2022 Trafficking in Persons Report: Nepal

• Amend the Human Trafficking and Transportation (Control) Act (HTTCA) to criminalize all forms of sex trafficking and labor trafficking, in line with the 2000 UN TIP Protocol.
• Increase investigations, prosecutions, and convictions of all trafficking offenses, including allegedly complicit officials, labor recruiters, and sub-agents for labor trafficking.
• Finalize standard operating procedures (SOPs) for victim identification and referral, train front-line responders on SOPs, and increase referrals of trafficking victims to services.
• Establish SOPs for law enforcement to investigate human trafficking cases, including referrals between agencies.
• Expand availability and capacity of victim care, including shelter and repatriation, for all victims, especially men and boys and workers exploited overseas.
• Increase staff, training, and resources to the Department of Foreign Employment (DoFE) to facilitate full implementation and monitoring of the low-cost recruitment policy.
• Take steps to eliminate recruitment or placement fees charged to workers by Nepali labor recruiters and ensure any recruitment fees are paid by employers.
• Implement the victim-witness protection provisions of the HTTCA.
• Significantly increase monitoring of children’s homes and orphanages and hold accountable those that do not meet the government’s minimum standards of care.
• Authorize labor inspectors to monitor the adult entertainment sector (AES) establishments for labor violations.
• Remove the HTTCA provision that allows the judiciary to fine victims if they fail to appear in court and hold them criminally liable for providing contradictory testimony.
• Lift current conditions and restrictions on female migration and engage destination country governments to create rights-based, enforceable agreements that protect Nepali workers from human trafficking.
• Finalize and implement a revised National Action Plan (NAP).
• Provide documentation to stateless individuals, internationally-recognized refugees, and asylum-seekers to allow them to work, attend school, and access social services.

The government slightly increased anti-trafficking law enforcement efforts. The 2007 Human Trafficking and Transportation (Control) Act (HTTCA) criminalized some forms of sex trafficking and labor trafficking. The HTTCA’s definition of trafficking was inconsistent with the international definition of trafficking. It limited the definition of “human trafficking” to the purchase or selling of a person and to causing another person to go into prostitution; did not include a demonstration of force, fraud, or coercion as an essential element of the base offense; and did not explicitly address forced labor. The law separately defined “human transportation” as the taking of a person from their home or place of residence through force, fraud, or coercion for the purpose of prostitution or the keeping a person as a slave or bonded labor. The HTTCA prescribed penalties ranging from five to 20 years’ imprisonment and a fine, which were sufficiently stringent and, with respect to sex trafficking, commensurate with those prescribed for other serious crimes, such as rape. The 2017 Labour Act, which is enforced by specialized labor courts, criminalized forced labor and prescribed penalties of up to two years’ imprisonment, a fine of up to 500,000 Nepali rupees (NPR) ($4,190), or both. Additionally, the 2002 Bonded Labor (Prohibition) Act abolished bonded labor and prescribed civil penalties of a fine between 15,000 and 25,000 NPR ($126-$209). The 2000 Child Labour Act criminalized forced child labor and prescribed penalties of up to one year’s imprisonment, a fine of 50,000 NPR ($419), or both. None of these laws prescribed sufficiently stringent penalties. The 2007 Foreign Employment Act (FEA) criminalized fraudulent and deceptive labor recruitment of Nepalese workers for employment abroad and was often utilized in labor trafficking cases in lieu of the HTTCA. Penalties prescribed under this law were significantly lower than those available under the HTTCA. For the seventh consecutive year, the government’s National Committee for Controlling Human Trafficking (NCCHT) continued to work on revisions to the HTTCA. The pandemic impacted the ability of the NCCHT to finalize the revisions during the reporting period. The National Human Rights Commission worked to align the country’s laws with the Palermo Protocol following accession in June 2020.

During the Nepali fiscal year from July 16, 2020, to July 15, 2021, police conducted 134 investigations involving 162 suspects and the District Government Attorney initiated prosecution against 300 suspects in 146 cases. District courts convicted 164 traffickers in 72 cases and acquitted 189 individuals in 87 cases under the HTTCA. A total of 214 cases involving 501 defendants remained ongoing. This compared with police initiating 97 investigations involving 240 suspects and the District Government Attorney initiating prosecution of 415 suspects in 170 cases, which resulted in the conviction of 202 traffickers in 88 cases during the previous reporting period. The government did not report the sentences prescribed to convicted traffickers or disaggregate data on sex and labor trafficking cases. Some police and prosecutors previously investigated and prosecuted suspected sex traffickers and facilitators for rape and public offenses. Some officials reported trafficking decreased during the pandemic and dismissed the prevalence of human trafficking in districts, although civil society organizations continued to report concerns about human trafficking and issues such as gender-based violence, caste-based discrimination, and child sexual abuse. Although courts reopened in August 2021 following more than five months of pandemic closures, NGOs reported that restrictions on transportation and pandemic testing requirements made it difficult to obtain victims’ statements and testimony.

