KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
Nepal’s current economic outlook reflects a mix of market uncertainty, rising living costs, infrastructure challenges, and opportunities for long-term development. The Nepal Stock Exchange (NEPSE) recorded a modest 4-point gain, closing at 2,595.81, but declining turnover and a majority of falling stocks suggest cautious investor sentiment. Meanwhile, lower gold and silver prices indicate short-term adjustments in the domestic commodities market. Rising inflation, particularly in food and transportation, is increasing pressure on household budgets during Dashain, highlighting the effects of supply disruptions, transportation constraints, and external price fluctuations.
Government initiatives indicate efforts to improve transparency, strengthen capital markets, and promote investment. The simplified citizen budget aims to enhance public understanding of fiscal priorities, while the Securities Board of Nepal’s study on private equity and venture capital highlights opportunities to mobilize capital, attract foreign investment, and generate employment. However, effective implementation and stronger regulatory safeguards remain essential.
Infrastructure development presents both promise and persistent challenges. Progress on the Arun-III hydropower project, the planned optical fibre network, and tourism infrastructure could improve energy security, connectivity, and regional economic activity. Conversely, flood-damaged highways and prolonged road construction delays threaten trade, mobility, and local livelihoods. Agricultural initiatives, including improved sugarcane varieties, fertilizer distribution, and dairy training, could strengthen domestic production and reduce import dependence. Nepal’s reported progress in reducing multidimensional poverty is encouraging, but sustained investment, resilient infrastructure, effective governance, and inclusive economic policies are necessary to translate these developments into broad-based prosperity.
NEPSE gains 4 points as daily turnover falls to Rs 4.46 billion
The Nepal Stock Exchange (NEPSE) index increased by 4.00 points to close at 2,595.81 points on Monday, while daily turnover declined to Rs 4.46 billion from Rs 4.83 billion on Friday. During the trading session, share prices of 105 companies advanced, 165 declined, and seven remained unchanged. Among sectoral indices, banking gained 1.01 percent, while the trade group rose by 1.02 percent. The development bank index increased by 0.53 percent, finance rose by 0.21 percent, and life insurance edged up by 0.05 percent. Dhaulagiri Laghubitta posted the highest individual stock gain at 15 percent, followed by Snow Rivers at 13.92 percent, Bungal Hydropower at 4.75 percent, and Super Mai Hydropower at 3.98 percent. Meanwhile, the hotels and tourism index fell by 0.87 percent. The hydropower index declined by 0.46 percent, the others group dropped by 0.42 percent, investment decreased by 0.28 percent, manufacturing and processing slipped by 0.19 percent, non-life insurance fell by 0.12 percent, and microfinance edged down by 0.01 percent.
Gold falls to Rs 294,400 per tola and silver to Rs 4,415
Gold and silver prices declined in Nepal’s domestic market on Monday, according to the Federation of Nepal Gold and Silver Dealers’ Association. The price of gold dropped by Rs 2,100 per tola (approximately 11.66 grams), falling from Rs 296,500 on Sunday to Rs 294,400 on Monday. Silver prices also decreased, declining by Rs 25 per tola. After trading at Rs 4,440 on Sunday, silver was priced at Rs 4,415 per tola on Monday. The declines reflect the latest daily price adjustments reported by the federation.
Finance Ministry releases simplified citizen budget to promote fiscal transparency
The Ministry of Finance has published a simplified citizen budget booklet titled Our Taxes, Our Budget, Our Future through its official digital platforms to help the public better understand government spending and budget allocations. The document presents the national budget, initially announced on May 29, in clear and accessible language. It explains government revenue sources, taxation policies, public debt, national development priorities, and the six stages of the budget preparation process. Finance Minister Swarnim Wagle said the citizen budget would strengthen institutional accountability by enabling ordinary citizens to understand how public resources are allocated, what the government aims to achieve, and how its spending supports socioeconomic development.
