KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
Nepal’s latest economic indicators reflect a fragile and import-dependent economy struggling with structural imbalances, weak public spending, and external vulnerabilities despite pockets of reform and investment activity. The widening Rs 1.443 trillion trade deficit—driven largely by imports from India, China, and Argentina—highlights Nepal’s continued dependence on foreign goods, fuel, industrial raw materials, and food products, while exports remain stagnant.
Although declining rice imports and rising real estate revenues suggest some domestic market resilience, weak industrial productivity, underutilized provincial development budgets, and the slowdown in EV imports indicate broader concerns about economic momentum and policy execution.
At the same time, the government and regulators are pushing institutional reforms through stricter banking accessibility standards, digital land administration rules, mining royalty recovery efforts, and improved Nepal-China border coordination. However, natural disasters damaging hydropower infrastructure, protests over urban regulations, and demands for industrial revival in Morang underscore persistent governance and infrastructure challenges.
Overall, the developments portray an economy attempting modernization and regulatory reform while still constrained by low production capacity, implementation gaps, trade imbalance, and heavy reliance on imports and remittance-driven consumption.
Country records Rs 1.443 trillion trade deficit with 120 countries
Nepal recorded a trade deficit of Rs 1.443 trillion during the first 10 months of the current fiscal year ending May 14, 2026, according to data released by the Department of Customs. Total imports reached Rs 1.692 trillion, while exports stood at only Rs 248.962 billion. Nepal posted trade surpluses with just 34 countries, including a Rs 63.2 million surplus with Denmark. India remained Nepal’s largest trading partner, with the bilateral trade deficit reaching Rs 769.927 billion. The deficit with China stood at Rs 335.015 billion.
Gold and silver prices decline in domestic market
Gold and silver prices fell in the domestic market today, according to the Federation of Nepal Gold and Silver Dealers’ Association. The price of gold dropped by Rs 2,800 per tola to Rs 290,900, down from Rs 293,700 on Friday. Silver prices also declined by Rs 105 per tola, falling to Rs 5,010 from the previous rate of Rs 5,115.
NRB tightens accessibility rules and mandates overtime pay for bank employees
Nepal Rastra Bank has revised its unified directives, introducing stricter accessibility standards and stronger labor protections for employees working in banks and financial institutions. Under the updated provisions, banks are required to jointly operate at least one disability-friendly branch and one accessible ATM in every local government unit. ATMs must now include Braille instructions, audio assistance, and user-friendly accessibility features. Banking websites, mobile applications, and cards must also be upgraded to improve usability for visually impaired customers. The central bank has also prohibited financial institutions from requiring employees to work overtime without compensation. Banks must provide overtime payments in accordance with existing labor laws for any work performed beyond regular office hours.
Rice imports decline to Rs 34 billion in 10 months
Nepal imported paddy and rice worth Rs 34.07 billion during the first 10 months of the current fiscal year, marking a decline compared to the previous year. According to the Department of Customs, imports between April 14 and May 14 alone totaled Rs 2.24 billion. The cumulative imports included 449.6 million kilograms of paddy valued at Rs 16.747 billion, 63.9 million kilograms of Basmati rice worth Rs 7.33 billion, and 155.3 million kilograms of non-Basmati rice. Analysts attributed the decline partly to higher procurement costs in India caused by trade disruptions linked to Middle Eastern markets.
Real estate revenue reaches Rs 6.263 billion in one month
The government generated Rs 6.263 billion in revenue from 169,538 property transactions between April 14 and May 14, according to statistics published by the Department of Land Management and Archive. A total of 58,886 property deeds were officially registered during the period. The Dillibazar Land Revenue Office in Kathmandu collected the highest revenue nationwide at Rs 599.1 million, followed by the Lagankhel office with Rs 529.6 million. The revenue included Rs 3.319 billion from registration fees and Rs 2.552 billion from capital gains taxes.
