Internet Issues in Nepal: A Clash Between Government and ISPs

Nepal, a country nestled in the Himalayas, faces significant challenges in its internet infrastructure. The struggle between private internet service providers (ISPs) and the government has led to disruptions, affecting citizens and businesses alike. Let’s explore the key issues, consequences, and potential solutions.

The Disruption

Recently, broadband internet services were disrupted in many parts of Nepal¹². The root cause? Indian vendors, from whom most Nepali private operators source bandwidth, stopped providing services due to payment defaults¹. Private ISPs issued notices, citing disruptions or slow connections. Meanwhile, the state-run Nepal Telecom continued to provide internet services, albeit with challenges.

Why the Payment Defaults?

The heart of the issue lies in foreign currency. Nepali ISPs have struggled to pay Indian vendors for months because the government hasn’t facilitated foreign currency exchange¹. The government’s stance is clear: ISPs must first clear taxes on certain services before receiving foreign currency. However, private companies argue that they are exempt from these taxes.

Consequences of Disruption

1. Educational Impact: Students relying on online learning faced difficulties.
2. Business Disruptions: Companies, especially those dependent on digital services, suffered.
3. Healthcare Challenges: Telemedicine and health-related services were affected.
4. Communication Hiccups: Slow internet speeds hindered communication.

Solutions and the Way Forward

1. Government Cooperation: The government should facilitate foreign currency exchange promptly.
2. Tax Clarity: Clear guidelines on tax exemptions for ISPs can prevent future disputes.
3. Public Awareness: Educate citizens about the importance of stable internet services.
4. Private Sector Resilience: ISPs should explore alternative solutions during disruptions.

Conclusion

Nepal’s internet issues are not isolated incidents. They reflect broader challenges in balancing economic interests, taxation, and public welfare. As the country marches toward digital transformation, collaboration between the government and ISPs is crucial. Let’s hope for a smoother online experience for all Nepalis!