Nepal was hit by an Internet outage lasting up to five hours, due to a dispute between Nepalese Internet Service Providers (ISPs) and Indian telco Bharti Airtel.

As reported by the Kathmandu Post, Bharti reportedly cut off upstream links into the country because Nepal’s private ISPs are behind on their payments.

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– Getty Images

The outage occurred on May 3, at around 5 pm.

"Airtel, a leading telecom provider in India, has cut upstream services to Nepal from today [Thursday]," said Sudhir Parajuli, chairman of the president of Internet Service Providers' Association Nepal.

Service was restored around 10 pm after the national regulator, Nepal Telecommunications Authority, promised to sort out the payment issue ‘responsibly.’

Parajuli noted that Airtel provides around 70 percent of Nepal's upstream services, while Nepal's private ISPs get their international capacity primarily via terrestrial links with India.

It's reported that the ISPs owe Airtel more than $30 million, although state-owned Nepal Telecom, was not impacted by the disruption to Internet services.

Nepal's private ISPs have been in a long-running dispute with the Nepali government over taxes.

The country's previous government exempted private ISPs from paying taxes for non-telecom services such as web services, co-location, hosted services, disaster recovery, managed services, data centers, and cloud services for the fiscal year 2017-2018.

However, the next government overturned this and ordered the companies to back-pay the waived taxes. This is something that the countries' ISPs are continuing to contest.

It's estimated that around 10.6 million people use Internet services in Nepal that are provided by around 20 ISPs.