Nepal has been jolted awake by its youngest political force: a Gen Z uprising against corruption and inertia. Their movement has reshaped the national landscape, ushering in a caretaker government under former Chief Justice Sushila Karki with a single, limited mandate – to guide the country to elections within six months. The symbolism is powerful: a generation demanding integrity has placed at the helm a leader known for it. Now the next 180 days should be about discipline, steadiness, and confidence.
This is not a long horizon, nor is it a blank check. The mission is narrow but, in many ways, very profound: stabilize, restore, and prepare. Nepal’s institutions have been tested by political collapse and social upheaval, but the greater test now lies ahead: can the state avoid erosion of trust and earn back confidence in markets, households, and the international community in these 180 days? The answer depends not on grand slogans or new blueprints, but on disciplined execution of a simple idea – a financial firebreak.
A firebreak, in forestry, is a deliberate clearing that stops flames from spreading, buying time for regrowth. For Nepal, it means a set of urgent, visible actions that insulate the economy from further damage and signal that the system still works. The firebreak does not solve every structural problem. It does not regrow the forest. But it creates the breathing space for recovery and hands the next elected government a platform of stability rather than ashes. In a nation shaken by crisis, confidence itself becomes the currency. Families spend when they believe prices will be steady. Banks lend when they believe clients will repay. Donors and investors engage when they see coherence rather than chaos. Restoring that belief is the real work of the next six months.
The first forty-five days are critical. They will decide whether the crisis deepens or begins to ease. So, protect the core, pause the rest. Nepal should focus on following five things: (i) Budget Reordering (ii) Banking and Insurance Stability (iii) Wage & SME Support (iv) Foreign Reserve Discipline, and (V) Festival management.
Nepal must start with triage, not theater. The budget is already constrained, with limited fiscal room for expansion. Every rupee must stretch further than before. That means freezing or deferring programs that do not touch daily life and redirecting funds toward essentials. Local governments need cash to keep lights on and services running. Families need assurance that incomes will not vanish. Small businesses need working capital to reopen their doors.
The banking and insurance sector is another early front. While deposits remain intact, stress is building in loans to small and mid-sized businesses battered by a week of closures and damage. The central bank must quietly but firmly require stress tests, and where liquidity gaps appear, provide refinancing windows out of public view. Insurance regulators must coordinate with banks so that claims for destroyed property are honored without cascading insolvencies. Boring stability is the goal: no panic, no headlines, no queues. In crises, what does not happen is often as important as what does.
Jobs and wages must be protected as well. More than four-fifths of Nepal’s workforce is informal, which means traditional safety nets do not catch them. A caretaker government cannot build a new welfare state, but it can design a simple wage bridge for the most affected areas. Using municipal records and existing digital wallets, partial payroll support can reach workers quickly. Even a modest subsidy, if on time, prevents layoffs and sustains consumption. In parallel, short-term working capital lines for small businesses can be offered with limited state risk-sharing. The objective is simple: freeze the freeze. Keep firms afloat until activity resumes.
Timing matters most during the festival season. Dashain and Tihar, normally the heartbeat of the retail economy, arrive as both risk and opportunity. If households have no cash, frustration could reignite unrest. If prices surge unchecked, trust collapses again. The government must pre-position food and fuel, front-load pensions and transfers, and hold utility prices steady through the holidays. A well-timed intervention — even small — can turn the festivals into a moment of uplift rather than anger. Confidence is often less about scale than about visible, reliable delivery.
By the end of forty-five days, Nepal should aim for one outcome: normalcy in daily economic life. Shops open, wages flowing, banks lending, festivals celebrated without shortage. Achieving this does not require miracles. It requires focus, speed, and communication. If people see the basics functioning, the firebreak begins to hold.
The second phase, from day forty-five to ninety, is about deepening trust. Stabilization without credibility is a false dawn. There are 4 key things to consider – (i) Household Financial Health (ii) Business Confidence (iii) International Credibility (iv) Bureaucratic Discipline.
Households must believe that the chaos will not return next week. That means predictability. A weekly “price and policy bulletin,” delivered consistently across radio, television, and social media, can assure citizens that essential prices will remain steady and no sudden taxes or fuel hikes are planned. People do not expect miracles; they expect no new shocks. Predictability itself is policy, and when expectations settle, spending resumes.
For businesses, confidence rests on breathing room. Fear of credit collapse can be as damaging as the collapse itself. If firms believe banks will cut them off, they preemptively stop borrowing or even default. If banks fear rising defaults, they tighten further. This vicious cycle must be broken. A three-month rollover of loans, paired with temporary regulatory forbearance, provides that breathing space. Coupled with a brief suspension of aggressive tax enforcement, it tells entrepreneurs: stay open, stay solvent, we are not here to punish. By keeping credit flowing, the backbone of the economy remains intact.
