KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
Recent developments across Nepal’s financial, commercial and public service sectors highlight a growing effort to balance regulatory enforcement with accessibility, accountability and economic growth. Nepal Rastra Bank’s revised branch consolidation rules seek to improve banking efficiency while requiring financial institutions to expand services in underserved rural areas. Similarly, the Supreme Court’s intervention against exclusive reliance on national identity cards underscores the importance of preventing administrative requirements from excluding citizens from essential financial services.
Economic activity presents a mixed picture. Real estate transactions have increased despite land subdivision restrictions, exposing tensions between property market demand and agricultural land protection. Meanwhile, plans for a tea testing laboratory in Jhapa, calls to expand egg production and temporary LPG cylinder exchange services reflect efforts to strengthen domestic industries, protect product quality and maintain essential supplies. The NTA’s warning against unauthorised internet tariff increases further highlights the need for consumer protection and transparent pricing.
Governance and institutional capacity remain significant concerns. The threat of e-passport service suspension over unpaid dues, rising digital financial fraud and the cancellation of 22 stalled infrastructure contracts in Dolakha point to weaknesses in payment management, public awareness and project implementation. Airport safety measures and action against smuggling demonstrate continued regulatory enforcement.
Australia’s additional AUD 15 million grant for flood reconstruction offers important external support, particularly for climate resilience. Overall, sustainable progress will depend on consistent policy implementation, stronger institutional coordination, consumer protection and equitable access to public and financial services.
NRB revises branch consolidation rules, requires banks to expand rural access
Nepal Rastra Bank (NRB) has amended its integrated regulatory directives governing the merger and consolidation of branches operated by licensed financial institutions. Under the revised provisions, commercial banks, development banks and finance companies may consolidate branches located in metropolitan, sub-metropolitan and municipal areas when another operating branch is within a distance of at least one kilometre, according to the provided report. To protect financial access in rural areas, institutions that close four branches in urban or semi-urban areas must establish a new branch in an unserved rural ward without formal banking facilities. Financial institutions must also publish public notices at least 90 days before consolidating branches, ensure customers can settle loans without penalty charges, transfer affected employees to other branches instead of laying them off, and update the relevant reporting portals within three working days.
Supreme Court directs NRB not to require national ID cards exclusively for banking services
The Supreme Court has issued an interim order directing Nepal Rastra Bank (NRB) not to make a national identity card the sole mandatory document for opening or maintaining bank accounts. A bench comprising Justices Sapana Pradhan Malla and Meghraj Pokharel partially suspended provisions of the integrated regulatory directives that restricted customer identification to national identity cards. The court directed financial institutions to accept other legally recognized documents, including citizenship certificates, to ensure that citizens are not deprived of essential banking services. The order followed a public interest litigation filed by advocate Sarita Adhikari, who argued that making national identity cards compulsory had created administrative difficulties and risked excluding ordinary citizens from banking services.
Real estate transactions rise despite land subdivision restrictions
Real estate transactions across Nepal have increased despite restrictions on land subdivision in local jurisdictions that have yet to complete official land-use classification. Although the government has not renewed administrative exemptions permitting land subdivision, property transactions have continued through bulk land transfers and court-ordered partition procedures, according to the provided report. Data from the Department of Land Management and Archive show that 37,487 land transactions were registered nationwide last month, compared with 27,494 during the same period last year. Real estate federation representatives have criticised the government for failing to complete land-use classification in more than 350 local units, arguing that the restrictions have hindered formal property transactions. However, ministry officials have maintained that enforcing land-use classifications is necessary to protect agricultural land from uncontrolled fragmentation.
NTA says no internet tariff hikes have been approved
The Nepal Telecommunications Authority (NTA) has clarified that no internet service provider has submitted a proposal to increase tariffs and that the regulator has not approved any hike in broadband subscription charges. Responding to recent media reports about rising internet prices, the authority said service providers must maintain fair and reasonable tariffs in accordance with existing regulations. Providers are required to submit proposed tariff changes for approval at least three months before implementation and publicly disclose their approved rates. The NTA warned that providers charging more than approved rates, increasing prices without prior authorization or operating services unlawfully would face action under the Telecommunications Act and related regulations.
Tea testing laboratory planned in Jhapa to safeguard quality and market identity
Authorities and industry stakeholders are working to establish a specialised tea testing laboratory in Jhapa to simplify quality assessments and protect the market reputation of Nepali tea. The initiative was discussed at a consultation involving the District Administration Office, the regional office of the National Tea and Coffee Development Board, and the Food Technology and Quality Control Division Office in Bhadrapur. Although the board’s central laboratory is located in Kathmandu, a regional facility in Jhapa would make quality testing and food safety verification more accessible to local producers. District officials stressed the importance of maintaining quality standards, preventing adulteration and complying with food safety regulations to protect consumers and preserve export markets. Jhapa has approximately 10,500 hectares under tea cultivation and 38 tea processing factories. The district produced 98.5 million kilograms of CTC tea in the previous fiscal year, while smallholder farmers cultivated about 3,600 hectares.
LP Gas association to exchange cylinders of 13 brands at six Kathmandu Valley locations
The Nepal LP Gas Industry Association is set to operate special cylinder exchange services at six locations across the Kathmandu Valley, allowing consumers to exchange cylinders from 13 different brands from Sunday, October 11. The service will run daily from 9:30 am to 4:30 pm until Saturday, October 17, in coordination with Nepal Oil Corporation and the Gas Dealers Federation. Rudra Singh, secretary at the Ministry of Industry, Commerce and Supplies, said the temporary arrangement was intended to ensure an uninterrupted supply of cooking gas during the festive period. The designated exchange points are Siphal, Pepsicola, Balaju Industrial Estate, Sukedhara, Kalanki and Harisiddhi in Lalitpur. The association’s president, Diwan Chand, said the service would handle cylinders belonging to participating gas companies under the association’s supervision.
