Persistent inequality in education has been one of the pressing political and moral challenges in Nepal. As a response to this, there have been several efforts to introduce social justice, affirmative action, and equity measures in the implementation of education policy. Education scholarship programmes for needy and deserving students is one of such programmes. Due to the ‘targeted’ nature of these programmes, scholarship recipients are identified based on their ‘need’, both socioeconomic inequality and cultural marginalization. Drawing on the ethnographic fieldwork of scholarship distribution process, this paper will highlight the characteristics of dynamics that is generated in this context. The focus of this paper is on the processes, strategies, and social relations through which people encounter the state and get access to education programmes that are meant to ensure social justice and equality. The paper argues that the rules, practices and effects of the state-sponsored education initiatives could form the basic tools for citizen engagement with the state. In the targeted policies, such as Scholarship Programmes, the procedures such as getting on the list, obtaining recommendation from the local authority etc. and interaction with various other intermediary actors during this process can impact the ways in which state is understood and interpreted in everyday lives.