KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
The developments present a mixed picture of Nepal’s economy, where rapid modernization is occurring alongside persistent governance and implementation challenges. Financial markets showed caution rather than confidence, with NEPSE falling despite higher turnover, indicating active trading but weak investor sentiment across most sectors. The sharp rise in gold prices further suggests a shift toward safer assets amid uncertainty.
At the same time, Nepal Rastra Bank’s inspection exposed serious weaknesses in the digital payment ecosystem, including widespread KYC non-compliance, cybersecurity risks, and governance failures that could threaten public trust. This is particularly significant because digital payments are expanding rapidly, with QR transactions growing by more than 90 percent and electronic payment systems becoming increasingly central to daily economic activity.
The contrast between rapid digital expansion and weak regulatory compliance is one of the report’s most important themes. The government is also pushing institutional reforms. Finance Minister Swarnim Wagle announced measures to improve capital expenditure performance through decentralized fund transfers, simplified procurement rules, and multi-year budgeting, while Lumbini Province introduced strict financial discipline guidelines.
Infrastructure and energy projects, including the Tamor-Mewa hydropower project and the Bajhang-Banlek transmission line, signal long-term growth ambitions. However, unresolved structural issues remain visible in unpaid dairy dues, declining transport revenue, and continued pressure on financial institutions, suggesting that stronger implementation and regulatory capacity will be crucial for turning reform momentum into sustainable economic growth.
NEPSE slips 13.82 points despite rise in trading turnover
The Nepal Stock Exchange (NEPSE) fell by 13.82 points, or 0.51 percent, on Thursday, closing at 2,654.15 and wiping out the gains made on Wednesday. The Sensitive Index also declined by 2.62 points to 464.73. A total of 10.8 million shares of 347 companies were traded through 60,381 transactions, generating a turnover of Rs 4.622 billion, higher than Wednesday’s Rs 4.409 billion. Share prices of 64 companies increased, 202 declined, and 10 remained unchanged. Among the 13 sectoral indices, only the trading sector advanced, while the remaining 12 sectors ended in negative territory.
Gold surges by Rs 8,000 per tola; silver also climbs
Gold and silver prices increased sharply in the domestic market on Thursday. According to the Federation of Nepal Gold and Silver Dealers’ Association, gold rose by Rs 8,000 per tola to Rs 296,000, up from Rs 288,000 on the previous trading day. Silver also increased by Rs 95 per tola, reaching Rs 4,570, compared with Rs 4,475 on Wednesday.
Finance minister announces reforms to boost capital spending
Finance Minister Swarnim Wagle has said the government has begun structural and procedural reforms aimed at raising capital expenditure performance to between 80 and 100 percent. Speaking at a parliamentary committee meeting, he said past delays were caused by suspended contracts and rigid approval procedures. He highlighted three key reforms: decentralization of fund transfers to ministries, simplification of procurement rules through a newly enacted law, and multi-year resource commitments under the Medium-Term Expenditure Framework. The minister also said efforts are underway to broaden the revenue base to meet a target of Rs 15.80 billion.
NRB inspection finds serious KYC and governance lapses in digital payment sector
An on-site inspection conducted by Nepal Rastra Bank (NRB) on 16 licensed payment system operators, payment service providers, and Real-Time Gross Settlement (RTGS) institutions for fiscal year 2024/25 has uncovered widespread regulatory non-compliance. The central bank found a large number of unverified Know Your Customer (KYC) records in digital wallets, along with significant weaknesses in governance and risk management. Other issues included outdated antivirus systems that increase cybersecurity risks, issuance of e-money beyond available settlement funds, and unauthorized super-admin access granted to compliance officers. NRB warned that such systemic shortcomings could undermine the stability of digital payment systems and weaken public confidence.
Digital payment transactions rise sharply, NRB study shows
A study by Nepal Rastra Bank has shown rapid growth in digital payment activity during fiscal year 2024/25. According to the report, transactions through faster payment systems increased by 34.6 percent in volume and 33.7 percent in value compared with the previous fiscal year. QR-based payments recorded the strongest growth, rising by 92.5 percent in volume and 91.8 percent in value. Online card payments, prepaid cards, and RTGS transactions also expanded significantly. The study noted that digital banking, e-wallets, and internet-based payment channels have become increasingly common across the country since the COVID-19 pandemic, while traditional debit and card payments are growing at a slower pace.