Sudurpashchim spends only 21 percent of development budget
The Sudurpashchim Province Government recorded a capital expenditure rate of just 21 percent by the end of the tenth month of fiscal year 2025/26. Financial records from the Provincial Comptroller Office showed that only Rs 4.177 billion had been spent out of the allocated Rs 19.838 billion development budget, leaving Rs 15.661 billion unused. Recurrent expenditure reached 37.92 percent, with Rs 5.16 billion spent from a total operational budget of Rs 13.606 billion. The Ministry of Physical Infrastructure Development, which holds the province’s largest capital budget allocation of Rs 14.716 billion, spent only 23 percent of its target.
Nepal imports Rs 95 billion worth of raw oils from Argentina
Trade data released by the Department of Customs showed that Argentina has become Nepal’s third-largest import partner during the current fiscal year. Nepal imported goods worth Rs 95.27 billion from Argentina while exporting products worth only Rs 3.6 million. Most imports consisted of industrial raw materials intended for domestic processing and re-export to India. These included 503.1 million liters of crude soybean oil valued at Rs 81 billion and 82.9 million liters of crude sunflower oil worth Rs 13.36 billion.
Auditor general orders recovery of Rs 237 million in mining royalties
The Office of the Auditor General has directed authorities to recover Rs 237.7 million in unpaid mining royalties and penalties from companies involved in mineral extraction. The 63rd annual audit report found that several firms extracted minerals beyond approved limits and failed to pay royalties within the mandatory deadline. The directive reaffirmed a royalty rate of Rs 25 per cubic meter for common stone, along with a 30 percent late fee and a 10 percent local development charge. The Department of Mines and Geology collected a total of Rs 1.594 billion in mineral royalties.
Imports through Birgunj customs rise 15 percent
Imports through the Birgunj Customs Office increased by 15 percent during the first 10 months of the current fiscal year. Total imports reached Rs 794.87 billion, compared to Rs 692.43 billion during the same period last year. The increase was driven mainly by industrial raw materials and fuel products. Imports included Rs 181.70 billion worth of petroleum products, Rs 69.42 billion worth of iron and steel materials, and Rs 57.66 billion in machinery and equipment.
EV imports decline through Belahiya border point
The Bhairahawa Customs Office reported a decline in electric vehicle imports through the Belahiya border checkpoint during the first 10 months of the fiscal year. A total of 2,019 electric jeeps, cars, and vans were imported, down from 2,270 units during the same period last fiscal year. As a result, customs revenue from EV imports declined to Rs 2.304 billion from Rs 4.50 billion previously. Meanwhile, imports of petroleum-powered vehicles increased to 4,373 units, generating Rs 10.309 billion in revenue. Motorcycle imports generated the highest revenue at Rs 18.113 billion.
Nepal Police moves ahead with Rs 1.61 billion secretariat project
The Ministry of Forests and Environment has advanced the Environmental Impact Assessment approval process for the proposed new Nepal Police Inspector General Secretariat building. The project, planned in Naxal, Kathmandu, carries an estimated cost of Rs 1.61 billion. The proposed 13-story structure will include basement parking facilities for 27 cars and 152 motorcycles, along with elevators, a command center, a multipurpose hall, and legal service units. Construction is expected to be completed within three years using a workforce of 45 skilled and 136 unskilled workers.
Nepal and China discuss easing border trade in Rasuwa
Officials from Nepal and China agreed to strengthen trade facilitation and border coordination during bilateral talks held in Dhunche on Saturday. The Nepali delegation was led by Rasuwa Chief District Officer Rajesh Panthi, while the Chinese side was headed by official Chu Jinsaon. Discussions focused on improving trade and transportation through the northern border, including possible permission for Nepali drivers from outside Rasuwa district to travel to Kerung after completing required procedures. The two sides also discussed cooperation to curb cross-border crime and improve support systems for Nepali workers in Kerung. Officials said regular bilateral meetings are intended to strengthen Nepal-China cooperation and improve border management operations.
Land management department issues strict nine-point directive to revenue offices
The Department of Land Management and Archives has introduced a mandatory nine-point directive aimed at streamlining property freezing, release, and record management related to bank collateral cases. Under the new rules, land revenue offices must process requests submitted before noon on the same working day, while applications filed after 12:00 PM must receive a processing update by noon the following business day. The directive also requires digital database integration among offices and makes authorized corporate documentation compulsory for property release procedures in an effort to reduce bureaucratic delays and prevent unauthorized land transfers.
