KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
Nepal’s economy presents a mixed picture, with encouraging signs in financial markets and policy reforms tempered by persistent structural challenges. While the NEPSE extended its gains and the government crossed Rs 1.2 trillion in revenue collection, declining market turnover points to cautious investor participation. Nepal Rastra Bank’s move to absorb Rs 100 billion in excess liquidity, alongside SEBON’s proposed capital market reforms, reflects efforts to deepen financial markets and improve regulatory efficiency.
At the same time, reforms to public procurement, tax compliance, and corporate governance signal the government’s push to strengthen fiscal discipline and the business environment. However, concerns remain over slow paddy transplantation, local governments failing to meet budget deadlines, protests by contract employees and farmers, and Nepal’s unfinished FATF compliance agenda.
Rising precious metal prices also suggest continued demand for safe-haven assets amid uncertainty. Overall, the developments indicate an economy that is gradually advancing through institutional reforms and financial sector modernization but still constrained by implementation gaps, governance challenges, and public dissatisfaction, underscoring the need for more effective execution of policies to sustain investor confidence and inclusive economic growth.
NEPSE gains 14 points as turnover falls to Rs 4.17 billion
The Nepal Stock Exchange (NEPSE) advanced by 14 points on Wednesday to close at 2,590.29. Share prices of 191 listed companies increased, while 64 declined and 19 remained unchanged. Despite the market’s positive performance, daily turnover dropped significantly to Rs 4.17 billion from Rs 8.41 billion recorded on Tuesday. Most sectoral indices closed higher, with the development banking index posting the strongest gain of 1.37 percent. Narayani Development Bank emerged as the day’s top performer with an 8.40 percent rise, while Upakar Laghubitta recorded the largest decline, falling 7.32 percent.
Gold and silver prices rise in domestic market
Gold and silver prices increased in the domestic market on Wednesday, according to the Federation of Nepal Gold and Silver Dealers’ Association. The price of gold rose by Rs 800 per tola to Rs 284,800, up from Rs 284,000 on Tuesday. Silver also gained Rs 55 per tola, reaching Rs 4,415 compared to the previous day’s price of Rs 4,360.
NRB invites bids to absorb Rs 100 billion in excess liquidity
Nepal Rastra Bank (NRB) has invited licensed Class A, Class B, and Class C banks and financial institutions to participate in a deposit collection auction worth Rs 100 billion as part of its liquidity management operations. According to a notice issued on Wednesday, participating institutions must specify the amount they wish to deposit and quote the proposed interest rate up to four decimal places. The minimum bid has been fixed at Rs 100 million, while bids must be submitted in multiples of Rs 50 million. The facility enables financial institutions to park surplus liquidity with the central bank on July 15.
Government revenue collection exceeds Rs 1.2 trillion
The Financial Comptroller General Office reported that the government’s revenue collection crossed Rs 1.2 trillion with one day remaining in the fiscal year. The amount represents a 2.12 percent increase from the previous fiscal year’s collection of Rs 1.178 trillion. Although the total remains below the annual target of Rs 1.48 trillion, the government collected Rs 1.087 trillion in tax revenue and Rs 116 billion in non-tax revenue. Foreign grants amounted to Rs 30.7 billion against a target of Rs 53 billion.
SEBON announces policy and programs for fiscal year 2026/27
The Securities Board of Nepal (SEBON) has published its policy and programs for fiscal year 2026/27, outlining 15 major initiatives aimed at strengthening the capital market. The plan includes restructuring the Nepal Stock Exchange (NEPSE) and CDS and Clearing Limited (CDSC), establishing a unified investor data portal, revising IPO issuance limits and share allocation provisions, and removing the six-month lock-in period for mutual funds. SEBON also plans to introduce a dedicated trading platform for small and medium-sized enterprises (SMEs) with paid-up capital below Rs 250 million, launch intraday trading, and automate government securities trading.
