Badri Pun, a former national volleyball athlete, quit sports when he was 22.
Now 37, Pun, also an LGBTI activist based in the capital Kathmandu, says coming out as a "third-gender" has been "the biggest drawback" professionally.
"Because I was different from my team members, I was stripped off the opportunities of participating in international competition," Pun recalls.
Almost 15 years later, Nepal is a new country today. With changed political leadership and social reforms, the country once known for its mountains and the Maoist conflict is now recognized for its gay rights movement.
In one of the latest efforts by activists, Nepal has launched an LGBTI sporting event that will further help in mainstreaming the LGBTI community in the country.
Organized by the Kathmandu-based Blue Diamond Society (BDS), Nepal's first non-government organization advocating on gay rights issues, "Blue Diamond National Sport Competition 2012" is scheduled for September.
The sporting event, which is being referred to as Nepal's "gay Olympics," will feature volleyball, football, long jump, and martial arts, among others.
A first of its kind in South Asia, supported by the Australian Sports Outreach Program, the gaming event will help "boost confidence of LGBTI members" and "enhance their image in the society," says Sunil Babu Pant, director of BDS and Nepal's only openly gay parliamentarian.
"Sports is something that will always get good attention," says Pant in an email. "Its about creating space as well as joining the space that exists."
But while most of the policymakers are planning and discussing policies of the country, they tend to ignore an integral part of the issue: the people and their rights.
Kyle Knight, Fulbright Fellow researching Nepal's LGBTI rights movement, says the 2007 Supreme Court decision in Pant v. Nepal contains some of the most progressive LGBTI laws in the world.
However, the Government of Nepal has been slow to implement many of these changes.
"But the relentless activism -- including public awareness and inclusion campaigns such as the 2012 LGBTI sports competition -- keeps the issues fresh and encourages change to happen in a very real way," Knight says.
And it's because of the campaigns and local consciousness about these issues that Nepal's goodwill stands out in the South Asian region, and also globally.
The New York Times listed Nepal as the "next gay destination" in 2010. In late 2011 U.S. Secretary of State Hillary Clinton commended Nepal during her speech on LGBT human rights in Geneva.
At a time when the Dharun Ravi case has sparked speculations on cultural bias against gays in India, in Nepal, though biases and discrimination still prevail, at least people are making an effort to understand the issue.
Compared to neighboring India, which also shares a close cultural tie to Nepal, the Himalayan nation is relaxed when it comes to LGBTI-related issues.
Pant says the issue is "not a taboo, at least to mention in the public, and people talk about it openly."
While homosexuality is a hush-hush affair is many cultures, the Himalayan republic has a television show, which Pant hosts, that discusses LGBTI issues in the public domain. Lately, a gender-reassignment surgery undergone by the son of one of Nepal's well-known actors was widely talked about, and also accepted, especially in the blogosphere. A Nepali film on a lesbian love story is in the pipeline.
In 2007 Nepal's Supreme Court ordered the government to scrap all laws that discriminate against LGBTI people in Nepal. It also gives people the right to identify themselves as "third-gender" and obtain their passports or citizenships accordingly.
Four years after the decision, as the country is meddling in drafting its new constitution, the 2007 decision has not been fully implemented in Nepal. However, Nepal's new constitution is likely to have the provision of same-sex marriage. Activists expect the new constitution to guarantee full rights for LGBTI people and define marriage as between two persons regardless of gender.
Pun is one of the two people in Nepal who have acquired official recognition as a "third-gender" citizen, allowing him to choose an identity apart from "male" or "female" (there are three people who have IDs that are not "male" or "female," but one says "both," not "third-gender").
Years later, though Pun is happy with his identity and actively propagating LGBTI rights, he says it is sad to see how discrimination killed his dream.
"I could have been a senior coach," Pun says, reflecting on the recent national games where he saw his friends as coaches and in other official positions.
"It [the game] will also help create an environment for people to open up," Pun says.
Arpan Shrestha contributed reporting from Kathmandu, Nepal.