KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
In Nepal’s evolving economic and infrastructure landscape, the government has accelerated policy and development initiatives, such as granting construction permits for 10 new hydropower projects totaling 241.50 MW and pledging to introduce a new Company Act by February 2026.
While these steps indicate progress, structural challenges persist—most notably in land revenue collection, which was disrupted by protests and festivals, and in stalled infrastructure projects like the Postal Highway, now facing contract cancellations after years of delay. Meanwhile, shifts in local economies—like Mulghat’s pivot to profitable sugarcane farming and Jumla’s timely rice harvest—demonstrate agricultural resilience.
Trade prospects are also rising, with over Rs 3 billion collected at Mustang’s Korala customs, though Nepal lags behind China in border infrastructure readiness. Amid energy sector gains, such as the successful launch of the Darmakhola Hydropower Project and rural electrification in Bhojpur, the growing popularity of silver investments and stronger enforcement of agricultural price policies further reflect shifting economic patterns and state accountability.
10 hydropower projects receive construction permits in first quarter
In the first quarter of the current fiscal year, the Department of Electricity Development issued construction permits for ten hydropower projects totalling 241.50 MW in capacity. To date, the department has approved 266 projects with a combined capacity of 10,825 MW. Among recent permits granted by mid October were Lapa Khola (4.72 MW), Lower Barun (132 MW), Myagdi Khola B (12.50 MW), and Lower Likhu Cascade (6 MW).
Govt to introduce new company act by February, 2026
The government plans to bring forward a new Company Act by February 2026. The Ministry of Industry, Commerce and Supplies has released its “Immediate Improvement Plan–2025 to Enhance Service Effectiveness,” pledging to present the bill during the month of Magh. Minister Anil Kumar Sinha, who began reform efforts soon after assuming office, is leading the initiative—drawing on his experience as a corporate lawyer and former Supreme Court judge, according to ministry officials.
Land revenue collection affected by protests and festivals
Between mid September and mid October, land revenue offices nationwide collected a total of Rs 275,85,57,927. However, many offices disrupted by the Gen Z movement—over a dozen were subjected to arson and damage—saw their operations hampered. The Department of Land Management and Records noted that although revenue collection appeared normal, work was impacted by both festivals and protests.
Darmakhola hydropower begins successful power generation
The Darmakhola Hydro Energy Limited’s Darmakhola Hydropower Project (9.6 MW) has successfully begun electricity production. The project serves Baglung’s Galkot Municipality, Badigad Rural Municipality, and Gulmi’s Musikot Municipality. The company expressed gratitude to stakeholders who supported its launch.
Silver gains popularity among investors
With silver being more affordable and accessible than gold, many Nepali investors are turning to it. As silver prices climb alongside those of gold, a growing number of people are choosing silver as an alternative investment and holding it as a store of value. If the upward trend continues, silver could increasingly rival gold in value. Both street markets and online networks show silver is currently a hot topic.
Chinese customs at Korala border well prepared; Nepal faces challenges
While China has invested an amount equivalent to Nepal’s annual budget in building customs offices and infrastructure at the Korala border, Nepal still struggles with significant bottlenecks. Vehicles with temporary passes are arriving from Mustang to the Chinese market, but Nepal has yet to establish permanent operational arrangements for border trade.
Postal Highway expansion project to see contract cancellations
Despite sixteen years passing since its start, the national prestige project Postal Highway remains incomplete after years of delay. Initially designed to pave 1,875 km of road and construct 300 bridges within eight years, several segments remain stalled. As a result, the Directorate has begun canceling contracts for five of those stagnant projects.
Market monitoring hampered by post protest disruptions
Following the Gen Z movement, efforts to monitor market conditions were significantly affected. No monitoring took place during the Dashain and Tihar festivals. Municipal teams responsible for inspections were displaced after incidents of arson and vandalism on 9 September; some monitoring offices were burnt and equipment looted.
Mustang customs collects over Rs 3 billion in revenue
The Mustang Customs Office at the Nepal China Korala border has reported revenue of Rs 3,01,44,36,000. The border became fully operational as a trade route on 16 September, and this revenue was collected up to Tuesday. The office inspects and clears goods and electric vehicles imported to and exported from China via the border, through traders’ designated customs agents.
Electricity service expanded to 107 homes in Bhojpur
In Ward No. 3, Ramprasad Rai Rural Municipality, Bhojpur, local efforts brought central electricity service to 107 homes after a lightning strike knocked out the Beheswar hydropower project and left the settlement without power. Continuous rain from 3–5 October and lightning had damaged local hydro machinery, cutting power to the community until intervention.
Jumla farmers rush to harvest Marshi rice
Farmers in Jumla’s Chandanath Municipality–2 are busy harvesting fully ripened Marshi rice. Despite the nationwide Tihar festival, locals began harvesting from dawn until dusk. Thanks to favourable weather, most farmers follow their own calendar to begin the harvest immediately after Dashain rather than during Tihar.
Mulghat farmers shift to sugarcane cultivation
Farmers who previously relied on maize, millet and vegetables in Mulghat have now made sugarcane their main source of income. Around 500 ropanis are currently dedicated to sugarcane cultivation, significantly boosting local economic activity and employment. Because demand remains stable even in the off season, growers enjoy steadier incomes. According to farmers, sugarcane offers higher profits and lower risk compared with maize and vegetables. On one ropani of sugarcane, a return of up to Rs 100,000 annually has been reported—an income level that other crops cannot match.
Sudurpaschim chief minister orders action on paddy support price noncompliance
Kamal Bahadur Shah, Chief Minister of Sudurpaschim Province, stated that tribunals will act if traders fail to meet the government’s support price for paddy. Responding to farmers’ complaints, he instructed the Chief District Officer of Kailali to assess whether the support price was honoured and warned that non compliant traders would face legal consequences.
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