KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
Nepal’s economic landscape reflects a mix of financial pressure, governance concerns, and selective sectoral resilience. While the NEPSE index declined despite strong trading activity, rising gold and silver prices and expanding share-backed lending indicate that investors remain cautious amid inflationary and geopolitical uncertainties.
The Nepal Oil Corporation’s mounting Rs 36 billion losses, fuel supply disruptions linked to the two-day weekend policy, and rising prices of imported appliances highlight growing external cost pressures on the domestic economy.
At the same time, the Auditor General’s findings exposed deep structural weaknesses in governance, including massive customs tax evasion, unauthorized fund disbursements, long-overdue state audits, and regulatory failures in mining and vehicle imports, raising concerns about institutional accountability and revenue leakage.
However, some sectors showed positive momentum, including tourism earnings from mountaineering royalties, strong microfinance profitability, improving domestic fish production, and new capital market activity through IPO issuance.
Overall, the developments suggest an economy facing rising fiscal and administrative stress but still supported by active financial markets, tourism recovery, and expanding domestic enterprise activity.
NEPSE falls by 6.51 points as trading volume reaches Rs 3.08 billion
The Nepal Stock Exchange (NEPSE) index dropped by 6.51 points on Tuesday, closing at 2,724.39, down 0.23 percent from the previous trading session. The sensitive index declined by 0.14 percent to 467.37, while the float and sensitive float indices also recorded losses. Despite the decline, trading volume increased to Rs 3.08 billion, with more than 7.81 million shares of 346 companies traded through 45,519 transactions. Share prices of 113 companies increased, while 145 declined. Development banks, finance, and non-life insurance sectors posted gains, whereas trading, hydropower, hotels, manufacturing, and other major sectors ended lower.
Gold and silver prices rise in the domestic market
Gold and silver prices increased in the domestic market on Tuesday, according to the Federation of Nepal Gold and Silver Dealers’ Association. The price of gold rose by Rs 500 per tola (11.66 grams), reaching Rs 295,300 per tola. On Monday, gold was traded at Rs 294,800 per tola. Silver prices also increased by Rs 45 per tola and are now being traded at Rs 5,085 per tola, compared to Rs 5,040 per tola on Monday.
NOC records Rs 36 billion losses while keeping fuel prices unchanged
The Nepal Oil Corporation (NOC) decided to keep domestic fuel prices unchanged despite receiving revised rates from the Indian Oil Corporation on Saturday. According to the latest import invoices, petrol prices increased by Rs 10 per liter, while diesel prices decreased by Rs 22 per liter, balancing the corporation’s overall profit and loss margins. However, liquefied petroleum gas continues to incur a loss of Rs 1,078 per cylinder. Due to global price increases linked to the Iran–America conflict since February 28, the corporation has accumulated losses totaling Rs 36 billion.
Commission requires wealth disclosures from Nepal Rastra Bank executives
The Property Investigation Commission has made wealth disclosure submissions mandatory for all senior executives and retired officials of the Nepal Rastra Bank. The directive applies to the governor, board members, deputy governors, executive directors, and first-class officers or above to promote transparency and prevent illegal asset accumulation in the financial sector. The disclosure forms require complete verification of family records, movable and immovable property, bank balances, share investments, foreign income, remittances, and outstanding liabilities. The commission stated that failure to disclose assets or submitting false information could lead to prosecution under existing anti-corruption laws.
Two-day weekend policy leads to fuel shortages and long queues
The government’s two-day weekend policy, introduced to reduce fuel consumption, has unintentionally caused congestion and long lines at fuel stations across Kathmandu on Mondays. Since the Nepal Oil Corporation closes its main distribution depots on Saturdays and Sundays, many fuel stations run out of supply over the weekend, leading to a surge in demand when business resumes. The corporation continues regular daily distribution to meet average valley demand, estimated at 700 to 800 kiloliters of petrol and 850 to 900 kiloliters of diesel. The Nepal Petroleum Dealers’ National Association has urged the Ministry of Industry, Commerce, and Supplies to reopen depots on Sundays to maintain market stability.
State-owned entities avoid mandatory audits for up to 17 years
The 63rd Annual Report of the Auditor General highlighted major weaknesses in financial governance, revealing that several state-owned enterprises have failed to conduct mandatory audits for as long as 17 years. Nepal Orient Magnesite has not submitted accounts for auditing since the 2007/08 fiscal year. Likewise, Sajha Prakashan has skipped audits for 12 years, while Rastriya Beema Sansthan and Rastriya Beema Company have avoided audits for nine and eight years, respectively. Data from the 2023/24 fiscal year showed that only 21 out of 45 public enterprises completed regular audits, while Gorkhapatra Sansthan and Nepal Railway Company also faced significant reporting delays.
