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 regulatory tightening, market volatility, and infrastructure push amid regional geopolitical uncertainty and domestic political activity. The introduction of mandatory IT audits by the Nepal Stock Exchange and liquidity absorption by Nepal Rastra Bank signal efforts to strengthen financial stability and digital security, even as development banks face rising non-performing loans nearing Rs 30 billion.
Surging global oil prices due to Middle East tensions, flight disruptions affecting Nepal’s connectivity, and sharp increases in gold and lemon prices point to inflationary pressures and supply-side vulnerabilities. At the same time, steady liquor imports, growth in motor insurance premiums, and bonus declarations by Prabhu Insurance suggest pockets of resilient demand.
The government’s measures to prevent fuel hoarding through Nepal Oil Corporation, ensure essential supplies during elections, and mobilize forest and infrastructure funds highlight proactive policy responses. However, long-stalled mega projects like Karnali-Chisapani contrast with progress in road upgrades, underscoring the broader challenge of translating plans into sustained execution amid economic slowdown and external shocks.
NEPSE enforces mandatory IT audits for brokers
Nepal Stock Exchange has introduced the IT Audit Guidelines 2026, requiring brokerage firms to undergo comprehensive technology audits at least once every two years. Newly licensed brokers must complete their first audit within six months of operation. The review will assess Trading Management Systems (TMS), server security, firewall protection, mobile applications, and data backup and encryption protocols. The measure aims to reduce cyber risks and strengthen investor confidence in Nepal’s digital trading environment.
Gold price rises by Rs 2,500 per tola
Gold prices increased by Rs 2,500 per tola on Tuesday, reaching Rs 328,600, according to the Federation of Nepal Gold and Silver Dealers’ Association. Meanwhile, silver prices declined to Rs 5,815 per tola from Rs 6,020 the previous day.
NRB withdraws Rs 1 billion from banking system
Nepal Rastra Bank absorbed Rs 1 billion in excess liquidity from the financial system on Tuesday through a six-day deposit collection instrument. The central bank used a competitive bidding process, allowing banks and financial institutions to place online bids, with interest rates determined accordingly. The principal and accrued interest will be repaid on March 8. The move forms part of the bank’s routine open market operations to maintain monetary stability and manage surplus funds in the banking sector.
Global crude oil prices climb more than five percent
International oil benchmarks surged Monday as tensions escalated in the Middle East. Following coordinated US-Israeli strikes on Iran, West Texas Intermediate (WTI) advanced over five percent, while Brent crude gained nearly six percent. Analysts warn that potential supply disruptions and maritime shipping risks could intensify global inflationary pressures. Although some experts view the spike as temporary, the sharp rise underscores geopolitical uncertainty and precautionary stockpiling, raising concerns about higher fuel and consumer prices in the coming weeks.
Liquor imports reach Rs 1.63 billion in seven months
Nepal imported nearly 1.9 million liters of alcoholic beverages worth Rs 1.634 billion during the first seven months of fiscal year 2025/26, according to the Department of Customs. The imports generated Rs 2.633 billion in revenue. Whiskey accounted for the largest share, followed by vodka, rum, and other alcoholic products, reflecting steady consumer demand despite broader economic challenges.
Development banks’ non-performing loans approach Rs 30 billion
Non-performing loans (NPLs) in development banks have climbed to 5.75 percent amid a prolonged economic slowdown. Central bank data show that Rs 30.874 billion of total lending remains inactive, marking a significant year-on-year increase. Narayani Development Bank reported the highest NPL ratio. Bankers attribute the deterioration to sluggish economic activity and disruptions caused by protests in September 2025, which hampered loan recovery efforts.
Karnali-Chisapani project remains stalled despite decades of study
The proposed 10,800-megawatt Karnali-Chisapani Multipurpose Project, first studied in 1960, remains unimplemented despite multiple feasibility assessments and the training of hundreds of engineers. Experts say progress depends largely on cooperation with India, considered the primary prospective energy buyer and investor. The project holds potential to irrigate vast agricultural land in Nepal and India and mitigate flooding in Bangladesh, yet successive governments have failed to prioritize its execution.
Over 1.5 million passengers affected by Gulf airport closures
Approximately 9,500 flights were canceled over four days at major Gulf airports, affecting more than 1.5 million travelers, according to aviation tracking data. Cancellations surged sharply over the weekend, creating logistical challenges for airlines and airport authorities as they work to rebook passengers amid ongoing airspace restrictions.