Dashain festival drives up prices of essential goods
With Dashain approaching, markets across Nepal have become increasingly active, with higher consumer footfall accompanied by rising prices of essential commodities, including food grains, clothing, meat, and cooking gas. According to Nepal Rastra Bank, annual consumer inflation reached 5.96 percent in the first month of fiscal year 2026/27. Food and beverage prices increased by 6.77 percent, while transportation costs rose by 13.17 percent. Madhesh Province recorded the highest consumer inflation rate at 6.94 percent. The price increases have been attributed to transportation disruptions following the August 26 Bhote Koshi–Trishuli floods, closures of the Rasuwa and Tatopani routes, currency fluctuations, and adjustments in international oil prices. In addition, all border crossings between India and China remain closed.
Labour Department directs employers to provide mandatory festival allowances
The Department of Labour and Occupational Safety has instructed private schools, businesses, and industries to provide festival allowances to employees in accordance with Section 37 of the Labour Act, 2017. Under the law, every worker is entitled to an annual festival allowance equivalent to one month of their basic salary. On October 9, the department issued formal directives to the Federation of Nepalese Chambers of Commerce and Industry, the Confederation of Nepalese Industries, and the Nepal Chamber of Commerce. It also sent similar notices to the Private and Boarding Schools’ Organization Nepal and the National Private and Boarding Schools Association Nepal, directing them to ensure that school employees receive the prescribed benefits.
Nepal reports progress in reducing multidimensional poverty, UNDP study finds
Nepal has made significant progress in reducing multidimensional poverty, alongside Egypt and Tajikistan, even as the global population living in acute poverty increased to 1.2 billion, according to a 2026 report by the United Nations Development Programme (UNDP) and the University of Oxford. Released on Monday, the report found that the number of people experiencing multidimensional poverty worldwide had increased by 51.5 million compared with the previous year. This marked the first increase in the index since it was introduced in 2010. Children account for more than half of the global population living in acute poverty. The index assesses multiple forms of deprivation, including inadequate housing, sanitation, electricity, cooking fuel, nutrition, and education, rather than measuring poverty solely by income. According to the report, population growth was the primary factor behind the global increase, although 33 countries managed to halve their multidimensional poverty rates over the past 15 years. The report also noted substantial progress in poverty reduction in China and India, Nepal’s neighbouring countries. However, most people living in poverty worldwide remain concentrated in Sub-Saharan Africa and South Asia.
SEBON publishes comprehensive study on Nepal’s private equity and venture capital ecosystem
The Securities Board of Nepal (SEBON) has released a comprehensive study assessing the regulatory framework and operational environment for private equity and venture capital in Nepal. The initiative aims to support sustainable capital market growth and encourage entrepreneurship and innovation. Prepared in line with the annual fiscal programme, the capital market development action plan, and consultations with public stakeholders, the report highlights the need to position private equity and venture capital funds as drivers of economic growth rather than merely specialized investment instruments. It identifies their potential to attract foreign investment, create jobs, and deepen domestic capital markets. Drawing on international best practices, the report recommends risk-based supervision, stronger investor protection, greater corporate transparency, clear classifications for qualified investors, and digital monitoring mechanisms to improve the productive mobilization of capital across the country.
LP Gas industry association expands cylinder exchange programme to 11 locations in Kathmandu Valley
The Nepal LP Gas Industry Association expanded its temporary cooking gas cylinder exchange programme to 11 designated distribution centres across the Kathmandu Valley from Monday, October 12, to ease supply shortages during the festive season. The initiative is being implemented in coordination with the Nepal Oil Corporation and the Gas Dealers Federation. It allows consumers to exchange empty cylinders from participating brands for refilled cylinders of available brands without paying additional service charges. The exchange centres operate daily from 11:00 AM to 4:30 PM until November 16. Newly added locations include Chapali Budhanilkantha, Harisiddhi, Kalanki, Khasi Bazar, and Santungal, alongside previously established centres. The expansion follows strong public demand, with 3,075 cylinder exchanges recorded on the programme’s opening day.
