A close look at Nepal’s planned AI policy
On what the planned National AI policy gets right and wrong
Good morning, good afternoon, and good evening from Kathmandu. This is Issue 175 of KALAM Weekly, the only newsletter you need to keep updated with everything happening in Nepal.
A big thank you to my newest paid supporters, Dhirendra Nalbo, Vijay Anand Vaidya, and one unknown supporter who paid over eSewa. Please reach out to me if you have paid over eSewa as it doesn’t provide me with your details and I am unable to thank you personally and provide you with the perks that come with a paid subscription. Thank you so much for your support. I hope you will continue to enjoy this newsletter.
In this newsletter:
Second Kalam live event with Dr. Thomas A Marks
Government and Mukkumlung protestors sign deal
Internet goes down across Nepal
The Duke of Edinburgh visits in Nepal
Recommendations
The deep dive: A close look at Nepal’s planned AI policy
Second Kalam live event with Dr. Thomas A Marks
February 13 marks the date when the Maoists formally launched their “People’s War,” plunging the country into civil conflict for 10 years. This year, to reflect on the origins and legacy of the conflict, I will be speaking virtually with Dr. Thomas A Marks, Distinguished Professor & MG Edward G. Lansdale Chair of Irregular Warfighting Strategy at the College of International Security Affairs of the National Defense University in Washington, DC. Dr. Marks is an expert on guerilla and irregular warfare and has extensively studied the Nepali Maoist conflict. His research includes female combatant motivation in the Maoist insurgency and on intelligence services during the conflict. He has a chapter on this latter subject in the upcoming book Intelligence Services in South Asia: Colonial Past and Post-Colonial Realities.
This is the second Kalam live event after my conversation with Bhrikuti Rai, journalist and founder of the BojuBajai podcast, in December last year. We hope to hold more of these events, so stay tuned!
I hope to have an illuminating conversation with Dr. Marks about his interest in Nepal, his expertise in terrorism and irregular warfare, and, generally, the Maoist conflict. The discussion will be held over Zoom on February 13, 6.30 pm Nepal time. This event is specially for our paid subscribers, so if you’d like to join us, please consider pledging a paid subscription. More details on being a subscriber can be found here. All paid subscribers will receive a separate email with a link to register. If you don’t receive a link as we get closer to the date, please reply to this email and we will get you sorted.
If you would really like to attend but are unable to pledge a paid subscription, please just reach out to me. I am happy to make it work for you. This goes especially for students.
Government and Mukkumlung protestors sign deal
On Tuesday, February 4, activists from the Mukkumlung Protection Struggle Committee and government representatives reached a deal regarding the ongoing protests over the planned cable car to Mukkumlung/Pathibhara Temple in Taplejung district. The cable car project, to be built by IME Group, had faced stiff opposition from members of the local Yakthung Limbu community, who argued that the cable car would harm their cultural and religious sentiments. Limbus follow the Mundhum, which holds many trees, rocks, and hills sacred. Mukkumlung, or Pathibhara in its Sanskritized name, is one such sacred site that they believe should not be desecrated by a commercial cable car. They were also concerned about the thousands of trees that would be cut down during construction, harming the environment and destroying the habitats of countless animals, including the endangered red panda.
The agreement immediately but temporarily halts all construction while discussions proceed on how to proceed. The government also agreed to release all arrested protestors, bear all medical expenses for the injured, and investigate the violent clash on January 26, which allegedly saw live ammunition fired at protestors. For their part, the protestors have agreed to lift a transport strike and temporarily cease protest activities.
While it is a good sign that the government is willing to talk to protestors, things should never have gotten to this stage. Locals brought on board the cable car project, which has been handed over to IME Group, a conglomerate led by businessman Chandra Dhakal. Locals see few positives in the cable car, with the bulk of profits being taken out of their community by the IME Group. I’m not too optimistic about the agreement as the Nepal government tends to enter into such deals to buy some time and wear out protestors before moving forward anyway. Still, let’s see what comes of this.
For more context, read this newsletter below and the update we provided last week.
