The Finance Committee of the Federal Parliament has decided to amend the Nepal Rastra Bank Act, proposing to limit the regular tenure of the central bank’s top officials to three years, with the possibility of a two-year extension.
Under the proposed amendment, the governor, deputy governors and directors of Nepal Rastra Bank (NRB) would serve an initial three-year term. Their tenure could then be extended by up to two additional years by the government based on their performance and prevailing circumstances.
The proposal marks a significant change from the existing legal provision, under which the NRB governor, deputy governors and directors serve five-year terms, with the possibility of reappointment.
The parliamentary committee’s proposal comes amid discussions over strengthening accountability and performance-based evaluation of senior officials at the central bank.
Analysts have pointed to a similar arrangement in India as a possible reference for the proposed reform. The governor of the Reserve Bank of India serves a three-year term, with the possibility of an extension of up to two years.
If endorsed through the legislative process, the proposed amendment would significantly alter the tenure structure of NRB leadership and introduce greater flexibility for the government to evaluate and extend the terms of senior central bank officials.
