Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: The Commission for the Investigation of Abuse of Authority (CIAA) has filed a corruption case against Nepal Telecom’s Managing Director, Sangita Pahadi Aryal, and 17 others, alleging financial irregularities in a billing system maintenance contract that caused a NPR 33.48 crore loss to the state. The case, lodged at the Special Court on Sunday, also names former Managing Director Sunil Paudel among the defendants, but no board members are included, according to Special Court Information Officer Yagya Raj Joshi.
The CIAA’s investigation focuses on a contract awarded to Asia Info in December 2023, during Paudel’s tenure, valued at NPR 3.25 billion for five years to maintain Nepal Telecom’s billing system. A board decision on December 8, 2022, approved a four-year maintenance agreement with Asia Info at an annual cost of NPR 65 crore, with an option to extend for an additional year.
The CIAA alleges that continuing the outdated billing system led to significant financial irregularities, estimating a NPR 30 crore misappropriation. The investigation further uncovered NPR 7 crore transferred to a Singapore bank account belonging to the son of a politically influential figure, raising suspicions of high-level involvement.
Nepal Telecom’s reliance on a decade-old billing system, despite transitioning from 3G to 4G and from copper to fiber-optic internet, has led to inefficiencies, with studies indicating an annual revenue leakage exceeding NPR 2 billion. The CIAA contends that the decision to extend the contract without upgrading the system exacerbated these losses, constituting corrupt practices.
The case has sparked public outrage, with calls for accountability in Nepal’s telecom sector. The CIAA’s probe included statements from former Chief Secretary Dr. Baikuntha Aryal, two joint secretaries, and around 30 employees, though only 18 individuals face charges. As Nepal ranks 110th on Transparency International’s Corruption Perceptions Index, this scandal underscores ongoing challenges in curbing corruption. The Special Court’s proceedings are expected to draw significant attention, with potential implications for governance reforms in state-owned enterprises.
Aryal, appointed acting MD in October 2023 after Paudel’s suspension in a prior corruption case, was confirmed as MD in September 2024. Her role now faces scrutiny as the court examines the extent of her involvement in the billing contract decisions. The case highlights systemic issues in Nepal Telecom’s operations, raising questions about transparency and oversight in public sector contracts. (500 words)
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