KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
The latest economic updates highlight a mixed scenario for Nepal’s market and industry. The Nepal Stock Exchange (NEPSE) experienced a slight decline, falling by 12.38 points, reflecting a downturn in market sentiment.
Despite this, the trading volume and number of transactions showed healthy activity. The rise in electric vehicle (EV) imports suggests a growing adoption of sustainable transportation, with China being the largest supplier.
Meanwhile, Nepal’s foreign trade saw both imports and exports increasing, though the country continues to face a significant trade deficit. The government is actively addressing key issues, such as inflation control, startup support, and energy challenges.
Prime Minister Oli’s commitment to reducing inflation and supporting entrepreneurship contrasts with ongoing struggles in sectors like energy, where industrial load shedding and power shortages are taking a toll.
Additionally, the government is considering legal amendments to facilitate infrastructure development in protected areas, while NEPSE’s interim leadership moves forward with reforms.
Despite these efforts, challenges such as rising bad loans and regulatory hurdles in hydropower projects persist.
NEPSE falls by 12.38 points
The Nepal Stock Exchange (NEPSE) dropped by 12.38 points (0.46%) on Thursday, closing at 2,669.76. This follows a decline of 14.88 points in the previous session. The index ranged between 2,685.87 and 2,666.69 throughout the trading day.
A total of 9.59 million shares from 312 companies were exchanged through 55,476 transactions, amounting to a turnover of Rs. 4.56 billion.
The Life Insurance Index saw the highest increase at 0.03%, while the Finance Index experienced the largest drop at 1.35%.
Over 7,000 electric vehiles imported to Nepal in nine months
In the first nine months of FY 2081/82, Nepal imported 7,080 electric vehicles (EVs), including cars, jeeps, and vans, valued at Rs. 16.64 billion, according to the Customs Department.
This represents a 10.02% increase compared to last year’s 6,435 units worth Rs. 15.81 billion. China continues to be the largest supplier, contributing 74.42% of the total imports, with 5,269 units valued at Rs. 13.08 billion.
India follows with 1,775 units worth Rs. 3.32 billion. Other suppliers include the U.S. and South Korea.
Most of the imported EVs have power ratings between 51–100 kW, with 3,879 units worth Rs. 9.69 billion. EVs with lower (50 kW) and higher (101–300 kW) power ratings were also imported in smaller quantities. In February alone, 824 EVs were imported, continuing the trend of rising electric vehicle adoption in Nepal.
Nepal’s imports and exports grow in first eight months
In the first eight months of the current fiscal year, Nepal imported goods worth Rs 11.45 trillion, an 11.8% rise compared to Rs 10.30 trillion last year. After two years of negative growth, imports have been on the rise for the past three months, driven mainly by crude soybean oil imports.
Exports also grew significantly, increasing by 57.2% to reach Rs 1.58 trillion, up from Rs 1 trillion the previous year. Nepal’s total foreign trade during this period amounted to Rs 13.03 trillion, with a trade deficit of Rs 9.87 trillion.
Gold price holds steady at Rs 176,000 per tola
The price of gold remained unchanged today, with hallmark gold trading at Rs 176,000 per tola, as reported by the Federation of Nepal Gold and Silver Dealers’ Association. Silver is also being traded at Rs 2,030 per tola in the domestic market.
TIA to extend daily operations to 18 hours starting March 31
Tribhuvan International Airport (TIA) will extend its daily operations to 18 hours, beginning March 31. Previously, operations were limited to 10 hours due to infrastructure upgrades.
With 70% of the construction completed, authorities plan to add an extra two hours for flight operations. The full upgrades, including taxiways and parking facilities, are expected to be completed within 1.5 years. The government and the Asian Development Bank have invested Rs. 15 billion in the project.
Nepal faces trade deficit with 126 countries
According to the Customs Department, in the first eight months of the current fiscal year, Nepal recorded a trade deficit with 126 countries and a surplus with 34.
The largest deficit was with India, amounting to Rs 563.67 billion, followed by China (Rs 217.06 billion), Argentina (Rs 46.47 billion), and Ukraine (Rs 18.55 billion).
Nepal’s exports to Afghanistan amounted to Rs 67.38 billion, while imports stood at Rs 1.59 billion, resulting in a trade surplus of Rs 657.9 million. Other surpluses were seen with Denmark (Rs 189 million) and Russia (Rs 25 million).
PM Oli announces startup loan support for 500 entrepreneurs
Prime Minister KP Sharma Oli announced that the government will offer startup loan assistance to at least 500 entrepreneurs this year. During his speech in the House of Representatives on Thursday, he revealed that the selection process for concessional loans to promote innovation and entrepreneurship is nearing completion.
Oli emphasized the government’s ongoing efforts to improve the business environment, attract investment, create jobs, and reduce trade deficits through policy reforms.
