KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
The latest economic and infrastructure developments highlight Nepal’s dual challenge of pursuing growth while addressing long-standing structural and governance issues. Positive signals include growing export earnings from niche products such as chhurpi, renewed foreign investment interest from the UAE, faster-than-scheduled infrastructure delivery in some areas, and regulatory efforts by Nepal Rastra Bank to strengthen banking efficiency.
However, the private sector continues to seek policy reforms to improve liquidity, simplify taxation and enhance the investment climate, underscoring persistent concerns over the business environment. At the same time, stricter regulatory enforcement through the cancellation of construction licenses and ongoing cooperative deposit repayments reflect greater institutional oversight.
Meanwhile, climate-related disruptions to transport networks and recurring altitude sickness fatalities in Mustang expose vulnerabilities in infrastructure resilience, tourism management and public safety, indicating that sustainable economic growth will depend not only on investment but also on stronger governance, disaster preparedness and service delivery.
FNCCI urges reforms to boost private sector investment
The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has called for policy and regulatory reforms to encourage private investment and stimulate economic growth. During a meeting with government officials on Wednesday, the federation said the private sector contributes 81 percent of Nepal’s economic output and generates 86 percent of total employment but continues to face weak demand and regulatory challenges. FNCCI urged the government to introduce measures to improve access to credit and liquidity, implement the proposed Sunset Law and Debt Recovery Act, and establish a unified tax code to simplify taxation across provinces and promote investment.
NRB instructs banks to reduce dormant accounts
Nepal Rastra Bank (NRB) has directed Class A commercial banks, Class B development banks and Class C finance companies to implement measures to reduce the number of dormant accounts by mid-January 2027. Under the revised Unified Directives issued on Friday, banks and financial institutions must regularly notify customers through phone calls, SMS or email before accounts become inactive and contact account holders at least once every six months to encourage reactivation. The central bank has also instructed financial institutions to allow customers to close or reactivate accounts from any branch nationwide or through mobile and online banking platforms while maintaining adequate security and transaction monitoring.
Licenses of 44 construction firms revoked
The Ministry of Infrastructure Development has automatically canceled the licenses of 44 construction companies after they failed to renew them within the stipulated deadline. According to a notice issued by the ministry’s Construction Business Promotion Branch, contractors were required under the Construction Business Act, 1999, to renew their licenses for fiscal year 2025/26 by April 13. Since the firms failed to do so, their licenses were revoked in accordance with the provisions of the Act. The ministry said the decision was implemented following a secretary-level approval on July 1.
UAE expresses interest in investing in Nepal’s railway and IT sectors
The United Arab Emirates has expressed interest in investing in Nepal’s railway infrastructure and information technology sector. During a bilateral meeting, UAE Minister of State for Foreign Trade Thani bin Ahmed Al Zeyoudi and Nepal’s Minister for Industry, Commerce and Supplies Gauri Kumari Yadav discussed potential investment in railway development, large-scale agriculture projects and a Green Data Center. The UAE also offered technical assistance and financial support to strengthen food quality testing systems aimed at boosting Nepal’s agricultural exports. Minister Yadav welcomed the proposals and called for expanding the Nepal-UAE Business Forum to deepen bilateral economic cooperation.
Chhurpi exports through Birgunj customs exceed Rs 1.18 billion
Exports of chhurpi, a traditional hard cheese, through the Birgunj Customs Office reached Rs 1.18 billion during the current fiscal year 2025/26 as of June 14. A total of 644,386 kilograms of the product was exported, up from exports worth Rs 1.04 billion during the same period of the previous fiscal year. The increase has been driven by rising demand in North America, Europe and Australia, where chhurpi is widely marketed as a long-lasting chew for dogs and cats. Much of the product is processed in eastern hill districts, particularly Ilam.
Contractors complete two bridges ahead of schedule in Gorkha
Two major bridge projects in Gorkha District have been completed ahead of schedule, improving road connectivity in the area. Ganeshkhund Infrastructure and Builder Pvt. Ltd. completed the 60-metre Ludi Khola bridge within one year of signing a Rs 75.9 million contract, well before its June 2027 deadline. Likewise, Amrit Construction Pvt. Ltd. finished the 20-metre Chukti Khola bridge six months ahead of schedule under a contract worth Rs 34.2 million. The newly completed bridges are expected to improve transport and trade links between several wards of Palungtar and Gorkha municipalities.
Beni-Jomsom-Korala road project invites Rs 2 billion tenders
The Beni-Jomsom-Korala Road Project has invited bids worth around Rs 2 billion for the upgrading and blacktopping of the Chhusang-Ghami section leading to the Korala border point. The project has been divided into two contract packages covering 20.1 kilometres each. The Chhusang-Vhena section is estimated to cost more than Rs 1 billion, while the Vhena-Ghami section carries a similar estimated value. The tender follows the Ministry of Finance’s approval of Rs 3.15 billion to upgrade the strategic trade corridor, which has generated around Rs 6 billion in customs revenue since becoming fully operational.
Altitude sickness claims 59 lives in Mustang over five years
A total of 59 tourists have died from altitude sickness in Mustang over the past five fiscal years, with most fatalities occurring along the popular Muktinath Temple pilgrimage route. The victims included 43 foreign nationals, most of them Indian pilgrims, and 16 Nepali citizens. Health experts say many of those who died were elderly or had pre-existing medical conditions and traveled rapidly to elevations above 2,500 metres without sufficient acclimatization. Although high-altitude treatment centres and health facilities are available across the district, authorities say rushed travel itineraries and a lack of awareness continue to undermine efforts to prevent altitude-related illnesses.
Shiva Shikhar Cooperative refunds savings to 96 more depositors
The Problematic Cooperative Management Committee has returned savings to 96 additional depositors of Shiva Shikhar Cooperative as part of its ongoing reimbursement programme for victims of troubled cooperatives. With the latest disbursement, the number of depositors who have recovered their savings from Shiva Shikhar Cooperative has reached 1,213. The committee said repayments are being made in phases, giving priority to small depositors. It added that the funds have been recovered through loan collections and the management of assets belonging to problematic cooperatives in accordance with existing legal provisions.
Rain-triggered disasters disrupt traffic on major highways
Persistent rainfall, floods and landslides have disrupted traffic on several highways across Nepal, with some roads fully blocked and others operating under one-way traffic, according to the Nepal Police road update issued at 2:00 pm on Saturday. The Mechi Highway in Ilam has remained blocked since July 7, while one-way traffic is in operation on sections of the Mid-Hill Highway in Bhojpur and the Kaligandaki Corridor in Gulmi. A landslide has also blocked the Saljhandi-Dhorpatan road in Baglung since July 10. Traffic on the BP Highway remains restricted as a precaution against flooding, while normal traffic has resumed on the Kanti Lokpath in Makwanpur and the Karnali Highway in Kalikot after earlier landslide-related disruptions.
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