KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
Nepal’s recent economic and administrative landscape reflects the broad impact of natural disasters alongside efforts to maintain economic activity, strengthen public services and advance development priorities. The Bhote Koshi floods have emerged as a major disruption, damaging agricultural land, bank branches, hydropower projects and highways while creating shortages in essential supplies such as cooking gas. The government and relief agencies are responding through financial assistance, emergency supplies and reconstruction planning, with the Prime Minister’s Natural Disaster Relief Fund accumulating Rs 13.54 billion.
The disaster has also highlighted the need for stronger infrastructure resilience and cross-border cooperation. Foreign Minister Shisir Khanal’s call for enhanced Nepal-China connectivity, trade, technology and disaster preparedness reflects the growing importance of regional cooperation in addressing climate and infrastructure risks. Nepal’s first formal export of Swertia through the Hilsa border also demonstrates opportunities for expanding northern trade.
Meanwhile, domestic economic management shows mixed trends. Koshi Province continues to accumulate large unspent funds, while Sudurpashchim is attempting to resolve a prolonged budget impasse. Major development projects such as Sikta Irrigation are progressing, although completion remains years away.
Other initiatives, including taxpayer incentives, land ownership distribution, wildlife protection and the upcoming housing expo, indicate continued efforts toward formalization, investment and institutional development. Overall, the developments point to a need for balancing immediate disaster recovery with long-term infrastructure, fiscal management and economic resilience.
PM Relief Fund balance reaches Rs 13.54 billion
Contributions to the Prime Minister’s Natural Disaster Relief Fund have continued to rise, with total deposits reaching Rs 13.54 billion as of 9:00 am today, according to the Office of the Prime Minister and Council of Ministers. The fund received an additional Rs 282.14 million after 5:00 pm on September 11. The money is being held in nine designated bank accounts established for the relief initiative. The government has already released Rs 1 billion from the fund through the National Disaster Risk Reduction and Management Authority (NDRRMA) to support flood victims. Contributions to the fund’s foreign currency accounts have also increased. An additional USD 154,770 was deposited into two designated US dollar accounts after 5:00 pm on September 11, taking the total balance in those accounts to USD 23.43 million, according to the Prime Minister’s Office.
Taxpayer incentive prize draw set for September 17
The Inland Revenue Department (IRD) will announce the winners of its taxpayer incentive prize scheme on September 17, with 33 consumers set to receive prizes totaling Rs 21.33 million. The draw, originally scheduled for September 1, was postponed following the Bhote Koshi floods in Rasuwa. The incentive scheme was introduced through the new fiscal year budget to encourage consumers to obtain bills and conduct tax-compliant transactions. According to IRD Director General Bhishma Kumar Bhusal, 31 winners will receive Rs 133,334 each, while two bumper winners will receive Rs 1 million each. The winners will be selected in two phases covering transactions from August 17 to August 31 and from September 1 to September 16. Consumers must obtain genuine VAT or PAN bills for purchases exceeding Rs 100 and register eligible cash transactions through the IRD taxpayer incentive prize portal. Online transactions are automatically included in the system. A 25 percent tax will be deducted from the prize amounts. Thus, winners of Rs 133,334 will receive Rs 100,000, while each Rs 1 million bumper prize winner will receive Rs 750,000 after tax.
50,000 cylinders to be brought to Kathmandu to ease supply
Gas industrialists have pledged to supply 50,000 additional cooking gas cylinders to Kathmandu to help ease the ongoing shortage, according to the Ministry of Industry, Commerce and Supplies. Minister for Industry, Commerce and Supplies Deepak Kumar Sah held discussions with gas industrialists and other stakeholders on Friday to address the supply disruption. The meeting focused on coordination and alternative arrangements to ensure the smooth distribution of cooking gas. The ministry said Kathmandu consumes around 40,000 cylinders daily, and the additional supply is expected to provide immediate relief to consumers. Gas supplies were disrupted after tankers carrying LPG were unable to reach the capital following a landslide that blocked the Krishna Bhir section of the highway on August 30.
FAO says Nepal floods damaged 1,800 hectares of crops
The August 26 Bhote Koshi-Trishuli floods damaged around 1,800 hectares of farmland, mostly paddy fields, and may have destroyed between 5 and 10 percent of livestock and poultry in the affected areas, according to the Food and Agriculture Organization of the United Nations (FAO). FAO Deputy Director-General Beth Bechdol said the disaster had severely affected farming communities through the destruction of crops, livestock, fishponds, food stocks and agricultural infrastructure. Preliminary estimates indicate crop production losses of nearly 7,700 tonnes. Before the disaster, more than 350,000 cattle, buffaloes, sheep and goats and around 1.6 million poultry were present across 11 affected local units. Thousands of animals are reportedly missing or dead. Bechdol said farmers urgently require seeds, livestock feed and veterinary services, including vaccination, treatment and disease surveillance. FAO has deployed emergency teams, supplied veterinary medicines and is assisting the government in assessing agricultural losses through field surveys, satellite imagery and remote sensing.
