The fake Bhutanese refugee scam has once more laid bare the unholy nexus between Nepal’s top political leaders and the bureaucracy.

Nepal Police are investigating the scam that apparently involves top former home ministry officials, including a former home secretary. They are also looking into the possibility of the scam going well beyond the walls of the home ministry and involving other high-profile leaders and bureaucrats.

While the scam has sent shockwaves through Nepali politics, it has also tarnished the country’s image in the international community, experts say.

If the home ministry is run by corrupt officials, how can Nepal’s immediate neighbours India and China be assured that the country’s corrupt system would address their legitimate security concerns, they question.

“This fake refugee scam has serious external dimensions too,” Ramesh Nath Pandey, a former foreign minister, said. “The Home Ministry is taken as a sensitive ministry. Imagine what will happen if India and China come to believe that Nepal can no longer address their legitimate concerns?”

Former home secretary Tek Narayan Pandey and Indrajit Rai, who served as security adviser to the then home minister Ram Bahadur Thapa, have been arrested for their active role in helping Nepalis forge documents in order for their emigration to the United States as Bhutanese refugees.

Meanwhile, CPN-UML Secretary and former deputy prime minister Top Bahadur Rayamajhi has been absconding since Thursday after Kathmandu District Court issued an arrest warrant against him. After he disappeared from Butwal on Thursday morning, the police have now issued a circular for his arrest in all 77 districts. Police have already nabbed his son, Sandeep, in addition to six individuals who were allegedly running the racket.

“This incident is unfortunate and if what the media are reporting is true, the dignity of our leadership has hit rock bottom,” said Dinesh Bhattarai, a former ambassador and adviser to two former prime ministers. “Definitely, the credibility of Nepali politicians has come under question.”

Day after day, new audio recordings are emerging of conversations between the alleged racketeers, politicians and senior bureaucrats.

“We are trying to verify the authenticity of these audio recordings circulating on social media,” a senior investigation official told the Post, adding, “once the links between the racketeers, politicians and bureaucrats are established, we will seek arrest warrants against all those involved.”

On June 14, 2022, the Ministry of Home Affairs and the Nepal Police had launched an investigation into a criminal group involved in a case of fraud. The group had allegedly been scamming people for years by promising to send them to the US as Bhutanese refugees. The government action was in response to a case filed by the victims at the Commission for Investigation of Abuse of Authority against the group a few months earlier.

The case was brought to the Kathmandu Valley Crime Division only in June 2022 after which the investigation was launched.

The group has allegedly swindled over 875 people from different places in Nepal of millions of rupees. The police earlier arrested Keshav Dulal, Sanu Bhandari, Sagar Thulung Rai, Tanka Gurung and Sandesh Sharma Pokhrel as prime accused in the case. All of them had strong political connections.

“What would be the implications if India and China believed that Nepal’s home ministry is corrupt?” said Pandey.

“Both the political and bureaucratic leadership of the home ministry has been exposed. It shows the entire system is corrupt. What if India and China think their security concerns can be easily compromised [in Nepal]? Is our political leadership paying attention to this? Now our political leadership has an even bigger challenge of assuaging the concerns of India and China,” said Pandey.

Bhattarai, the former foreign policy advisor, said, “When we were trying to repatriate Bhutanese refugees, a long way back now, we used to bracket the Bhutanese refugees living in several camps in Nepal into four categories, one of them being ‘non-Bhutanese’.”

Back then Bhutanese officials used to say that there were lots of non-Bhutanese refugees in the camps, and this new scam is proving them right, Bhattarai added.

“The credibility of the Nepali political as well as bureaucratic leadership is at stake due to this scam. It has created suspicions and given rise to a big question: Whom do we trust? Although the case is still under investigation, if it is established that an organised crime was committed, it will be disastrous,” said Bhattarai.

Other experts also worry about the scam’s implications.

“Externally, this incident has eroded our trust, tarnished our image and downgraded our confidence,” former Nepali Army General Binoj Basnyat said, “and domestically, questions will be raised about our national security, credibility of our institutions and system and commitments made by the political parties.”

He asked for a thorough investigation of all past and present corruption scandals through a powerful commission.