Auditor General recommends action against 89 mining firms over weighbridge violations
The Office of the Auditor General has instructed the government to take action against mining companies and processing factories accused of bypassing weighbridge requirements through fraudulent extraction practices. Of the 159 licensed operators ordered by the Department of Mines and Geology to install calibrated weighing systems, 89 failed to comply. Field inspections found that 22 mines without weighing systems remain operational, while checks at three cement factories showed that only two had functioning scales. Under Rule 19 of the Mines and Minerals Regulations, 1999, operators that fail to record accurate extraction volumes may face immediate cancellation of their licenses, as such violations enable under-reporting and royalty evasion.
Finance Ministry illegally disburses Rs 129.2 million in micro-insurance funds
The Office of the Auditor General reported that the Ministry of Finance violated the Insurance Act, 2079 BS, by distributing Rs 129.2 million in micro-insurance funds to unauthorized financial institutions. The ministry ignored legal provisions limiting micro-insurance implementation to non-life insurance companies and allocated Rs 41.6 million to Agricultural Development Bank and Rs 87.5 million to Sana Kisan Bikas Laghubitta Bittiya Sanstha. Neither institution possesses an insurance license or agent registration under the 2076 BS guidelines. The ministry also failed to establish standard operating procedures or conduct required project monitoring, prompting the auditor to call for a complete structural review.
Gen Z protests disrupt audit of Rs 162.9 billion at the Office of the President
The Office of the Auditor General stated that the Office of the President, which employs 68 staff members, was unable to complete its financial audit after records were destroyed during the Gen Z protests on September 8 and 9, 2025. The missing documents prevented the audit of Rs 162.9 billion, including Rs 141.9 million in budget allocations, Rs 20.9 million in deposits, and Rs 53,000 in revenue. Auditor General Toyam Raya said the unrest affected audits worth more than Rs 150 billion across 179 offices, although nationwide audits still covered a total of Rs 9.484 trillion.
Five customs offices undercharge Rs 7.498 billion on vehicle imports
The Auditor General’s report revealed that several customs offices caused a revenue shortfall of Rs 7.498 billion by improperly granting customs and excise duty exemptions on unassembled vehicle imports under the Customs Act. Assembly industries are legally eligible for a 25 percent customs duty discount and a 50 percent excise duty reduction if they meet employment and value-addition requirements. However, importers failed to provide certified manufacturing verification, violating Harmonized System regulations that require knocked-down kits to be taxed as finished vehicles. The report showed undercollected revenue of Rs 4.797 billion at Bhairahawa Customs Office, Rs 2.587 billion at Birgunj Customs Office, and Rs 106.8 million at the Dry Port Customs Office in Parsa.
Bhadrapur Inland Revenue Office collects Rs 3.618 billion in 10 months
The Inland Revenue Office in Bhadrapur collected Rs 3.618 billion in revenue during the first 10 months of the 2025/26 fiscal year, from July 17, 2025, to May 14, 2026, achieving 82.21 percent of its target. According to tax officer Dilli Ram Chamlagain, the office had aimed to collect Rs 4.401 billion by mid-May. Between mid-April and mid-May, the office targeted Rs 428.5 million in revenue but achieved only 83.87 percent of the monthly goal. By mid-May, collections included Rs 1.686 billion from income tax, Rs 1.288 billion from VAT, and Rs 499.7 million from excise duty. The office stated that efforts are ongoing to improve revenue collection through taxpayer awareness programs, regular monitoring, and more efficient tax administration.
Auditor General identifies Rs 2.508 billion in EV customs tax evasion
The Auditor General’s report revealed that Rs 2.508 billion in government revenue was evaded through the underreporting of peak motor power capacities in electric vehicles (EVs). Of the total amount, Rs 1.272 billion was linked to the Rasuwa Customs Office and Rs 1.235 billion to the Tatopani Customs Office. Importers allegedly manipulated technical specifications to avoid Customs Act tax rates that impose 20 percent customs duty and 15 percent excise duty on vehicles with 50–100 kW motors, and 30 percent customs duty and 20 percent excise duty on vehicles with 100–200 kW motors. Models such as the Zeekr X, Deepal E07, Jaecoo J6, Avatr 11, Xpeng, Nami Box, and X30LEV passenger vans were reportedly imported with understated power ratings, resulting in millions of rupees in lost revenue.
JICA to hand over Nagdhunga–Naubise Tunnel project after nearly seven years
The Japan International Cooperation Agency (JICA) is set to hand over the Nagdhunga–Naubise Tunnel Project to the government within the next seven to 10 days. Construction began in October 2019 with an initial completion target of 42 months, but the project faced delays due to the COVID-19 pandemic and local protests, extending the timeline to almost seven years. After the official transfer, the operating contractor ART-Yucin JV, which signed its service agreement on April 29, 2026, will begin managing staffing and technical training within 15 days. Vehicle testing is expected to start in mid-June, with full public operation scheduled between mid-July and mid-August.