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Internet goes down across Nepal
On Sunday night, February 2, internet services went down across Nepal. It wasn’t just broadband internet that stopped working; it was also mobile internet. For almost an hour, all of Nepal had no connection to the internet. When the connection came back over 45 minutes later, speculation was rife that upstream Indian bandwidth providers had cut off internet services for Nepal over unpaid dues. However, according to the Indian Internet Service Provider (ISP) Airtel, there were issues with their fiber cables in Bhairahawa and Birgunj, which led to the outage. Nepali ISPs are not buying this, as they say such a problem could not have been fixed within an hour. They believe the disruption was a warning from Indian ISPs to clear outstanding dues.
This has happened before. In May last year, Indian ISPs shut down the internet in Nepal for nearly five hours as a warning to pay them what was due. As Nepal is a landlocked country with no access to undersea fiber optic cables, Nepali ISPs rely on Indian ISPs to provide them bandwidth, which they, in turn, sell to customers. However, the Nepal government had refused to provide Nepali ISPs with foreign exchange approval to pay the Indians. Nepal pays all of its imports, tangible or otherwise, in US dollars, which requires permission from the central bank. The government refused Nepali ISPs permission after the two disagreed over payment of certain taxes. ISPs argued they were exempt, while the government claimed they were not. A Supreme Court decision in May 2024 decided that ISPs were on the hook for the taxes, leading most ISPs to accept the decision and pay the government, which then began issuing foreign exchange approval. However, 30 percent of ISPs still have not paid their Indian counterparts, leading to suspicion that Sunday’s outage was a warning to pay up or face more disruption.
Are you still with me? Yes, I know it's a complicated situation, but it bears repeating as the internet has become an essential service. Any disruption to internet services can impact lives and livelihoods. Nepalis already pay more than most other countries in the region for our internet, and we deserve uninterrupted service. Here’s hoping the issue will be resolved permanently, especially since Nepal is considering a national AI policy. See the deep dive below for more on that.
The Duke of Edinburgh visits in Nepal
Prince Edward, brother to British monarch King Charles, is currently in Nepal on a six-day visit. The Prince and his wife Sophie arrived on Tuesday and will leave on Sunday. Edward was in New Delhi so he hopped over the border while Sophie came directly to Nepal from London, meaning that perhaps she’s interested in the country.
Since arriving, the royal couple have been visiting landmarks, attending charity events, and attending banquets, things that ceremonial royals tend to do. They attended the ceremony for the Duke of Edinburgh Awards, set up by his father Prince Philip. They also visited Bhaktapur and Godawari in the Valley before heading to Pokhara to meet with British Gurkha veterans and widows. They will be making their way up to Ghandruk before departing the country.
Is this visit very important? No, not really. But it’s nice to have a high-profile foreign visit that isn’t about geopolitics and playing one country off another. The United Kingdom is Nepal’s oldest bilateral partner, having signed a Treaty of Friendship in 1923. However, diplomatic relations date back a hundred years earlier to 1816, when the Sugauli Treaty was signed. Since then, Nepal has supplied the British with able-fighting men who have served in almost every single conflict the UK has been a part of. Britain has provided Nepal with aid, opportunity, and three to four weeks to process your tourist visa.
Recommendations
Film: State of Siege, a film by the great Greek-French filmmaker Costa-Gavras, loosely based on the 1970 kidnapping and killing of USAID official Dan Mitrione by Tupamaros guerillas in Uruguay. Former Uruguayan officials and CIA operatives have alleged that Mitrione taught torture techniques to Uruguayan police while employed as a USAID official.
Article: World’s smallest otter makes comeback in Nepal after 185 years by Abhaya Raj Joshi, Mongabay
The deep dive: A close look at Nepal’s planned AI policy
HAL 9000, the AI abroad the spaceship USSC Discovery in the film ‘2001: A Space Odyssey’
This past week, the Ministry of Communication and Information Technology released a draft of the planned National Artificial Intelligence Policy for public feedback. The draft comes at an opportune time, just as the Chinese-made DeepSeek AI made headlines across the world for doing what American giants like OpenAI did with ChatGPT for a fraction of the cost. And some said DeepSeek did it better. AI threatens to change how the world works, for good or bad. It has serious applications in hard science areas like medicine, coding, and engineering but also comes with equally serious concerns about data privacy, ethical usage, and resource use.