The government had standard training for labor, immigration, judicial, law enforcement, and foreign employment officials that included general definitions of human trafficking. International donors provided anti-trafficking trainings for the Nepal Police Anti-Human Trafficking Bureau (AHTB), a specialized police unit dedicated to trafficking crimes created in 2018. Due to the pandemic, the AHTB conducted online training for its personnel; however, most police lacked specialized training and resources to interact with trafficking survivors in a victim-centered way. In addition, the dearth of investigators and prosecutors trained to work on trafficking cases, coupled with frequent personnel turnover, further hampered efforts. The AHTB had 82 Kathmandu-based staff as well as additional staff in all seven provinces at the end of the reporting period. The Nepal Police Women’s Cells (NPWC) had female officers in all 77 districts to investigate crimes against women and girls, including trafficking, but not all district offices had units that were fully operational. NPWC had internal guidelines on the identification and treatment of victims. While investigative capacity was improving, Nepali law enforcement did not proactively identify trafficking cases and often relied on referrals from civil society, some of which occurred more than one year prior, thereby undermining evidence collection and prosecution efforts. Moreover, police and prosecutors remained overly reliant on victim testimony for successful investigations and prosecutions. Victims often did not want to assist in cases against their perpetrators because the perpetrators were family friends or relatives. Traffickers often bribed victims and their families not to provide testimony in trafficking cases. The AHTB and other law enforcement units often lacked the resources to effectively coordinate with NGOs and victims to register cases against traffickers. Pandemic-related lockdowns and court closures further exacerbated these issues during the reporting period. Police and the judiciary did not always collaborate, which led to police submitting incomplete cases that prosecutors could not pursue in court. Many district courts did not comply with the 2013 Supreme Court directive to adopt a “fast-track” system for human trafficking cases. This was at times due to stipulations of the law that did not allow a fast-track court case, delays related to the pandemic, and non-trafficking caseloads. As a result, the government reported that most trafficking cases heard at district courts take one year. The National Judiciary Academy had SOPs on investigation and prosecution of trafficking cases; however, implementation of the SOPs varied. Nepal Police coordinated on international investigations of trafficking-related crimes through INTERPOL and with other foreign governments.

NGOs noted that although there was increased willingness to take action against the operators of unregistered children’s homes, which exploited children in forced begging, prosecution remained inadequate. Many of the individuals running these exploitative institutions were politically connected and viewed favorably within their community. NGOs stated that even when arrested, they were almost never prosecuted and often used political connections to thwart child protective agencies. Prior to the pandemic-related lockdowns, the government directed children’s homes to return children to their families. The government did not report screening the children for trafficking indicators before they were sent home. The government reported approximately 11,000 children reside in 489 children’s homes, while another 1,000 children live in children’s correction homes.

The government did not make sufficient efforts to actively investigate or prosecute suspects for bonded labor and did not provide any data on bonded labor cases. The government continued to misidentify the majority of transnational labor trafficking cases as labor violations and resolved most cases administratively through the Ministry of Labor, Employment, and Social Security (MoLESS) in lieu of criminal investigation, with inadequate sentences for perpetrators. Legal experts stated prosecutors could pursue a case under both the HTTCA and the 2007 FEA for transnational labor trafficking and foreign employment fraud, respectively; however, prosecutors regularly refused to do so, believing such action would violate the prohibition against double jeopardy.

The government did not report any investigations, prosecutions, or convictions of government employees complicit in human trafficking; however, corruption and official complicity in trafficking crimes remained significant concerns, inhibiting law enforcement action during the year. In November 2017, the Commission for the Investigation of Abuse of Authority arrested the Director General of DoFE and two DoFE officials for allegedly attempting to collect a bribe from a foreign employment agency. In December 2020, the former Director General and two DoFE officials were convicted and sentenced to one and a half years in prison and a 1 million NPR ($8,380) fine. The defendants filed an appeal, and the cases remained pending in the Supreme Court at the end of the reporting period. Officials called on the government to investigate allegations that Department of Immigration officials were complicit in the transportation of potential trafficking victims at the Kathmandu international airport, although the government did not report any action by the end of the reporting period. During previous reporting periods, NGOs reported traffickers bribed government officials to include false information in genuine Nepali passports and provide fraudulent documents to prospective labor migrants or foreign employment agents. NGOs reported concerns that because a number of government officials, including parliamentarians, maintained close ties to foreign employment agencies, such officials might have a conflict of interest in approving policies that increase protections for migrant workers. NGOs alleged some police and political party leaders were complicit in sex trafficking in conjunction with their financial involvement in the AES. Some traffickers, including owners of AES establishments and exploitative orphanages, enjoyed impunity due to personal connections with politicians and by bribing police to avoid raids or procure fraudulent identity documents; one alleged trafficker reportedly led a local coordination committee on human trafficking (LCCHT). The UN Human Rights Committee previously heard two cases against Nepali military officials who allegedly forced one boy and one girl into labor in 2010 and 2002; the government has not reported initiating any criminal investigation or victim compensation procedures.

