KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
The developments highlight the broad economic and social consequences of the Bhote Koshi disaster while showing coordinated efforts to stabilize affected communities and financial systems. The destruction of 15 out of 16 bank branches has caused Rs 600 million in direct physical losses and exposed additional risks from destroyed collateral, damaged safety lockers, and missing employees. The Rs 2.43 billion in non-hydropower loans linked to affected borrowers could create future credit and recovery challenges for banks. The government’s formation of five task forces, international assistance, and deployment of security and technical teams indicate an increasingly coordinated recovery strategy.
The disaster has also generated financial-market uncertainty. Hydropower and non-life insurance stocks faced significant selling pressure as investors anticipated project losses and insurance liabilities, contributing to a 43.89-point decline in the NEPSE index. At the same time, the Nepal Rastra Bank’s absorption of Rs 20 billion, following an earlier Rs 90 billion withdrawal, signals active liquidity management amid changing financial conditions.
Infrastructure restoration is progressing through electricity repairs, alternative road connectivity, and Bailey bridge construction, which should gradually support economic activity and emergency access. Meanwhile, falling gold prices and declared corporate dividends suggest that domestic financial markets continue to function despite the disaster. Overall, the situation underscores the need for sustained reconstruction financing, insurance settlement, credit-risk management, and resilient infrastructure planning.
Banking sector records Rs 600 million in physical damage in Bhote Koshi
Commercial bank branches in areas affected by the Bhote Koshi floods have suffered direct physical damage estimated at Rs 600 million, according to the Nepal Bankers Association. Of the 16 branches operated by 12 banks in the disaster-affected areas, 15 were completely destroyed, while the remaining branch sustained severe structural damage. These branches served 78,204 depositors and held total deposits of Rs 4.50 million. They had also extended Rs 2.43 billion in non-hydropower loans to 2,125 borrowers whose land pledged as collateral was swept away by the floods. Cash held in vaults, counters, and ATMs is covered by insurance. This includes Rs 172.4 million kept in vaults, Rs 11.7 million at counters, and Rs 11.6 million distributed across nine ATMs. However, major losses involving loan collateral and damaged safety deposit lockers, particularly at Agricultural Development Bank, have not been compensated. Meanwhile, 26 bank employees working at the affected branches remain out of contact.
Gold traded at Rs 306,600 per tola
The price of gold fell by Rs 2,400 per tola (11.66 grams) in the domestic market on Monday, while the price of silver remained unchanged. According to the Federation of Nepal Gold and Silver Dealers’ Association, gold was trading at Rs 306,600 per tola, while silver remained priced at Rs 4,780 per tola. On Sunday, gold had been traded at Rs 309,000 per tola, while silver was priced at Rs 4,780 per tola. The federation said the price of gold had declined by Rs 9,500 on Sunday. The price of silver also fell by Rs 185 on the same day. In the international market, the spot price of gold stood at approximately USD 4,455 per troy ounce. Gold had been trading at around USD 4,454 per ounce on Sunday.
NRB absorbs Rs 20 billion in liquidity
The Nepal Rastra Bank (NRB) absorbed Rs 20 billion from the financial system on Monday through an emergency deposit collection auction as part of efforts to manage increasing liquidity in the banking sector. The central bank invited bids from Class ‘A’, ‘B’, and ‘C’ financial institutions through its online bidding system until 3:00 PM. The deposits carry an 86-day maturity period, with repayment of principal and interest scheduled for November 25 this year. Participating institutions were allowed to submit bids starting from Rs 100 million and up to the total amount offered, in multiples of Rs 50 million. The applicable interest rates were determined competitively through the auction. The move followed the NRB’s withdrawal of Rs 90 billion from the financial system on August 26, 2026.
Bhote Koshi flood weighs on NEPSE as hydropower and insurance stocks fall
The Bhote Koshi flood in Rasuwagadhi has started affecting the stock market, with hydropower and non-life insurance companies facing significant selling pressure. Investors have been offloading shares in these sectors following damage to hydropower projects and concerns about potential corporate losses and insurance liabilities. Some investors have shifted toward manufacturing companies amid the uncertainty. The hydropower sub-index declined by 2.94 percent, while the non-life insurance sub-index dropped 5.03 percent. The Nepal Stock Exchange (NEPSE) index fell 43.89 points to close at 2,513.42 points. Total turnover stood at Rs 3.648 billion, with shares of 347 companies traded. Mailung Khola Hydropower Company, Rasuwagadhi Hydropower, and Chilime Hydro were among the biggest decliners.
