KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Despite a modest rise in NEPSE by 9.16 points, the broader economic indicators reveal underlying concerns about Nepal’s economic momentum. The central bank’s withdrawal of Rs 380 billion in liquidity highlights stagnant credit demand and subdued private sector activity.
This is reinforced by the fact that 27 percent of economic and private sector-focused programs went unimplemented in FY 2024/25, pointing to inefficiencies in fiscal execution. Meanwhile, rising gold and cardamom prices reflect shifting investor and market sentiment toward safer or more profitable assets, as traditional investment avenues slow.
Infrastructure delays, like the stalled East-West Highway expansion, further signal structural constraints that could hinder growth. Against this backdrop, events like the NADA Auto Show and initiatives like Digital Nepal Framework 2.0 offer glimpses of progress, but the overall economic environment remains marked by caution and uneven development.
NEPSE gains 9.16 points
The Nepal Stock Exchange (NEPSE) saw a modest rise on Monday, with the index gaining 9.16 points to close at 2,770.39, marking a 0.33 percent increase. Despite the positive movement in the index, overall trading volume declined. Shares worth Rs 6.17 billion changed hands, with a total of 15,229,921 units traded during the day. At the market close, 175 companies recorded an increase in share prices, while 74 companies saw their share prices fall. No company’s shares remained unchanged. During Monday’s session, a total of 320 companies were active, and shares were traded 67,959 times. Investor interest was particularly visible in the trading group, which posted the highest gain of 1.29 percent. All groups, except mutual funds and “other” categories, saw positive movement during the day.
Demand for credit stagnant, NRB withdraws Rs 380 billion in liquidity
Since the beginning of the current fiscal year 2025/26, Nepal Rastra Bank (NRB) has withdrawn a total of Rs 380 billion from the banking system through eight separate operations to absorb excess liquidity. The central bank has taken this step in response to weak credit demand and a slowing investment environment. While liquidity continues to build up in banks, businesses and entrepreneurs are reluctant to take out loans. To prevent an oversupply of funds in the market, NRB has been actively mopping up liquidity to maintain macroeconomic stability.
27% of economic and private sector programs unimplemented in FY 2024/25
In fiscal year 2024/25, 27 percent of the budget programs focused on the economy and private sector were not implemented, according to the Budget Watch report published by the Confederation of Nepalese Industries (CNI). Of the 63 key initiatives, only 25.4 percent were fully executed, while 47.6 percent saw partial implementation. The report highlights poor performance across several sectors. In industrial development and agriculture, most programs were either partially implemented or not executed at all. The information technology sector showed particularly weak implementation, with the majority of plans left untouched. Energy, tourism, and tax reform sectors saw mixed results, with a few programs completed and others partially or not implemented.
Gold prices up by Rs 800
The price of gold increased on Monday. According to the Federation of Nepal Gold and Silver Dealers’ Association, the price of gold went up by Rs 800. With this, the price of gold was set at Rs 196,300 per tola. Similarly, the price of gold went up by Rs 5 and was sold at 2,315.
NADA Auto Show 2025 to begin today
The NADA Auto Show 2025 kicks off today at Bhrikutimandap Exhibition Hall in Kathmandu and will run until August 24. Organized by the NADA Automobiles Association of Nepal, the show will be open daily from 10:30 a.m. to 7:00 p.m. This year’s highlight includes a flying car, among various other vehicles and auto-related products. 75 companies are participating, showcasing four-wheelers, two-wheelers, light commercial vehicles, and offerings from insurance, lubricant, and tire companies.
PM Oli briefed on DNF 2.0 expansion and Nepal Telecom progress
Prime Minister KP Sharma Oli was briefed on the expansion of the Digital Nepal Framework (DNF) and the progress of Nepal Telecom. In a meeting with officials, including the Minister for Communications and Information Technology, he emphasized promoting good governance and development through technology. He was updated on the newly endorsed Artificial Intelligence (AI) Policy and preparations for DNF 2.0, which focuses on strengthening Nepal’s digital ecosystem across sectors like infrastructure, agriculture, education, finance, governance, and more.
Black cardamom prices reach highest level in seven years
The price of large cardamom, often referred to as the “black gold” of eastern Nepal, has surged to a seven-year high at the beginning of the current harvest season. Anil Dhungana, Executive Director of the Federation of Large Cardamom Entrepreneurs of Nepal, reported that black cardamom was sold for Rs 94,000 per 40 kilograms in Birtamod—the country’s major cardamom trading hub. He noted this is a significant increase compared to the same time last year, when prices were around Rs 40,000 for the same quantity. This is the highest price seen since 2018, when it hit Rs 105,000 during the harvest season and climbed to Rs 107,000 by December. The all-time peak was in 2010, reaching Rs 120,000 per 40 kilograms.
Citizens Super-30 to distribute 12.75 percent dividend
Citizens Super-30 has announced a 12.75 percent dividend for its shareholders, based on the profits earned in the last fiscal year 2024/25. The fund, promoted by Citizens Bank and managed under the Citizens Mutual Fund scheme by Citizens Capital, received approval for the dividend distribution from the board of directors of Citizens Capital. The fund has set August 29 as the book closure date for the purpose of dividend distribution. Shareholders holding units until August 29 will be eligible to receive the announced dividend.
Delay in expansion and maintenance of East-West Highway’s Far Western Section
The expansion and maintenance of the Gaddachauki–Chisapani section of Nepal’s East-West Highway remain stalled due to a lack of adequate funding. Despite being a critical 126-kilometer stretch in the far west, only Rs. 30 million was allocated this fiscal year, allowing for minimal work such as culvert construction and minor repairs. Of the section, only 12 kilometers have been expanded so far. Officials say at least Rs. 150 million is needed annually to progress effectively. While other parts of the highway are being upgraded with support from donor agencies, this section lacks a detailed expansion plan, risking further delays and regional development setbacks.
Paddy plantation reaches 94.15% amid dry spells
As of mid-August, paddy has been planted on 94.15 percent of rice fields nationwide, a slight drop compared to 98.44 percent during the same period last fiscal year. The decrease in coverage is primarily due to prolonged drought conditions in the Terai and inconsistent rainfall across various regions. According to the Department of Agriculture (DoA), Sudurpaschim Province leads in paddy plantation with a completion rate of 99.72 percent, while Madhesh Province lags behind with only 86.35 percent.
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