The correct word to indicate nationality must be "NEPALESE". The use of "NEPALI" is not correct for indicating nationality.
The correct word to indicate language must be "KHAS bhasa". The use of "NEPALI" for khas language is not correct.

The use of words like NEWARI and KIRANTI to indicate languages of Newah and Kirant is also wrong. It must be said either "Newah Nepali, Kirant Nepali" or "Nepalbhasa, Kirantbhasa". We do not have Tamangi, Gurungi, Limbui, Magari languages, do we ?  The indigenous ethnic groups such as Newah, Tamang, Gurung, Magar etc. should not have "I" added behind their ethnic identity to name their respective languages. But we do have Maithili, Bhojpuri, Abadhi etc. which are from Indo-aryan family and  have more closure ties with Sanskrit language. Additional  examples are hindi, marathi, singhali, etc.

Nowadays, people have understood that the use of words like NEPALI, NEWARI, KIRANTI is wrong. These words were intensionally or ignorantly imposed in our society and practiced for sometime. We need to abandon these wrong words from our daily uses.

Let me tell you why NEPALI is a wrong word. The excessive use of NEPALI to indicate Khas language is merely the result of Shah Rana's policy who provided state sponsorship to call Khas language and literature as the NEPALI language and literature for about a century. Before that the Khas language was not NEPALI but it was GORKHALI language. The name NEPAL+I follows LOCATION+I format. For any language to be associated with the location, it must be originated and developed in that particular location. Historically Khas language was not originated in historical Nepal which extends to the region covered by Nepal mandala. This region includes the areas of Dolakha, Kabhre, Sindhupalchok, Bhaktapur, Lalitpur, Kathmandu, Nuwakot and Makwanpur districts. Known history has traced back the origin of Khas language and civilization to Sinja Valley of western Nepal which was then called as Khas Rajya. The name should not be renamed when the language travels from one location to other. We can take an example of English that is named after England. The language has travelled the entire World, but is always named after the location where it was originated. The language is not renamed as Australish language in Australia or Indish language in India. It remained as the English everywhere. Therefore it is logically incorrect to call Khas language as the Nepali language. In addition to that, for the historic Nepal, the Khas language is equivalent to the language of Gayasuddin who invaded the Nepalese civilization. The massive and forceful use of NEPALI for the Khas language is nothing but hijacking the identity by invador, which should not prevail in the modern world.

Now, let me tell you why we should not use NEWARI or KIRANTI. Obviously the format of NEWAR+I or KIRANT+I does not match to NEPAL+I, The NEWARI and KIRANTI have CAST+I format. If they keep this CAST+I format rule, then the true name for Khas language should be KHAS+I = KHASI language,  .  But, you notice that Khas people get badly offended if you call KHASI language to their language. This implies that the use of CAST+I format to call a language is an offensive way of naming. With power, politics and profanity, Khas peopld have used the offensive CAST+I format names to others for very long time and were thus developed a habit of offence to others. Now enough is enough. This would not be tolerated as others have started learning what is behind this all. Therefore I urge all to abandon the habit of using NEWARI, KIRANTI etc. (CAST+I) format naming to the language of respective cast group. Calling by an appropriate name is the true respect you show to a different language.