Sudurpaschim earmarks Rs 32.5 million for Badimalika cable car feasibility study
The Sudurpaschim Province government has allocated Rs 32.5 million in its fiscal year 2026/27 budget for a feasibility study on establishing a cable car system at Badimalika, a prominent religious and tourist destination in Bajura. Presenting the provincial budget before the assembly, Economic Affairs Minister Chakrabahadur Malla announced plans to assess the project’s operational viability and explore public-private partnership arrangements under a build-own-operate model. The government also plans to extend electricity transmission lines to the area. In addition, the provincial budget has set aside Rs 61 million for infrastructure development at Triveni Dham in Khaptad National Park, including the construction of a pagoda-style temple reflecting the region’s cultural identity and a golden bridge. The national park spans Bajura, Bajhang, Achham, and Doti districts. A further Rs 60 million has been allocated to upgrade Kolti Basic Hospital in Ward 2 of Budhinanda Municipality into a provincial-level medical centre serving neighbouring districts.
Parliamentary committee questions ambassador-designate on trade and BRI cooperation with China
Lawmakers questioned Kalyan Raj Sharma, Nepal’s ambassador-designate to China, about bilateral trade, infrastructure development, and economic cooperation during a parliamentary hearing on Monday, October 12. Committee members Rajiv Khatri, Madhukumar Chaulagain, Barshaman Pun, Prem Dangal, and Padma Kumari Aryal raised concerns about reducing Nepal’s trade deficit with China, ensuring regular flights at Pokhara and Bhairahawa international airports, attracting Chinese investment, and clarifying investment arrangements under the Belt and Road Initiative (BRI). The discussion also covered the Rasuwa and Tatopani border crossings, export promotion, wellness tourism, and support for Nepali women living in China. Sharma pledged to give priority to Nepal’s national interests in carrying out his diplomatic responsibilities. The hearing also took place amid reported closures of all border crossings between India and China.
Nepal Telecom to establish optical fibre network across Gandaki and Lumbini provinces
The Nepal Telecommunications Authority has signed an implementation agreement with Nepal Telecom to develop a high-capacity optical fibre network across Gandaki and Lumbini provinces, ending a legal impasse that had persisted for nearly a decade. Under the agreement signed by Authority Chairman Arjun Ghimire and Nepal Telecom Managing Director Sangeeta Pahadi, the company will install 2,216 kilometres of optical fibre, 55 high-capacity routers, and 28 dense wavelength division multiplexing (DWDM) systems across 194 local government administrative units within 36 months. The project will receive a maximum capital subsidy of Rs 2.01 billion from the Rural Telecommunications Development Fund. Implementation had been delayed after the termination of the original contractor, United Telecom Limited, for failing to meet the expansion requirements along the Mid-Hill Highway corridor within the deadlines established in 2017. The dispute continued through subsequent legal proceedings until the Supreme Court dismissed the pending challenges in 2024, allowing the project to move forward.
Investment Board extends commercial operation deadline for 900 MW Arun-III project
The Investment Board of Nepal has extended the commercial operation deadline for the 900-megawatt Arun-III Hydropower Project in Sankhuwasabha to mid-March 2029. SJVN Arun-III Power Development Company, a subsidiary of India’s SJVN, requested the extension, citing construction delays caused by the COVID-19 pandemic and related operational disruptions. Physical progress has reached 77.5 percent for the power generation facilities and 60 percent for the transmission infrastructure. The project has an estimated total cost of Rs 144 billion and includes a 253-kilometre, 400-kilovolt cross-border transmission line connecting the project to Sitamarhi in India. Under the project development agreement, Nepal will receive 21.9 percent of the project’s electricity, equivalent to 197 megawatts, free of charge. The agreement also provides for progressively increasing energy royalties ranging from 7 percent to 12 percent.
Fertiliser shipments through Birgunj support preparations for winter crop planting
Chemical fertilisers imported from India under government-to-government procurement agreements are continuing to arrive through the Birgunj customs corridor to meet farmers’ requirements for the upcoming winter cropping season. According to the chief of the Krishi Samagri Company’s provincial office, Nepal procured 30,000 tonnes of urea and 20,000 tonnes of diammonium phosphate (DAP) from India. Over the past month, 13,761 tonnes of fertiliser had arrived at the Birgunj distribution centre, comprising 7,954 tonnes of urea and 5,807 tonnes of DAP. Of the total procurement, 11,500 tonnes of urea and 7,600 tonnes of DAP have been allocated to the Birgunj regional office. The remaining quantities are being distributed to centres in Bhairahawa and Biratnagar to maintain adequate supplies for winter crop cultivation, particularly wheat and oilseed production.
