Bandipur was established as a funnelling point of trade by Newar traders fromBhaktapur in the Kathmandu valley after it had been conquered in 1768 by Prithvi Narayan Shah. They took advantage of its malaria free location to develop it into an important stop along the India-Tibet trade route. With them they brought their cultural heritage and architecture which basically has remained unchanged to this day.
Originally a simple Magar village in the early 19th. Century Bandipur developed into prosperous trading centre and a community with town-like features: substantial buildings, with their neoclassical façades and shuttered windows and streets paved with slabs of silverish slate. Bandipur had its heyday in the Rana times (1846-1951), when, as a measure of its power and prestige, it was granted special permission to have its own library (still existing).
In the 1970s, trading fell into a steep decline with the construction of the Kathmandu – Pokhara highway. For technical reasons it was logically built in the Marsyangdi valley, leaving Bandipur isolated up on the mountain. In addition to that, as a result of its poor accessibility, Bandipur lost importance because the district headquarters of Tanahu were moved to Damauli. The tradesmen of Bandipur were forced to move down to Dumre and many even left for the Terai; Bandipur turned a semi-ghost town. The population declined considerably. On two occasions Bandipur has witnessed some turmoil. The people were not easily and readily sidestepped by the construction of the road and fought for a different route in the planning process. In the 1970s, when the first demonstrations for democracy took place in Nepal, the people of Bandipur stormed the little garrison. Several people were killed and the soldiers fled. Again, when the district headquarters were to be moved, the people demonstrated and occupied the administration. The civil servants fled during the night. Even the king was flown in by helicopter to