Poultry stakeholders call for higher egg production and consumption
Poultry industry stakeholders have stressed the need to increase domestic egg production and consumption to support farmers and improve nutritional security. During a consultation organised by the Nepal Layers Poultry Farmers Association, participants highlighted the importance of cooperation between private-sector producers and government agencies to ensure sustainable growth in the industry. Association representatives said Nepal currently produces an average of around 3.8 million eggs a day. They aim to restore daily production to between 6.5 million and 7 million eggs, the levels recorded before the pandemic. The number of large-scale layer poultry farmers has risen to 180, while a crate of 30 eggs sells for around Rs 600. The estimated production cost is Rs 19.12 per egg. Industry representatives also expressed their willingness to offer discounted prices for school meal programmes, provided that supply remains stable and restrictions on unauthorised cross-border imports are effectively enforced.
German firm threatens to suspend e-passport services over Rs 300 million in unpaid dues
Muehlbauer ID Services GmbH, the German company operating Nepal’s electronic passport system, has given the Department of Passports until Monday to settle Rs 300 million in outstanding payments, warning that it could suspend services if the dues remain unpaid. The company reportedly said it had not received any payment since securing the contract last year. A suspension could disrupt passport issuance nationwide because Veridos GmbH, the German company responsible for printing passports, relies on Muehlbauer’s systems to process applicants’ data. The payment dispute is linked to a corruption case filed by the Commission for the Investigation of Abuse of Authority on June 23 against 18 individuals, including government officials and representatives of the two companies. The Special Court has yet to deliver its final verdict. Muehlbauer has warned that it could take contractual action, including terminating its agreement. Its employees have also threatened to strike over unpaid salaries, while internet service provider Subisu has warned of a possible service suspension over unpaid bills.
Pokhara International Airport bans drones, kites and laser lights
Pokhara International Airport has prohibited the use of drones, kites, hot-air balloons and laser lights in and around the airport’s airspace and approach zones to protect flight safety. Airport Chief Jagannath Niroula said unauthorised aerial activities could pose serious risks to aircraft during take-off and landing. Authorities have also urged residents and local governments to manage waste properly and avoid dumping animal carcasses near open drains, as unmanaged waste can attract birds and other wildlife that pose hazards to aircraft. The Civil Aviation Office warned that those violating the restrictions would face legal action under prevailing civil aviation and security laws.
Banking offences and digital fraud pose growing challenge to Nepal Police
Banking offences and digital financial fraud are emerging as significant challenges for Nepal Police, prompting authorities to call for greater public awareness of safe digital transactions. According to the Nepal Police Cyber Bureau, 744 complaints involving eSewa, Khalti, bank accounts and SMS-related issues were registered in fiscal year 2025/26. Police have identified cyber fraud and banking-related offences as growing areas of concern. A Nepal Police spokesperson said such crimes were creating difficulties for law enforcement agencies and stressed the importance of public awareness to prevent financial fraud. The spokesperson also urged families to pay closer attention to digital financial activities, noting that cases involving bank accounts registered in parents’ names had highlighted the risks associated with children handling mobile banking and other digital transactions.
Australia pledges additional AUD 15 million for flood reconstruction in Nepal
Australia has pledged an additional AUD 15 million in grant assistance for flood reconstruction and rehabilitation in Nepal, Foreign Minister Shisir Khanal has said. Speaking to journalists at Tribhuvan International Airport after returning from visits to Fiji, Tuvalu and Australia, Khanal said Australia’s total assistance for flood disaster response had reached AUD 26 million. During his meetings with Australian Foreign Minister Penny Wong and New South Wales Premier Chris Minns, discussions focused on strengthening technical cooperation, modernising early warning systems, developing climate-resilient infrastructure and sharing disaster management expertise. Khanal also outlined Nepal’s priorities for the upcoming UN Climate Change Conference (COP31), emphasising grant-based climate adaptation financing and stronger international cooperation. COP31 is scheduled to take place in Antalya, Türkiye, in November.
Road Division cancels contracts for 22 stalled projects in Dolakha
The Road Division Office in Charikot has cancelled contracts awarded to 22 contractors for infrastructure projects that remained stalled across Dolakha district. The office, which operates under the Ministry of Infrastructure Development, said the contractors had failed to resume work despite repeated written warnings and formal notices issued since fiscal year 2022/23. Following the cancellations, the division office issued legal notices requiring the contractors to pay the assessed costs of completing the projects and any associated damages within 30 days. The amounts are to be recovered as government dues. The move is intended to hold non-performing contractors accountable and allow stalled projects to be reassigned to other companies capable of completing the work, thereby accelerating infrastructure development in the district.
APF seizes smuggled goods and e-loaders worth over Rs 1.4 million in Parsa
The Armed Police Force (APF) has seized smuggled goods and two electric loaders worth more than Rs 1.4 million during operations in Parsa district. According to the APF’s 13th Battalion Headquarters in Parsa, a patrol intercepted two electric loaders near the Gandak intersection in Birgunj Metropolitan City-14. The vehicles were carrying textiles, kitchenware and grocery items worth Rs 334,945. The two loaders used to transport the goods were valued at Rs 1 million, bringing the total value of the seized consignment and vehicles to Rs 1.334 million. The confiscated goods and vehicles were handed over to the Birgunj Customs Office for further legal proceedings. In a separate operation, a team from the Birgunj border security company seized smuggled grocery and cosmetic products worth Rs 101,690 near the Inarwa border area.
Comment