Foreign embassies in Nepal are flouting diplomatic norms by distributing scholarships without the permission of Ministry of Education (MoE) and Ministry of Foreign Affairs (MoFA). The Indian embassy distributes more than 2000 scholarships every year. Pakistan has an annual quota reserved for 15 Nepali students pursuing MBBS. These scholarships which should have been distributed through MoE are doled out like kickbacks from embassies, often to children and relatives of high-ranking government officials and political leaders. Very few seats are left for open competition while most are given to favoured candidates.

Chairperson of Foreign Affairs and Human Rights Committee, Padmalal Bishwakarma says that embassies have ignored their directive to distribute education assistance only through MoE. More than 50 seats for MBBS which come from China, India, Pakistan and Bangladesh are distributed as 'cultural quotas' without free competition. Government officials admit that politicians frequently visit embassies to secure scholarships for their children. And this is the main reason why no one is keen on regulating the embassies and making these scholarships more accessible.