The government maintained efforts to identify and protect trafficking victims. The government identified 187 victims compared with 141 victims the previous year. Of the 187 victims, traffickers exploited 99 in sex trafficking, 64 in labor trafficking, and 24 in unspecified exploitation; 97 victims were exploited in Nepal while 90 victims experienced transnational trafficking. The 187 victims included 80 children and 107 adults, including 183 female victims and four male victims, compared with 62 children and 79 adults, including 133 female victims and eight male victims, identified the previous year. Authorities did not systematically track the total number of victims identified. The government did not have formal SOPs for victim identification and referral to services, impeding proactive identification efforts; the Ministry of Women, Children, and Senior Citizens (MoWCSC) previously drafted SOPs that remained pending final approval at the end of the reporting period. Police did not always recognize that children in commercial sex were sex trafficking victims and sometimes removed girls 16-17 years old from commercial sex, sent them home, and did not refer them to services or file criminal charges against the client. The pandemic continued to impact anti-trafficking efforts, including reducing resources and capacity to provide services to survivors. Additionally, the government’s pandemic restrictions continued through June 2021, which limited the government’s ability to identify and assist trafficking victims.

Although the government had national standards for care of trafficking victims, referral efforts remained ad hoc and inadequate. The government did not report how many victims it referred for care. NPWC typically referred trafficking victims to government-run, one-stop emergency centers located within hospitals or to NGOs, both of which could provide shelter, medical, and legal services. Public hospitals charged NGOs for medical assistance to trafficking victims. The government reported it provided psycho-social counseling to an unknown number of victims to assist in the investigation and prosecution of cases, up to three months of shelter, and police security if a victim required protection. The MoWCSC, in partnership with NGOs, provided shelter services to 2,628 trafficking victims in 10 shelters and two long-term rehabilitation centers that offered counselling, health services, legal support, and employment programs. The government allocated 8.26 million NPR ($69,170) through the NCCHT for victim services during fiscal year 2020 to 2021. While the shelters assisted 2,628 victims of crimes— including trafficking victims—during the fiscal year, the shelters had to restrict or halt several services due to pandemic-related restrictions. MoWCSC and NGOs operated 123 community service centers across 36 districts for female victims of gender-based violence, including trafficking. MoWCSC paid for victims’ basic needs, including lodging, food, health services, psycho-social counseling, and capacity building, while NGOs covered other administrative and staff costs. The NCCHT monitored the 10 shelters and required NGOs running government-funded shelters to periodically submit details of their operations. Similarly, district anti-trafficking committees were required to conduct at least one monitoring visit to government-funded shelters every six months; the NCCHT could conduct additional inspections as needed. MoWCSC provided shelter and services to men and women, including trafficking victims, through the Victim Assistance Rehabilitation Fund. The government reported male trafficking victims of all ages were eligible for placement in government-funded shelters, and the NCCHT could reallocate funds if male victims sought services. Nevertheless, international organizations reported labor trafficking victims and men and boys frequently did not receive services. FEB and MoLESS continued to finalize an SOP to improve shelter referral services for both male and female trafficking survivors and returning migrant workers. The current SOP and government practices focus on gender-based violence and trafficking of women and girls, potentially creating challenges for male victims attempting to access shelters. Victims could obtain restitution from traffickers through criminal proceedings, or if the government was unable to collect the fines imposed on traffickers, the government could provide back wages from an HTTCA rehabilitation fund. The government did not adequately compel perpetrators to pay compensation because officials did not investigate property holdings and could not assess values for victim compensation. As in prior reporting periods, the government did not report if any victims obtained restitution or if the government provided any compensation from the fund.

The pandemic slowed physical monitoring of children’s homes. The National Child Rights Council, which monitored childcare homes remotely and with NGO assistance, previously removed 84 children from exploitation in abusive and unregistered children’s homes, although the number of removals during this reporting period is unknown. Unregistered or fraudulent orphanages and children’s homes had forced some children into labor making handicrafts and begging and had sexually abused other children. The government estimated at least one-third of the total registered orphanages did not meet government standards and did not have regular oversight.

