Nepal Orders Riverside Slum Clearance: Balen Shah's Eviction Drive, the 1,000-Day Resettlement Plan, and What It Means for Urban Land

Opening: A Directive That Has Been Tried Before

Nepal's squatter eviction drive is not new. What is new is the authority executing it. Prime Minister Balendra Shah of the Rastriya Swatantra Party (RSP), who attempted and failed to clear Thapathali's riverbank settlement in November 2022 as Kathmandu's mayor — a clash that left 36 people injured — now commands both federal and municipal levers simultaneously. On April 23, 2026, his government issued an eviction notice to all residents of unauthorized structures on public land along Kathmandu Valley's riverbanks. Demolitions began at 6 am on April 25.

The legal basis is not a single new ordinance. The directive operates through three instruments: Point 92 of the Cabinet's 100-point action plan adopted immediately after government formation; a District Administration Office (DAO) Kathmandu public notice dated April 23, 2026, ordering clearance by 7 pm April 24; and a Ministry of Federal Affairs and General Administration (MoFAGA) circular issued April 30, 2026, directing all 753 local governments to complete squatter identification before undertaking further clearance operations. No single parliamentary ordinance governs this drive — the legal authority derives from existing land management law and executive direction.

LEGAL STATUS: The eviction drive is an executive action under existing law — not a new parliamentary ordinance. The Cabinet 100-point plan (Point 92), the DAO notice, and the MoFAGA circular of April 30, 2026, are the operative instruments. No new statute has been passed. Government spokesperson Sasmit Pokharel confirmed no formal Council of Ministers resolution was passed on the eviction.

What the Government Has Ordered

The DAO Kathmandu notice directed residents of unauthorized structures on public and government land along all riverbanks to vacate by 7 pm on April 24, 2026. The notice covered not only residents but also tenants and businesses operating within those settlements. Demolition authority was granted from 6 am April 25, with joint enforcement by metropolitan police, Nepal Police, and the Armed Police Force.

Government spokesperson Pokharel stated that displaced residents would be provided temporary housing with basic facilities at designated locations, including Dasharath Stadium in Kathmandu. A screening process to identify genuine landless squatters — legally defined as sukumbasi — would begin after relocation. The government committed to moving verified genuine squatters to government apartments in Nagarjun Municipality-1 and other designated sites within two weeks of verification.

The MoFAGA circular of April 30, 2026, issued at secretary level and citing Section 97 of the Local Government Operation Act 2017, instructed all 753 local governments to: complete identification of squatters before clearance operations; coordinate with district administration offices to distinguish genuine squatters from other encroachers; and prepare concrete relocation plans for eligible individuals. The circular effectively acknowledged that the first phase of evictions — the April 25 clearances — preceded the required identification process.

Sources: Kathmandu Post, April 25-May 2, 2026; Khabarbub, April 24, 2026; ANI, April 25, 2026; MoFAGA press release, April 30, 2026.

The Scale of the Problem

Nepal's landless crisis is structural, not episodic. The Landless Issue Resolution Commission has received more than 1.2 million applications, comprising 98,851 from landless Dalits, 181,378 from landless squatters (sukumbasi), and a larger category of unorganized settlers seeking legal recognition. Land rights activist Biswas Nepali estimated the actual affected population at 5-6 million people across Nepal when household dependants are included.

In the Kathmandu Valley specifically: an estimated 35,000 squatter families lived along the Bagmati River as of 2022. The six major river corridors — Bagmati, Bishnumati, Manohara, Dhobikhola, Balkhu, and Godavari — contain approximately 4,000 families in direct riverbank settlements. The valley-wide total including non-riverbank informal sites is estimated closer to 50,000 families. The first phase of demolitions — covering Thapathali, Sinamangal, Teku, Balkhu, Bansighat, Jadibuti, and Manohara corridors — affected an estimated 1,900 households and more than 10,000 people from approximately 3,500 families.

