KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s economic landscape reflects a mix of short-term stress and cautious structural optimism: financial markets and precious metals prices are softening, signaling weak investor sentiment, while inflation—driven largely by sharp rises in food and fuel costs—is intensifying pressure on household budgets and triggering public protests and political pushback.
At the same time, policy uncertainty, including contested stock market reforms and stricter customs enforcement, is adding friction to economic activity, even as revenue growth remains modest and below target.
However, the government is attempting to stabilize conditions through administrative reforms (such as bi-monthly salaries) and anti-corruption measures, while medium-term prospects are supported by improving political stability, planned credit easing, expanding tourism, infrastructure projects, and export growth.
Overall, the economy appears to be in a transitional phase where immediate inflationary and confidence challenges coexist with longer-term development and recovery efforts.
NEPSE drops 13 points as most sectors end in the red
The Nepal Stock Exchange (NEPSE) fell by 13.17 points, or 0.46%, on Monday, settling at 2,825.23. The Sensitive Index also declined by 0.67% to 473.71, with float indices following a similar downward trend. A total of 116.5 million shares from 349 companies were traded in 116,310 transactions, producing a turnover of Rs 5.43 billion. Share prices of 65 companies increased, while 197 declined and six remained unchanged. All sector indices recorded losses except Hotels and Tourism, which rose by 1.01%, while banking, finance, hydropower, insurance, and manufacturing sectors drove the overall decline.
Gold and silver prices decline on Monday
Gold prices dropped on Monday, according to the Federation of Nepal Gold and Silver Dealers’ Association. The price of gold fell by Rs 1,300 per tola, bringing it down to Rs 299,700 from Rs 301,000 the previous day. Silver prices also declined, decreasing by Rs 35 per tola to Rs 5,190, compared to Rs 5,225 on Sunday.
Government to introduce twice-monthly salary payments
The government has decided to shift from monthly salary payments to a bi-monthly system for civil servants. This decision was made at the ministerial level by the Finance Minister on April 17. The Ministry of Finance has requested the Office of the Auditor General to arrange the implementation of the new system. The move aims to improve employees’ cash flow, replacing the long-standing practice of paying salaries only at the end of each month.
Kitchen expenses surge as vegetable prices jump by 304%
According to the Department of Commerce, Supplies and Consumer Protection, the cost of essential goods rose sharply during March/April. While prices of meat and dairy products stayed stable, vegetables in Kathmandu saw steep increases. Local cauliflower prices climbed by 304.76%, and long green pumpkins rose by 200%. Fuel prices were raised five times within a month, pushing petrol to Rs 219 and diesel to Rs 207. The US dollar also reached Rs 152.01. Rising transportation costs and tensions in the Middle East have been identified as key factors behind the inflation.
Revenue collection reaches Rs 891.56 billion in nine months
Government revenue rose by around 6% during the first nine months of the fiscal year 2025/26 (July 17, 2025, to April 13, 2026). By mid-April, total revenue collection reached Rs 8.915 billion, compared to Rs 8.411 billion during the same period last year. However, this accounts for only 60.24% of the annual target of Rs 14.80 billion. Value Added Tax contributed Rs 2.614 billion, while income tax collections totaled Rs 2.159 billion. Education service fees recorded the highest growth at 56.66%.
Investors challenge new share market policies before public accounts committee
The Nepal Share Market Investors Association has submitted a petition to the Public Accounts Committee of the House of Representatives, calling for the immediate withdrawal of newly introduced policies. The Nepal Stock Exchange has implemented changes from today, including raising the daily price movement cap for individual stocks from 10% to 15%. The association argues these decisions were influenced by vested interests without sufficient analysis. It also warned that increasing the circuit breaker threshold from 6% to 8% could trigger excessive volatility and jeopardize the investments of over 7.6 million general investors.
Lumbini lawmakers call for rollback of fuel hikes and customs rules
During the 13th meeting of the Lumbini Province Assembly’s seventh session, lawmakers urged the federal government to reverse recent increases in petroleum prices and scrap the Rs 100 customs rule at the border. They highlighted that higher fuel costs have increased irrigation expenses, tractor hire charges, and overall production costs, placing farmers’ livelihoods at risk. Concerns were also raised about the impact on low-income groups and the need to ensure companies such as Meta comply with Nepal’s tax laws. The session also covered updates on Dalit rights and reports from the Agriculture, Forest, and Environment Committee.