In June 2021, the government approved the Crime Victim Protection Regulation 2021 to increase protections for victims of crime, including the right to claim compensation. However, overall victim-witness protection mechanisms and the practices of police and justice officials remained insufficient. In civil suits, most victims remained unaware of the HTTCA provision granting the right to private representation. Even in cases where victims had private representation, the attorneys often could not build strong cases because law enforcement and the judiciary denied them access to critical case files and the dates of hearings. Police continued efforts to pay for some victim and witness transportation and lodging during judicial hearings; authorities did not report whether they provided these services to any trafficking victims. Victims could provide testimony via video or written statement; however, most courts did not have facilities for video conferences, and even when they did, officials often did not make victims aware of the option. Victims continued to report challenges in providing testimony, including threats from perpetrators, and the lack of compensation and lack of ability to collect compensation when awarded. Notably, resource limitations impeded authorities’ provision of a victim’s right to police protection, and observers stated victims were reluctant to file criminal complaints under HTTCA in part because of stigma, greater ease pursuing compensation through the FEA, and personal or family safety concerns. The HTTCA authorized the judiciary to fine victims who failed to appear in court and hold victims criminally liable for providing testimony contradicting their previous statements. Due to a lack of formal identification procedures, authorities arrested, detained, and fined adult and child sex trafficking victims for crimes their traffickers compelled them to commit. The government did not have legal alternatives to the deportation of foreign victims. The Department of Immigration continued to deport foreign nationals who overstayed their visas; the government did not report whether the department screened for trafficking among those deported.

Government services for Nepali nationals exploited abroad remained inadequate. The 2007 FEA required the government to appoint labor attachés in countries with more than 5,000 registered Nepali migrant workers to facilitate claims of abuse, exploitation, and repatriation. In February 2022, the government had seven labor attachés and five labor counselors deployed in eight countries. Although MoLESS assigned labor attachés and counselors in diplomatic missions with a high volume of migrant workers, limited resources prevented attaché presence in all required countries. The number of labor counselors and attachés remained nominal compared to the large number of workers and growing number of complaints. While some embassies could provide temporary shelter and repatriate trafficking victims, officials acknowledged inadequate staffing and resources created large delays in provision of assistance, and the quality of the government-run shelters abroad was poor. Nepali embassies in Bahrain, Kuwait, Malaysia, Oman, Qatar, Saudi Arabia, South Korea, and the UAE could provide emergency shelter for approximately 25 female migrant workers each, some of whom were trafficking victims; embassies did not report the number of workers assisted. The Foreign Employment Board (FEB), which is responsible for protecting migrant workers and maintains a welfare fund to support labor migrants registered with the DoFE, acknowledged shelters lacked sufficient space, staff, and resources to meet the high demand for assistance.

FEB collected fees from departing registered migrant workers for a welfare fund to provide repatriation and one year of financial support to families of injured or deceased workers, which could include trafficking victims. During the fiscal year, the fund repatriated 413 migrant workers compared with 1,398 in the previous year. Additionally, 892 bodies of Nepalis who had died while employed abroad were repatriated, compared with repatriation of 413 bodies the previous year. The government did not report identifying any trafficking victims among those repatriated or initiating any criminal investigations into their exploitation. MoWCSC allocated funds to Nepal’s embassies in India, Sri Lanka, Thailand, and the UAE, as well as the consulate in Kolkata, for repatriating trafficking victims. MoWCSC funded Nepali embassies to repatriate 138 Nepali trafficking victims during the reporting period. FEB could also repatriate undocumented migrant workers, including trafficking victims, by requesting funds through the finance ministry on an ad hoc basis, but it could not provide any other financial support or services. NGOs bore the primary cost of repatriating Nepali trafficking victims from India and noted that due to the lack of formal repatriation procedures between countries, repatriation could take up to two years. DoFE maintained an online migrant worker portal that allowed migrant workers facing abusive or untenable situations overseas, or someone on the migrant worker’s behalf, to file a request for repatriation. Since the site’s introduction, DoFE has received increasing online requests for repatriation, the majority from workers in Kuwait, Malaysia, Saudi Arabia, and the UAE. The DoFE did not provide data indicating the percentage of those who filed requests that were successfully repatriated. In addition, NGOs reported many migrants lacked the requisite computer access or skills to use the site. NGOs reported coordination between the labor ministry and MoWCSC remained weak, and labor officials did not routinely inform labor trafficking victims about the services MoWCSC and NGOs could provide.

