On January 18, 1993 Nepalese Parliament passed an Act for establishing BPKIHS as an autonomous institution. On May 30, the Senate (Governing Council) of the Institute was constituted under the Chairmanship of Minister of State for Health Dr. Ram Baran Yadav.

BPKIHS took over the management of 150 bedded former Eastern Regional Hospital on 16 July 1993 that marked the formal launching of the Institute at Ghopa, Dharan.

On the auspicious day of Mahashivaratri, March 10, 1994 the final Indo-Nepal agreement for establishment of B.P. Koirala Institute of Health Sciences at Dharan was signed in Kathmandu at ministerial level. The signatories were Mr. B. Shankaranand, Minister of Health and Family Welfare of India and Dr. Ram Baran Yadav, Minister of State for Health, HMG, Nepal.

Subsequently, the Parliament has upgraded the status of this Institute to a university level and has broadened its scope in preparing various health workforce required for the country. The bill was approved by His Majesty King Birendra Bir Bikram Sahadev on 28 October 1998. Now, the Institute has Prime Minister as Chancellor and Health Minister as Pro-Chancellor. Vice Chancellor is appointed by the Chancellor for a tenure of five years.

Under the agreement Government of India provided a sum of Indian Rupees 640,000,000 for construction of a 350 bedded hospital and 50 seat medical college complex. Part of the fund was used to renovate the existing buildings at Ghopa to turn them into make shift class rooms, laboratories and faculty rooms. An additional sum of INR 160,000,000 was set aside for faculty development which would cover the cost of training of Nepalese candidates in India and deputation of selected Indian teachers to BPKIHS. Under this budget several Nepalese faculty members have been trained in various specialties.

The year 1994 leaves a permanent mark in the annals of BPKIHS. This year the Academic Committee approved the MBBS curriculum, essentially the product of the seminar on “Medical Education for the Twenty First Century” held in December 1993 and the workshop on MBBS Curriculum Development held in April-May 1994. The first anniversary of the Institute was observed on September 9, 1994 on the occasion of 79th birth anniversary of B.P. Koirala. The then Prime Minister Girija Prasad Koirala inaugurated MBBS Programme on October 19 and laid the foundation stone of 350 bedded hospital and academic complex.

On February 18, 1996 the DPS-BPKIHS school was opened with the help of Delhi Public School, India. The school opened as a consequence of agreements between GOI and HMG, is affiliated to Central Board of Secondary Education (CBSE) India and the curriculum followed is as per CBSE.

On January 7-8, 1996 a conference on Nursing Education in Twenty-first Century and workshop for Development of B.Sc. Nursing Curriculum were organized at Dharan to develop first phase curriculum for generic B.Sc. Nursing. On August 1, 1996 classes of first batch of generic B.Sc. Nursing Programme started for the first time in Nepal.

December 11-14, 1996 witnessed the workshop on development of MBBS Internship Programme followed by a number of workshop & CME programme & conferences held during 1997-98 on Assessment Techniques, Teaching methodology, Teachers Training, Management workshop, Epidemiological Surveillance, Emergency management & Resuscitation, Problem based learning, Integrated health services and important topics of tropical interest in the area of priority health care needs.

During February 22-28, 1998 workshop on Development of Curriculum for Postgraduate Programme was undertaken. After approval by the Academic Committee the MD/MS and M.Sc. Programmes were started in December 1999. Similarly, curriculum development workshop for BDS and Certificate Nursing Programmes were held on 15-20 March 1999 and 10-15 January 1999, respectively. Likewise, Curriculum for Technician Course in Operation Theater and Allied Services was developed on 2-3 April 1999. Separate workshops for developing curricula of B.Sc. Radiography and B.Sc. Physiotherapy & Rehabilitation were held on 4-5 March 2000 and 15-17 March 2000.

Only six years have passed since the formal launching of BPKIHS. We at the end of 1993 feared whether a new health sciences university would ever thrive in a remote place on the outskirts of Dharan which is not even the headquarter of the district. Today it has the highest number of national and international doctors and nurses outside Kathmandu, and BPKIHS is the only institute in the whole of the Kingdom to be so privileged. The achievements of the last six years can be considered as examples or be taken as a challenge for the future which demands more action, more devotion and commitment to make Dharan the Health Capital of the country. BPKIHS which takes pride in being developed as a center of excellence in few years time should be prepared to tread on thorny path, since constraints on many fronts have begun to crop up.

September 9, 1999 has added another milestone in the history of development of BPKIHS. On the occasion of 6th Anniversary of BPKIHS the new teaching hospital complex was dedicated to the nation. The then Prime Minister Mr. Krishna Prasad Bhattarai inaugurated the BPKIHS Teaching Hospital Complex in the presence of Minister of Foreign Affairs of Government of India, Mr. Jaswant Singh. In the inaugural address, Mr. Jaswant Singh announced that the Government of India would continue its support for further five years after 2004.

The most ambitious project to pay tributes to Late Bisheshwar Prasad Koirala by the nation as well as the largest Nepal-India co-operation project in this country so far, this Institute is a monument dedicated to understanding between Nepal and India. BPKIHS will also provide a common platform for specialists from various countries to interact with each other and provide an opportunity to set up an International Village. There are substantial number of Indian Teachers employed here in BPKIHS.