Nepal’s Tourism Potential Stalled by State Apathy, Safety Gaps, and Policy Inertia

Nepal’s tourism sector continues to underperform despite its immense natural and cultural advantages, largely due to weak state facilitation rather than a lack of private initiative. Natural disasters such as floods, landslides, earthquakes, and recurring aviation accidents have repeatedly disrupted tourism growth, but deeper structural and policy failures have compounded the damage. Instead of acting as a facilitator, the state apparatus is often accused of constraining the sector through indecision, poor governance, and inconsistent priorities.

Among the most persistent challenges facing tourism is safety—particularly in aviation and road transport. Nepal’s difficult terrain and unpredictable weather already pose natural risks, but inadequate infrastructure, outdated navigation systems, and weak weather forecasting have magnified those risks. Frequent air accidents have eroded international confidence, discouraging visitors from travelling beyond major hubs and limiting the dispersal of tourism benefits across the country.

Several high-profile aviation incidents have left lasting scars on Nepal’s tourism image. Accidents within the premises of Tribhuvan International Airport itself, including fatal crashes and runway mishaps, have raised serious concerns about aviation governance. The repeated closure of the country’s only fully operational international airport following incidents has highlighted the absence of functional alternatives and emergency preparedness. These disruptions not only endanger lives but also signal systemic weaknesses to the global travel market.

Falling Behind Regional Competitors

While Nepal struggles to regain momentum, neighbouring and regional competitors have surged ahead. Countries such as India and Thailand have rapidly expanded tourist arrivals, leveraging infrastructure, connectivity, and aggressive promotion. Nepal, by contrast, remains trapped in modest recovery numbers even years after the pandemic, failing to capitalise on renewed global travel demand.

Although tourist arrivals have improved compared to pandemic lows, the pace remains far below potential. At a time when comparable destinations are attracting tens of millions of visitors annually, Nepal continues to hover around one million visitors a year. This stagnation reflects not a lack of attractions, but an absence of strategic planning and execution.

Untapped Economic Multiplier

Tourism has one of the highest employment multipliers in the economy. Each tourist arrival can support multiple direct and indirect jobs across transport, hospitality, agriculture, handicrafts, and services. In an economy facing declining activity in traditional sectors, tourism remains one of the few industries capable of delivering rapid, inclusive growth with relatively modest capital investment.

Experts argue that Nepal should already be aiming for several million tourists annually, with tourism contributing a double-digit share to GDP. Achieving this would significantly ease unemployment pressures, boost foreign exchange earnings, and stimulate domestic demand. However, realising such gains requires a fundamental shift in how tourism is governed and prioritised.

Private Sector Leads, State Lags

Tourism development in Nepal has largely been driven by private entrepreneurs—hotels, trekking agencies, airlines, and adventure operators—who take the initial risks of attracting visitors. The state’s role, ideally, should be to ensure safety, connectivity, and policy stability. Instead, tourism often remains a secondary priority within government planning and budgeting.

Institutional neglect is reflected in the low political priority accorded to tourism-related ministries. Frequent leadership changes, political appointments, and a lack of sectoral expertise have weakened long-term planning. As a result, tourism policy often reacts to crises rather than preventing them.

Infrastructure Bottlenecks Undermine Growth

Inadequate infrastructure remains a major constraint. Despite heavy investment, international airports in Pokhara and Bhairahawa have yet to operate at full capacity. The inability to attract regular international flights has raised concerns about financial sustainability and debt servicing, particularly for infrastructure built using foreign loans.

Road connectivity to major tourist destinations is equally problematic. Poorly maintained highways, frequent disruptions due to landslides, and slow expansion of strategic corridors limit tourist mobility. These constraints reduce length of stay, increase costs, and deter repeat visits.

National Carrier in Chronic Distress

Nepal’s national airline has failed to play a meaningful role in tourism promotion. Persistent political interference, weak management, and outdated business models have reduced its market share to a fraction of its former presence. Without a strong national carrier capable of connecting Nepal to major global markets, tourism growth remains dependent on foreign airlines with limited incentive to develop secondary destinations.

The lack of innovation in aviation services, routes, and products further weakens Nepal’s competitiveness. While global tourism markets evolve rapidly, Nepal’s aviation sector remains largely static.

Lost Opportunities at the Local Level

Operational failures often translate into real losses for visitors and local communities. Instances of tourists stranded for days due to flight cancellations, poor coordination, and weak ground infrastructure have damaged Nepal’s reputation for reliability. These experiences, amplified through digital platforms, undermine marketing efforts and discourage future travel.

Tourism development cannot succeed if visitors face repeated uncertainty and inconvenience. Reliability and predictability are as important as scenic beauty in today’s travel decisions.

A High-Return Sector Starved of Support

Tourism is uniquely accessible as an investment sector. Unlike heavy industries, tourism enterprises can be launched with relatively small capital, making them ideal for local entrepreneurship. However, without supportive infrastructure and predictable regulation, even small investors face outsized risks.

Adventure tourism, mountaineering, and cultural travel have already given Nepal global recognition. With modern marketing, digital platforms, and product diversification, these segments could grow significantly. Yet innovation remains constrained by outdated thinking and bureaucratic barriers.

“Let the Private Sector Work”

A recurring sentiment among tourism stakeholders is that the government does not need to provide subsidies or incentives—only space to operate. Excessive regulation, slow approvals, and administrative obstruction have become greater obstacles than financial constraints.

Instead of enabling growth, the state machinery often creates friction, delaying projects and discouraging initiative. This pattern extends beyond tourism, affecting multiple sectors and reinforcing a culture of underperformance.

Roads as Tourism Lifelines

Nepal’s national highways are central to unlocking tourism potential. Expanding and upgrading corridors such as Kathmandu–Muglin, Muglin–Pokhara, Pokhara–Mustang, East–West Highway, Karnali Highway, and the Kathmandu–Nijgadh fast track could dramatically improve access to destinations across the country.

Improved road connectivity would not only boost tourist arrivals but also integrate local economies into the national market, spreading tourism benefits beyond traditional hubs.

Nepal’s tourism stagnation is not a failure of potential but of governance. The private sector has demonstrated initiative, resilience, and creativity, but cannot succeed in isolation. Without safe infrastructure, consistent policy, and competent administration, tourism will remain underutilised.

If the state shifts from obstruction to facilitation—prioritising safety, connectivity, and stability—tourism could emerge as a cornerstone of Nepal’s economic revival. The choice lies not in discovering new destinations, but in removing old barriers.