The government maintained overall efforts to prevent human trafficking. The NCCHT, headed by the MoWCSC, continued to lead interagency efforts on human trafficking. The government continued to operate and fund 732 local anti-trafficking committees (LCCHTs) through the district anti-trafficking committees (DCCHTs); the government did not report how much funding was allocated during the reporting period. The NCCHT regularly met with and trained DCCHTs to enhance coordination between central and district-level civil society organizations and government officials. While the NCCHT continued to meet with and train officials from the DCCHTs, observers noted the need for improved coordination between the NCCHT, DCCHTs, and LCCHTs. NGOs reported that lack of resources for LCCHTs and DCCHTs limited sub-national anti-trafficking efforts, which delayed reforms planned for DCCHTs. While the NCCHT continued to meet with and train officials from the DCCHTs, observers noted the need for improved coordination between the NCCHT, DCCHTs, and LCCHTs. In 2020, the MoWCSC formed a task force to revise the NAP and continued to finalize the revised NAP, which remained pending by the end of the reporting period. The government continued to conduct public awareness campaigns throughout the country, sometimes in partnership with NGOs or international organizations, and produced a radio program to raise awareness and disseminate information about trafficking. Observers noted frequent personnel turnover among the committees continued to hamper efforts and federal and provincial governments sometimes provided conflicting messaging that impeded anti-trafficking efforts. Officials observed the lack of trafficking data and insufficient resources were significant challenges to combating trafficking.

The Department of Immigration lacked effective processes for detecting potential victims of trafficking as well as a mechanism for coordinating victim identification among intergovernmental agencies and civil society. Border checkpoints were not operational, and pandemic mitigation measures reduced formal interactions with potential victims. Police lacked the staff, resources, and training required to patrol Nepal’s nearly 1,100-mile border with India, which Nepalis and Indians could cross without visas or passports. Significant transnational trafficking reportedly occurred along the border; however, officials did not report identifying any victims. NGOs conducted some checkpoint inspections along the border focused almost entirely on intercepting female travelers. Police reported NGOs did not always refer potential trafficking victims to law enforcement. The Metropolitan Police Crime Division in Kathmandu continued to operate an anti-trafficking hotline; the government reported it operated other hotlines to report cases involving women, children, or gender-based violence, including human trafficking. The FEB also operated a hotline to receive complaints concerning migrant workers, including human trafficking incidents.

The DoFE maintained offices in all seven provinces to increase prospective migrant workers’ access to foreign employment-related services. The FEB also operated approximately 41 migrant resource and information centers at the district level, which provided information on authorized recruitment agencies, maximum fees the agencies could charge workers, and information on the risks and challenges of working abroad and potential ways to minimize the risks. However, lengthy pandemic-related lockdowns, as well as closures of the national airport and border with India, limited the government’s trafficking prevention screening efforts. The government continued to use a revised two-day, pre-departure orientation curriculum for migrant workers; however, the course was not mandatory. Some NGOs also provided training to migrant workers. The government offered free certifications for skills obtained abroad for migrant workers; it did not report how many workers utilized these services. The government updated its Foreign Employment Information Management System platform to record data on returning migrant workers in addition to offering services such as applying for labor permits and paying insurance and other fees. During the previous reporting period, Nepal signed a labor recruitment memorandum of understanding (MOU) with the Government of Israel to provide employment for migrant workers in the fields of agriculture, construction, and hospitality. Inconsistent with the international best practice of employer-paid fees, the agreement required migrant workers to pay recruitment fees and related migration costs, although the government has taken steps to reduce some of these fees, including by negotiating some air travel costs.

The government’s labor migration policies remained lengthy, costly, and sometimes discriminatory against women. Although the Parliamentary Committee for Industry, Commerce, Labour and Consumer Welfare in 2020 revoked its previous recommendation to ban the migration of female domestic workers younger than age 24 to Gulf States and Malaysia, the government maintained strict pre-conditions. Observers have expressed concern that outright bans on migration may increase the likelihood of migration through irregular means and trafficking risks. Migrant rights activists expressed concern the government continued to send Nepali female domestic workers abroad to countries without bilateral agreements to protect workers’ rights.