Five task forces formed to speed up Bhote Koshi disaster recovery
Finance Minister Swarnim Wagle announced the formation of five specialized task forces during a stakeholder meeting at Singha Durbar on Monday to accelerate rescue, relief, and reconstruction efforts following the Bhote Koshi River disaster. The task forces will immediately focus on damaged infrastructure, roads, suspension bridges, and water, sanitation, and hygiene facilities. Specialized tunnel rescue operations will be carried out in coordination with the Nepal Army and the Nepal Electricity Authority. Minister Wagle stressed the need for rapid administrative action and transparent mobilization of funds without bureaucratic delays. He outlined a two-phase damage assessment process and said a business recovery package would be introduced for tourism and hospitality businesses affected by the disaster. Officials have also been instructed to prepare a comprehensive reconstruction framework within three days. The government plans to use existing legal provisions to establish an empowered structure capable of coordinating the recovery response.
Nepal seeks international support for Bhote Koshi flood rescue and recovery
The Government of Nepal has appealed for international assistance for ongoing search, rescue, and relief operations following the Bhote Koshi floods. More than 4,200 people remain unaccounted for, including around 590 foreign nationals from 39 countries. According to the Ministry of Foreign Affairs, 903 bodies have been recovered, while more than 10,000 people, including 323 foreign nationals, have been rescued. Specialized technical teams from India, China, and the Republic of Korea are assisting authorities with operations on the ground. Prime Minister Balendra Shah is personally monitoring the response and coordinating international assistance. Support being sought includes bridge units, freezers, DNA testing kits, and forensic expertise. The government expects international assistance to remain important during the rehabilitation and reconstruction stages as well.
Police recover cash and gold from flood-hit Agricultural Development Bank branch
Nepal Police have recovered Rs 15 million in cash, gold worth approximately Rs 500 million, and important documents from the Trishuli Dhunge branch of Agricultural Development Bank after an operation lasting nearly eight hours. Security personnel used specialized equipment and resources to safely access the damaged bank premises despite structural hazards. They transferred the vaults, cash reserves, precious metals, and important institutional records to a secure location. The operation helped protect valuable financial assets and critical documents as security agencies continue to lead the emergency response along the Trishuli corridor.
Energy Minister and Home Minister discuss Rasuwa rescue efforts in Nuwakot
Minister for Energy, Water Resources, and Irrigation Biraj Bhakta Shrestha has reached Trishuli in Nuwakot to inspect flood-affected hydropower projects and receive updates on rescue operations. Minister Shrestha held discussions with Home Minister Sudan Gurung at the Shree No. 1 Army Training Centre in Bidur Municipality. Home Minister Gurung is based at the training centre and is coordinating rescue activities. Senior Army officers involved in the tunnel rescue operation at the hydropower project briefed Minister Shrestha on the latest developments. Prime Minister’s Political Advisor Asim Shah also arrived in Nuwakot alongside Minister Shrestha. Following the briefing, Minister Shrestha is scheduled to travel by helicopter to the hydropower project rescue site in Rasuwa. He also plans to meet and discuss the situation with the families of those affected.
NDRRMA urges public to avoid non-essential helicopter rescues
The National Disaster Risk Reduction and Management Authority (NDRRMA) has urged the public and concerned agencies to refrain from seeking helicopter rescues unless they are genuinely necessary. The authority said helicopters should be prioritized for emergency search and rescue operations and the transportation of relief supplies. NDRRMA spokesperson Shanti Mahat said some requests for aerial rescue were being made by people who were only minimally affected by the disaster or were already in safe locations. Authorities said 3,596 people have so far been rescued by air from Rasuwa, Nuwakot, Dhading, Gorkha, and Tanahun. The figure includes 252 foreign nationals and 3,344 Nepali
Electricity service restored in several areas of Rasuwa
Electricity service has resumed in several areas of Rasuwa after the Bhote Koshi River flood disrupted power supply, according to the Nepal Electricity Authority (NEA). The NEA said electricity has been restored in most parts of Kalika and Naukunda Rural Municipalities in Rasuwa. Power services have also resumed in Dhunche, Bharkhu, and Gosaikunda areas of Gosaikunda Rural Municipality. The flood caused extensive damage to electrical infrastructure in the affected areas. In response, technical teams from the authority intensified repair and restoration efforts despite difficult weather conditions and challenging geographical terrain. The NEA said the continuous efforts of its technical teams have enabled electricity supply to resume in several affected locations, allowing residents to gradually return to their normal daily activities. The authority said restoration work is still underway in the remaining affected areas. It has deployed the necessary manpower, equipment, and other resources to restore and regularize electricity services there as soon as possible.