Tourism Department collects Rs 1.258 billion in spring mountaineering royalties
The Department of Tourism collected Rs 1.258 billion in mountaineering royalties during the Spring 2026 climbing season by issuing permits to 1,181 climbers from 79 countries. Mount Everest attracted the highest number of climbers, with 494 mountaineers from 55 countries, including 109 from China, 77 from the United States, 61 from India, and 12 from Nepal, generating Rs 1.078 billion in royalties. The department also issued 143 permits for Lhotse, generating Rs 63.6 million, at least 111 permits for Ama Dablam, generating Rs 16.6 million, and 36 permits for Kanchenjunga, generating Rs 16 million. The Department of Tourism manages permits for peaks above 6,500 meters, while the Nepal Mountaineering Association oversees mountains between 5,800 and 6,500 meters.
Kaski Police collect over Rs 4.4 million in traffic fines in May
The District Police Office in Kaski collected more than Rs 4.4 million in revenue from traffic violations during May, according to officials. Police Inspector Sujit Kumar Devkota said that 5,263 drivers were fined as traffic monitoring and enforcement campaigns intensified across the district. Records show that 12 vehicles were penalized for overspeeding, five drivers were caught driving without licenses, and three drivers were found operating vehicles under the influence of alcohol. During the same period, Kaski recorded 22 road accidents, resulting in five deaths and 26 injuries. Police stated that joint inspections by the District Police Office and the Traffic Police Office focused on traffic violations, driver behavior, and passenger treatment to improve road safety and reduce accidents.
Border controls raise wholesale fish prices to Rs 330 per kilogram in Nawalparasi
Government border restrictions aimed at limiting cheap, chemically preserved fish imports have boosted the domestic aquaculture industry in Nawalparasi (Bardaghat Susta Purba). Wholesale fish prices increased from Rs 280 per kilogram last year to Rs 330 per kilogram this year. The Veterinary Hospital and Livestock Services Expert Center in Kawaswoti reported 1,574 operational fishponds covering 93,606.84 square meters of water area. The district is nearing self-sufficiency in fish production, with annual per capita production reaching 13 kilograms compared to the recommended consumption target of 14 kilograms. Local farmers are requesting government support through subsidized loans, technical training, and dedicated transportation systems for live fish.
Commercial banks increase share pledge loans to Rs 136.71 billion
Commercial banks expanded share-backed lending to Rs 136.71 billion during the nine-month period ending April 13, 2026, compared to Rs 101 billion during the same period a year earlier. The increase represents a growth of 34.55 percent, with total margin lending rising by Rs 35.10 billion following central bank decisions to reduce risk weights to 100 percent. Nabil Bank recorded the highest lending volume, increasing its portfolio by 19.94 percent to Rs 17.40 billion. Agricultural Development Bank posted the fastest growth, expanding its share pledge lending by 179.71 percent to Rs 8.49 billion. Meanwhile, lending volumes declined at Nepal Bank, Citizens Bank, and Nepal SBI Bank.
Inflation pushes induction cooker prices up to Rs 2,700
Rising geopolitical tensions in the Gulf have increased global fuel transportation and shipping costs, driving up domestic prices of electric induction and infrared cookers by around 20 percent. In wholesale markets, basic induction cookers previously priced at Rs 2,200 now cost between Rs 2,600 and Rs 2,700, reflecting an average increase of Rs 400 per unit. Salt Trading Corporation also reported that the price of its Diamond-branded induction cookers rose from Rs 4,000 to Rs 4,960. Despite changing consumer demand, Department of Customs data from mid-March to mid-April showed imports of 17,125 induction cookers, 19,010 infrared cookers, and 14,303 electric rice cookers.
Microfinance institutions record Rs 7.244 billion profit growth of 43.16 percent
Third-quarter financial reports from 51 operating microfinance institutions showed combined net profits of Rs 7.244 billion for the fiscal year ending April 13. This marks a 43.16 percent increase compared to Rs 5.06 billion recorded during the same period of the previous fiscal year. However, profits declined in nine institutions, including Unique, Kalika, Sirjanashil, Nerude Mirmire, CYC Nepal, Mahila, RSDC, Nirdhan Utthan, and Sana Kisan Bikas Microfinance. Bijay Microfinance reported a sharp decline, moving from a Rs 78 million profit to a Rs 26.7 million loss, while Chhimek Microfinance posted the highest overall profit among the institutions.
Sanigad Hydro to issue Rs 467.4 million IPO for the general public
Sanigad Hydro Company is set to launch its Initial Public Offering (IPO) for the general public on May 28, issuing 4,674,000 shares worth Rs 467.4 million at a face value of Rs 100 per share. The company has an authorized capital of Rs 2.85 billion and received approval to issue 30 percent of its shares, totaling Rs 855 million or 8,550,000 shares. Previously, the company allocated 2,850,000 shares to local residents, at least 570,000 shares to migrant workers, 171,000 shares to employees, and 2,850,000 shares to mutual funds. The issue is being managed by Laxmi Sunrise Capital, and applications will close on June 3.
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