International credibility also matters in this window. Donors, lenders, and rating agencies do not expect instant reform, but they do expect coherence. Start publishing a simple fiscal governance dashboard at least at a monthly cadence, showing where funds are flowing demonstrates transparency. Coordinated updates on remittances, reserves, and revenue reassure partners that the government is not hiding its books. Even more important is signaling integrity. The protests were against corruption; to ignore that demand would squander the moral force of the moment. Accelerating prosecution of one or two high-profile investigations would show that no one is above the law. These are not witch-hunts, but proof of seriousness. The world is watching, and so are Nepal’s own citizens.
Yet even the best designs can be undone by inertia. Bureaucratic drift is a silent killer. Without urgency, plans dissolve into memos and meetings. To counter this, the caretaker team should publish a short scorecard of critical actions – a handful of promises made visible and time-stamped. As each is delivered, check it off. Citizens will see progress, and civil servants will feel pressure to act. This is less about slogans and more about tempo. Confidence erodes when announcements are not matched by delivery.
Guard Rails against Disaster Capitalism (the Shock Doctrine) is Vital. Focus on (i) having a Sovereignty Filter (ii) No Fire Sale of Assets (iii) Transparency (iv) Diaspora Capital as Shield.
History shows that crises invite opportunism. Quick loans with long strings, rushed concessions of hydropower or airports, and quiet privatizations can mortgage the future for short-term relief. Nepal must resist. Any major agreement during this period should be reviewed under a sovereignty filter: does it create unsustainable liabilities, cede control of strategic assets, or lack transparency? If so, pause. If urgent, build consensus. Strategic resources – rivers, grids, airports, digital networks – should NOT be traded under duress.
Transparency is the antidote. Commit to publishing major contracts and loans within days of signature. Sunlight deters predation and ensures that the next government can adjust terms if needed. And rather than turning outward for quick fixes, Nepal can look inward to its greatest untapped asset: the diaspora. Remittances already sustain the economy; structured properly, diaspora bonds or co-investment vehicles can provide capital without compromising sovereignty. Inviting Non-Resident Nepalis to invest in recovery is both patriotic and prudent. It shields the nation from predatory capital while signaling self-reliance. The objective is to see this as a co-investment opportunity to participate in Nepal’s future and NOT a cry for help!
Execution is what will define the firebreak. Plans mean little if ministries drift back into silos. A small economic war room under the Prime Minister’s Office can coordinate daily across finance, foreign affairs, central banking, supply ministries, and local governments. Its task is simple: track a handful of vital signs – liquidity, remittances, revenue, prices, wages – and act quickly when they flash red. Publish a concise weekly dashboard to show citizens the economy’s pulse. No new bureaucracy, no new law, just disciplined coordination.
In the final ninety days, the emphasis should shift subtly from defense to preparation. The panic will have passed, but the election horizon will draw closer. The caretaker government cannot launch sweeping new programs, but it can prepare the ground. Refocus on already-funded, labor-intensive projects such as road maintenance or irrigation repairs putting cash into communities and absorbing labor. Nudging more transactions onto digital rails builds transparency and inclusion without new mandates. Most importantly, drafting ready-to-implement policies – from diaspora bonds to SME securitization pilots – ensures the next elected government inherits not only stability but also a head start.
A clean fiscal handover will be a mark of maturity. Before elections, the Finance Ministry should publish a clear summary: what was reallocated, what remains committed, what liabilities are deferred, and what forecasts are realistic. No surprises, no hidden traps. Handing over clarity is as important as handing over stability. It tells citizens and partners alike that Nepal’s institutions can function even in transition.
The payoff of this 180-day firebreak is not measured in GDP points or budget lines. It is measured in trust. If families believe prices will hold, if entrepreneurs believe credit will flow, if donors believe the government is transparent, confidence grows. And once confidence grows, investment, consumption, and growth follow naturally. It is the cheapest and most powerful stimulus. But it is not gifted; it is earned.
Nepal’s Gen Z demanded honesty. The caretaker government now has the chance to demonstrate competence. Every fulfilled promise, however small, adds a brick to rebuilding trust. Every missed promise chips away at it. The task is not to impress with vision, but to deliver with discipline.
If done well, the story Nepal tells in six months will be remarkable. A youth-led revolution, answered not with chaos but with steady stewardship. An interim government that stayed within its mandate yet left the country stronger. A society that stared into crisis and built a bridge across it. The new government elected next year would then inherit not collapse but a platform: banks stable, shops open, jobs preserved, plans prepared. That is no small gift.
The world will measure Nepal not by how loudly it spoke in the streets, but by how calmly it governed after. Our neighbors, partners, and citizens will watch whether we can turn protest into progress. And the answer, if discipline holds, can be yes.
Confidence is not decreed. It is earned through consistent action, through honesty, through delivery. Over the next 180 days, Nepal must earn it day by day. If we do, when history records 2025, it will not tell the story of collapse. It will tell of a courageous generation, a disciplined government, and a nation that chose confidence over despair
(The author is a New York-based global banking executive with deep expertise in finance and capital markets. The views expressed here are his own – Editor.)
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