Bhote Koshi floods cause Rs 724 million damage to 17 bank branches
The August 26 Bhote Koshi floods damaged 17 branches of various banks, causing an estimated Rs 724 million in losses, according to a Rapid Damage and Needs Assessment report prepared by the National Planning Commission and the National Disaster Risk Reduction and Management Authority. The Agriculture Development Bank suffered the largest loss, with one branch reporting damage worth Rs 650 million. Citizens Bank recorded losses of Rs 15.6 million, Laxmi Sunrise Bank Rs 11.2 million, and NIC Asia Bank Rs 8.8 million across three branches. In terms of location, four bank branches in Bidur Municipality of Nuwakot suffered damage estimated at Rs 671.3 million. Eleven branches in Gosaikunda Rural Municipality of Rasuwa sustained losses of Rs 42.3 million, while additional damage was reported in Kalika and Uttargaya rural municipalities.
Highway disruptions slow economic activity nationwide
Floods, river erosion and landslides have disrupted major highways across Nepal, slowing the movement of passengers and goods and affecting key trade and transit routes. The complete closure of the Prithvi, Pasang Lhamu and Arniko highways has disrupted important connections between central Nepal, northern districts and border points with China. Damage in Rasuwa has particularly affected access to Rasuwagadhi, while travellers heading toward Syabrubesi are being diverted through alternative routes. Restrictions on heavy vehicles along the BP Highway and the rerouting of cargo traffic in Makwanpur have further affected transportation. Authorities have imposed time and weight restrictions on several operational routes while repair and restoration works continue, resulting in delays for commercial traffic and passengers.
Nepal-China relations require focus on connectivity and trade: Foreign Minister
Foreign Minister Shisir Khanal has called for stronger Nepal-China cooperation in connectivity, trade and technology to further strengthen bilateral relations. Speaking at the third edition of the Kasthamandap Dialogue in Kathmandu on Saturday, Khanal said the longstanding relationship between Nepal and China should continue to be based on mutual trust, friendship and cooperation while expanding into new areas of economic and technological partnership. The event, organized by the Foundation for Peace, Development and Socialism (FPDS), brought together policy experts and diplomats to discuss ways to broaden Nepal-China relations. Khanal emphasized the need to advance trans-Himalayan connectivity networks and establish stronger mechanisms for joint disaster preparedness and resilience. He also highlighted the importance of reducing trade imbalances and expanding technological cooperation to promote sustainable economic growth.
Nepal exports Swertia to China through Hilsa border for first time
Nepal has formally exported Swertia, locally known as chiraito, to China through the Hilsa border point for the first time. The medicinal herb, widely cultivated in Nepal’s mid-hill regions, was cleared for export after the necessary quarantine documents were obtained from the Department of Customs in Kathmandu. Namkha Rural Municipality Chairman Prem Bahadur Lama confirmed that the shipment marked the first official export of Swertia through the Hilsa transit point. As Hilsa does not currently have a quarantine facility, traders were required to obtain the necessary documentation in Kathmandu before transporting the consignment. According to Yari Customs Office chief Ramraj Jaisi, the Swertia was transported by Nepali trucks from Surkhet to Simikot and then to Hilsa. At the border, the consignment was transferred to Chinese trucks for onward transportation to Taklakot. The development is expected to help formalize trade in Nepal’s medicinalForeign Minister Shisir Khanal has called for stronger Nepal-China cooperation in connectivity, trade and herbs through the northern border.
Koshi Province accumulates nearly Rs 8 billion in unspent funds
Despite having substantial capital resources, the Koshi Province government left a significant portion of its budget unspent in fiscal year 2025/26, leaving an estimated Rs 7–8 billion in the provincial consolidated fund, according to preliminary financial reports. Provincial Comptroller Damodar Khatri said the preliminary figures show that the accumulated surplus is higher than the Rs 5 billion cash reserve projected by Minister for Economic Affairs and Planning Bidur Kumar Lingthep while presenting the annual budget. The surplus is attributed mainly to underutilization of financial transfers allocated to local governments. Koshi Province has maintained a budget surplus every year since its establishment in fiscal year 2018/19.
Sudurpashchim holds all-party meeting to resume stalled budget process
The Sudurpashchim Province government has intensified efforts to resume the stalled budget process after an all-party meeting reached an agreement to move forward with the provincial legislative procedure. The meeting, held at the Office of the Chief Minister and Council of Ministers on Friday following coordination by Chief Minister Khagaraj Bhatt, focused on ending the ongoing budget impasse that has disrupted government operations and development activities. Nepali Congress parliamentary party leader and former chief minister Kamal Bahadur Shah said all political parties should work together through dialogue and give priority to public administration and service delivery.
