Gagan Thapa’s IT salary claims fact-checked: Here’s what we know

Kathmandu, December 1 — The address given by Nepali Congress General Secretary Gagan Kumar Thapa at an election rally in Kirtipur on Thursday is currently making waves. Two of his statements have gone viral on social media.

One of his comments was related to the chairman of the CPN (Maoist Centre), Pushpa Kamal Dahal 'Prachanda', while the other was about creating an environment in Nepal where young people can earn as much as they do abroad.

In the first comment, Thapa claimed that Prachanda frequently sent messages to Nepali Congress President Sher Bahadur Deuba, urging him to become the Prime Minister. Thapa said, “Even now, Prachanda sends a message to Deuba once a week, saying, ‘You have to assume the role of the Prime Minister.’”

However, this statement has been denied by Maoist leaders, including Prachanda himself, and the issue is still being debated. We won’t delve into the details of that matter here.

In the second statement, Thapa claimed that it is possible to earn 3 to 4 lakh rupees a month by sitting on the hill in Kirtipur and working on a laptop. He said, "Right now, many young men are going to Qatar to work, and many women are going to Israel. They don't have to leave the country, we can create jobs here in Nepal that pay more than what they are earning abroad. We can create an environment where, in the next 5, 6, or 7 years, young people will no longer need to go to Qatar, Malaysia, or Israel. They can sit here on Kirtipur's hill, work on laptops, and earn 2, 3, or 4 lakh rupees a month."

He argued that this could be achieved through the IT sector. But the idea of earning 3 to 4 lakh rupees per month in a country where the minimum wage is only 18,000 rupees a month seems unrealistic to many. As a result, this statement has been widely ridiculed on social media, with people even posting memes of someone sitting on a hilltop with a laptop, jokingly portraying it as the new trend.

So, is it really possible to earn 3 to 4 lakh rupees per month in Nepal, as Thapa suggested? Let's discuss this further.

In 2022, the Institute of Integrated Development Studies (IIDS) published a report on the income of IT workers in Nepal. According to the report, a novice IT professional earns around 2,810 US dollars annually, a mid-level IT engineer earns 6,395 US dollars, and a senior IT engineer earns 15,322 US dollars. Freelance IT engineers also earn about 4,723 US dollars annually. These figures are considered a reflection of the actual conditions by Nepal’s IT professionals.

Based on this data, an entry-level worker in the IT sector makes about 30-32 thousand rupees per month, a mid-level engineer makes around 70-72 thousand rupees, and a senior-level engineer earns approximately 170 thousand rupees a month. Freelancers earn more than 50 thousand rupees per month on average.

However, over the last two years, the earnings in this sector have grown significantly. Gaurav Pandey, Vice President of NAS-IT, mentioned that the sector has seen an average growth of 25-30% over the past two years. If this growth trend continues, it is expected that senior IT engineers will be earning over 2 lakh rupees per month, and other workers will see a proportional increase in their earnings. Within 5 to 7 years, senior-level engineers could be earning over 3 lakh rupees a month.

However, Nepal’s IT companies are currently stuck in a situation where they are dependent on middlemen. Most of the software developed by Nepali IT engineers is sold through agents in countries like the US and Australia. The agents in these countries take a 40-60% commission for sales in the US and 62% for sales in Australia.

If Nepali companies could sell their software directly, they would earn the full amount, and the salaries of IT engineers could be raised as well. Pandey claims that this could lead to a 30-35% increase in earnings, and senior-level engineers could potentially earn 3 lakh rupees per month.

Pandey further added, “If we can reduce the commission rates, it could lead to a 30-35% increase in earnings for engineers. Right now, 10 to 20% of senior-level engineers are already earning in the 3 lakh range, and more than 50% are earning over 1.5 lakh rupees. Isn’t that a good salary? And, if the government addresses these issues, in the next 5 to 7 years, even mid-level workers will be earning at this range, which will affect around 70% of the workforce in this sector.”

Government’s neglect on the issue

However, the issue of workers' earnings is still hindered by government regulations. Nepal’s laws prevent money from being invested abroad, which means that Nepali companies must set up subsidiaries in other countries to sell their software. This requires capital to be taken out of the country, which is currently not allowed.

The government had promised to allow the opening of branches of Nepali companies abroad, but no steps have been taken so far. Opening a branch would allow companies to pay marketing and operational expenses for staff in those countries, but it would not generate as much income as having a company registered in those countries, where greater bargaining power exists.

Pandey further states, "India, Pakistan, and other countries can open their own companies abroad, but we haven’t been able to do that."