KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s current economic landscape reflects a mix of cautious financial activity, institutional reforms, and sector-specific disruptions. The NEPSE index declined after a six-day rally, signaling a market pullback accompanied by reduced turnover, while mutual funds continue to deepen their equity exposure, highlighting investor confidence in the stock market’s long-term outlook.
Regulatory bodies are actively shaping the financial ecosystem—SEBON has greenlit perpetual preference shares, and the government has mandated the release of trade-related bank guarantees to ease liquidity for importers.
Meanwhile, policy coordination discussions between the NPC and NRB indicate an effort to realign monetary and fiscal strategies. Across other sectors, agriculture is under pressure due to delayed monsoons, with key provinces reporting significantly lower paddy plantation.
Protests over new taxes have halted gold and silver trade, and municipalities face internal gridlock over budget approvals. Infrastructure development persists despite delays, as seen in the Sun Koshi-Marin project and Ring Road survey.
Tourism and hospitality are in transition, with legacy hotels upgrading and Pokhara yet to deliver on its Tourism Capital promise. These developments collectively underscore a dynamic but uneven recovery path shaped by policy, weather, and institutional efficiency.
NEPSE declines after six-day rise; turnover also drops
After gaining for six consecutive trading sessions, the Nepal Stock Exchange (NEPSE) index fell on Monday, shedding 22.35 points to close at 2,684. Market activity slowed alongside the index, with total daily turnover dropping from Rs 9.50 billion to Rs 8.37 billion. Out of all listed companies, only 39 recorded gains, while 209 saw their share prices decline. Most sector indices ended in negative territory, with the finance sector experiencing the largest drop at 3.76%.
Govt directs banks to release guarantees for trading firms
The government has instructed commercial banks to release security deposits held from companies involved in international trade. Previously, importers were required to maintain a deposit guarantee of NPR 300,000, except during EXIM Code renewals. The EXIM Code remains a mandatory license for conducting cross-border trade from Nepal.
Mutual funds boost stock market exposure to NPR 4.837 billion by mid-June
Investment by mutual funds in the stock market rose significantly, reaching NPR 4.837 billion by mid-June (end of Jestha). This marks a growth of NPR 246 million since mid-April (end of Chaitra), when the figure stood at NPR 4.591 billion. As of mid-June, 72% of mutual fund assets—worth NPR 6.372 billion—were invested in equities.
SEBON permits issuance of perpetual non-cumulative preference shares
The Securities Board of Nepal (SEBON) has updated its Securities Issue and Allotment Guidelines through a ninth amendment, enabling banks and financial institutions to issue perpetual, non-cumulative preference shares. These shares, valued at Rs 100 each, will only be tradable among promoter shareholders. Issuance will be restricted to fewer than 50 institutional investors via private placement, and institutions must first receive approval from Nepal Rastra Bank before applying to SEBON.
Demat account renewal deadline set for July 16
Depository Participants have issued a reminder urging account holders to renew their Demat accounts by July 16. Accounts that are not renewed by the deadline will be frozen, blocking both buying and selling of shares. The renewal fee for a Demat account is NPR 100, while users of the Mero Share platform must pay an additional NPR 50. Both services can be renewed together to maintain seamless trading access.
NPC Vice Chair and NRB governor hold talks on policy coordination
National Planning Commission Vice Chair Prof. Dr. Shiva Raj Adhikari met with Nepal Rastra Bank Governor Dr. Biswo Poudel to discuss improving coordination between monetary and fiscal policies. The meeting, held at the NPC office in Singha Durbar, comes ahead of the 54th National Development Problem Resolution Committee session and the upcoming monetary policy announcement. Dr. Adhikari stressed the need to reassess Nepal’s current economic model and ensure alignment with long-term development goals.
Gold and silver trade suspended nationwide amid tax dispute
Jewelry businesses across Nepal have shut down operations in protest against new taxes introduced in the upcoming budget. The Federation of Nepal Gold and Silver Dealers’ Association has also paused the daily publication of gold and silver prices. The budget unveiled on May 29 imposes a 2% luxury tax on gold and a 13% VAT on diamonds and other precious stones. Traders argue that these measures will significantly raise consumer costs and hurt the industry, prompting shop closures since the last week of Jestha.
Chinese experts complete survey of second section of Ring Road
A Chinese technical team has finished surveying the second section of the Kathmandu Ring Road, covering 8.2 kilometers from Kalanki to Basundhara Culvert. The survey, which took two and a half months, began on April 19 (6th Baishakh). According to Arjun Prasad Aryal from the Department of Roads, a final design report is expected within three months after the team’s return to China, scheduled for this week.
Labor Ministry finalizes draft law for collateral-free migrant worker loans
The Ministry of Labor, Employment, and Social Security has prepared a draft law aimed at offering collateral-free loans to Nepali migrant workers heading abroad. The draft, titled “Procedure for Providing Collateral-Free Loans to Nepali Workers Going Abroad 2082,” is in its final phase. Joint Secretary Jiblal Bhusal is leading the drafting process.
