KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
The commercial banking sector in Nepal is showing mixed movements in interest rates for Chaitra, with some banks adjusting their rates. While most institutions have maintained the rates from Fagun, a few have made changes.
For example, Himalayan and Citizens Bank have lowered their personal fixed deposit rates, while Kumari Bank has raised rates for both personal and institutional deposits.
Meanwhile, the Governor Recommendation Committee for Nepal Rastra Bank has been finalized, with a process underway to appoint a new governor, as current Governor Maha Prasad Adhikari’s term nears its end.
The tourism sector continues to grow, with loans surpassing NPR 216 billion, signaling a robust recovery in this critical industry. Additionally, credit card usage has surged past NPR 6 billion, reflecting growing consumer adoption of cashless transactions.
The weather disrupted operations at Tribhuvan International Airport, while preparations for the Mount Everest climbing season continue, with expectations for higher participation.
On the telecom front, the sector faces challenges in rolling out 5G services due to financial strains and regulatory delays. Lastly, Nepal is being urged to regulate the import of Chinese garlic, with concerns raised by India over excessive re-exports.
Commercial banks announce chaitra interest rates
Commercial banks have disclosed their interest rates for Chaitra, with most maintaining the rates from Falgun.
Himalayan and Citizens Bank have lowered their rates to 5.5% and 5.65% for personal fixed deposits, respectively. Kumari Bank has raised its rates to 6.01% (personal) and 5.01% (institutional).
NMB and NIC Asia have kept their rates at 6.6% (personal) and 5.6% (institutional).
Other banks such as Global IME, Machhapuchchhre, Siddhartha, Everest, and RBB set their rates at 6% for personal deposits, with institutional rates varying. Agricultural Development Bank, Nepal SBI, and Nepal Bank have kept their rates unchanged.
NRB governor recommendation committee confirmed
The Governor Recommendation Committee for Nepal Rastra Bank has been officially confirmed, advancing the process of appointing a new governor.
The committee, chaired by Finance Minister Bishnu Prasad Paudel, includes Bijayanath Bhattarai and Dr. Bishwo Paudel as members.
The committee will propose three candidates for the position. Current Governor Maha Prasad Adhikari’s term concludes on April 5, and he is expected to begin his leave shortly.
Tourism sector loans exceed NPR 216 billion
As of Magh this fiscal year, commercial banks have lent over NPR 216.74 billion to the tourism sector, marking a 12.09% increase compared to last year.
Nepal Investment Mega Bank has the highest loan amount at NPR 22.98 billion, followed by Prabhu Bank (NPR 21.57 billion) and Global IME Bank (NPR 19.11 billion).
Other significant lenders include Prime Commercial, Kumari, and Rastriya Banijya Bank. While most banks have increased their lending, Nabil and Standard Chartered have seen slight decreases.
Credit card usage in Nepal surges past NPR 6 billion
The use of credit cards is rapidly increasing in Nepal. According to Nepal Rastra Bank, Nepali consumers took out loans totaling NPR 6.12 billion via credit cards in the first seven months of the current fiscal year, up from NPR 5.35 billion during the same period last year.
In January alone, credit cardholders made 251,000 transactions worth NPR 1.85 billion. With the option to spend now and repay later, credit cards have become more popular, contributing to the rise in cashless transactions.
Weather disruptions at TIA
Inclement weather caused disruptions at Tribhuvan International Airport, leading to missed landings and delays on Thursday.
An Air Arabia flight aborted its landing due to wind shear, and other flights, including those from Air India and Thai Lion Air, circled before landing.
Active pre-monsoon conditions have caused poor visibility and erratic winds for a week. More thunderstorms and rain are expected in Koshi, Bagmati, and Gandaki provinces in the coming days.
Preparations underway for Mt Everest climbing season
As spring arrives, preparations for Mt Everest expeditions are progressing rapidly. A team of 10 “icefall doctors” has arrived at Base Camp to secure climbing routes through the dangerous Khumbu Icefall.
Special Buddhist rituals have been conducted to ensure safety during the season. Authorities anticipate a higher number of climbers this year, which will contribute to Nepal’s growing mountaineering tourism.
Nepal’s telecom sector faces crisis as 5G requires $500 million investment
Nepal’s telecom sector is facing a crisis as it requires an estimated $500 million to implement 5G services, according to Ncell CEO Jabbor Kayumov.
Both Ncell and Nepal Telecom are under financial pressure, with limited revenue and regulatory delays hindering progress.
Although the telecom authority has promised quick approval, unresolved infrastructure-sharing policies are complicating the rollout of 5G services despite high demand for faster internet.
India calls for Nepal to regulate Chinese garlic trade
India has urged Nepal to regulate the influx of Chinese garlic, which is being re-exported to India despite import restrictions.
Nepal’s garlic imports surged to NPR 6.26 billion in seven months, far exceeding domestic demand. Indian authorities have raised concerns over this issue, while Nepalese officials argue that an outright ban on imports would be impractical, suggesting stricter monitoring and border control as alternatives.
Bardiya farmers begin Chaite paddy planting
Farmers in Bardiya’s Rajapur and Geruwa areas have started planting Chaite paddy, which is typically cultivated from late February and harvested by June.
However, the area dedicated to cultivation has decreased to 750 hectares this year, down from 1,175 hectares last year. Chaite paddy is primarily used for making beaten rice (Chiura). Challenges with irrigation and sugar mills reducing farmland have affected production.
After the harvest, farmers will begin planting monsoon paddy on over 50,000 hectares in the district.
Dominant companies in NEPSE by market capitalization
Nepal’s stock market is largely driven by a few major companies. The top 10 largest firms by market capitalization on the Nepal Stock Exchange (NEPSE) include leading banks, insurance companies, a telecom provider, and a trading firm.
NEPSE closed on Thursday for Fagu Purnima holiday
The government declared a public holiday on Thursday, Falgun 29, for Fagu Purnima (Holi). As a result, the Nepal Stock Exchange (NEPSE) remained closed, with trading set to resume on Sunday.
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