KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s economy and infrastructure landscape showed mixed signals across key sectors, reflecting both structural pressures and emerging opportunities. The capital market remained under strain, with NEPSE declining for the fifth straight session amid weak investor sentiment, even as turnover rose modestly, suggesting cautious trading activity rather than renewed confidence.
Regulatory actions intensified, with the CIAA moving ahead on a high-profile corruption case involving former ministers and the central bank tightening liquidity management by withdrawing Rs 90 billion while simultaneously reviewing restrictive blacklisting rules that may be discouraging investment.
External trade frictions persisted as new Indian customs measures increased export costs, especially for goods routed through Biratnagar, underscoring Nepal’s vulnerability to unilateral policy shifts from its largest trading partner. Agriculture displayed both gains and losses: rice and paddy output suffered in districts like Jhapa and Sunsari due to unseasonal rains, while orange and cardamom production surged, driven by supportive local programs and strong international demand.
In energy, hydropower development advanced with capacity increases in the Upper Myagdi project and partial resumption of the flood-damaged Rasuwagadhi plant, signalling long-term strengthening of Nepal’s electricity supply. Meanwhile, the government’s allocation for fertilizer imports and ongoing infrastructure projects—such as highway expansion—reflect efforts to stabilize production and improve connectivity.
On the other hand, the tourism sector showed resilience, evidenced by the arrival of high-end American travelers and Nepalgunj’s plans to host a cross-border tourism conclave. Financial markets also saw modest corporate developments, including Nabil Bank’s cash dividend announcement and slight fluctuations in gold and silver prices.
Overall, the updates highlight an economy navigating external shocks, policy reforms, and sector-specific recoveries while grappling with liquidity challenges, governance concerns, and weather-induced agricultural volatility.
NEPSE drops by 23.50 points
The stock market continued its downward trend on Sunday—the first trading day of the week—with all major indicators declining for the fifth straight session. The Nepal Stock Exchange (NEPSE) index fell by 23.50 points, closing at 2,607. Although the market briefly climbed to 2,636 at 11:09 AM, it gradually weakened throughout the session. Turnover increased by Rs 100 million compared to the previous day, reaching Rs 5.33 billion. Out of the listed companies, 46 gained in value, 204 declined, and 8 remained unchanged. Swastik Laghubitta, Shreenagar Agritech, and Jhapa Energy all surged by 10 percent, hitting their highest-ever share prices.
CIAA seeks Rs 8.36 billion in Pokhara airport corruption case
The Commission for the Investigation of Abuse of Authority (CIAA) is filing a corruption case related to the construction of Pokhara International Airport, naming five former ministers and others as defendants. CIAA officials say the case will demand a recovery of Rs 8.36 billion. The former ministers being charged include Bhim Acharya, Ram Kumar Shrestha, Dipak Amatya, Ram Sharan Mahat, and the late Post Bahadur Bogati—represented legally by his wife, Ram Maya Bogati.
Gold price dips by Rs 200 per tola; silver rises by Rs 50
Gold prices in Nepal fell slightly on Sunday, declining by Rs 200 per tola (11.66 grams). According to the Federation of Nepal Gold and Silver Dealers’ Association, fine gold was traded at Rs 252,200 per tola, down from Friday’s rate of Rs 252,400. Meanwhile, silver prices increased by Rs 50 per tola, rising from Rs 3,555 to Rs 3,605.
NRB to withdraw Rs 90 billion for 84 days to ease excess liquidity
Nepal Rastra Bank is preparing to absorb Rs 90 billion from the banking system on Sunday for 84 days through its deposit collection instrument, a measure aimed at managing the persistent surplus liquidity in banks and financial institutions. The central bank has been frequently withdrawing funds for longer periods in recent months due to the high availability of lendable money. These auctions are part of the NRB’s routine operations held every Sunday and Wednesday. Only ‘A,’ ‘B,’ and ‘C’ class financial institutions may participate, with minimum bids set at Rs 100 million and additional bids allowed in multiples of Rs 50 million.
Govt sets aside Rs 28.82 billion for fertilizer imports
The government has allocated Rs 28.82 billion to import chemical fertilizers, targeting the procurement of 550,000 metric tons this fiscal year. Tenders have already been floated for 465,000 metric tons. The Ministry of Agriculture and Livestock Development reports that 266,510 metric tons are currently in the supply chain. Of this, Agricultural Inputs Company is importing 180,491 metric tons, while Salt Trading Corporation is bringing in 86,016 metric tons. There are also 86,333 metric tons in existing warehouse stock.
Governor Poudel to reassess blacklisting rules
Nepal Rastra Bank Governor Dr. Biswo Nath Poudel announced that the central bank has begun reviewing its blacklisting framework, saying the current approach is one factor slowing investment growth. Speaking at the Nepal Economic Journalists’ Association anniversary, he noted that roughly 150,000 borrowers are listed as defaulters. The review will also examine the practice of blacklisting all members of a group investment even if only one defaults. The governor added that the central bank is taking private-sector misconduct seriously, including cases where collateral provided by debtors is purposely undervalued and sold.