Minister Pandey heads to France to advocate for Tilaurakot’s heritage listing
Culture, Tourism, and Civil Aviation Minister Badri Prasad Pandey departed for Paris on Monday to attend the UNESCO World Heritage Committee meeting. He is expected to propose the inclusion of Tilaurakot, a historic site in Kapilvastu, on the World Heritage List. Ministry Secretary Hariprasad Mainali and senior officials were present to see him off at Tribhuvan International Airport.
Hatchery Association halts chick production until July 13 over pricing concerns
The Nepal Hatchery Industry Association has announced a temporary halt on broiler and color broiler (cockerel) chick production and distribution until July 13. The suspension applies to all member companies and is in response to farmers’ inability to receive cost-based prices. Senior Vice President Rajendra Lamichhane explained that the decision aims to pressure stakeholders to ensure fair pricing in the poultry industry.
Contract extension likely for delayed Sun Koshi-Marin diversion project
The government is preparing to extend the contract for the construction of the Sun Koshi-Marin Diversion Multipurpose Project, which has faced delays. The joint venture between India’s Patel Engineering and Nepal’s Raman Construction is responsible for the project. At a federal infrastructure committee meeting, Energy Minister Deepak Khadka stated that the contractor has been asked to submit a revised timeline to justify the extension.
Paddy plantation in Terai Madhesh falls sharply due to lack of rainfall
Paddy cultivation in Terai Madhesh Province has dropped significantly this year compared to the same period last year, mainly because of insufficient rainfall. According to the Agriculture Department, only 13.6% of the land had been planted with paddy as of Asar 20, compared to 25.5% last year. Agriculture Director General Prakash Sanjel stated that planting has mostly occurred only in irrigated regions due to the lack of rain.
Bagmati Province sees only 20.51% paddy plantation so far
As the month of Asar nears its end, only 20.51% of cultivable land in Bagmati Province has been used for paddy plantation. Pramod Prasad Dahal, spokesperson for the Bagmati Province Agriculture Directorate, said delayed monsoon rains have left around 80% of farmland uncultivated. Out of a total of 534,871.60 hectares, only 120,610.25 hectares have been planted with rice.
Koshi province and insurance authority discuss coverage expansion
The Koshi Province government and Nepal Insurance Authority held a joint interaction in Biratnagar to explore ways of expanding insurance access. Chief Minister Hikmat Kumar Karki announced plans to form a high-level committee and draft a provincial insurance policy. He emphasized the importance of extending coverage to low-income citizens and promoting home insurance in the upcoming fiscal year.
Budget uncertainty continues in Jitpur Simara and Nijgadh municipalities
The annual budget discussions in Bara’s Jitpur Simara Sub-Metropolitan and Nijgadh Municipalities have hit roadblocks due to internal disputes. Jitpur Simara’s second municipal assembly meeting was postponed indefinitely, and members of the Nijgadh assembly boycotted their session. Disagreement over capital expenditure, particularly a proposed NPR 30 million allocation within Jitpur Simara’s NPR 201 million budget, has stalled progress.
Technical issue disrupts customs operations in Birgunj
Customs clearance in Birgunj has been affected due to a malfunction in the ASYCUDA system, which automates international trade and customs processes. The disruption has caused delays in daily customs-related tasks. ASYCUDA plays a key role in managing customs data and trade procedures.
Legacy five-star hotels renovate to compete with newer rivals
Older five-star hotels are upgrading their infrastructure to stay competitive amid growing pressure from newer luxury hotels. Long-standing names like Hotel Annapurna, Shangrila, Yak and Yeti, Mall Hotel, and Everest Hotel have launched modernization efforts to retain their appeal in Nepal’s evolving tourism market.
Pokhara yet to begin tourist data collection 15 months after tourism capital declaration
Despite being declared the Tourism Capital over 15 months ago, Pokhara has not started collecting official data on tourist arrivals. Tourism stakeholders say roughly 40% of Kathmandu visitors also travel to Pokhara, but no formal statistics exist. The city was jointly named the Tourism Capital by Gandaki Province and Pokhara Metropolitan on Chaitra 4, 2080 BS.
Cliff honey collected in Tarakhola’s community forest in Baglung
Traditional cliff-side honey harvesting has taken place in Tarakhola Rural Municipality of Baglung district. This year, 150 liters of honey were gathered from Julphe and Thulobhir community forests in Tarakhola-5. According to Narayan Gharti, secretary of the Julphe Community Forest User Group, this year’s harvest was smaller than last year’s 260 liters.
Abhiyan Microfinance shares to be tradable from Shrawan 30
Shares of Abhiyan Microfinance will become tradable on the secondary market starting Shrawan 30 (August 15), following the end of the lock-in period on Shrawan 29. A total of 1,525,000 shares held by founding shareholders and 12,500 shares owned by employees will be eligible for trading.
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