KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
The developments collectively point to a mixed but revealing picture of Nepal’s current economic and governance landscape, marked by strong liquidity, cautious fiscal pressure, and targeted policy easing. The sharp drop in gold and silver prices alongside the massive oversubscription of NRB bonds underscores excess liquidity in the banking system and limited attractive investment avenues, prompting financial institutions to park funds in low-yield sovereign instruments.
At the same time, the government’s consolidated fund deficit highlights persistent structural weaknesses in revenue mobilization despite a positive cash balance and steady inflows from customs, particularly petroleum imports. Policy measures such as easing profit repatriation for foreign investors and allowing IT firms limited overseas investment signal efforts to boost investment confidence and export-oriented sectors.
Meanwhile, substantial disaster recovery funding for Ilam and strict warnings to contractors reflect growing pressure to improve infrastructure delivery and accountability. However, challenges in fine recovery, delayed enforcement of court rulings, and ongoing market monitoring needs indicate that institutional capacity and enforcement gaps remain key constraints alongside fiscal and developmental ambitions.
Gold prices decline in domestic market
Gold prices in the domestic market fell sharply on Tuesday, dropping by Rs 7,900 per tola (11.66 grams). According to the Federation of Nepal Gold and Silver Dealers’ Association, the price of gold declined to Rs 262,100 per tola on Tuesday, down from Rs 270,000 per tola on Monday. Silver prices also decreased, falling by Rs 305 per tola to Rs 4,590 per tola, the Federation reported.
NRB bond attracts Rs 1.22 trillion in subscriptions
The inaugural “Nepal Rastra Bank Bond” issued on Tuesday drew an exceptionally strong response, with demand exceeding the offer by nearly 49 times. Although NRB planned to raise Rs 25 billion, bids from 32 financial institutions totaled Rs 1.22 trillion. The one-year bond was issued at an average interest rate of 2.64 percent and will mature on December 29, 2026. These bonds are also eligible to be used as collateral for loans. The overwhelming response highlights the large volume of excess liquidity currently held by banks and financial institutions.
Finance Ministry commits Rs 2.19 billion for Ilam disaster recovery
The Ministry of Finance has approved a funding source of Rs 2.19 billion to rebuild roads and bridges in Ilam damaged by floods on October 4 and 5. Finance Minister Kulman Ghising instructed the Department of Roads to initiate tenders for reconstruction work on the Mechi Highway, Maikhola Bridge, and the Mechi Corridor. So far, Rs 540 million has been released for immediate repair work. Following the floods, which claimed 39 lives, the government declared Ilam a crisis zone on October 9. Of the total allocation, Rs 1.5 billion has been set aside specifically for the permanent restoration of the Mechi Highway.
NRB relaxes profit repatriation rules for foreign investors
Nepal Rastra Bank (NRB) has revised the Foreign Investment and Foreign Loan Management Bylaw 2021 to make the process of repatriating profits easier for foreign investors. Under the new provision, investors no longer need prior approval from the central bank to remit dividends, profits, or earnings from share sales to their home countries. NRB Governor Biswo Nath Poudel said the change is intended to cut down procedural hurdles and attract more foreign investment. Investors can now complete the process directly through commercial banks by submitting the required documents. However, liquor-producing industries are still required to comply with the 2021 technology transfer rules for royalty payments unless they export all of their production.
Mechi Customs Office collects Rs 3.8 Billion in revenue from petroleum imports
The Mechi Customs Office in Jhapa collected Rs 3.8 billion in revenue from the import of petroleum products during the first five months of the current fiscal year 2025/26. According to Information Officer Ishwar Kumar Humagain, revenue from petroleum products alone accounted for 55.8 percent of the office’s total revenue during the period. Humagain added that five different types of petroleum products worth Rs 7.84 billion were imported through the customs office. Similarly, the office collected 4.14 percent of its revenue from the import of readymade garments, 3.68 percent from vehicles and spare parts, 3.4 percent from vegetables, and 3.3 percent from cement clinker.
Consolidated fund records Rs 108.99 billion deficit
The Office of the Auditor General submitted the integrated financial statement for fiscal year 2024/25 to Finance Minister Rameshore Khanal on Tuesday. The report shows that the combined funds of federal, provincial, and local governments have posted a deficit of Rs 108.99 billion, mainly due to shortfalls in revenue collection. Despite this, the government’s overall cash balance remains positive at Rs 104.13 billion. Auditor General Shobhakant Paudel noted that the government frequently relies on overdrafts from Nepal Rastra Bank to manage expenditures, while the persistent gap between revenue targets and actual collection continues to strain public finances.
Karnali ministry collects over Rs 125.7 million in revenue
The Ministry of Physical Infrastructure and Urban Development in Karnali Province has collected more than Rs 125.7 million in revenue during the first five months of fiscal year 2025/26, covering the period from July 17 to December 15. Senior Division Engineer Ramesh Subedi said the revenue was generated through transport service offices operating in three locations. The Surkhet office accounted for the largest share, collecting Rs 110.9 million, while Chaurjahari and Jumla offices generated Rs 8.3 million and Rs 6.5 million, respectively. The revenue includes fees from driving licenses, vehicle registration, taxes, and administrative penalties across the province.
Minister Ghising warns contractors over road repair delays
Minister for Physical Infrastructure and Transport Kulman Ghising warned on Tuesday that contractors who delay road maintenance and repair works will face strict penalties. Addressing the 23rd anniversary of Road Board Nepal, he said the government will no longer tolerate repeated extensions and may terminate contracts if delays persist. Ghising acknowledged that repair needs are high at both federal and provincial levels but said limited budgets pose challenges. Road Board Nepal Director General Dr. Bijay Jaisi and Secretary Keshav Kumar Sharma stressed that timely maintenance is essential, as postponements can increase reconstruction costs by three to four times.
Lamjung court unable to recover Rs 105 million in fines
The Lamjung District Court has reported that approximately Rs 105 million in fines remain unpaid as of November 16. In addition, prison sentences totaling 343 years, nine months, and 13 days have yet to be enforced. Court officials cited staff shortages and the deaths of some convicts as key reasons for the delays. Despite these challenges, the court has performed well in resolving case backlogs, settling 386 cases by December 15—about 40 percent more than its target of 275 cases for the current fiscal year 2025/26.
Commerce department fines two firms and warns 15 others in Lalitpur
The Department of Commerce, Supplies and Consumer Protection inspected 17 business firms in Lalitpur on Tuesday. During the inspection, Shakti Marbles of Ekantakuna was fined Rs 20,000 and RK Brothers of Hattiban Rs 15,000 for violating the Consumer Protection Act, 2018. The remaining 15 firms were issued warnings along with instructions to correct their practices. The department said such market monitoring will continue in coordination with local authorities to curb black marketing and protect consumer rights.
IT companies allowed USD 20,000 overseas investment without conditions
Nepal Rastra Bank has introduced a provision allowing IT service exporting companies to invest up to USD 20,000 abroad without meeting additional conditions. The amendment to the Foreign Investment and Foreign Loan Management Bylaw 2021 is intended to support the international expansion of Nepal’s IT sector. Companies that have earned foreign currency from exports over the past three fiscal years are eligible for this facility. For larger overseas investments, firms may exchange up to 50 percent of their average annual export earnings or USD 1 million—whichever is lower—within the limits of their paid-up capital.
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