Protests erupt at oil corporation over fuel price increases
The Rastriya Gen Z Nagarik Abhiyan staged a demonstration at the Nepal Oil Corporation in Babar Mahal, demanding an immediate rollback of recent fuel price hikes. Protesters carrying placards and banners were stopped by police at the Babar Mahal intersection before reaching the corporation’s main office. Organizers warned that protests would continue until prices are reduced, citing the growing financial strain on young people and the general public.
Government plans to probe corruption in private sector and NGOs
The Office of the Prime Minister and Council of Ministers has drafted the second National Strategic Plan Against Corruption, set to run from fiscal year 2025/26 to 2031/32. The strategy proposes bringing cooperatives, private companies, and NGOs under the investigative authority of the Commission for the Investigation of Abuse of Authority (CIAA). The government also plans to introduce laws within two years to define private sector misconduct as criminal offenses. While the initiative aims to enhance transparency in areas such as aviation and insurance, business groups have expressed concerns that it could discourage investment and innovation.
Tensions grow as customs enforce duty on goods above Rs 100
Tensions have intensified at border checkpoints such as Birgunj and Gaddachauki after authorities began strictly enforcing customs duties on goods valued above Rs 100. The Armed Police Force has been using loudspeakers to inform the public that such goods must be declared. This move follows an April 2 decision by the Central Revenue Leakage Control Committee. While officials and traders believe the measure will reduce revenue leakage and curb cross-border shopping, consumers have protested, citing inflation and impractical limits. Clashes have been reported as inspections at border points become stricter.
Political stability expected to boost slow credit demand
Despite high liquidity and low interest rates, loan disbursement remained weak during the peak economic season following the November/December festivals. Only Rs 2.02 billion in loans were issued in the first eight months of the fiscal year, compared to Rs 2.65 billion in the same period last year. Bankers attribute the slowdown to political uncertainty surrounding the March 5 elections and rising fuel prices linked to Middle East tensions. With a stable government now in place and Nepal Rastra Bank easing lending conditions for real estate and SMEs, credit demand is expected to improve.
Tribhuvan International Airport to close daily for construction work
Tribhuvan International Airport has revised its operating hours starting today to allow for taxiway construction. The airport will remain closed daily from 11:45 PM to 6:30 AM until May 18. This 6.75-hour closure is required for expansion work on multiple taxiways. The project aims to increase the airport’s capacity to handle up to 10 million passengers annually after 2026. Flight schedules, particularly for airlines operating to the Gulf, India, and Turkey, have been adjusted accordingly.
Nepal Airlines to launch direct flights to Dhaka
Nepal Airlines Corporation is preparing to begin direct flights between Kathmandu and Dhaka, Bangladesh. A feasibility study subcommittee has been formed to finalize operational plans. Although Bangladesh is a neighboring country, the national carrier has not previously operated on this route, unlike Himalaya Airlines and Biman Bangladesh Airlines. The final schedule will depend on the study report. Additionally, Nepal Airlines expanded its Kathmandu–Delhi service on March 31, increasing flights to 10 per week, and has formed a task force to improve cargo management.
TIA handles over 711,000 passengers in March 2026
Tribhuvan International Airport served a total of 711,357 passengers in March 2026. Of these, 375,674 were international travelers, while 335,683 were domestic passengers. Among international airlines, Air Arabia carried the highest number of passengers at 50,527, followed by Nepal Airlines with 38,595. Qatar Airways experienced a decline due to regional conflicts, serving 15,928 passengers. Domestically, Buddha Air led the market with 182,509 passengers during the month.
Nagdhunga–Naubise tunnel to begin testing by May 3
The Nagdhunga–Naubise Tunnel project is set to start trial vehicle operations by May 3. Yuxin-ART JV has been appointed to operate and maintain the tunnel for five years at a cost of Rs 1.1 billion, with staff deployment expected by April 23. During the testing phase, only a limited number of vehicles will be permitted during daytime hours without toll charges. Construction of the toll plaza and final road surfacing is almost complete, while full commercial operations, including toll collection, are planned for the new fiscal year beginning July 17, 2026.
