KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s economic landscape presents a mix of growth, reform, and challenges across multiple sectors. While international trade surged by over 26 percent during the festive season and banking penetration surpassed 60 million deposit accounts, several industries face instability—highlighted by factory shutdowns over electricity tariff disputes and a 35 percent drop in sales at Everest Sugar Chemical Industries.
Policy-wise, the government is classifying public enterprises to improve efficiency, freezing Rs 120 billion in politically influenced projects, and delaying mandatory enrollment in the Social Security Fund due to political disruptions. Meanwhile, the FATF has criticized Nepal’s slow progress in combating financial crimes, and Bagmati Province’s low budget spending reflects weak fiscal execution.
On a brighter note, tourism is rebounding in regions like Annapurna, Ilam, and Taplejung, though market volatility persists, with gold prices continuing to fall sharply. Overall, the economy shows signs of revival and reform but remains hindered by governance gaps, regulatory delays, and external pressures.
Gold price drops by Rs 2,000 per tola on Monday
Gold prices continued to decline on Monday, falling by Rs 2,000 per tola compared to Sunday’s rate. The Federation of Nepal Gold and Silver Dealers Association fixed the price at Rs 239,900 per tola, down from Rs 241,900 a day earlier. Before the Tihar holidays, gold had peaked at Rs 253,500 per tola before plunging by Rs 11,600 when trading resumed on Sunday. Silver prices also followed a downward trend.
Nepal’s international trade grows 26 percent during festive season
Nepal’s international trade surged during the major festive period, increasing by 26.04 percent in the first quarter of FY 2025/26 compared to the same period last year. Total trade reached Rs 540 billion, up from Rs 429 billion, according to the Department of Customs. Both imports and exports recorded notable growth during the Dashain–Tihar–Chhath season.
Govt to categorize public enterprises into two groups
The government has decided to classify all state-owned public enterprises into two categories — commercial and strategic. Approving the Public Institutions Management and Good Governance Policy, 2025, the Ministry of Finance said that public enterprises competing directly with private sector companies will fall under the commercial category. For such entities, procurement rules will be simplified to enhance efficiency. Meanwhile, institutions that execute government programs, fulfill national and international obligations, or deliver essential services not covered by the private sector will be designated as strategic.
FATF says Nepal’s progress to exit grey list remains inadequate
The Financial Action Task Force (FATF) has stated that Nepal’s progress toward exiting its “grey list” is insufficient. Nepal was added to the list on February 21, 2025, after concerns about weak mechanisms to curb money laundering and terrorist financing. FATF had provided a two-year action plan outlining key reforms Nepal must complete. While the plan has been drafted, the watchdog observed that its implementation has been slow and ineffective.
Power tariff dispute forces shutdown of major industries
Several major industries have been forced to halt operations due to an escalating dispute over electricity tariffs. The issue intensified after Kulman Ghising took office as Energy Minister and the Nepal Electricity Authority began disconnecting power lines of industries over unpaid dues related to dedicated and trunk lines. Entire industrial areas, including Bhairahawa, saw shutdowns last Friday, affecting thousands of jobs and significant tax revenue.
Enrollment of private sector workers in Social Security Fund delayed
The government’s plan to make enrollment of private sector employees in the Social Security Fund (SSF) mandatory from this fiscal year has been postponed. The delay follows political changes and disruptions caused by the Gen Z movement. The policy had aimed to bring all employees, regardless of employment type, under the contribution-based SSF system to expand its coverage and strengthen workers’ welfare.
Number of bank deposit accounts exceeds 60 million
The total number of deposit accounts across Nepali banks and financial institutions has surpassed 60.4 million, while loan accounts stand at nearly 2 million. Data from Nepal Rastra Bank shows that as of the first two months of FY 2025/26, there were 60,453,593 deposit accounts and 1,993,234 loan accounts. Of these, 51.85 million were held in commercial banks, 7.57 million in development banks, and 1.02 million in finance companies.
Govt freezes Rs 120 billion in development projects
The interim government has suspended development projects worth Rs 120 billion across multiple ministries in a bid to control politically influenced spending. Projects lacking proper feasibility studies, missing from the project bank, or introduced under high-level political pressure have been put on hold or had their budgets reduced. Officials said the move aims to redirect funds toward nationally significant and well-prepared projects.
Tourist arrivals remain strong at North Annapurna Base Camp
Tourist flow to North Annapurna Base Camp in Myagdi has remained high since mid-October, exceeding expectations for the season. Hotels in Mustang, Myagdi, Baglung, and Parbat are fully booked, creating accommodation challenges. The extended Dashain–Tihar–Chhath holidays have drawn large numbers of domestic travelers, students, and Nepalis returning from abroad to the Annapurna region.
Bhairahawa Customs collects Rs 27.75 billion in first quarter
Bhairahawa Customs Office in Rupandehi collected Rs 27.75 billion in the first quarter of FY 2025/26, meeting 97 percent of its Rs 28.57 billion target. In the first month alone, the office achieved 102.05 percent of its target by collecting Rs 9.02 billion. The same period last year saw only 83.54 percent of the target achieved.
Tourist rush returns to Antu and Kanyam in Ilam
Tourism has revived in Ilam’s scenic spots, Antu and Kanyam, following weeks of calm after the October 4 floods and landslides. Improved weather and repaired infrastructure have attracted both domestic and Indian tourists, with many hotels and homestays reporting full bookings. Locals have also begun hosting guests in their homes to meet rising demand.
Bagmati Province spends just 6.19% of budget in first quarter
Bagmati Province utilized only 6.19 percent of its total allocated budget in the first quarter of FY 2025/26 — slightly less than 6.88 percent spent during the same period last year. According to the Ministry of Economic Affairs and Planning, total expenditure for the first quarter stood at Rs 4.17 billion.
Authorities urge Food Company to start paddy procurement in Kailali
The local administration in Kailali has urged the Food Management and Trading Company Limited to immediately begin paddy procurement. A meeting chaired by Chief District Officer Krishna Prasad Lamsal recommended starting purchases by October 28 and expanding the quota. Farmers have complained that delays are forcing them to sell paddy at prices up to Rs 900 below the government’s minimum support price.
Prabhu Bank founders to sell over 400,000 shares
Ten founding shareholders of Prabhu Bank have decided to offload more than 400,000 founder shares after existing founders declined to purchase them. The bank has opened bidding for interested investors starting Monday.
Mountaineering season begins in Taplejung
The climbing season has officially begun in Taplejung, with two French climbers — Benjamin Charles Ely Vedrins and Nicolas Paul Aristide — making the first successful ascent of the 6,808-meter White Wave Peak in September. A Chilean climber also recently summited Pathibhara Himal, located near Kanchenjunga, according to Annapurna Foothills Treks and Expeditions.
Everest Sugar Chemical Industries’ sales drop 35 percent
Everest Sugar Chemical Industries reported a 35 percent decline in sales in 2025 compared to the previous year. Sales fell from Rs 3.32 billion in 2024 to Rs 2.15 billion in 2025. The company had posted Rs 1.32 billion in 2023 and Rs 1.37 billion in 2022.khaba
Comment