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 and disaster-related developments present a mixed picture: strong external-sector fundamentals are supporting macroeconomic stability, while severe flooding is creating significant infrastructure and humanitarian pressures. Foreign exchange reserves increased 45.6 percent to Rs 38.976 billion, covering nearly two years of merchandise imports, while remittance inflows rose 37.1 percent to Rs 23.631 billion.
The country also recorded substantial current-account and balance-of-payments surpluses, indicating improved external resilience. However, annual average inflation fell to 3.08 percent, while point-to-point inflation accelerated to 5.14 percent, suggesting renewed short-term price pressures.
Financial markets remained relatively subdued. The NEPSE index slipped marginally to 2,557.31 points, accompanied by lower turnover, although eight of 13 sub-indices advanced. Gold and silver prices also declined, reflecting softer domestic precious-metal prices.
Meanwhile, the Bhote Koshi flood has imposed considerable economic and logistical costs. Infrastructure damage is estimated at Rs 20 billion, with roads and dozens of bridges destroyed, disrupting connectivity across several districts. Electricity restoration through alternative transmission arrangements demonstrates the authorities’ efforts to maintain essential services, while solar power banks provide temporary energy access in severely affected communities.
The scale of the disaster has prompted substantial domestic and international assistance. Banks and institutions contributed Rs 273.3 million, India supplied 37.5 tonnes of relief materials, the IFRC released nearly CHF 1 million, and the US pledged USD 500,000. Government plans to increase allowances for frontline security personnel further underscore the intensity of the ongoing response. Overall, Nepal’s strong macroeconomic buffers provide resilience, but rebuilding damaged infrastructure and sustaining relief operations will require significant resources.
NEPSE index falls 1.04 points
The Nepal Stock Exchange (NEPSE) index declined by 1.04 points to close at 2,557.31 points on Thursday. The total trading turnover also decreased, falling to Rs 3.78 billion from Rs 4.77 billion recorded on Wednesday. Of the 13 sub-indices, eight posted gains, with the Manufacturing and Processing sub-index recording the largest increase of 1.75 percent. The remaining five sub-indices ended the session lower. Sarbottam Paints recorded the strongest gain among individual companies, rising by Rs 181.90 to reach Rs 1,394.80 and hitting the positive circuit limit. Meanwhile, Upper Hewakhola Hydropower Company recorded the largest decline, dropping 9.45 percent. Shivam Cements led the market in trading volume, with shares worth Rs 217.5 million changing hands. Nepal SBI Bank and Chilime Hydropower Company followed in terms of transaction value.
Gold falls to Rs 320,900 per tola, silver to Rs 4,965
Gold prices declined in Nepal’s domestic market on Thursday, according to the Federation of Nepal Gold and Silver Dealers’ Association. The price of fine gold fell by Rs 1,030 per tola, with one tola equivalent to 11.66 grams, to settle at Rs 320,900. Gold had traded at Rs 322,100 per tola on Wednesday. Silver prices also decreased by Rs 10 per tola. The metal was priced at Rs 4,965 per tola on Thursday, down from Rs 4,975 recorded a day earlier.
Annual consumer inflation stands at 3.08 percent
Nepal’s annual average consumer inflation stood at 3.08 percent during fiscal year 2025/26, down from 4.06 percent recorded in the previous fiscal year, according to official macroeconomic data released by Nepal Rastra Bank. However, annual point-to-point consumer inflation reached 5.14 percent by July 16, compared with 2.20 percent during the same period a year earlier, indicating an increase in price pressures. Within the food and beverage category, prices of ghee and oil increased by 10.05 percent, while the indices for vegetables and legumes declined. In the non-food and services category, miscellaneous goods and services recorded a significant increase of 17.61 percent. Education and transportation costs also registered moderate increases across the provinces covered by the statistical reporting system.
NRB removes digital transaction limits for disaster relief contributions
The Payment Systems Department of Nepal Rastra Bank (NRB) has removed the existing digital transaction limits for financial contributions made to designated government disaster relief funds. In a circular issued on Thursday, NRB announced that the limits would not apply to contributions transferred through mobile banking, internet banking and digital wallets to the Prime Minister Disaster Relief Fund and the Prime Minister Relief Fund. The government has established dedicated accounts at major commercial banks, including Rastriya Banijya Bank, Nepal Bank, Agriculture Development Bank, Everest Bank, Global IME Bank, Nabil Bank, Standard Chartered Bank, Himalayan Bank and Laxmi Sunrise Bank. The accounts are intended to facilitate the collection of financial assistance and support immediate relief efforts for people severely affected by monsoon floods and landslides.
