KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
The developments reflect a government balancing fiscal pressure, regulatory tightening, and election-related governance challenges amid a sensitive political period. Rising public debt nearing 47 percent of GDP, alongside significant debt servicing obligations, underscores mounting fiscal strain, prompting the Finance Ministry to proactively form a revenue advisory panel to widen the tax base and resolve structural inefficiencies such as dual taxation.
Simultaneously, regulatory bodies are stepping up oversight—from cracking down on counterfeit currency and substandard food to enforcing election finance transparency and penalizing code violations—indicating a push for institutional credibility ahead of polls.
However, stalled infrastructure projects, cost uncertainties in mega ventures like the Fast Track, and compliance gaps among election candidates highlight persistent implementation weaknesses. Meanwhile, capital market controversies, new IPO issuances, hydropower reforms, and SME promotion efforts reveal an economy attempting to stimulate investment and private sector confidence despite governance and structural bottlenecks. Overall, the picture is one of cautious administrative assertiveness under fiscal constraints and political transition.
Finance Ministry forms revenue panel for 2026/27 budget
The Ministry of Finance has begun preparations for the fiscal year 2026/27 budget by establishing a Revenue Advisory Committee. Headed by the Revenue Secretary, the body includes representatives from NRB, the Confederation of Nepalese Industries, and the Nepal Chamber of Commerce. Nine subcommittees will recommend revisions to income tax, VAT, and customs duties. The panel will also explore new non-tax revenue streams and address double taxation concerns between federal and local governments. Its final policy report is scheduled for submission to the finance minister by May 14.
Public debt climbs to Rs 28.589 billion
According to the Public Debt Management Office, Nepal’s total public debt reached Rs 28.589 billion between January 15 and February 12. Since the beginning of the fiscal year, debt has increased by Rs 1.849 billion and now represents 46.81 percent of GDP. Of the total, 52.81 percent is external borrowing while 47.19 percent is domestic debt. In the first seven months of the fiscal year, the government allocated Rs 2.036 billion for debt servicing, including Rs 1.635 billion in principal repayment and Rs 401.3 million in interest.
NRB launches awareness drive against counterfeit currency
The Janakpur office of Nepal Rastra Bank (NRB) organized an awareness program in Jaleshwar to prevent the circulation of counterfeit currency ahead of the elections. Officials cautioned that increased cash flow during election campaigns heightens the risk of fake notes entering the market, particularly in districts along the Indian border. The initiative trained students, traders, and security personnel to identify key security features in banknotes. NRB stressed that detecting counterfeit currency at the transaction point is vital to curbing illegal trade and safeguarding small businesses during the politically sensitive period.
Gold falls by Rs 500 per tola
Gold prices declined by Rs 500 per tola in the domestic market, trading at Rs 314,900, while silver rose by Rs 15 to Rs 5,740 per tola, according to the Federation of Nepal Gold and Silver Dealers’ Association. The previous day’s gold price stood at Rs 315,400 per tola.
EC fines candidates Rs 25,000 for code violations
The Election Commission (EC) has penalized several candidates Rs 25,000 each for violating the Election Code of Conduct 2026. A candidate in Jajarkot-1 was fined for distributing Rs 500 notes at a rally, while another in Rupandehi-2 was penalized for misusing imagery linked to the September 8 protests. The Sram Sanskriti Party also faced a fine for featuring children in campaign materials. Additionally, the commission recommended departmental action against the chief of Dhorpatan Hunting Reserve for posting inflammatory political content online.
Only 1,670 candidates comply with mandatory election bank accounts
The Election Commission reported that just 1,670 of the 3,406 direct candidates contesting the March 5 polls have opened the required bank accounts for campaign transactions. Among 65 participating political parties, only 11 — including the Nepali Congress and Janata Samajwadi Party — have complied. Under 2026 procedural rules, all campaign-related income and expenses must pass through designated accounts to ensure transparency and spending oversight. The commission has urged immediate compliance from the remaining candidates and parties.
Kalikot bans loose fuel sales to maintain poll security
The District Administration Office in Kalikot has prohibited the sale of fuel in bottles, jerrycans, and other open containers to prevent misuse ahead of the March 5 election. The District Security Committee authorized only registered fuel stations to operate and warned of strict action against artificial shortages or overpricing. Essential service providers and approved election vehicles will receive fuel as per official recommendations. Nepal Oil Corporation and security agencies will conduct surprise inspections, with violators facing fines or permit suspension.
Govt files 62 cases over substandard food
The Department of Food Technology and Quality Control has lodged 62 lawsuits against firms producing low-quality or contaminated food products. Of these, 34 cases involve quality deficiencies and 20 concern contamination in items such as milk, oil, and spices. During the first half of the fiscal year, expired goods worth Rs 2.9 million were confiscated and destroyed. The department also issued 13 recall notices for bottled water and beverages and introduced mandatory quality standards for traditional products like Chhurpi and Masyoura.