Real estate firms given 21 days to obtain transaction licenses
The Department of Land Management and Archives has instructed companies and organizations planning high-value real estate transactions in metropolitan and sub-metropolitan areas to apply online for a transaction license within 21 days. A license is mandatory for entities involved in a single property transaction exceeding Rs 30 million. The fee has been fixed at Rs 500,000 for transactions up to Rs 50 million and Rs 1 million for transactions above that amount. Applicants must submit hard copies of supporting documents, including a clearance certificate from the Central Investigation Bureau confirming that board members are not involved in criminal activities.
Nagendra Sah appointed executive director of Nepal Oil Corporation
The government has appointed Nagendra Sah as the Executive Director of Nepal Oil Corporation (NOC). The decision was taken at Wednesday’s Cabinet meeting. Sah, who had been serving as acting executive director, replaces Chandika Bhatta after the government revoked earlier political appointments. He was selected through an open competitive process conducted by the Ministry of Industry, Commerce and Supplies, defeating finalists Kaushal KC and Sanjeev Kumar Dev.
Lumbini government issues 52-point financial discipline directive
The Lumbini Province government has introduced a 52-point guideline to strengthen financial discipline, transparency, and results-oriented budget implementation for fiscal year 2026/27. The directive prohibits non-essential seminars and workshops during Asar and requires the surrender of budgets for unspent programs. Infrastructure projects exceeding Rs 1 million must go through competitive procurement, while vehicle purchases will require prior approval from the Ministry of Economic Affairs and Planning. The province said the measures are intended to improve accountability and ensure timely project completion.
Tamor-Mewa hydropower project begins tunnel blasting
The 128-megawatt Tamor-Mewa Hydropower Project has started underground tunnel blasting work in Phungling, Taplejung, marking a major milestone in the project. The project, developed by Spark Hydroelectric Company, is estimated to cost Rs 23.04 billion, including Rs 17.28 billion in debt financing led by Siddhartha Bank and co-led by Machhapuchhre Bank, and Rs 5.76 billion in equity investment. The project is expected to generate about 711 gigawatt-hours of electricity annually and begin commercial operation by Oct. 10, 2028.
Nepal-Oman business forum highlights trade and investment opportunities
More than 70 business leaders, government officials, and entrepreneurs from Nepal and Oman participated in a business networking and interaction program held in Muscat on Aug. 4. Organized by the Embassy of Nepal in Muscat, the event focused on expanding cooperation in trade, investment, tourism, and employment. Nepali export products and traditional handicrafts were displayed by the Federation of Entrepreneurship Nepal and the Federation of Handicraft Associations of Nepal. Chargé d’Affaires Bishesh Kumar Sah highlighted Nepal’s investment potential, while the visiting trade delegation held meetings with Lulu Hypermarket, the Oman Chamber of Commerce and Industry, and the Oman Investment Authority.
Cabinet approves revised salary structure for public servants
The Office of the Prime Minister and Council of Ministers has approved a new salary structure for public servants. The revised scale includes a 10 percent increase in basic salary and an additional 10 percent incentive allowance effective from the current fiscal year. Government pensioners will also receive a 10 percent increase. Under the new structure, the Chief Secretary and the Chief of Army Staff will receive the highest monthly salary of Rs 90,594, while office assistants will receive Rs 28,984. The Inspector General of Police will receive Rs 84,576 per month.
Finance committee orders immediate share allocation for project-affected locals
The Parliamentary Finance Committee has directed relevant authorities to enforce the legal provision requiring 10 percent of hydropower project shares to be issued to directly affected local residents at the face value of Rs 100 per share. The committee cited complaints about delays in implementing Rule 9(4) of the Securities Registration and Issue Regulations, 2016. It instructed the Ministry of Finance, the Ministry of Energy, Water Resources and Irrigation, and the Securities Board of Nepal (SEBON) to ensure that affected communities receive their allocations without further administrative obstacles.
Community school teachers receive updated pay scale
The government has published a revised salary structure for community school teachers based on qualification, level, and rank. Primary-level teachers who failed the School Leaving Certificate in more than two subjects will receive Rs 34,426 per month, while those failing up to two subjects will receive Rs 36,445. About 2,000 teachers fall under this category out of 109,125 approved positions. Under the new scale, first-class primary teachers will receive Rs 60,874, while lower secondary teachers will receive up to Rs 63,904 and secondary teachers up to Rs 74,958 per month.