Hospitality sector employs 94,000 people ahead of FBH 2026
Nepal’s food, beverage, and hospitality industry has grown to more than 25,500 businesses, employing around 94,000 individuals. Looking ahead to 2026, over 25 new star-rated hotels are expected to open within two years. The Food and Beverage and Hospitality 2026 (FBH 2026) expo is projected to host 300 companies and attract about 30,000 visitors. The sector is increasingly integrating technologies such as AI-driven hotel services and QR-based menus, while also emphasizing sustainability and organic production to meet the needs of a rising tourist base, which surpassed 1.2 million in 2023.
Mountaineering royalties reach Rs 755.8 million for spring season
The Department of Tourism has collected Rs 755.8 million in royalties from 700 climbers during the 2026 spring mountaineering season. Mount Everest remains the main attraction, with 297 climbers from 30 teams contributing Rs 652.6 million. China leads in participation with 89 climbers, followed by the United States with 71. On April 18, the first successful ascents of the season were recorded on Dhaulagiri I and Annapurna I by teams of nine and 12 climbers, respectively.
Karnali aims to extend tourist stays to 21 days
The Karnali Province government plans to increase the average tourist stay from four days to between 10 and 21 days. As part of a 10-year master plan, the Ministry of Industry, Tourism, Forest and Environment has allocated Rs 430 million for infrastructure development in the current fiscal year. By 2030, the province aims to attract 1.5 million domestic and 200,000 international visitors annually. Key initiatives include integrated settlement development near Phoksundo Lake and constructing a model gateway for Mansarovar in Humla. Coordination is also underway with the Civil Aviation Authority of Nepal to establish direct air links between Surkhet and Himalayan districts.
Dudhkoshi-5 hydropower project to be built for Rs 19.11 billion
The 110 MW Dudhkoshi-5 Hydropower Project will be developed in multiple wards of Mapya Dudhkoshi Rural Municipality in Solukhumbu. This semi-reservoir project is expected to generate 617.86 GWh of electricity annually for the national grid. Promoted by Independent Power Company Nepal, the project has an estimated cost of Rs 19.11 billion, averaging Rs 200 million per megawatt. Construction will involve clearing 2,459 trees across 25.28 hectares of forest, and the project is targeted for completion within five years, creating jobs for 565 workers.
Irrigation projects worth Rs 10.42 billion stall in Parbat
In Parbat district, 10 out of 78 planned irrigation projects for the current fiscal year remain uncontracted, raising the risk of budget freezes. The Gandaki Province government allocated Rs 10.42 billion for these initiatives, with project costs ranging from Rs 500,000 to Rs 3.5 million. While 24 projects have been completed and 44 are ongoing, the remaining ones have stalled due to low participation from farmers and consumer groups. Contributing factors include a required deposit of Rs 100 per ropani, rising material costs, and labor shortages.
Magic Footwear surpasses Goldstar with Rs 1.5 billion in exports
Birgunj-based Magic Footwear has emerged as Nepal’s leading footwear exporter, surpassing Goldstar. In the fiscal year 2024/25, the company recorded exports worth Rs 1.5 billion, exceeding Goldstar’s average of Rs 1 billion. With three production units in Birgunj and a workforce of 1,700 employees, the company was recognized by the Export Federation of Nepal. For the current fiscal year, it has set a target of Rs 2 billion in exports, though concerns remain over the removal of government export subsidies.
Kalinchowk Hydropower allots IPO shares to 68,475 applicants
Kalinchowk Hydropower has completed the allotment of its IPO shares. Out of 2,784,519 applicants, 68,475 individuals received 10 shares each through a lottery system. According to issue manager RBB Merchant Banking, 2,635,634 applications were deemed valid, while the rest were rejected. The company had issued 684,750 shares at a face value of Rs 100 per unit, totaling Rs 68.4 million, to the general public between April 5 and April 8.
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