Kathmandu

Kathmandu functions as Nepal's political, economic, and cultural capital—a city of 1.5 million in a valley that has dominated the Himalayan region for over two millennia. The Kathmandu Durbar Square and six other monument zones form the UNESCO World Heritage Site inscribed in 1979, preserving Newar architecture and Buddhist-Hindu cultural traditions. The 2015 earthquake damaged many historic structures, and reconstruction continues. Tourism reached 1.12 million arrivals in fiscal year 2024, with most visitors passing through Kathmandu en route to Everest treks or other Himalayan destinations. In 2024, UNESCO designated Kathmandu a Creative City of Films, signaling cultural industry ambitions. Private consumption accounts for over 80% of Nepal's GDP, and Kathmandu captures the lion's share. The city's primacy reflects path-dependent concentration: government, universities, international NGOs, and businesses cluster here because everything else is here. This creates dysfunction: traffic congestion, air pollution, and housing costs contrast with village Nepal's emptiness. Remittances from the 2+ million Nepalis abroad flow primarily to Kathmandu and the Central Region, reinforcing wealth concentration. Some 600,000 working-age Nepalis emigrate annually, many fleeing the capital's high costs and political instability for Gulf employment. By 2026, Kathmandu's trajectory depends on whether federalism redistributes resources, whether tourism rebounds to pre-pandemic levels, and whether the city can absorb continued rural migration without infrastructure collapse.