The government’s 2015 labor migration guidelines included a policy requiring foreign employers to pay visa and transportation costs for Nepali migrant workers bound for Malaysia and the Gulf and restricted agency-charged recruitment fees to 10,000 NPR ($84). Among the 859 licensed manpower agencies in Nepal in 2022, 832 agencies were functional and only 15 had authorization to recruit domestic workers (compared with 24 in the last reporting period). The government did not report if it initiated any civil or criminal investigations into fraudulent recruitment agents or agencies. Both NGOs and government officials noted the government’s monitoring mechanism of employment agencies was ineffective to address non-compliance; agencies regularly charged migrant workers fees higher than the 10,000 NPR ($84) government-set limit. Many migrant workers remained unaware of the process for obtaining redress, including in cases of trafficking. The DoFE regulates and monitors recruitment agencies and pre-departure orientation centers for migrant workers and handles complaints of exploitative labor by returning migrant workers. DoFE officials continued to advise abused migrant workers to register complaints under the 2007 FEA rather than notify police. In January 2020, DoFE and the police signed an MOU to allow labor trafficking victims to file complaints at local police stations instead of requiring them to travel to Kathmandu. Although the pandemic hindered the effective implementation of the provision, the DoFE reportedly began to refer labor trafficking cases to police but did not report how many cases were referred. Many labor trafficking victims preferred to submit claims for restitution through the 2007 FEA in lieu of lengthy criminal prosecutions under the HTTCA, citing the desire to avoid the stigma associated with trafficking, the higher potential for compensation through the 2007 FEA, and the lack of time and funding to access the centralized institutions charged with providing redress. An international organization reported DoFE continued regular monitoring and inspection of recruitment agencies suspected to be conducting irregular activities during the pandemic; however, FEB did not report if it identified or referred any non-compliance cases during the reporting period. Observers reported DoFE settled the vast majority of labor complaints administratively and did not refer violators to the FET for civil penalties nor to police for criminal investigation. DoFE officials stated employment agencies continued to regularly charge Nepali workers during the reporting period for visas, airplane tickets, and/or service fees above the cap, and added that they believed bilateral labor agreements with destination countries would be essential for enforcing labor rights. DoFE required additional staff, training, and resources to fully implement and monitor the government’s 2015 low-cost recruitment policy.

While the informal sector employed more than 70 percent of workers in the country, including nearly all child laborers, inspectors did not regularly inspect the informal sector for violations, including forced labor. The government continued to fund and conduct inspections focused specifically on child labor; however, the Department of Labor (DOL) did not report referring any employers for criminal investigation or issuing any administrative penalties. NGOs reported the DOL did not take meaningful action against perpetrators of child labor and forced child labor and did not undertake many unannounced inspections. DOL did not report how many child laborers it identified or removed from exploitative conditions during the reporting period, and it typically only removed children whom employers physically or sexually abused. While civil society reported forced and bonded labor at carpet factories, labor inspectors—who received training on forced labor, although no training on trafficking more broadly—did not regularly monitor the factories, and police did not report investigations into allegedly exploitative employers. NGOs reported DOL encouraged mediation over prosecution, including in cases of forced child labor. DOL previously passed a guideline to declare child labor-free municipalities and set criteria for all local governments to maintain a child labor-free environment. The government set a target to declare at least 25 municipalities child labor-free by July 2021 and sent more than 30 million subscribers text messages to raise awareness. However, implementation of the project stalled due to the pandemic. Civil society organizations reported the pandemic increased the number of children working in agriculture, domestic employment, and on the streets; a recent study concluded child labor in the carpet and garment industries gradually declined. The government organized media campaigns and workshops to hold discussions on child labor; however, these were limited due to pandemic restrictions. The government did not make efforts to reduce the demand for commercial sex acts. Despite reports of foreign nationals involved in child sex tourism, the government did not make efforts to prevent child sex tourism. The government did not provide anti-trafficking training to its diplomatic personnel.

The government had special committees led by chief district officers to monitor the AES to mitigate regulatory gaps; however, they remained highly dependent on individual officers and did not have a comprehensive regulatory framework for monitoring such establishments. Existing laws did not permit labor inspectors to monitor AES establishments for labor violations, which NGOs reported allowed many establishments to use children and adult trafficking victims with impunity. Observers estimated only half of AES establishments had valid registration. NGOs raised concerns that victims may have had even less chance of being identified when, due to the government’s pandemic-related restrictions, the AES shut down for most of the reporting period and may have moved operations to unmonitored private residences.

As reported over the past five years, human traffickers exploit domestic and foreign victims in Nepal, and traffickers exploit Nepali victims abroad. Nepal is a source, transit, and destination country for men, women, and children subjected to forced labor and sex trafficking. In 2019, the National Human Rights Commission estimated that 1.5 million Nepalis are vulnerable to human trafficking. Sex traffickers exploit Nepali women and girls in Nepal, India, the Middle East, Malaysia, and—to a lesser extent—other Asian countries and Sub-Saharan Africa. Traffickers use Nepal’s open border with India to transport Nepali women and children to India for sex trafficking. Unregistered migrants—including the large number of Nepalis who travel via the open border with India en route to third country destinations and those who rely on unregistered recruiting agents—are particularly vulnerable to forced labor and sex trafficking. Traffickers continue to target young, poorly educated people from traditionally marginalized castes and ethnic minority communities with limited economic opportunities and increasingly utilize social media and mobile technologies to lure their victims. Civil society organizations noted the economic impact of the pandemic increased vulnerability among at-risk groups such as day laborers, AES employees, women, and children. Many Nepalis whose homes or livelihood were destroyed by the 2015 earthquakes—especially women and children—remain vulnerable to trafficking.