Govt committed to controlling inflation: PM Oli
Prime Minister KP Sharma Oli reassured lawmakers that the government is committed to controlling inflation. Speaking in the House of Representatives, he highlighted the government’s efforts in closely monitoring markets to prevent black market activities and ensure a steady supply of goods, especially in remote areas.
PM Oli noted that inflation this fiscal year was lower (4.16%) compared to the previous year (5.01%). He also emphasized subsidies for agriculture to stabilize food prices.
Additionally, he reiterated the government’s commitment to supporting burn victims through the Acid and Hazardous Chemicals Act, 2079.
NEPSE without CEO for two months
NEPSE has been without a CEO for two months, although five candidates have been shortlisted for the position. Despite this, Acting CEO Niranjan Phuyal has initiated several significant reforms, including the introduction of average price determination in the final 15 minutes of trading.
Additionally, regulations for the SME platform have been finalized, and once approved by the Securities Board, the procurement of software will begin, enabling SMEs with less than Rs. 250 million capital to issue IPOs.
Govt to amend laws for infrastructure development in protected areas
The government has decided to amend existing laws to align with the Supreme Court’s decision regarding infrastructure development in national parks, reserves, and conservation areas.
A meeting held at the Office of the Prime Minister has resolved to revise legal provisions to balance environmental protection with development needs.
Banks struggling with loan recovery as bad loans approach 5%
Nepal’s banks are facing significant challenges with loan recovery, as bad loans continue to rise over the past two years. Due to the economic slowdown, many banks are unable to distribute dividends, and their profits have dropped.
Some banks have bad loan rates exceeding 5%, leading CEOs to personally meet borrowers for repayments. Despite these efforts, recovery of both principal and interest has not improved.
The slowdown in the real estate market has also made it difficult to sell collateral. With stricter capital adequacy requirements, banks are under pressure from Nepal Rastra Bank to improve recovery or face lending and dividend distribution restrictions.
FNCCI raises alarm over 12-hour industrial load shedding
The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has expressed serious concern over the ongoing power cuts affecting the industrial sector.
FNCCI highlighted that industries are experiencing up to 12 hours of unannounced load shedding, severely impacting production and business operations.
The power disruptions have caused machinery damage, increased maintenance costs, and threatened economic stability.
FNCCI urged the government to ensure an uninterrupted electricity supply for industries and called for long-term investments in energy infrastructure, better power management, and closer collaboration with the private sector.
Nepal requests 230 MW power from India amid load shedding crisis
Energy Minister Dipak Khadka has formally requested India to supply 230 MW of electricity during peak evening hours (6–10 PM). Nepal imports around 600 MW daily, but has faced severe load shedding, particularly in industries, after India limited power imports to “solar hours” (6 AM–6 PM) starting March 15.
This has led to 12-hour power cuts in industries, negatively affecting the economy. Nepal and India had previously agreed on new power tariffs for 2025/26, but regulatory approvals are still pending.
The government has also sought clarification from NEA MD Kulman Ghising about the reportedly expensive power purchase agreements.
CNI demands immediate action to address industrial load shedding
The Confederation of Nepalese Industries (CNI) has strongly criticized the ongoing 12-hour daily load shedding affecting industries, calling it a serious threat to the economy.
CNI urged the government and relevant authorities to ensure an uninterrupted power supply to industries. The frequent power outages have raised production costs, hindered industrial growth, and created uncertainty for future investments.
CNI also criticized the Nepal Electricity Authority (NEA) for prioritizing electricity exports over the needs of domestic industries. It emphasized that electricity is essential for industries and warned that continued disruptions could severely impact Nepal’s investment climate.
Suyog Shrestha re-elected President of Development Bankers Association Nepal
Suyog Shrestha has been re-elected as President of the Development Bankers Association Nepal (DBAN).
The 19th Annual General Meeting, held in Pokhara, unanimously selected Shrestha, the CEO of Shangri-la Development Bank, for another term. Dinesh Thakali (CEO of Kamana Sewa Development Bank) was elected Vice President, Madhav Prasad Upadhyaya (CEO of Garima Development Bank) as Secretary, and Kapil Dhakal (CEO of Jyoti Development Bank) as Treasurer. The executive committee also includes representatives from Lumbini, Shine Resunga, Mahalaxmi, Green, and Saptakoshi Development Banks.
Policy reforms to address challenges of small-scale hydropower projects
Energy Minister Dipak Khadka has committed to introducing policy reforms to resolve the challenges faced by small-scale hydropower projects. Speaking at a Green Energy Entrepreneur Nepal event, he emphasized the importance of government-private sector collaboration for the growth of the energy sector.
Khadka mentioned that the approved energy development roadmap would address concerns raised by the private sector. Meanwhile, Green Energy Entrepreneur Nepal Chairperson Surya Prasad Adhikari called for adjustments to power purchase agreements and the removal of provisions related to alternative power production to support small-scale hydropower ventures.
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