Highway disruptions threaten transport and trade in affected districts
Floods and landslides have disrupted highway connectivity across Gandaki and Bagmati provinces, affecting Gorkha, Myagdi, Nawalparasi (Bardaghat Susta Purba), Manang, and Dhading districts. The disruptions are raising concerns about the movement of passengers and goods. The road connecting Arughat and Dhading, along with the iron bridge at Soti in Gorkha, remains completely blocked following flooding on October 11. Meanwhile, one-way traffic is operating along the Beni–Jomsom road, the Kali Gandaki Corridor, the Besisahar–Khangsar road, and the Tribhuvan Highway. Heavy vehicles cannot pass through the affected section of the Kali Gandaki Corridor, further restricting freight transportation. However, Nepal Police has not released estimates of the financial losses, shipment delays, or wider economic consequences resulting from the disruptions.
Blacktopping of Mid-Hill Highway’s starting section in Panchthar remains uncertain after six years
The blacktopping of the starting section of the Pushpalal (Mid-Hill) Highway in Panchthar remains stalled nearly six years after the initial contracts were awarded, primarily because of contractors’ failure to complete the work on schedule. The approximately 51-kilometre section stretches from Chiwabhanjyang in Ward 1 of Yangwarak Rural Municipality, near the Nepal–India border, to Darimba in Ward 4 of the same municipality. The construction work was divided into three packages in 2021, but physical progress across the active sections has remained below 55 percent. The first 16-kilometre package, awarded to Roshan-Shivashakti JV for Rs 531.7 million, has achieved 35 percent progress, with its deadline extended until next May. The second package, covering 17 kilometres and valued at Rs 464.6 million, was awarded to Santoshi-Shivashakti JV. However, its contract was terminated around June–July 2025 after progress stalled at just 16 percent. The prolonged delays have continued to disrupt transportation and inconvenience residents in the surrounding communities.
Dairy training equips 56 women farmers with modern livestock management skills in Sindhuli
A four-year dairy training initiative has equipped 56 women farmers in Kamalamai Municipality, Sindhuli, with practical skills to improve livestock management, adopt modern farming methods, and increase household income. The participants completed 48 training sessions under the Heifer-KOICA Farmers Field School programme. Organizers described the event as the country’s first graduation ceremony for dairy farmers completing a structured field school course. The training covered animal health, nutrition, reproduction, farm management, and enterprise development, alongside financial management, record-keeping, and public speaking. The initiative complements ongoing efforts to improve dairy production through the introduction of Holstein cattle. Sindhuli currently has 169 purebred Holstein cattle, including 35 bulls, following a breeding programme launched with cattle donated by South Korea. According to Heifer International Nepal, a Holstein can produce approximately 10,000 litres of milk during a 10-month lactation period, compared with around 3,200 litres from a crossbred cow. The project aims to increase daily milk production in Kamalamai from approximately 5,000 litres to 10,000 litres within two years.
NARC introduces four high-yield Indian sugarcane varieties to boost domestic production
The Nepal Agricultural Research Council (NARC) has received four improved sugarcane varieties from India through institutional cooperation aimed at increasing domestic sugar production and reducing dependence on imports. During a handover ceremony in Kathmandu, Indian Embassy First Secretary Nisha presented the varieties to NARC Executive Director Srimat Shrestha. The initiative will support collaborative research between the National Sugarcane Research Program in Jitpur, Bara, and the Indian Institute of Sugarcane Research in Lucknow. The newly introduced varieties are CoLK 16202, CoLK 16470, CoS 17231, and CoS 18231. They have sucrose content ranging from 17.4 percent to 18 percent and reported yields of 82.5 to 93.2 tonnes per hectare. They also demonstrate resistance to red rot disease, a major threat to sugarcane cultivation. Researchers expect the varieties to help narrow the productivity gap between Nepal and neighbouring countries while strengthening the domestic sugar industry.