Procurement law amended to discourage lowest-bid contracts
The government has amended the Public Procurement Act, 2006, replacing the long-standing practice of awarding contracts solely to the lowest bidder. Under the revised law, contracts will instead be awarded to bids closest to the average bid price, provided they remain within the approved cost estimate. The amendment, authenticated by President Ram Chandra Paudel on July 9, also shortens the national bidding period to 21 days, makes social security enrollment mandatory for workers, introduces a government e-marketplace, and imposes criminal penalties for misuse of mobilization advances. The Federation of Contractors’ Associations of Nepal has welcomed the changes.
NOC restores full LPG cylinder supply
Nepal Oil Corporation (NOC) has instructed LPG bottling companies to resume supplying cylinders at the standard weight of 14.2 kilograms from Wednesday. NOC spokesperson Manoj Thakur said the decision follows improvements in LPG supplies from Indian Oil Corporation’s loading points and refineries. The retail price of a full cylinder has been fixed at Rs 2,060. Earlier, on March 13, the corporation had introduced half-filled 7.1-kilogram cylinders to manage supply shortages.
Local unit provides scholarships worth Rs 1.9 million to 135 students
Phaktanglung Rural Municipality in Taplejung has distributed scholarships to 135 students pursuing higher education under its long-running education support program. The municipality has been providing financial assistance to students enrolled in Grades 11, 12, and bachelor’s programs for the past four years. During fiscal year 2025/26, it allocated more than Rs 1.9 million for the initiative. Rural Municipality Chair Rajan Limbu said the program has helped many students continue their education after being forced to suspend their studies due to financial and other hardships.
Transport offices to enforce TDS compliance
The Inland Revenue Department has directed the Department of Transport Management to ensure tax deduction at source (TDS) is collected from salaries paid to transport workers. Under the Income Tax Act, 2002, transport operators are required to maintain annual salary records for drivers, helpers, and co-drivers. Transport offices will now require proof of TDS payment before registering or renewing public transport vehicles. The measure is expected to expand tax compliance within the transport sector and strengthen domestic revenue collection.
Paddy plantation reaches 54.52 percent nationwide
Paddy transplantation has covered 54.52 percent of the country’s target area by mid-July, according to the Department of Agriculture. Out of 1.37 million hectares designated for paddy cultivation, planting has been completed on 746,960.63 hectares, slightly behind last year’s progress of 59.28 percent during the same period. Sudurpashchim Province has recorded the highest transplantation rate at 87.8 percent, while Madhesh Province remains the lowest at 32.8 percent. Koshi Province has shown notable improvement, reaching 54.9 percent from 41.32 percent just two days earlier. Plantation has also reached 65.9 percent in Gandaki, 60.2 percent in Karnali, 59.6 percent in Lumbini, and 57.1 percent in Bagmati provinces.
New York to host Nepal-US business summit
The Greater New York Nepali Chamber of Commerce has announced that the Nepali American Business and Investment Summit 2026 will be held from September 25 to 27 at the New York JFK Marriott Hotel. Organized with support from the Consulate General of Nepal in New York, the summit will focus on tourism, hydropower, information technology, agriculture, infrastructure, and startup development. Timed to coincide with the United Nations General Assembly high-level week and Climate Week NYC 2026, the event aims to strengthen bilateral trade, promote investment opportunities, and facilitate networking among business leaders and policymakers.
Seventeen Madhesh local governments miss budget deadline
Seventeen local governments in Madhesh Province have failed to present their budgets for the current fiscal year, missing the constitutional deadline of June 24. Of the province’s 136 local units, 119 have submitted their budget details to the ministry’s online system, while 17 have yet to do so. Parsa District recorded the highest number of non-compliant local units with six, followed by Rautahat with five, Dhanusha with four, and Siraha with two. Officials said political disputes and administrative disagreements have been the primary reasons for the delay.