Nepal Oil Corporation bans fuel hoarding
Nepal Oil Corporation has urged consumers not to stockpile fuel, warning of fire hazards and safety risks. Executive Director Chandika Prasad Bhatta said petroleum imports through pipelines remain steady and sufficient for the election period. The corporation has prohibited the storage of fuel in jerry cans and drums and appealed to the public to purchase only necessary quantities.
Motor insurance leads non-life premium collection
Non-life insurers collected Rs 28.274 billion in premiums in the first seven months of the fiscal year, according to the Nepal Insurance Authority. Motor insurance dominated the sector with Rs 9.159 billion in premiums, followed by property and engineering insurance. While most segments recorded growth, aviation insurance premiums declined, indicating shifting trends in the insurance market.
Government assures essential supply stability during polls
The Ministry of Industry, Commerce, and Supplies has instructed key agencies to maintain adequate stocks of fuel and essential goods ahead of the March 5 election. Officials said regional tensions would not immediately disrupt fuel supply, citing sufficient reserves held by suppliers. Market monitoring has been intensified to prevent artificial shortages or price manipulation during the election period.
International flights disrupted amid regional tensions
Air connectivity to Nepal has been affected following US-Israeli strikes on Iran and subsequent retaliatory actions. Several international flights were canceled at Tribhuvan International Airport, impacting carriers including Nepal Airlines and Qatar Airways. Airspace closures across parts of the Gulf and Middle East have forced airlines to suspend or reroute services, leaving passengers stranded.
Yeti Airlines suspends flights for election day
Yeti Airlines has announced the suspension of all domestic flights on Thursday in observance of the House of Representatives election. The airline said services will resume on March 6 and apologized for inconvenience, noting the decision supports national security and logistical arrangements during the polls.
Government sets nine priority areas for forest fund mobilization
The government has unveiled the Forest Development Fund Operation Guidelines, identifying nine sectors for spending revenues generated from carbon trading, environmental service fees, and infrastructure projects. Priority areas include forest expansion, nursery development, and the Sagarmatha Plantation Campaign (2025–2045). Funding will also support biodiversity conservation, climate adaptation, human-wildlife conflict mitigation, research initiatives, and acquisition of private land to expand forest cover. A technical subcommittee will review proposals annually to ensure transparency and prevent duplication.
Daunne road stretch to be concreted at additional Rs 510 million
The Asian Development Bank-funded Narayangarh-Butwal road expansion has reached 80 percent completion after seven years. Authorities have decided to use concrete instead of asphalt for 11 kilometers of the Daunne section due to unstable terrain and heavy traffic, adding Rs 510 million to the cost. Officials say the change will extend the road’s lifespan to 30 years and reduce long-term maintenance expenses.
Prabhu Insurance declares 8.7 percent bonus shares
Prabhu Insurance has announced an 8.7 percent bonus share dividend from last fiscal year’s profits, along with a 0.4679 percent cash dividend for tax purposes. The proposal awaits approval from the Nepal Insurance Authority and the company’s Annual General Meeting.
Abukhaireni-Jamune section nears completion
Work on the 41-kilometer Abukhaireni-Jamune stretch of the Prithvi Highway is 95 percent complete. The Rs 6.31 billion project, financed by the Asian Development Bank, has expanded urban sections to six lanes. Engineers are addressing landslide-prone zones to ensure durability, while the Madi Bridge project is 80 percent finished, improving connectivity between Mugling and Pokhara.
Rs 910 million allocated to blacktop Nagma-Gamgadhi road
The Road Division in Jumla has invited tenders to pave 15 kilometers of the 93-kilometer Nagma-Gamgadhi road, backed by a Rs 910 million budget. The upgrade is expected to improve access to Rara Lake and strengthen regional connectivity, though much of the route remains in poor condition due to budget constraints.
Lemon prices jump 161 percent in one month
Wholesale lemon prices have surged dramatically, rising from Rs 90 per kilogram on February 2 to Rs 235 per kilogram on March 3, marking a 161 percent increase. The spike reflects seasonal supply constraints and rising demand.
Dang to host industrial and tourism festival from March 12
The Federation of Nepal Cottage and Small Industries (FNCSI) Dang chapter will organize the Lumbini Provincial Small and Cottage Industry, Cultural Tourism, and Agriculture Festival 2026 in Ghorahi from March 12 to 29. The event will feature 300 stalls promoting local products, entrepreneurship, agricultural technology, and digital marketing initiatives.
Comment