Corruption in Nepal: Types, Strategies and Solutions

The report analyzes the problem of corruption in Nepal, its types, and strategies to overcome it. It also discusses contemporary problems faced by Nepal and the need for strong laws and transparency in the system.

Running head: CORRUPTION IN NEPAL
CORRUPTION IN NEPAL
Name of the Student
Name of the University
Author Note

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Executive Summary
Developing countries go through a large number of contemporary problems which are required
to be dealt with by the society as a whole in order to ensure that the country marches towards its
economic progress. The given report analyses one such problem named the Corruption in the
developing country of Nepal. In this report, the concept and the depth of the problem was
analyzed which was then followed by the types of corruption analysis as prevalent in the country.
Moreover, the latter half of the report outlines the different strategies with respect to the problem
solving which can be used in Nepal to ensure that the corruption is reduced.

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Table of Contents
Introduction......................................................................................................................................3
About Nepal.....................................................................................................................................3
Contemporary problems..................................................................................................................4
Corruption........................................................................................................................................4
Types of corruption..........................................................................................................................6
Bribery.........................................................................................................................................6
Embezzlement and fraud.............................................................................................................7
Graft.............................................................................................................................................7
Blackmail.....................................................................................................................................7
Abuse of discretion......................................................................................................................7
Strategies to solve them...................................................................................................................8
Conclusion.......................................................................................................................................9
References......................................................................................................................................10

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Introduction
Corporate governance can be rightfully defined as the system of rules as well as the
practices which take place in an organization and the medium using which a firm is controlled
and directed. The main purpose of corporate governance is to balance the interest of the different
parties like the stakeholders, shareholders, management, suppliers, customers and other bodies
like the financiers, government and the community at large (Banjade et al., 2017). However, it
may often be the case that these systems are not well aligned and this may lead to a dis-balance
in the society.
The primary aim of the report is to throw light on the different contemporary problems
which is being faced by various organizations and management in Nepal. The main problem
which has been chosen for the critical discussion is the problem related to corruption. The report
will be following a structured format whereby the corruption as a problem will be discussed and
will be followed by the types of corruption prevalent in the country. Certain strategies to
overcome this problem shall also be provided.
About Nepal
Nepal is a country in South Asia and located near the Himalayas. It has an estimated
population of around 27 million people and is believed to be the 48th largest country by
population. The economic development in the country has been highly complicated and has been
affected by a continuous change in the political scenario of the country (Ghimire, 2017).
However, the country is taking considerable efforts in order to make a progress towards the
sustainable economic growth. However, the country has been going through various challenges
to receive higher economic developments due to its existing corruption in the society. In order to

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improve this system the country has formed a series of five year plans to develop the growth and
economy.
Contemporary problems
There are various contemporary problems being faced by Nepal and although these
problems are quite similar in nature to other countries like violence, drug peddling, trafficking,
environmental problems and corruption. For the purpose of the assignment the problem related to
the corruption has been chosen. Violence and crime is taken to be very common in the country
just like in other developing countries like Brazil and Guatemala (Kathmanupost.ekantipur.com,
2018). It becomes very difficult for the government and other parties as present in the country to
solve these problems and very often a lack of resources results in inefficiency and further
escalates the situation. The different people have strong expectations from the government and
higher authorities to solve these problems but due to corruption, this is often not possible and the
people often feel that they are the victims of their surroundings.
Corruption
Corruption can be rightfully described as a form of dishonesty or criminal activity which
is undertaken by an individual or any company who is empowered with a certain level of
responsibility and is done in order to attain a personal gain. There are many activities which are
existent in corruption but the major form of them is bribery and embezzlement. However, the
most prevalent type of corruption which takes place is political corruption. In Nepal, there have
been various cases of political corruption which takes place on different scales. They either take
place in small favors between few people or takes place on a large scale where a large scam is
involved. Although the corruption and crime can be described as the endemic sociological events
which appear in various frequencies, they take place in all countries, the scale is rather high in

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Nepal (Nepaldemocracy.org., 2018). At present, Nepal is holds the ranking of 122 in the least
corrupted countries list out of 175 countries. This index was taken into consideration in the year
2017 and reached an all-time high in the year 154 in 2011. As there exists a knowledge that
Nepal is a poor country, it is a known fact that the level of corruption has been increasing
considerably.
Figure 1: The corruption range in Nepal
(Source: Tradingeconomics.com., 2018).
In Nepal Corruption can be described as a communicable disease which is easily
transferable. Moreover, the only viable solution for it to raise awareness. Additionally, the chain
of corruption in the country has been is prevalent from the lowest level to the highest level in a
manner such that if it is eliminated, the economy may come to a halt because all the levels of
employees from government to social service are employed in it (Crane and Matten, 2016). In a
recent case which came up, is that a whooping amount of 34 crore 50 lakhs which was kept aside

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for the recruitment of the Nepal police, was lost and thus the relationship of the country with
other countries declined.
Types of corruption
The types of corruption may be essentially described as the different methods of
corruption which are followed in a particular country at large. In the given section, the different
types of corruption which take place in Nepal will be critically analyzed.
Figure 2: The corruption Perception Index 2016
(Source: Kathmanupost.ekantipur.com,2018).
Bribery
Bribery can be essentially described as the improper use of gifts and other monetary
favors in exchange of certain personal gains. The kind of favors given out during this bribery
may vary in nature. Bribery is often done in order penetrate further types of corruption. The case

