KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s economic indicators point to a system under mounting strain, where liquidity surplus coexists with weak demand and structural inefficiencies. While Nepal Rastra Bank aggressively mops up excess funds and pushes digital reforms like online mortgage systems, the broader economy shows signs of slowdown—reflected in a declining NEPSE Index, falling precious metal prices, and a sharp rise in non-performing loans nearing 6 percent.
Trade and revenue channels are also under pressure, with customs disruptions in Birgunj and Timure, a significant revenue shortfall at Nepalgunj, and idle freight capacity in key industrial corridors, all signaling weakened economic activity and policy friction.
At the same time, under-execution of public spending in provinces like Koshi and delayed infrastructure projects highlight governance bottlenecks, even as isolated positives—such as increased agricultural procurement, export earnings from forestry, tourism inflows, and IPO activity—suggest pockets of resilience.
Overall, the economy appears caught between policy intervention and sluggish real-sector momentum, raising concerns about recovery sustainability.
NEPSE declines 5.73 points; turnover at Rs 4.916 billion
The NEPSE Index dropped by 5.73 points on Thursday, closing at 2,738.72, a decrease of 0.20 percent. The Sensitive Index also slipped slightly by 0.07 points to 464.43. A total of 10.97 million shares were traded in 80,427 transactions across 346 companies, generating Rs 4.916 billion in turnover. While 98 companies posted gains, 161 declined and 10 remained unchanged. Among 13 sectors, only two recorded growth—led by manufacturing and processing—while most others, including hydropower, investment, and life insurance, ended lower.
NRB absorbs Rs 120 billion in excess liquidity
Nepal Rastra Bank carried out a large-scale liquidity absorption operation on Thursday to address surplus funds in the banking system. The central bank collected Rs 120 billion through a deposit collection instrument, with banks and financial institutions participating in bidding at 3:00 PM for a 97-day term. The repayment of principal and interest is scheduled for August 5 as part of NRB’s ongoing efforts to maintain stable market interest rates.
NOC revises fuel prices, petrol and diesel cheaper
Fuel prices have been adjusted, with petrol, diesel, and kerosene becoming cheaper, while LPG and aviation fuel prices have increased. Effective Friday, Nepal Oil Corporation (NOC) has reduced the price of petrol by Rs 2 per litre and diesel and kerosene by Rs 12 per litre. The move comes amid public criticism over recent sharp hikes in fuel prices. However, the adjustment also includes increases in other categories. Domestic aviation fuel has been raised by Rs 7 per litre, while international aviation fuel for Kathmandu has increased by USD 46 per kilolitre. Prices for international aviation fuel in Pokhara and Bhairahawa have been set at breakeven levels. In addition, the price of LPG cooking gas has gone up by Rs 150 per cylinder. Following the revision, petrol is priced at Rs 217 per litre, while diesel and kerosene stand at Rs 225 per litre.
Gold and silver prices decline in domestic market
Gold and silver prices fell on Thursday, according to the Federation of Nepal Gold and Silver Dealers’ Association. Gold prices dropped by Rs 1,800 per tola, settling at Rs 292,700, down from Rs 294,500 on Wednesday. Similarly, silver prices decreased by Rs 105 per tola to Rs 4,810.
Banking sector under pressure as non-performing loans near 6 percent
Nepal’s banking sector is facing rising stress as non-performing loans (NPLs) have increased from around 3 percent to nearly 6 percent of total lending. Out of Rs 5.869 trillion in total credit, about 6 percent is now classified as non-performing. In the third quarter, the average NPL ratio reached 5.22 percent for commercial banks and 5.96 percent for national-level development banks. Banks such as NIC Asia Bank, Prabhu Bank, and Nepal Investment Mega Bank have reported particularly high levels. The rise in bad loans is forcing banks to increase provisions, affecting profitability and capital adequacy.
Nepalgunj customs records Rs 9.64 billion revenue shortfall
The Nepalgunj Customs Office has fallen short of its revenue target for nine straight months, collecting Rs 14.89 billion against a target of Rs 24.54 billion—a gap of Rs 9.64 billion. Officials attribute the shortfall to reduced imports, a widening trade deficit, and low capital expenditure by the government. However, a recent rule requiring customs duty on goods valued above Rs 100 has increased daily passenger-branch revenue from Rs 250,000 to Rs 450,000.
Online mortgage system made mandatory for banks
The Department of Land Management and Archive has made the online mortgage system compulsory for all banks and financial institutions. From Wednesday, institutions that have already signed a Memorandum of Understanding (MoU) must carry out property-related transactions digitally. Others still preparing will be required to adopt the system starting May 15. This “faceless” approach aims to reduce intermediaries and improve efficiency in line with the Digital Nepal initiative.
Cargo shortage leaves thousands of trucks idle in Bara–Parsa
Despite a 5 percent increase in transport and freight fares due to rising fuel costs, truck operators in the Bara–Parsa industrial corridor are facing a severe shortage of cargo. Thousands of vehicles remain idle as demand for goods transport has sharply declined. Although the official rate for transporting a 10-ton load from Birgunj to Kathmandu is higher, intense competition has forced operators to accept as little as Rs 31,000—around Rs 10,000 below the fixed rate. Around 45,000 freight vehicles are currently operating nationwide.
