formation, the morale of the private sector has significantly weakened due to the ongoing crackdown on individual industrialists, traders, construction business owners, and contractors, who have been largely ignored by officials. On March 26, 2026 (Chaitra 13, 2082), after Balendra Shah was sworn in as Prime Minister, businessman Deepak Bhatt was arrested on March 31 (Chaitra 19) on charges of irregularities in share trading and in Himalayan Reinsurance Company. Subsequently, industrialist Shankar Agrawal was also detained. Since his son, Sulabh Agrawal, was not in the country at the time and could not be apprehended, Shankar was arrested and held in custody. However, despite the government’s filing of cases in court, no crimes have been proven against Shankar Agrawal, and no legal proceedings are currently underway against him.
After Sulabh Agrawal was arrested, the government relieved Shankar. Then, former FNCCI president Shekhar Golchha was also detained, but the court released him on bail requiring him to appear regularly. The continuous crackdown on industrialists, traders, construction entrepreneurs, and contractors has dampened the spirit within the private sector. The government’s approach of detaining businessmen first and listening later has sparked widespread opposition. All private sector organizations jointly protested these actions.
On May 23 (Baisakh 10), following the detention of former president Golchha, the FNCCI, the Industrial Federation, and the Nepal Chamber of Commerce jointly released a statement on May 24 (Baisakh 11), advising that the government should listen first rather than arresting businessmen outright, and cautioned against detaining without proper hearings. Despite this, the crackdown on traders and entrepreneurs continues unabated. On May 12 (Baisakh 29), the Chief Executive Officer of Nepal Investment Mega Bank, Jyotiprakash Pandey, was arrested by the Criminal Investigation Bureau. He was taken into custody over allegations of selling government property during the auction of assets pledged by Smart Telecom. However, the court later released Pandey on bail requiring his regular appearance.
The arrests and subsequent releases of Golchha, Agrawal, and Pandey highlight the need for transparency in legal proceedings. The ongoing crackdown has created unrest within the private sector. An official from the Federation, speaking on condition of anonymity, said, “Please do not publish my name; the government may arrest me, too.” He added, “The government’s approach has discouraged existing investors from making new or additional investments. The tendency to label entrepreneurs as criminals has weakened the private sector’s confidence.”