NIFRA declares dividend of over 5 percent
Nepal Infrastructure Bank Limited (NIFRA) has announced a total dividend of 5.26 percent from the profits earned during the previous fiscal year. The proposed dividend consists of a cash distribution that includes applicable taxes. The bank’s board of directors approved the dividend proposal at a meeting held on August 30. However, the distribution is subject to final approval from the government, the Ministry of Finance, and Nepal Rastra Bank (NRB). The proposal must also receive formal approval from shareholders at the bank’s upcoming annual general meeting.
Local road connectivity restored along Trishuli riverbanks in Nuwakot
Local road connectivity has been restored along both sides of the Trishuli River in Nuwakot, reconnecting communities that had been isolated after bridges were damaged by severe natural disasters. Vehicles can now travel along an alternative route beginning from the Galchhi-Trishuli Highway and passing through Kalleritar, Koshikhola, Pipaltar, Darshantar, Chhatrekhola, and Ghaubeshi before reaching Trishuli Bazaar. The reopening of the route has restored an important transportation link to the district headquarters for residents of several affected communities. It is also expected to make it easier for emergency response personnel, humanitarian and rescue teams, and relief supplies to reach areas heavily affected by the disaster.
Bailey bridge construction begins over Puwa Khola
Construction of a 230-foot-long and 14-foot-wide Bailey bridge over Puwa Khola in Ilam began on Monday. The federal government is funding the project at a cost of more than Rs 22 million. Technical assistance will be provided by an Indian team that is expected to arrive under a grant program designed to establish an alternative route to the Mechi Highway. Arjun Ghimire, a technician at the Road Division Office, Ilam, said the bridge is expected to be completed within two weeks. The structure will connect Bhangtar in Ilam Municipality-9 with Soyak in Ward No. 11. Local resident Prakash Nepal expressed optimism that the bridge would help maintain regular transportation between Jhapa, Ilam, Panchthar, Taplejung, and parts of Terhathum during the monsoon season. The new bridge is also expected to complement ongoing blacktopping work along the 50-kilometer road corridor connecting Ilam with Birtamod. Around 17 kilometers of the corridor currently remain unpaved.
Muktinath Mutual Fund announces 2.20 percent cash return
Muktinath Capital Limited has announced a 2.20 percent cash return, including applicable taxes, for unit holders of Muktinath Mutual Fund-1. The company’s board meeting held on August 27 decided to distribute the announced return to eligible unit holders. Muktinath Capital has set September 9, 2026, as the book-closure date for the distribution. Investors who retain ownership of the fund’s units through transactions completed on the Nepal Stock Exchange by September 8, 2026, will be eligible to receive the declared cash return.
Varun Beverages and Softy Hygiene contribute to disaster relief fund
Varun Beverages has donated Rs 10.1 million to the Prime Minister Disaster Relief Fund to support rescue, relief, and rehabilitation efforts for people affected by the floods. Representatives of the company handed over the cheque to Finance Minister Swarnim Wagle on Monday. Similarly, Softy Hygiene Private Limited contributed Rs 2.1 million to the disaster relief fund. Company directors Bijay Pokharel and Subas Bhandari handed over the contribution to Finance Minister Wagle to support families affected by the Bhote Koshi River floods in Rasuwa. Both companies said their contributions reflected their commitment to corporate social responsibility. They also expressed their willingness to continue cooperating with government authorities during national emergencies and other crises.
NDP approves 2.5 percent bonus shares at second annual general meeting
Nepal Development Public Limited (NDP) held its second annual general meeting under the chairmanship of Chandra Prasad Dhakal. The meeting approved the company’s annual report, financial statements, and audit reports for fiscal year 2025/26. Shareholders also endorsed a proposal to distribute 2.5 percent bonus shares along with more than Rs 1.5 million in cash dividends to cover applicable taxes on the bonus shares. The meeting further authorized the company’s board of directors to undertake mergers and acquisitions and issue convertible debentures, preference shares, and financial instruments aimed at foreign investors. The board was also granted authority to seek international financing from sources such as the Green Climate Fund and blended finance programs. In addition, the meeting approved the allocation of 20 percent of the company’s issued capital to the general public. During the fiscal year, NDP reported a net profit of Rs 73.3 million after tax. The company’s paid-up capital reached Rs 1.183 billion, while its shareholder base expanded to include investors from all 77 districts of Nepal.
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