Soon after the removal of a minister on disciplinary grounds from Nepal’s new government led by Balendra Shah, reports from Kathmandu now report financial irregularities allegations against another.
The Rastriya Swatantra Party (RSP) assumed power with a landslide victory in the national election held on March 5, with promises of good governance, transparency, and people-oriented politics.
“Following reports of Home Minister Sudan Gurung’s investments that put him alongside businessman Deepak Bhatta, who is under investigation for money laundering, leaders within the ruling party are demanding a fair investigation,” The Kathmandu Post reported.
Bhatta was arrested on April 1 and is being investigated by the Department of Money Laundering Investigation after being detained by the Nepal Police’s Central Investigation Bureau, the report added.
“Two weeks ago, the RSP recalled Labour Minister Deepak Kumar Sah following controversy over the appointment of his wife to the Health Insurance Board. Party insiders say it cannot remain silent now that more serious allegations have surfaced against Gurung,” it noted.
Sah was removed from office after the RSP’s central disciplinary commission found he had misused his position to keep his wife on the Health Insurance Board, a move the party said undermined its image and discipline.
The Prime Minister acted on the party chair’s recommendation and dismissed Sah.
Gurung is under scrutiny after reports linked him to shareholdings in companies associated with a businessman under investigation for alleged money laundering.
The Home Minister, however, defended his asset declarations, saying his stock investments were disclosed and that any apparent omission was a matter of classification rather than concealment. His investments in Star Micro Insurance and Liberty Micro Life, he clarified, fall under the same share category as his other stock market holdings and are included accordingly in his declaration, according to The Himalayan Times.
“Someone who intends to hide assets does not openly declare over Rs 20 million in investments,” the report quoted the minister as saying.
An unnamed RSP lawmaker told Nepali daily Kantipur that “Sah was sacked without allowing him to clarify. Allegations against the Home Minister are more serious,” later adding: “No wrongdoing should be covered up. It should be investigated through a proper mechanism.”
Reports added that the issue, however, was not discussed at Monday’s Central Committee meeting, with leaders saying it was not on the agenda. Party spokesperson Manish Jha told the media that the leadership’s attention had been drawn to the matter and that consultations were underway.
The Sah dismissal shows the RSP is willing to act swiftly on internal findings to protect its image. That decisiveness can be politically useful, signalling zero tolerance for nepotism. But rapid expulsions without a transparent, public process risk perceptions of selective enforcement or internal politicking. The party’s reliance on internal disciplinary mechanisms will be tested if calls grow for independent probes rather than party-led actions.
The RSP assumed office riding on the popularity and trust of Gen Z protestors who toppled the K. P. S. Oli government in September 2025, alleging unemployment, nepotism, corruption, and its perceived indifference towards their future.