Indian rules obstruct Nepali exports at Biratnagar border
Nepali exporters are struggling at the Biratnagar–Jogbani crossing due to the Indian Customs Office’s new “token system” and a sharp rise in parking fees. Under the new rule, cargo vehicles must enter the Indian customs area within 24 hours of receiving a token, with a penalty of Rs 5,000 imposed for entry after 4 PM. Indian officials have also unilaterally increased parking fees from INR 300 to INR 500 (Rs 800) per hour. According to the Morang Merchant Association, these measures are impractical and are increasing export costs, discouraging trade from Nepal.
Upper Myagdi hydropower project capacity raised to 46.25 MW
The capacity of the Upper Myagdi Hydropower Project in Dhaulagiri Rural Municipality has been increased from 37 MW to 46.25 MW following confirmation of adequate water flow. The project, estimated to cost Rs 8.465 billion, has reached 35 percent physical progress. Project adjustments include expanding tunnel dimensions and head height. Officials expect electricity generation to begin by mid-March 2027. A public hearing on the revised environmental assessment was conducted on Saturday.
Cardamom exports double in four months
Nepal’s cardamom exports have doubled in the first four months of the fiscal year 2025/26. Customs data show that 1,823,000 kilograms of cardamom worth Rs 3.974 billion were exported—up from 1,206,000 kilograms worth Rs 1.901 billion during the same period last year. The Federation of Large Cardamom Entrepreneurs Association of Nepal credits the growth to higher international demand and stronger prices, which have reached up to Rs 105,000 per man (40 kg). Production is also expected to rise by 10–15 percent this year, with total exports potentially reaching Rs 8 billion.
Rasuwagadhi hydropower project partially back online
The Rasuwagadhi Hydropower Project, damaged by the July 8 flood triggered by Tibet’s Lhyende stream, has partially resumed operations. After repairs to the headworks, one of the project’s three units—capable of generating 37 MW—was reactivated on Saturday using a river diversion arrangement. Nepal Electricity Authority (NEA) officials said the remaining two units will resume within a month, and the full headworks reconstruction will be completed before next year’s monsoon. Once fully operational, the 111 MW project is expected to generate 613.875 million units of electricity annually, producing revenue of around Rs 3.25 billion.
Jhapa sees decline in rice output
Jhapa district harvested more than 350,000 metric tons of summer paddy this season—specifically 354,315.92 metric tons from 72,742.65 hectares. Although productivity slightly increased to 5.195 metric tons per hectare, total output and area under cultivation both decreased compared to last year. Unseasonal October rains damaged about 23,564.33 metric tons of paddy, causing losses estimated at Rs 78.1 million. Farmers are currently selling medium-quality paddy for Rs 3,000 per quintal and coarse paddy for Rs 2,750—both below the government’s minimum support prices.
Orange output in Kavre expected to rise
Kavrepalanchowk district is projected to see a 10–15 percent increase in orange production this year, recovering from last year’s seven percent drop caused by floods and landslides. The District Agriculture Development Office estimates output will reach around 8,000 metric tons. The improvement is attributed to local government assistance and ongoing orange orchard rehabilitation programs. Historically, the district earns more than Rs 400 million annually from orange sales. Treatment of aging trees and awareness programs have also helped revive productivity across approximately 1,300 hectares of orchards in areas like Panauti and Dhulikhel.
Sixty-five high-end American tourists arrive in Kathmandu
A chartered Airbus flight operated by the UK’s Tyn Air landed in Kathmandu on Sunday carrying 65 high-end American tourists, despite the instability following the Gen-Z protests. The travelers arrived from Bhutan via a Bhutan Airlines flight after beginning their journey in Kona, Hawaii, with travel stops in Guam, Thailand, and Cambodia. Because Bhutan’s Paro airport has a short runway and load restrictions, the group transferred aircraft before flying to Nepal. They are staying at Dwarika’s Hotel and will visit major cultural landmarks including Pashupatinath, Boudhanath, and the Durbar Squares of Patan and Bhaktapur. Each tourist is expected to spend about USD 500 in Nepal.
International Civil Aviation Day marked globally
International Civil Aviation Day was observed worldwide on Sunday under the theme “Safe skies and a sustainable future for all.” The United Nations formally recognized December 7 as International Civil Aviation Day in 1996 to promote awareness of the sector’s role in sustainable development. The observance supports the International Civil Aviation Organization (ICAO), which leads efforts to ensure a safe, secure, inclusive, and environmentally responsible global air transport system.
Nabil Bank declares 12.50 percent cash dividend
Nabil Bank has announced a 12.50 percent cash dividend (including tax) based on its profit from fiscal year 2024/25. The decision was made during Friday’s board meeting and will take effect once it receives approval from Nepal Rastra Bank and the bank’s annual general meeting. With a paid-up capital of Rs 27.5 billion, the total payout will amount to Rs 3.38 billion.
Nepalgunj to host cross-border tourism conclave
Nepalgunj is set to host a “Cross Border Tourism Conclave” on December 19–21 to promote Indian tourist arrivals. The event is being organized by the Nepal Tourism Board with coordination from the Nepal Association of Tour and Travel Agents (NATTA) Banke Chapter. The conclave aims to revitalize western Nepal’s tourism industry by facilitating experience-sharing between Nepali and Indian tourism stakeholders. Activities will include B2B sessions and a safari at Banke National Park. Stakeholders have urged the government to create a more conducive environment for Indian tourists.
Comment