Labor traffickers exploit Nepali men, women, and children in Nepal, India, the Middle East, and East Asia in construction, factories, mines, domestic work, begging, and the adult entertainment industry. The government estimates approximately 1.5 million Nepalis work in the Middle East, with the vast majority of men in construction in Saudi Arabia, Qatar, and the UAE. Nepalis work under oppressive conditions, which include forced labor, and continuing reports indicate employers retain their passports and sometimes do not pay them for months at a time. Foreign employment is often regarded as a respectable way to earn money to support families, but many migrant workers are not well-informed about their rights or applicable laws. Due to the government’s restrictions on female domestic workers to Gulf countries, many Nepali domestic workers in Iraq, Kuwait, and Saudi Arabia do not have valid work permits and migrate through irregular channels, increasing their vulnerability to trafficking. Traffickers lure women with the promise of work as domestic servants or in the entertainment sector in the Middle East, Sub-Saharan Africa, and Malaysia. Labor traffickers exploit Nepali men, women, and children in East Asia, including in Japan, Malaysia, and the People’s Republic of China (PRC), and in Europe, including Portugal, on farms and in construction, factories, mines, begging, and the adult entertainment industry. Trafficking of unemployed residents in districts of the northern Nepal-PRC border for manual labor and commercial sex was prevalent prior to the border closure due to the pandemic. Traffickers bring Nepali victims to European countries and Australia on tourist, student, marriage, and work visas. An international organization reported a rise in Nepalis using tourist visas for foreign employment due to pandemic restrictions and the temporary suspension of work visas in destination countries.

Some recruitment agencies and agents engage in fraudulent recruitment practices and impose high fees to facilitate forced labor. Migrant workers reported that recruitment agencies sometimes provided inaccurate information about the nature and conditions of work abroad, and migrants often discovered they were required to work in jobs that differed from what they had been promised. Traffickers target unregistered migrants, including the large number of young Nepali women who transit India or men and women who rely on unregistered recruitment agents. Some Nepali women who agree to arranged marriages—through Nepali companies—to men in the PRC and South Korea are forced into domestic servitude. Traffickers subject some migrants who transit Nepal en route to the Middle East to human trafficking, including Bangladeshis and Sri Lankans who use falsified Nepali travel documents. Some government officials allegedly accept bribes to include false information in Nepali identity documents or provide fraudulent documents to prospective labor migrants, which allows recruiters to evade recruitment regulations. The lack of a birth registration system and database in Nepal further contributed to the production of fraudulent identification documents. Traffickers reportedly take advantage of more relaxed pre-departure screenings at Kolkata and Chennai airports or bribe Indian officials in New Delhi and Mumbai to fly Nepali migrant workers to third countries without proper documentation, which increases the workers’ vulnerability to trafficking. Labor traffickers also transport Nepali victims through Sri Lanka and Burma en route to destination countries. Traffickers increasingly used social media and mobile technologies to lure and deceive victims during the government’s pandemic-related lockdown.

Within Nepal, forced labor, including through debt-based bondage, of adults and children exists in agriculture, brick kilns, the stone-breaking industry, and domestic work. For example, traffickers use debt to coerce a community of landless Dalit known as Haruwa-Charuwa into forced labor in the agricultural sector in certain districts of the eastern Terai region of Nepal. Agricultural bonded labor in Nepal has historically affected the Haruwa-Charuwa, the Haliya, and the Kamaiya communities disproportionally. High-interest loans, landlessness, discrimination, limited livelihood opportunities, and inadequate government policies contribute to intergenerational bonded labor. Households frequently take on high-interest loans for healthcare expenses, funeral costs, and other necessities while earning low wages, resulting in debts passed from one generation to the next. A 2021 study estimated that 1.1 million children are engaged in child labor—compared to 1.6 million children in 2008—with 87 percent of cases occurring in the agriculture sector. In addition, approximately 74 percent of children engaged in the informal sector worked in hazardous conditions. A government study documented more than 61,000 Nepalis—including approximately 10,000 children—in forced labor over the past five years, especially in agriculture, forestry, and construction. NGOs continued to report some children worked in brick kilns, including carrying loads, preparing bricks, and performing other tasks at kilns for extended periods. A 2021 international organization report estimated 17,000 children worked in brick kilns. Traffickers subject Nepali and Indian children to forced labor in domestic work, brick kilns, the embroidered textile (Zari) industry, as well as in carpet factories and stone quarrying. According to the government’s 2017-2018 labor survey, traffickers force children younger than 15 into labor in agriculture, forestry, and construction. Some Nepali brick kilns employ Indian migrant laborers, including children, who take out large advances that require them to work for subsequent seasons. Traffickers exploit debts to compel adults and children into labor in carpet factories. Parents sometimes force their children to work in carpet factories to repay family debts. Some Nepali parents give their children to brokers, who promise education or work opportunities but instead take them to frequently unregistered children’s homes and force them to pretend to be orphans to garner donations from tourists and volunteers, and, where some force children into manual labor or begging, force them to entertain visitors for donations and sexually abuse them. International organizations and NGOs estimated that 80 to 85 percent of children in “children’s homes” and orphanages had at least one living parent at home. Recruitment agents promise Bangladeshi workers well-paying jobs in Nepali carpet factories but exploit them, including by obtaining tourist visas for them instead of work visas and paying less than the agreed wages. Traffickers use children to transport drugs across the Indian-Nepali border.