So, in this newsletter, let’s take a close look at the planned AI policy, what it gets right and where it goes wrong.
First, what’s in the policy? Since this is a policy and not an Act, it only sets broad guidelines that will later be implemented through specific laws. It identifies the problems, challenges, and opportunities with AI, culminating in the rationale for the policy. Interestingly, the very first challenge is “keeping the application of AI within ethical boundaries.” This is a good start, as it recognizes early on one of the major concerns with the adoption of AI across the world. Other challenges in the policy include lack of awareness, expertise, infrastructure, research, and investment in AI; ensuring that trademarks, patents, and intellectual property rights are not infringed upon; and data security and privacy concerns. These are all very real challenges, and it is good to see a policy that is cognizant of them.
Next, there are opportunities, too. The policy states that AI can augment economic and social development with applications in education, health, transport tourism, agriculture, finance, energy, security, disaster management, art, entertainment, and service delivery. However, a major sector is missing here: climate change and the environment. Climate science is largely data-driven and involves models and predictions, all of which AI excels at.
The policy also sees an opportunity for a workforce trained in AI. While disruptive technology often destroys some jobs, AI will likely also create new ones, which can be lucrative if Nepal is able to meet international demand. AI can also spark innovation, which can, in turn, lead to economic opportunities.
The policy seeks to meet these challenges and harness these opportunities for Nepal. Its vision is to “build a prosperous Nepal through the development and inclusive, ethical use of AI,” and its mission to “harness the transformative potential of AI to achieve social and economic prosperity.” In order to achieve this vision and mission, the policy has set a goal to “increase the contribution of AI to the Gross Domestic Product through the promotion of innovation and entrepreneurship, the strengthening of educational infrastructure, and inter-sectoral coordination and collaboration.” This goal is further divided into four specific objectives:
Build a secure and sustainable AI ecosystem;
Develop human resources, research and development, innovation, and entrepreneurship in AI;
Improve public service delivery and sectoral development through the use of AI; and
Collaborate, coordinate, regulate, and monitor AI for its development and secure application
These goals are supported by specific policies, which in turn have multiple strategies. I will not discuss the policies and strategies in detail. Instead, let’s examine how the policies will be implemented. First, the Ministry of Communication and Information Technology will create a new AI Regulatory Council to oversee all AI-related work. The Council will be chaired by the minister and will consist of the following members: Nepal Rastra Bank governor; secretaries from the council of ministers, the national planning commission; and the ministries of communication and information technology, finance, industry, education, science and technology; chief executive officer of the e-governance board; chairperson of Nepal Telecommunications Authority; two private sector representatives; two experts; and the chair of the to-be-formed National AI Center as the member-secretary. The council will develop guidelines for the ethical use of AI, along with safeguards for fairness, transparency, and intellectual property protection, while ensuring compliance with national and international laws and guidelines. The council seems bloated and would probably benefit from a more streamlined team of people who actually understand AI.
Furthermore, a National AI Center will be created at the Ministry of Communication and Information Technology to promote AI research and innovation, provide training, and implement AI policies. AI Excellence Centers will also be established in universities and research institutions to support AI education, research, and development. However, I’m not too optimistic about these ever materializing, especially the Excellence Centers. Even if they do, they are likely to be staffed with political cronies who will hinder rather than help.
By and large, the policy is okay. It is well-intentioned and considers the major concerns that most people have with AI — ethical applications, data privacy, and intellectual property. However, some important issues seem to have been overlooked, even to my untrained eye. Now, I’m not an expert on AI by any means, but as a critical reader, I noticed some shortcomings.
For instance, while the policy mentions data privacy and intellectual property, dealing with large data sets comes with its own challenges. It is commendable that Nepal wants to use AI in fields like medicine, education, traffic management, and disaster management. AI can parse through large amounts of data in very short times, coming up with optimal ways to manage traffic, assessing which areas might be most vulnerable to a landslide or a flood, or deciding on public health measures whenever an epidemic strikes. But does Nepal have the structured data sets required for AI to comb through? Accurate, reliable real-time data is notoriously difficult to find in Nepal. Besides large-scale surveys like the national census and periodic health and housing surveys, there are few other sources of data that could be analyzed by AI to predict outcomes or recommend interventions. The AI policy does not acknowledge this shortcoming and also has no provisions to collect and standardize such data or guidelines for sharing frameworks that will allow public and private AI actors to access the data in order to process it.