Sikta Irrigation Project targets completion within five years
The national pride Sikta Irrigation Project in Banke is accelerating construction with a target of completing its major infrastructure within the next five years, according to Project Director Raju Acharya. The project has achieved 51 percent physical progress, with approximately Rs 24 billion spent so far. Its estimated total cost is Rs 52.89 billion, with the project designed to irrigate 42,766 hectares and targeted for completion by fiscal year 2032/33. The 45-kilometre western main canal has been completed, while work on the 53-kilometre eastern main canal remains unfinished. Project Information Officer Manoj Kumar Sah said 30 additional tenders have been invited. During fiscal year 2025/26, the project achieved more than 96 percent physical and 89 percent financial progress, spending Rs 1.41 billion of its Rs 1.57 billion allocation.
385 families in Dhanusha receive land ownership certificates
The Survey Office, Dhanusha, has distributed land ownership certificates to 385 families in Sabaila Municipality-8, formerly Thila Village Development Committee, nearly five years after their land survey was completed. The families had been living on the land as self-settlers for many years but had yet to obtain formal ownership. Although the survey had been completed, the distribution process was delayed because of insufficient public participation required to complete land registration. After the necessary procedures were completed, the 385 families finally received their ownership certificates. Earlier, the office had distributed certificates to 3,226 families in Wards 4, 5, 6 and 10 of the same municipality.
IPPAN seeks government support to rebuild 13 flood-hit hydropower projects
The Independent Power Producers’ Association, Nepal (IPPAN) plans to seek government assistance for the reconstruction and resumption of 13 hydropower projects damaged by the Bhote Koshi floods. IPPAN President Mohan Kumar Dang said representatives of the affected projects will meet on Sunday to identify their requirements and prepare a formal proposal for government support. The document will be submitted through the Ministry of Energy, Water Resources and Irrigation. Dang said Nepal has the potential to generate 30,000 MW of electricity over the next decade, but emphasized the need to expand domestic consumption and electricity exports. He proposed consuming 15,000 MW domestically and exporting 10,000 MW to India and 5,000 MW to Bangladesh. Nepal earned Rs 29.31 billion from electricity exports last year.
SAWEN adopts Kathmandu Declaration against illegal wildlife trade
The South Asia Wildlife Enforcement Network (SAWEN) has adopted the Kathmandu Declaration to strengthen regional efforts against illegal wildlife trade. The declaration was adopted on Friday at the conclusion of SAWEN’s first general assembly in Kathmandu. The two-day event was chaired by Agriculture and Environment Minister Gita Chaudhary and inaugurated by Speaker Dol Prasad Aryal. The declaration calls for stronger measures against wildlife trafficking, improved intelligence sharing and greater regional cooperation. The assembly also approved January 30 as SAWEN Day to commemorate the network’s establishment in Bhutan in 2011 and endorsed its 2026–2030 strategic framework.
9th Nepal Housing and Construction Expo to begin September 17
The Ninth Nepal Housing and Construction Expo 2026 is scheduled to take place from September 17 to 20 at Bhrikutimandap in Kathmandu. The event is being jointly organized by the Nepal Land and Housing Developers’ Association and the Nepal Land and Housing Developers’ Federation under the coordination of Roshan Bhoyad. More than 100 corporate stalls will showcase real estate projects, environmentally friendly construction technologies and affordable housing options. Housing units starting at around Rs 14 million will also be promoted at the expo. The event will additionally feature relief donations and free medical camps.
Machhapuchchhre Bank announces 6 percent dividend
Machhapuchchhre Bank has proposed a 6 percent dividend from its profits for the previous fiscal year following a meeting of its board of directors on Friday. The proposed dividend comprises 3 percent bonus shares and 3 percent cash dividend for tax purposes. Based on the bank’s paid-up capital of Rs 12.086 billion, the total dividend amounts to approximately Rs 725 million. The proposal is subject to approval from Nepal Rastra Bank and endorsement by shareholders at the bank’s upcoming annual general meeting.
Pokhara resumes settlement management at proposed bus park site
Pokhara Metropolitan City (PMC) is set to resume its settlement management program at the proposed Pokhara Bus Park site in Prithvichowk from Sunday. Municipal verification has identified 325 landless families at the site, including 144 landless Dalit families and 181 landless squatters, along with 242 unorganized settler households. PMC Mayor Dhanraj Acharya said the process had been temporarily delayed as municipal resources were diverted toward rescue and relief operations following the Bhote Koshi floods. The municipality will now resume the process of managing the settlements and making necessary arrangements for eligible families.
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