KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s economic landscape reflects a mix of financial optimism and structural challenges. The NEPSE index crossing the 3,000-point mark signals rising investor confidence, while record churpi exports and mutual fund dividend announcements point to sectoral growth.
However, fiscal stress remains high as public debt surged by over Rs 231 billion, and government borrowing crossed Rs 455 billion, driven by spending needs. NRB’s upcoming term deposit investment and high-level talks on BAFIA reform underscore ongoing financial system adjustments. Infrastructure setbacks—such as delays in the Muglin–Pokhara road and Rs 1 billion flood damage to the Rasuwa dry port—reveal persistent project vulnerabilities.
Meanwhile, social and regulatory measures, like disaster insurance in Karnali and e-commerce registration, show efforts to enhance resilience and governance. Yet, tensions loom as sugarcane farmers prepare protests over subsidy cuts and Japan announces higher interest rates on loans, potentially tightening Nepal’s future financing options.
NEPSE surpasses 3,000-point milestone with 30-point gain
The Nepal Stock Exchange (NEPSE) index broke through the psychological barrier of 3,000 points on Tuesday, the third trading day of the week. The index climbed by 30.49 points to close at 3,001.80. This followed a 7.10-point rise on Monday, after a drop of 18.44 points the previous Wednesday. Before that, NEPSE had enjoyed an eight-day rally. On Tuesday, trading volume reached Rs 18.52 billion.
Public debt increases by over Rs 200 billion in one year
Nepal’s total public debt jumped by Rs 231.08 billion in the fiscal year 2024/25, rising from Rs 2.438 trillion to Rs 2.669 trillion. This amount now accounts for 43.71% of the national GDP. Internal debt stood at Rs 1.263 trillion (22.14% of GDP), while external debt reached Rs 1.401 trillion (24.56% of GDP), according to the Public Debt Management Office.
Gold prices decline, silver prices edge up
On Tuesday, the price of hallmark gold fell by Rs 600 per tola to Rs 193,000, down from Rs 193,600 the day before, according to the Federation of Nepal Gold and Silver Dealers Association. Conversely, silver prices rose slightly from Rs 2,295 to Rs 2,300 per tola.
NRB to invest Rs 2.92 billion in term deposits
Nepal Rastra Bank (NRB) is set to invest Rs 2.92 billion in term deposits across several financial institutions. The central bank’s Financial Management Department has invited proposals from commercial banks, national-level development banks, and finance companies for the allocation.
Government borrowing rises to Rs 455 billion in FY 2024/25
To finance expenditures, the government borrowed Rs 455.39 billion in fiscal year 2024/25, a significant increase from Rs 358.02 billion the previous year. The borrowing surpassed the prior year by over Rs 100 billion, though it remained under the Rs 547 billion target.
NRB governor meets bank heads over BAFIA amendment
Nepal Rastra Bank Governor Dr. Biswo Nath Poudel held separate consultations with CEOs and chairpersons of commercial banks to discuss proposed amendments to the Bank and Financial Institution Act (BAFIA) and the second financial sector development strategy. On Tuesday, he met with CEOs, and meetings with board chairpersons are scheduled for Wednesday.
Prime Minister Agriculture Project reaches 67% financial progress
The Prime Minister Agriculture Modernization Project, initiated in 2016, has spent Rs 36.5 billion of its total Rs 53.17 billion budget, achieving 67% financial progress. The project, designed to promote agro-industrial transformation, is in its final year of the first phase.
‘Take and pay’ provision halts progress on 4,967 MW power deals
A clause introduced in the current fiscal year’s budget requiring ‘take and pay’ arrangements has stalled power purchase agreements for 4,967 MW of capacity. The policy, included in the budget released on 15 Jestha, has impacted 54 hydropower projects currently awaiting NEA agreements.
Company update certificates now available online after fine payment
Companies that submitted their annual reports before the July 16 deadline but failed to pay fines will now receive their update certificates automatically online after settling the penalty. The Office of the Company Registrar has activated this automated service to improve convenience and compliance.