Annapurna Rural Municipality raises Rs 10.4 million for disaster relief in Kaski
Annapurna Rural Municipality in Kaski has collected Rs 10.4 million in voluntary contributions for its disaster management fund to support emergency relief, rescue, and rehabilitation efforts. According to the rural municipality chairman, contributions came from tourism management committees, community organizations, businesses, and political groups following appeals for financial assistance. The funds have supported emergency relief and infrastructure repairs in areas affected by monsoon floods and landslides. Additional assistance included material support from the Gandaki provincial government, volunteer labour from the Army, and technical assistance from regional hydropower projects. The municipality reported spending Rs 6.6 million directly on disaster response and related activities, helping affected communities address immediate needs and begin recovery.
Him Parbat Hydropower opens IPO for project-affected residents and migrant workers
Him Parbat Hydropower Limited has opened its initial public offering (IPO) of approximately 5.9 million ordinary shares at a face value of Rs 100 per share. The offering represents 35 percent of the company’s issued capital of Rs 1.69 billion and targets project-affected residents and Nepali citizens working abroad. In the first phase, approximately 1.6 million shares have been allocated to permanent residents of Dolakha district, with priority given to heavily affected wards in Bhigu and Kalinchowk rural municipalities. Another 422,500 shares have been reserved for Nepali migrant workers. The application period runs between October 26 and November 26, 2026, with the applicable closing dates varying by category. The company has received an ICRA NP Issuer Rating of Double B Plus, indicating moderate credit risk. Him Parbat Hydropower operates the 20 MW Sangu Khola and 5.5 MW Sangu Khola-1 hydropower projects. Citizens Capital has been appointed as the issue manager for the offering.
Share lock-in periods for securities of three companies to expire in the coming weeks
Lock-in periods for shares held by founders, project-affected local residents, and mutual fund schemes in three companies are set to expire between October 19 and November 2, 2026, making the securities eligible for secondary-market trading. The restrictions will expire for 849,080 shares of Upper Mailung Khola Hydropower Company on October 19 and 3.02 million shares of Chhirkhwa Hydro Power on October 30. Meanwhile, the lock-in period for 214,500 mutual fund units of Sopan Pharmaceuticals will end on November 2. The companies have issued public notices informing investors and market participants of the upcoming expiry dates and the resulting eligibility of the securities for trading.
Super Mai Hydropower receives approval to issue Rs 594 million in rights shares
Super Mai Hydropower Company has received preliminary approval from the Electricity Regulatory Commission to issue rights shares at a ratio of 1:0.9252 as part of efforts to strengthen its capital structure. The company plans to issue approximately 5.94 million ordinary shares at a face value of Rs 100 each, raising a total of Rs 594 million to repay outstanding commercial loans from Nabil Bank. The company had initially proposed a rights issue at a ratio of 1:1 through a resolution passed at its 11th annual general meeting. Following a regulatory review, the proposed ratio was revised to 1:0.9252 to finalise the capital restructuring plan.
Yampaphant Dairy Cooperative rewards 15 outstanding milk-producing farmers in Tanahu
The Yampaphant Dairy Cooperative in Bandipur Rural Municipality-5, Tanahu, has honoured 15 farmers for their outstanding milk production and deliveries over the past year. Cooperative Chairman Kashinath Bhattarai said Pushparaj Paudel secured first place after supplying 89,128 litres of milk. Bhattarai ranked second with 51,812 litres, while Suraj Ghimire placed third with 44,444 litres. The cooperative awarded cash prizes ranging from Rs 3,000 to Rs 11,000 to the recognised farmers. During the previous fiscal year, the cooperative handled more than 1.4 million litres of milk and recorded commercial transactions exceeding Rs 170 million. The achievements highlight the contribution of commercial dairy farming to the local agricultural economy and rural livelihoods.
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