There is also the issue of data storage and localization. Where will all the data and analysis generated by AI be stored? Nepal does not have large-scale data storage facilities, which require round-the-clock access to electricity, vast amounts of water for cooling, and physical security safeguards against potential disasters like fires and earthquakes. If Nepal is unable to securely store its data within its borders, it will have to rely on international actors, which could potentially constitute a security risk as all that sensitive national data will be on the servers of a foreign country.
A broad policy like this should be especially cognizant of the many current problems with AI, especially regarding biases. AI models trained on specific data sets tend to provide solutions tailored to that data set. So, AI developed in Western countries could potentially provide problematic results when applied in Nepal. The use of AI in human resource management has already shown prejudice toward certain races, ethnicities, or religions. Such biases could potentially be replicated in Nepal, where numerous castes and communities continue to face discrimination.
There are no guidelines for how AI will be used in sensitive areas like surveillance and policing. Surveillance is already becoming routine in Nepal, with thousands of new CCTV cameras across major cities like Kathmandu. While these all-seeing eyes might assist in policing and traffic management, they also pose threats to personal privacy. AI can go much farther with surveillance. It can easily analyze movement and behavior patterns, social media usage, and other forms of surveillance to predict, accurately or not, whether crimes have been committed. The plot of the novel/film Minority Report does not seem too far-fetched now, even if it might not be working well just yet.
This AI policy also fails to take into account the existing threats Nepal already faces in cyberspace. Financial crime, fraud, scams, cyberstalking, cyberbullying, revenge porn, and impersonation are all already rife. Nepal also periodically suffers from large cyberattacks that attack governmental systems. In November last year, the Department of Passports was allegedly hacked by an unknown entity leading to service disruption. More recently, the cybersecurity company Vairab Tech revealed that numerous Nepali banks were recently targeted in a cyberattack. In the absence of mandatory reporting laws, no banks have confirmed the attack, though.
The proliferation of AI will only increase these risks, making them harder to detect and harder to stop. AI also provides easy access to photo and video manipulation. Deepfakes, which are fake images and videos so convincing that they are difficult to tell apart from the real thing, will increase in the days to come, providing new challenges for individuals and police, especially during sensitive times like elections. None of this is mentioned in the AI policy.
But let’s ignore everything in the policy and just examine the state of digital services and infrastructure in Nepal. Electricity is still intermittent, going out randomly at any point in the day without warning. The government’s plan to digitize all services has not gone well. In fact, instead of providing incentives for the public to go digital, the government has been imposing new taxes and fees on electronic transactions. Any government office visit inevitably ends up recording everything on paper with a stamp and a sign. The Internet remains slow, much slower than most of the region. To complicate things further, Nepali Internet Service Providers (ISPs) have been locked in a tussle with Indian ISPs who provide us with internet bandwidth, leading to complete blackouts from time to time. According to The Kathmandu Post, Airtel and Tata provide 90 percent of Nepal’s bandwidth, and Nepali ISPs have not paid them to the tune of around Rs 8 billion. The ISPs allege that Nepali authorities have not provided them with foreign exchange approval to pay the Indian ISPs.
To put it bluntly, Nepal is not ready for the digital age, let alone the AI age. Nepali officials, infrastructure, and ways of working still remain in the time of pen and ink. In this day and age, government documents still require thumbprints to make them legal. So, while it’s a good thing that bureaucrats and the government are thinking ahead and attempting to prepare for AI, the policy reads a little too ambitious, given the current state of digitization in Nepal. The AI policy is largely well-intentioned, even if I am skeptical about its implementation. We in Nepal say “घाँटी हेरेर हाड निल्नु (only swallow bones the size of your throat), basically cut your coat according to your cloth, just said more poetically.
That’s all for this week. I will be back next Friday, in your emails, for the next edition of KALAM Weekly.
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