The legal framework defines sukumbasi strictly under the Lands Act 1964 (amended 2019): a person who has never owned land and cannot acquire it through family income or effort. Only approximately 20% of Thapathali's residents qualify under this strict legal definition. The remaining 80% are unorganized settlers — people with small land parcels elsewhere in Nepal but with no viable housing alternative in Kathmandu. This distinction determines eligibility for state land allocation under the 100-point plan.

The 1,000-Day Plan: What It Promises

The government's 100-point action plan, Point 92, contains specific commitments on the squatter issue. PM Shah announced these publicly on social media on April 24, 2026:

• Complete a nationwide digital survey and verification of all landless squatters within 60 days
• Build a GIS-based database identifying genuine beneficiaries
• Update records of all public and Guthi land
• Provide land or integrated housing for relocation in urban areas for verified genuine squatters
• Resolve the full landless squatter issue within 1,000 days through relocation and land allocation

PM Shah's public statement drew a distinction between urban encroachment clearance along riverbanks and the broader national sukumbasi resolution, framing the Kathmandu operation as disaster preparedness ahead of the monsoon season rather than punitive eviction.

HISTORICAL CONTEXT: 22 commissions since 1990 have failed to resolve Nepal's squatter crisis. The 22nd Landless Issue Resolution Commission's term expired September 2024 without completing land title distribution. The 23rd commission was in preparation as of early 2026 — not yet formed. The 1,000-day timeline is the most specific commitment any government has made. It is not backed by enacted legislation.

Constitutional Rights vs. Current Action

Nepal's Constitution contains explicit guarantees relevant to this situation. Article 37 guarantees every citizen the right to housing. Article 40(5) obligates the state to provide land to landless Dalits. Article 42 enshrines the right to social justice. Article 51(J)(6) calls for identification and rehabilitation of historically marginalised groups including landless people and squatters. Section 52(C) of the Lands Act permits, as a one-time measure, land allocation to informal settlers who have occupied and used land continuously for at least 10 years.

Critics argue the April 25 demolitions proceeded without the prior verification, consultation, and resettlement planning that these provisions require. Senior advocate Raju Chapagain cited a Patan High Court directive — issued during Shah's mayoral eviction attempt — ordering six months for verification before any eviction. That verification was never completed. Amnesty International Nepal stated that the evictions were conducted without prior verification, meaningful consultation, or assured alternative housing. Three UN Special Rapporteurs wrote to Kathmandu Metropolitan City in January 2023 expressing alarm at forced evictions without adequate housing alternatives.

Urban Land Implications for Real Estate Investors

Cleared riverbank land along the six corridors is government and public land. It does not become privately transactable following clearance. The government's stated intent is urban infrastructure development and river corridor management — not private sale or developer allocation.

However, the clearance drive has indirect real estate market implications. Residential land supply in Kathmandu Valley is structurally constrained by geography. Cleared riverbank areas that are developed into public infrastructure increase the livability premium of nearby residential properties. If the current drive succeeds at scale, that premium dynamic will extend to additional corridor sections.

NRN and diaspora property investors with assets near the six river corridors should monitor whether cleared land is developed as public infrastructure or remains vacant. Vacant cleared government land in Kathmandu Valley has historically attracted informal reoccupation during periods of weak enforcement.

Investor Takeaways

• Cleared riverbank land remains public: No river corridor land becomes privately purchasable or developable as a result of this eviction drive.
• Proximity premium is real but requires infrastructure follow-through: Monitor whether public infrastructure investment follows this eviction cycle.
• 60-day verification process creates short-term uncertainty: Results will clarify which settlements face further clearance and which will receive land title.
• Legal challenge risk is active: Court intervention could pause further clearances.
• NRN property ownership limits are unaffected: The eviction directive and 100-point plan do not alter NRN area limits or agricultural land prohibitions.

Outlook

The next 90 days are determinative. The government's 60-day digital survey commitment expires in late June 2026. If the GIS-based national database is operational by that deadline, it will be the first functional verification tool Nepal has produced after 22 prior commissions failed to complete one. If the verification process stalls, the 1,000-day plan will follow the trajectory of its 22 predecessors.

For urban land investors: the relevant question is not whether the evictions proceed — they have — but whether the government's infrastructure follow-through converts cleared riverbank corridors into permanent public amenity.