Bagmati cold storage project worth Rs 982 million remains stalled
A Bagmati Province project to construct 12 cold storage facilities, launched seven years ago with a Rs 982 million budget, is still largely inactive. Although facilities in Rasuwa, Dolakha, and Sindhupalchowk are completed, handover delays persist due to unresolved 30–50 percent cost-sharing arrangements with cooperatives and private partners. The Ministry of Agriculture and Livestock Development stated that Rs 138.2 million in partner contributions is pending. Legal disputes and an investigation by the CIAA have further delayed the transfer process.
Proposed shift of fast track zero point may raise costs
Relocating the starting point of the Kathmandu-Tarai/Madhesh Fast Track to Pharsidol could increase both expenses and technical challenges. While the move is being considered due to land disputes in Khokana, experts warn that travel time to central Kathmandu could extend to four hours because of congestion. Khokana remains the most feasible option at Rs 42.169 billion. The Pharsidol alternative is estimated at Rs 42.183 billion, whereas Dukuchhap is projected to be the least costly at Rs 40.285 billion.
Strawberry farming promotes agro-tourism in Bharatpur
Nepal Agrovine Private Limited in Bharatpur Metropolitan City-5 has combined strawberry cultivation with agro-tourism. Covering over 33,863 square meters, the farm offers visitors a fruit-picking experience and attracts students from agricultural colleges. The farm grows American strawberry varieties suited to the plains and employs four permanent and up to 10 daily workers. It also cultivates tomatoes and capsicum. The founders plan to expand the model, citing Nepal’s strong potential for experiential farm tourism.
Chaite rice planting begins in Jhapa as farmers shift to maize
Spring-season Chaite rice planting has started in Kachankawal Rural Municipality of Jhapa. However, the cultivated area is expected to decline by 15–20 percent as farmers increasingly switch to maize due to last year’s unprofitable rice prices of Rs 700 per 40 kg. Interest in the Hardinath-6 variety persists after a private mill offered Rs 1,000 per 40 kg. The district is currently using 10 mechanical transplanters to support planting.
Parbat local units enlist unemployed for national employment scheme
Municipalities in Parbat district, including Modi, Jaljala, Bihadi, and Paiyu, have begun registering unemployed individuals for the National Employment Promotion Program for fiscal year 2026/27. The initiative guarantees at least 100 days of employment in public works for citizens aged 18 to 59. Priority will be given to women, Dalits, marginalized communities, and returnee migrants. Officials believe the program will reduce local unemployment while advancing community infrastructure projects.
Dhankuta to digitize land administration services
The Department of Land Management and Archive has initiated a program in Dhankuta to digitize land administration services. In coordination with Dhankuta, Mahalaxmi, and Pakhribas municipalities, the system aims to enhance transparency and efficiency. Authorities say digitization will reduce delays and increase revenue collection, marking the first such implementation in a hilly district.
Regulator proposes traffic-light system for hydropower costs
The Electricity Regulatory Commission plans to introduce a green, yellow, and red classification system for hydropower projects based on per-megawatt costs. The move is intended to protect investors from high-risk ventures and improve cost transparency. Proposed governance reforms include a two-year cooling-off period for senior officials and mandatory female board representation. CDSC has also suggested separate ISIN codes for founder and public shares to enforce lock-in rules.
Marsyangdi hydropower plant shuts for 21-day maintenance
The 69 MW Marsyangdi Hydropower Center in Tanahun commenced a 21-day shutdown on February 14 for major repairs. Maintenance includes fixing a long-defunct undersluice gate and clearing silt buildup. Crews are working in shifts to complete repairs before March 6, aiming to preserve the plant’s annual output of 451.7 GWh.
Beni hydropower opens IPO for locals and migrant workers
The Beni Hydropower Project will begin its IPO on March 15, offering 2,080,000 shares worth Rs 208 million, equivalent to 20 percent of its capital. Half the shares are reserved for Solukhumbu locals, while 104,000 shares are allocated to Nepali migrant workers. The project has received a Double B Plus rating.
KMC inspects 40 cooperatives to safeguard depositors
Kathmandu Metropolitan City’s Cooperative Department has begun onsite monitoring of 40 cooperatives to assess compliance with the Cooperative Act 2017. Inspection teams are reviewing financial and audit documents to ensure transparency. In previous years, over 12 cooperatives were referred to police for defrauding depositors.
Investors see Bardghat SME village as growth driver
Business leaders expressed optimism that the Bardghat SME Village in Nawalparasi will boost regional development. Organized by the Confederation of Nepalese Industries and local chambers, the initiative aims to strengthen small and medium enterprises. With manufacturing contributing only 5 percent to GDP, experts view such industrial hubs as crucial for achieving a USD 100 billion economy.
Debate erupts over reliance spinning mills listing price
Controversy has arisen after NEPSE fixed Reliance Spinning Mills’ trading range at Rs 100–300, despite shares being issued through book-building at over Rs 820. Experts argue the move undermines the pricing mechanism approved by SEBON. Although prices later climbed to Rs 472.20, investors remain concerned, prompting SEBON to seek clarification.
Hulas finserv applies for IPO at premium
Hulas Finserv Higher Purchase has applied to SEBON to launch an IPO priced at Rs 358.85 per share, issuing 2,075,000 shares to raise Rs 744.6 million. NMB Capital has been appointed as the issue manager. The company aims to expand its hire-purchase credit operations nationwide.
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