Koshi Province spends only 34% of budget
Koshi Province has utilized just Rs 11.044 billion—around 34 percent of its revised Rs 32.45 billion budget—with only two and a half months remaining in the fiscal year. Capital spending remains particularly low at Rs 4.17 billion. Officials cite external factors such as rising costs of fuel and construction materials, partly driven by Middle East tensions, which have led contractors to halt projects. The province now faces pressure to spend Rs 21.41 billion in the remaining period.
Revenue collection hit at Birgunj amid MRP dispute
Revenue collection at the Birgunj Customs Office has been disrupted after traders boycotted clearance procedures for two consecutive days. The protest stems from the government’s requirement to enforce Maximum Retail Price (MRP) labeling at entry points, which traders argue is impractical. While the office typically collects Rs 500–600 million daily, revenue has dropped to around Rs 310 million, mainly from petroleum products and perishable goods that are exempt from the rule.
Timure customs halts imports over missing MRP labels
The Rasuwa Customs Office has temporarily stopped clearing commercial goods imported from China due to the absence of mandatory MRP labels on packaging. Under consumer protection regulations, all imported goods must clearly display retail prices. While industrial and hydropower equipment continue to be cleared, hundreds of trucks carrying consumer goods remain stranded until compliance is ensured.
Taplejung earns Rs 54.3 million from timber and herb exports
Taplejung district generated Rs 54.3 million in revenue from timber and herb exports during the first nine months of the fiscal year. According to the Division Forest Office, timber accounted for Rs 53.9 million of the total. The district exported over 1.3 million cubic feet of wood and 51,590 kilograms of herbs, including Chiraito, Lokta, and wild honey, sourced from private and community forests.
Food company buys wheat above government support price
The Food Management and Trading Company has started procuring wheat in Kailali at rates higher than the government’s minimum support price. While the official floor price is set at Rs 3,945 per quintal, the company is offering Rs 4,250 per quintal to encourage farmers. Procurement began in Mohanpur on Tuesday and in Tikapur on Wednesday. The company aims to purchase 10,000 quintals from Sudurpashchim and 40,000 quintals nationwide, with Rs 180 million allocated for the program this fiscal year.
Money laundering probe targets reinsurance and micro-insurers
The Department of Money Laundering Investigation has sought detailed financial records from Himalayan Reinsurance and seven micro-life insurance firms. The investigation focuses on the sources of funds used by founding shareholders to pay premiums exceeding paid-up capital during licensing. Companies such as Guardian, Crest, Liberty, Protective, Star, and Trust Micro Life Insurance have been asked to submit bank and payment details within 15 days.
Sudurpashchim gets reduced Rs 22.63 billion budget ceiling
The Provincial Policy and Planning Commission has set a budget ceiling of Rs 22.63 billion for Sudurpashchim Province for the fiscal year 2026/27, marking a decline of Rs 2.24 billion compared to the current year. The reduction is attributed to lower federal grants and weaker internal revenue. The Ministry of Physical Infrastructure Development received the largest allocation at Rs 7.53 billion. The province has listed 1,405 projects in its project bank, prioritizing those already under implementation.
Bridge projects in Rautahat face delays due to contractor negligence
Several strategic bridge projects in Rautahat Constituency-3 remain incomplete due to delays by contractors, prompting inspections by local lawmakers on Wednesday. Key projects, including bridges over the Kothiyar-Brahmatol and Lamaha (Gujara) rivers, initiated in fiscal year 2016/17, have reached only about 50 percent completion. Similarly, the Tarahi and Namaha river bridges remain stalled at around 45 percent despite missing their deadlines. Authorities have warned that contracts may be terminated if progress does not improve within revised timelines.
Over 2,600 tourists visit Shuklaphanta in six months
Shuklaphanta National Park recorded 2,634 visitors between July 17, 2025, and January 14, 2026. The figure includes 2,278 domestic tourists, 244 visitors from SAARC countries, and 112 from other nations. The park, known for Nepal’s largest grassland and a population of over 2,300 swamp deer, generated approximately Rs 1.4 million in revenue during the period.
Mount Everest Power opens IPO for locals and migrant workers
Mount Everest Power Development Limited launched its Initial Public Offering (IPO) on Thursday. In the first phase, 860,000 shares priced at Rs 100 each are being issued to residents of Solukhumbu district. Of these, 344,000 shares are allocated for Solududhkunda Municipality Wards 1 and 2, while 516,000 shares are for other wards. Additionally, 172,000 shares are reserved for Nepalis working abroad. Applications can be made through NIMB S Capital.
Sopan Pharmaceuticals allots IPO shares to 347,490 applicants
Sopan Pharmaceuticals completed the allotment of its IPO on Thursday at the office of NMB Capital. Out of over 2.73 million applicants, 347,490 were allotted 10 shares each through a lottery system. The company had issued 3.47 million shares worth Rs 347.4 million. Results are available via NMB Capital, Mero Share, and CDSC platforms.
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