1020 GMT February 21, 2020
The bus was heading to the Indian town of Gorakhpur returning from a pilgrimage to the famed Hindu temple of Pashupatinath in Kathmandu, when the accident happened.
"Twelve Indian passengers were killed on the spot. Five others died during treatment," Hemant Bahadur Chettri, a local police official, told AFP.
More than two dozen injured have been taken to Kathmandu for treatment, four of whom are said to be in a critical condition.
"Many families have reached out to us. Two help lines have been put in place for anyone who needs to contact us," Abhay Kumar, an official from the Indian Embassy in Nepal, told AFP.
Kumar said most of the passengers came from the western state of Gujarat.
Deadly crashes are relatively common in the impoverished Himalayan nation because of poor roads, badly maintained vehicles and reckless driving.
Four South Korean tourists were killed on the same highway last month when their minibus collided with an oncoming bus.