Traffickers subject Nepali girls, boys, and transgender persons to sex trafficking in Nepal on the streets and in the AES, including dance bars, massage parlors, and cabin “restaurants,” a type of brothel. A study focused on the Kathmandu Valley determined approximately 17 percent of workers in the AES are minors and 62 percent of adult women in the AES had commenced work while a minor, including as young as 7 years old. Many women reported a family or friend had connected them to the establishment, where they voluntarily agreed to waitress-like positions. Their employers then exploited them in forced labor or sex trafficking. The study estimated nearly 30 percent of all minor workers in AES establishments are victims of forced labor, usually as restaurant staff, and employers later subject many to sex trafficking. Police report an increasing trend of AES businesses recruiting Nepali female employees for work abroad in the same sector, which increases vulnerability to sex trafficking. NGOs alleged some police and political party leaders are complicit in sex trafficking because of their financial involvement in the AES. Only about 25 percent of the adult entertainment venues in Kathmandu and other major cities were operational in 2021 due to the government’s prohibitory orders and social distancing. NGOs reported that pandemic-related closures increased strain on individuals working in the AES, and some women were forced into sex trafficking. NGOs reported that businesses increasingly moved into residential and underground areas. A study on commercial sexual exploitation of children found that children living on the street were highly vulnerable to trafficking. Researchers estimated that there are approximately 2,000 to 3,000 child victims of commercial sexual exploitation outside the adult entertainment sector. NGOs reported girls in early and forced marriages, especially in the Terai region among Dalit and Madhesi communities, were vulnerable to sex traffickers.

Under false promises of education and work opportunities, some Nepali parents give their children to brokers who instead take them to frequently unregistered children’s homes and force them to pretend to be orphans to garner donations from tourists and volunteers. The government instructed childcare homes to return children to their families prior to the government’s pandemic-related lockdown; approximately 1,500 children were reunited with their families or returned home in 2020. However, NGOs estimate more than 11,000 children remain in registered children’s homes and “orphanages,” and international organizations and NGOs approximate 80 to 85 percent have at least one living parent. Seventy-five percent of registered Nepali orphanages and children’s homes are located in the country’s five main tourist districts, out of 77 national districts. Some of the orphanages and homes force children into manual labor or begging, force them to entertain visitors for donations, and sexually abuse them. Since 2016, police have identified and arrested at least 12 tourists or international volunteers, all men older than 50, mostly from Western countries (Austria, Canada, Denmark, France, Germany, India, Netherlands, the United Kingdom, and the United States), for sexual abuse of Nepali children, including child sex trafficking. Although there is increased will to act against the traffickers operating these children’s homes, NGOs reported some owners of exploitative child institutions, including fake orphanages, use political connections to thwart child protective agencies and prosecution. In addition, some child-care homes register as educational hostels to avoid government monitoring.

The government recognized Bhutanese and Tibetans as refugees but regarded refugees and asylum seekers of other nationalities as irregular migrants. The government provided registered Bhutanese refugees an identification card that was renewed periodically and provided to children upon reaching 16 years of age. The government has not issued new refugee cards for Tibetan refugees since 1995 nor recognized any Tibetans who arrived after 1990, leaving most of the government-estimated 12,540 Tibetan refugees in the country undocumented, which prevents them from legally working, studying, traveling, and accessing public services. According to a local NGO, upwards of 6.7 million individuals—one-quarter of Nepal’s population—lack citizenship documentation, rendering them de facto stateless. Legal requirements on transferring citizenship continue to impose hardships on children whose fathers are deceased, abandoned, or departed the country to work abroad. Some women are also unable to obtain citizenship due to formal attestation requirements from a male family member. Lack of documentation precludes the participation of all these groups in the formal economy and increases their vulnerability to traffickers.