Flash floods halt four hydropower projects along Taplejung-Panchthar border
Severe flooding on the Kabeli and Indrawati rivers last Friday forced the shutdown of four hydropower projects operating along the Taplejung-Panchthar border. Mud, logs, and boulder debris clogged water intakes and damaged pipelines, suspending operations at the 25 MW Kabeli ‘B-1’ project and its 10 MW cascade plant operated by Arun Kabeli Power Limited. Repair work has begun after river levels receded, though engineers estimate it could take up to two weeks to restore operations. Meanwhile, the 9.9 MW Inwa Khola project operated by Ridi Hydropower Limited and the 9.7 MW facility run by Iwa Hydropower Limited suffered major damage to intake systems and powerhouses, with repairs expected to take several months.
Krishi Samagri begins fertilizer distribution in Mahendranagar
Krishi Samagri Company has started distributing chemical fertilizers from its Mahendranagar branch ahead of the main paddy planting season. The branch is supplying 1,000 metric tons of urea, 500 metric tons of DAP fertilizer, and 150 metric tons of potash through local cooperatives. Cooperatives have been instructed to collect allocated supplies within 10 days to avoid storage congestion. Since mid-July 2025, the company has already distributed nine consignments of urea and seven consignments of DAP, with each quota equivalent to 500 metric tons.
Jumla local governments plan Rs 30 million organic fertilizer plant
Three local governments in Jumla—Chandannath Municipality, Tatopani Rural Municipality, and Patarasi Rural Municipality—have launched a feasibility study for a proposed Rs 30 million organic fertilizer industry. The initiative aims to support Jumla’s status as Nepal’s first fully organic district, declared in fiscal year 2007/08, where chemical fertilizers and pesticides are prohibited. Supported by Norway-funded REED and the UNDP, the project seeks to meet the district’s annual demand of 400 metric tons of organic fertilizer. Tatopani Rural Municipality has allocated 10 hectares of land for the proposed plant.
Industrialists seek revival package for struggling Morang industries
Business leaders from the Morang-Sunsari Industrial Corridor have urged the Koshi Province government to introduce grants, tax relief, and technology support programs in the upcoming 2026/27 budget to revive struggling industries. Several factories, including the historic Biratnagar Jute Mill established in 1936, are either closed or operating below capacity due to high energy costs and limited credit access. Industrialists have proposed the creation of a provincial rehabilitation fund to support manufacturing recovery and employment generation.
Binod Chaudhary attends high-level U.S.-India reception in New Delhi
Nepali billionaire Binod Chaudhary and his son Varun Chaudhary attended a reception hosted at Roosevelt House by the U.S. Embassy in New Delhi during the visit of U.S. Senator Marco Rubio to India. The event, hosted by U.S. Ambassador to India Sergio Gor, was also attended by India’s External Affairs Minister S. Jaishankar, diplomats, senior officials, and private-sector representatives. Discussions during Rubio’s visit focused on trade, strategic cooperation, technology, and regional security.
Everest Color Company to launch IPO from June 5
Everest Color Company has received approval to issue its initial public offering (IPO) starting June 5. The company will issue 790,000 ordinary shares worth Rs 79 million, representing 26.33 percent of its Rs 300 million authorized capital. Of the total shares, 79,000 units have been reserved for migrant workers, 39,500 for mutual funds, and 15,800 for employees. The remaining 655,700 shares will be available to the general public at Rs 100 per share until June 10.
Damauli traders close shops over parking restrictions
Business owners in Damauli’s Safa Sarak market area shut down their shops in protest against new traffic and parking regulations imposed by Vyas Municipality. The municipality recently introduced a complete parking ban and selective one-way traffic rules to ease congestion in the busy commercial zone. Traders argue that the restrictions have reduced customer access and negatively affected business activity. Merchant associations warned that the protest would continue until municipal authorities reconsider the policy and consult with local businesses.
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