Government launches e-commerce registration to fight fraud
In response to growing fraud complaints in online shopping, the Department of Commerce, Supplies and Consumer Protection has started registering e-commerce businesses under the E-Commerce Act, 2024. Issues such as fake sellers, undelivered orders, and substandard goods prompted the move. Director Bharat Prasad Acharya said the measure will help reduce scams.
New ICP facilities to be built with Rs 1.06 billion allocation
The Nepal Intermodal Transport Development Committee plans to construct two new facilities—a warehouse and parking area—at the Integrated Check Post (ICP) with a Rs 1.06 billion budget. Rs 410 million of this will go toward the warehouse and parking lot, supported by a World Bank loan. A connecting road to the Koshi Highway will also be built.
Muglin–Pokhara road (west section) likely to miss deadline
The western portion of the Muglin–Pokhara road project is facing delays, with only 55% of work completed from Jamune to Seti Bridge in Pokhara. Although the deadline is mid-January 2026, project officials say the remaining construction cannot be completed on time. So far, 36 km of the single-lane section has been blacktopped.
Minister Dahal inspects Nagdhunga Tunnel, urges timely completion
Physical Infrastructure and Transport Minister Devendra Dahal conducted an early-morning inspection of the Nagdhunga Tunnel on Tuesday. Accompanied by Roads Department officials, he directed the team to accelerate work and ensure timely operation of the tunnel.
Karnali provides disaster insurance for 16,000 vulnerable homes
In Karnali Province, 16,072 houses classified as disaster-prone have been insured under a program initiated by the Ministry of Internal Affairs and Law. The total insured value amounts to Rs 11.5 billion. The announcement was made during a launch event in Birendranagar, Surkhet.
Japan to raise interest rate on loans to Nepal to 2% from 2026
Starting in 2026, Japan will increase its loan interest rate to Nepal from 0.1% to 2%, citing the country’s rising per capita income. According to Finance Ministry Joint Secretary Dhaniram Sharma, institutions such as the ADB and European banks may also revise their rates.
Floods inflict Rs 1 billion in damages on Rasuwa dry port
Flash floods on July 8 caused an estimated Rs 1 billion in destruction at the under-construction dry port in Timure, Rasuwa. The project, initiated on February 14, 2023, with Chinese support, had reached 81% completion. However, 55% of the structure was destroyed, requiring reconstruction from the ground up, according to the Intermodal Transport Development Committee.
Churpi exports reach all-time high in FY 2024/25
Nepal exported a record 2.6 million kilograms of churpi (hardened cheese) worth Rs 4.51 billion in fiscal year 2024/25, according to the Customs Department. This marks a significant increase from 1.786 million kg in FY 2022/23 and 1.647 million kg valued at Rs 3.18 billion in FY 2023/24.
Timure dry port site declared unfit for further construction
The dry port being built at Timure, Rasuwagadhi, is no longer considered viable for development. During a meeting on Monday, Project Manager Eng Li from the construction company recommended relocating the site. The Intermodal Transport Development Committee has endorsed the proposal.
Sugarcane farmers to protest over removal of subsidies
Sugarcane farmers are gearing up for protests after the government removed subsidies in the fiscal year 2025/26 budget. These subsidies had been provided consistently since 2009. Raj Kumar Upreti, chairperson of the Sugarcane Producers Association, announced that protests will begin after July 31 in response to the decision.
Mugu farmers earn Rs 40 million from food sales
Farmers in Mugu sold Rs 40 million worth of agricultural produce—including chino, kauno, red rice, beans, and various types of buckwheat—outside the district during FY 2081/82. The National Agriculture Modernization Program’s acting chief, Tej Bikram Malla, confirmed the figures.
Mutual funds begin dividend announcements
Mutual funds have started distributing dividends from the profits of FY 2024/25. Investors in open-ended mutual funds can reinvest their dividends as new fund units. So far, three such funds have declared dividends, inclusive of tax.
Himalayan Bank completes FPO allotment process
Himalayan Bank has finalized the allotment of its Further Public Offering (FPO) at its Kamaladi office. The public subscription, held from July 15 to 20, drew 1,825,922 applicants. Of those, 121,649 applications were rejected, while 1,704,273 were approved.
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