Foreign exchange reserves rise by 45.6 percent
Nepal’s total foreign exchange reserves increased by 45.6 percent to Rs 38.976 billion by the end of fiscal year 2025/26, according to data released by Nepal Rastra Bank (NRB). Of the total reserves, NRB held Rs 34.731 billion, while commercial banks and other financial institutions accounted for Rs 4.244 billion. In US dollar terms, the country’s total foreign exchange reserves reached USD 25.31 billion by the end of the fiscal year. According to the latest economic indicators, the reserves are sufficient to cover approximately 23 months of merchandise imports. They can also cover around 19.6 months of imports of both merchandise and services, indicating a strong reserve position.
Govt. assures adequate resources for disaster response
Finance Minister Dr. Swarnim Wagle has assured that the government will make sufficient resources available for rescue, relief and reconstruction following floods, landslides and inundation. Speaking after a meeting of senior leaders from major political parties at Singha Durbar on Thursday, Wagle said search and rescue efforts for missing and stranded Nepali citizens and foreign tourists had been intensified. He said 22 helicopters were being used in the operations despite difficult weather and challenging terrain. Wagle said around Rs 25 billion in assistance had been secured from the World Bank, while China, India, Japan, the Asian Development Bank and the International Federation of Red Cross and Red Crescent Societies (IFRC) had also pledged support. The government has allocated Rs 10 billion for disaster management. Meanwhile, Rs 2.34 billion remains available in the Prime Minister’s Disaster Relief Fund and Rs 1.17 billion in the Home Ministry’s disaster fund. Preliminary assessments indicate that 25 bridges and hydropower projects with a combined capacity of around 700 MW have sustained damage.
500 solar power banks supplied to flood-hit Nuwakot and Rasuwa
The Ministry of Energy, Water Resources and Irrigation has supplied 500 solar power banks to flood- and disaster-affected areas of Nuwakot and Rasuwa to provide an alternative source of electricity. The power banks were distributed through the Alternative Energy Promotion Centre to meet the immediate electricity needs of communities where regular power services have been disrupted. The portable devices can be used to charge mobile phones and operate approximately four to five lights. They are expected to help affected residents maintain essential communication and lighting during the ongoing disaster situation. The ministry said the initiative is intended to provide temporary alternative energy services and ensure continued access to basic electricity while regular power supplies remain disrupted.
Remittance inflows reach Rs 23.631 billion in last FY
Nepal received remittance inflows totaling Rs 23.631 billion during fiscal year 2025/26, according to the latest macroeconomic report released by Nepal Rastra Bank (NRB) on Wednesday. The amount was significantly higher than the government’s original budget allocation of Rs 19.641 billion. The allocation was later revised downward to Rs 16.883 billion during the mid-term review because of difficulties in implementation. Remittance inflows grew by 37.1 percent during the fiscal year, marking a substantial acceleration compared with the previous fiscal period. The strong growth in remittances contributed to the country’s favorable external-sector position, with current account and foreign exchange reserves also maintaining significant surpluses during the period.
Govt. plans higher allowances for security personnel deployed in disasters
The government has decided to revise allowances and daily snack expenses for security personnel involved in frontline search, rescue and relief operations during floods, landslides, fires and other disasters. The decision was taken during Thursday’s meeting of the Executive Committee of the National Disaster Risk Reduction and Management Authority (NDRRMA). The committee agreed to review service facilities for personnel from the Nepal Police, Armed Police Force (APF) and Nepal Army engaged in disaster response activities. According to the authority, the revision is aimed at recognizing and encouraging security personnel who carry out high-risk operations while putting their lives in danger. The government believes that improved service facilities will boost the morale of frontline responders and help make disaster response more effective, timely and results-oriented. Following the committee’s decision, the concerned security agencies have been instructed to submit proposals to their respective line ministries. The ministries will then take the necessary decisions regarding the revision of the facilities.
External sector records strong surplus
Nepal maintained a strong external-sector position during fiscal year 2025/26, recording a current account surplus of Rs 9.235 billion and a balance of payments surplus of Rs 10.27 billion, according to data released by Nepal Rastra Bank. In US dollar terms, the current account surplus amounted to USD 6.33 billion, while the overall balance of payments surplus stood at USD 7.05 billion. Net capital transfers totaled Rs 185 million during the period, while foreign direct investment equity inflows reached Rs 284.9 million. The figures indicate continued strength in Nepal’s external-sector indicators, with the country maintaining substantial surpluses in key areas of its external accounts.
Bhote Koshi flood causes estimated Rs 20 billion in infrastructure damage
The flash flood in the Bhote Koshi River has caused extensive damage to roads and bridges, with preliminary estimates putting the total infrastructure loss at around Rs 20 billion. According to the Department of Roads, approximately 40 kilometers of roads have been washed away in Nuwakot and Rasuwa. In addition, 32 concrete bridges have been completely destroyed across Rasuwa, Nuwakot, Dhading and Chitwan. Department spokesperson Shubharaj Neupane said that only six of the 41 concrete bridges along the Chitwan-Rasuwa corridor remain safe, while three others have suffered structural damage. The floods have also swept away 45 suspension bridges connecting Rasuwa and Dhading, disrupting direct transportation links between several areas. The Betrawati Bridge and the main bridge over the Malekhu Khola are among the key structures affected by the disaster.