Gandak Canal water supply resumes after emergency repairs in Bara
Water flow in the Gandak Canal resumed on Thursday after a three-day suspension for urgent maintenance near Matirwa in Bara, where leakage developed in Block 8 due to damage caused by rats, according to the Narayani Irrigation Management Office. Indian authorities have continued releasing 850 cusecs of water under the Nepal-India Gandak Treaty, ensuring irrigation supply to agricultural areas in Parsa, Bara, and Rautahat. The uninterrupted release is expected to support ongoing paddy plantation activities throughout the canal command area during the irrigation period running from June 29 to Oct. 1.
Janakpurdham transport office collects Rs 571.5 million in revenue
The Transport Management Office in Janakpurdham generated Rs 571.5 million in revenue during fiscal year 2025/26 through vehicle registration, renewal, and driving license services. Office chief Basu Dev Malla said the amount was Rs 95.4 million lower than the previous year’s collection of Rs 666.9 million. He attributed the decline to protests and delays in software development. During the fiscal year, the office registered 21,294 new vehicles and issued 13,338 driving licenses.
Work begins to advance Bajhang-Banlek 400 kV transmission line project
The National Transmission Grid Company has started the process for constructing the Bajhang-Banlek (West Seti) 400 kV transmission line, which is intended to support the transmission of 2,500 megawatts of electricity. The proposed line will extend 60 km from the Chainpur Substation in Bajhang to Banlek in Shikhar Municipality-10 of Doti. An application has been submitted to the Department of Electricity Development for construction approval under the Electricity Act, 2049. The project is expected to be completed within five years of commencement, and the department has issued a public notice inviting comments and suggestions on the proposal.
Narayangadh-Butwal road project cuts travel time to around two hours
Travel on the 113.35-km Narayangadh-Butwal road section has become significantly faster, with journeys that once took up to 12 hours or required overnight travel now taking about two hours. Business owners, transport operators, and media professionals have described the improvement as a major economic relief. According to engineer Shiva Khanal of the eastern section, overall construction progress has reached about 92 percent, with only minor works remaining. The Rs 16.99 billion project is being implemented by China State Construction Engineering Corporation.
Multipurpose Finance withholds dividend for fiscal year 2024/25
Multipurpose Finance has decided not to distribute any dividend from the profits of fiscal year 2024/25. The decision was taken at a board meeting held on Wednesday after reviewing the company’s financial performance and profitability. The institution said it would retain earnings to strengthen its financial position and capital base.
Kathmandu court acquits commodity market operators in Rs 97.8 million fraud case
The Kathmandu District Court has acquitted operators and employees of several commodity market-related companies in a fraud case involving Rs 97.8 million filed five years ago. The court ruled that financial losses in commodity trading do not by themselves prove organized crime or software manipulation unless there is concrete evidence of intentional fraud. It ordered the release of frozen bank accounts, personal properties, and deposited bail amounts of all acquitted defendants. The acquitted entities include Mercantile Exchange Nepal, Money Spell Investment, Himalayan Clearing Corporation, Bijay Commodity, Sonata Investment, Ezone Commodity, and Money Plus and Securities.
Makwanpur administration acts against dairy firms over unpaid farmer dues
The District Administration Office in Makwanpur has initiated legal action against dairy industries that have failed to clear more than Rs 100 million in outstanding payments to farmers. An audit found that only Rs 43.4 million had been paid out of Rs 143.5 million owed by mid-March of fiscal year 2025/26. Under previous agreements, dairy firms were required to pay at least 65 percent of arrears by mid-July and the remaining balance by mid-October. Authorities have issued warning letters and begun enforcement measures to protect farmers’ livelihoods.
MBL Equity Fund declares 8 percent return for unit holders
MBL Equity Fund has announced an 8 percent cash and tax-inclusive return for unit holders for fiscal year 2025/26. The fund has allocated Rs 97.3 million for the distribution and fixed Aug. 18 as the book closure date for the one-day unit holder registry closure. Investors holding units before the closure date will be eligible to receive the declared return in accordance with the fund’s operating guidelines.
Petrol tanker overturns and catches fire in Rautahat
A petrol tanker traveling from Amlekhgunj to Sarlahi overturned and caught fire on Thursday morning at Dhansar in Gujara Municipality-3, Rautahat. According to Deputy Superintendent of Police Basanta Gautam, the driver lost control while trying to avoid hitting a deer. Fire engines from Chandrapur Municipality and Nijgadh Municipality, along with police and traffic personnel from Chapur, brought the blaze under control. No human casualties were reported.
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