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of Bribery prevalent in Nepal is quite high (Gardiner, 2017). For smallest of the activities, the
different individuals in the country are required to pay a huge amount of bribes. For example, in
the case of receiving a driving license, the amount of bribe paid is quite high even for the
smallest of the activities.
Embezzlement and fraud
The fraud and embezzlement comprises of activities where the various funds are taken
care of illegally. There are various examples of the particular type of corruption which comprises
of misdirection of people’s fund into shadow companies and skimming of foreign aid money. As
stated earlier, the money set aside for the Sudan recruitment was used for personal uses and
shows how Nepal lags in the particular domain.
Graft
This is a global form of corruption where the individuals or the members of the
government take advantage of their power for their personal gain. The level of governmental
corruption in Nepal is very high and there have been various instances of scams done by high
level politicians.
Blackmail
Blackmails are often referred to as threats which are given to the different people in case
they are unable to provide something in return (Chell et al., 2016). The cases relating to
blackmail have also been very high in the country with respect to the oppression of the lower
classes.

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Abuse of discretion
This kind of corruption can be rightfully defined as the misuse of one`s power and
decision making facilities. For instance, there are various politicians like Baburam Bhattarai and
others who have often considered to be politically incorrect and have made a misuse of their
powers at large.
Strategies to solve them
Therefore, from the above analysis, it can be rightfully stated that the corruption problem
which takes place in Nepal, needs to be resolved adequately (Rose-Ackerman and Palifka, 2016).
It needs to be understood that although corruption cannot be fully eliminated but it can be
controlled till a certain extent. The strategies that can be employed in order to resolve the
corruption in the country have been stated as follows:
1. Implementation of strong laws
Although various laws are prevalent in the country there needs to be a presence of
a set of strict laws in order to deter the people. At present in Nepal, if any company
engages in corruption then they get a punishment of around two years and a fine which is
minimal and this is the reason why the corruption is very high (Bowie, 2017). Hence,
with respect to this if stronger laws need to be implemented with a minimum punishment
of 10 years and larger fines.
2. Secondly there needs to exist a transparency into the system.
One of the methods of doing this is engaging in online systems which shall allow
the company to make the entire system digitalized (Friedrich, 2017). By engaging in this
manner, the government will be successfully able to reduce the corruption to a great
extent and bring about an efficiency in the entire system.

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3. Lastly, another method is a change in the mindset of the people.
The people in Nepal have accepted he corruption as a common pattern but this
should not be the case and in order to bring about the change, it is necessary for them to
change their mindset and see it as a disease which can then be eradicated.
Conclusion
Therefore, from the given analysis it can rightfully be stated that corruption is a
widespread disease present in Nepal. The mere existence of it acts as a barrier for the entire
country and hinders them in their path to prosperity. The report analyzed the contemporary
problems which take place in the country and identified the problem of corruption to be the
largest of them. Moreover, the concept of corruption was then analyzed and the different types of
corruption which exists in the economy of Nepal has been discussed. It can be analyzed that
Nepal holds high ranking with respect to corruption as per the data in 2017 and for this reason,
certain strategies have been recommended which shall assist the country in overcoming this
problem.

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References
Banjade, M.P., Thapa, B.K., Malla, S., Man, R., Ghimire, K.S., Seidman, R.B. and Seidman, A.,
2017. Draft bills and research reports on: reducing judicial corruption and child labor in Nepal.
Bowie, N.E., 2017. Business ethics: A Kantian perspective. Cambridge University Press.
Chell, E., Spence, L.J., Perrini, F. and Harris, J.D., 2016. Social entrepreneurship and business
ethics: Does social equal ethical?. Journal of business ethics, 133(4), pp.619-625.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Della Porta, D., 2017. Corrupt exchanges: Actors, resources, and mechanisms of political
corruption. Routledge.
Friedrich, C.J., 2017. Corruption concepts in historical perspective. In Political Corruption (pp.
15-24). Routledge.
Gardiner, J., 2017. Defining corruption. In Political corruption(pp. 25-40). Routledge.
Ghimire, D.K., 2017. Social Aspects of Political Corruption: A Case Study of Nepal. Madhya
pradesh journal of social sciences, 22(1), p.53.
Kathmanupost.ekantipur.com,2018. Nepal and Corruption. . [Online]. Available at:
http://kathmandupost.ekantipur.com/news/2017-01-26/nepal-ranked-as-third-most-corrupt-
country-in-sasia.html (Accessed on: 23 Sept. 2018).

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Nepaldemocracy.org., 2018. Civic Education. [Online]. Available at:
http://www.nepaldemocracy.org/civic_education/civics/civicedu_chap2.html (Accessed on: 23
Sept. 2018).
Rose-Ackerman, S. and Palifka, B.J., 2016. Corruption and government: Causes, consequences,
and reform. Cambridge university press.
Tradingeconomics.com., 2018. Corruption Rank. [online]. Available at:
https://tradingeconomics.com/nepal/corruption-rank (Accessed on: 23 Sept. 2018).