Electricity restored in Battar and Trishuli Bazar after Bhote Koshi flood
Electricity has been restored in Battar, Trishuli Bazar and nearby areas of Nuwakot after the Bhote Koshi River flood disrupted the regular power supply, according to the Secretariat of Energy, Water Resources and Irrigation Minister Biraj Bhakta Shrestha. The Nepal Electricity Authority (NEA) restored the service through an alternative arrangement by energizing the Balaju-Trishuli and Chapali-Devighat 66 kV transmission lines at 11 kV. The flood had damaged the regular electricity distribution system, prompting the NEA to use available transmission infrastructure to reconnect the affected areas. Power has now resumed in Battar, Trishuli Bazar and surrounding locations. The NEA said it is continuing work to restore electricity to all affected areas while accelerating the repair and rehabilitation of infrastructure damaged by the flood.
India sends 37.5 tonnes of relief supplies to flood-hit Rasuwa
India has dispatched a second consignment of humanitarian and disaster relief supplies to communities affected by the floods in Rasuwa. Indian External Affairs Minister S. Jaishankar said in a social media post Thursday morning that India had sent 37.5 tonnes of relief materials to Nepal. Jaishankar said India remained in regular communication with Nepali authorities and was committed to supporting the country’s disaster relief efforts. India had previously sent 10 tonnes of relief supplies to Rasuwa on Wednesday night. The assistance includes humanitarian aid, disaster response materials, food and essential medicines for flood-affected communities.
Banks and institutions contribute Rs 273.3 million to Rasuwa flood relief fund
Banks, companies and other institutions have begun making financial contributions to the Prime Minister’s Disaster Relief Fund to support search, rescue, relief and rehabilitation operations in flood-hit areas of Rasuwa. The Ministry of Finance said Thursday that Rs 273.3 million had been collected from various contributors within a six-hour period through the government’s one-door mechanism for receiving disaster assistance. Nepal Infrastructure Bank (NIFRA) contributed Rs 25 million, while Kamana Sewa Bikas Bank provided Rs 2.5 million. The ministry said additional contributions had also been received from various companies and institutions to support relief, rescue and rehabilitation activities in the affected areas.
IFRC releases emergency funds for Bhotekoshi-Trishuli flood response
The International Federation of Red Cross and Red Crescent Societies (IFRC) is releasing nearly CHF 1 million, equivalent to approximately Rs 189.545 million, in emergency funding to support the Nepal Red Cross Society (NRCS) in responding to severe flash floods in Nepal. According to an IFRC statement, the funding is being provided through the organization’s Disaster Response Emergency Fund (DREF). It will enable the NRCS to address urgent needs while response teams assess the extent of the damage and identify communities requiring immediate assistance. The IFRC said the immediate priority is to reach affected communities and provide assistance to people who have lost their homes, sustained injuries or become isolated because of the floods. The organization is closely monitoring the situation and has indicated that additional assistance could be provided if the needs increase. The NRCS has already begun distributing drinking water and emergency supplies, including tarpaulins, blankets, sleeping mats, first aid kits, stretchers and body bags. The IFRC is supporting the NRCS through emergency financing, operational coordination and technical assistance. Regional and global teams are also on standby to provide additional resources and international support if necessary.
US provides USD 500,000 in emergency assistance for Nepal flood response
The United States Department of State has announced USD 500,000 in immediate humanitarian assistance for disaster response and relief efforts following the severe flash floods in Nepal’s Bhote Koshi River. In a statement issued by the Office of the Spokesperson, the US government expressed condolences to those who lost their lives and to families affected by the disaster. The funding will be provided through Catholic Relief Services (CRS), a global US partner, to deliver emergency shelter, essential relief supplies and water, sanitation and hygiene (WASH) assistance to communities hardest hit by the floods. The US State Department is also deploying a disaster response advisor to the region to support local authorities in coordinating immediate relief operations. Meanwhile, the US Embassy in Kathmandu is working with Nepali security agencies and local authorities to locate and assist American citizens in affected areas. The embassy has advised US nationals requiring urgent assistance to contact [email protected], follow safety instructions issued by local authorities and register with the Smart Traveler Enrollment Program (STEP).
Everest Bank announces 15 percent dividend for shareholders
The board of directors of Everest Bank has decided to distribute a total dividend of 15 percent to shareholders from the bank’s profits for fiscal year 2025/26. At a meeting held Thursday, the bank approved a 5 percent bonus share dividend and a 10 percent cash dividend for tax purposes. Everest Bank currently has a paid-up capital of Rs 13.621 billion. In the previous fiscal year, the bank had distributed a total dividend of 20 percent to its shareholders.
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