Contract employees protest outsourcing proposal
Contract employees from 18 government ministries staged a sit-in outside Singha Durbar on Wednesday in protest against the government’s proposed outsourcing policy. The protesters argued that replacing contract positions with outsourced services would threaten the jobs of thousands of long-serving employees. They urged the government to withdraw the proposal, halt its implementation, and ensure job security for existing contract workers.
Tatopani invests in embankment and irrigation projects benefiting 701 farmers
Tatopani Rural Municipality has completed five agricultural infrastructure projects benefiting 701 farmers with an investment of more than Rs 250,000. Implemented under a cost-sharing arrangement with the Local Adaptation Plan for Action, the projects were launched in mid-April to restore farmland damaged by the devastating floods of 2022. The completed works include the Dhaulapani Irrigation Project, Haku Marshi Paddy Field Protection Project, Panikhola Source Protection Project, Bataghatt Embankment, and Ramijiulo Embankment, helping rehabilitate agricultural land across eight wards.
Hetauda bans sale and transport of riverbed materials
Hetauda Sub-Metropolitan City has imposed a temporary ban on the sale and transportation of riverbed materials from local industries and businesses, effective from midnight. According to a public notice, the restriction is intended to facilitate verification of stock balances and transaction records from fiscal year 2025/26, as required before crusher plants and sand-processing industries begin operations in fiscal year 2026/27. The ban will remain in effect until further notice.
Nepal completes four of 15 FATF action plans
The Ministry of Finance has confirmed that Nepal has completed four of the 15 action plans assigned by the Financial Action Task Force (FATF) as part of efforts to exit the organization’s gray list. The remaining 11 measures are currently being implemented through coordinated efforts by various regulatory agencies. Nepal’s progress will be assessed during a face-to-face review meeting scheduled for September 2026 in Malaysia. Authorities, including Nepal Rastra Bank, the Securities Board of Nepal (SEBON), and the Nepal Insurance Authority, are strengthening risk-based supervision to improve financial transparency.
Department penalizes manpower agencies for violating foreign employment rules
The Department of Foreign Employment has taken action against 159 licensed recruitment agencies for sending migrant workers abroad through foreign airports without official approval, in violation of the Foreign Employment Act, 2007. Of the country’s 1,117 registered recruitment agencies, only 678 submitted workers’ flight records for the period between April 13 and June 14. The department issued warnings to 156 agencies and imposed fines of Rs 50,000 each on eight repeat offenders on July 10.
Morang Chamber welcomes Company Bill, seeks revisions
The Chamber of Industries Morang has welcomed the proposed Company Bill 2026, describing it as a positive step toward modernizing corporate regulations through digital services. The chamber praised provisions related to online company registration, tax enrollment, and electronic services. However, it urged the government to reconsider provisions that could increase compliance costs, including higher minimum paid-up capital requirements for public companies, restrictions on certain businesses operating as private firms, and mandatory public listing within five years. Chamber President Nanda Kishor Rathi stressed the need to strike a balance between regulation and investment promotion.
SEBON plans reforms to IPO share issuance and allocation rules
The Securities Board of Nepal (SEBON) has announced plans to revise regulations governing share issuance and allocation as part of its policy and programs for the upcoming fiscal year. The regulator intends to introduce new rules for institutional investors participating in initial public offerings (IPOs) and allow external experts to review company financial statements when necessary. Under the proposed framework, companies seeking to issue IPOs will be prohibited from adding new shareholders immediately before listing, while recently added shareholders will be required to observe a mandatory holding period.
Farmers dump tomatoes in Kathmandu to protest agricultural policies
Vegetable farmers staged a protest at Maitighar Mandala in Kathmandu on Wednesday by dumping tomatoes on the street, accusing the government of failing to protect domestic producers. They said low market prices, rising production costs, and import-oriented agricultural policies have made it increasingly difficult to sustain farming. The protesters demanded the immediate implementation of a minimum support price for agricultural products, higher production subsidies, easier access to fertilizers and seeds, better market management, and stronger policy support to help locally produced vegetables compete with imported products.
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