KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
The Nepal Stock Exchange (NEPSE) saw a slight dip of 7.10 points, closing at 2,697.59, amid notable fluctuations in various sectors, particularly the insurance sector, which experienced losses.
Despite this, some companies, like Neco Insurance, saw gains. Gold prices in Nepal also rose by Rs 1,100 per tola, reflecting increased demand. Nepal’s public debt reached Rs 26.76 trillion, raising concerns over fiscal sustainability.
Meanwhile, commercial banks witnessed a rise in deposits, but loan growth remained slow, contributing to a lower Credit-to-Deposit ratio. On the international front, Nepal’s remittance largely comes from Asia, with the Middle East playing a dominant role.
The government’s capital spending in urban development remains low at just 17.43%, reflecting slower progress on infrastructure projects.
Other developments include the arrival of crude edible oil via railway at Birgunj Dry Port, investments by Nepal Telecom in a new billing system, and the launch of Sichuan Airlines’ charter flights between Pokhara and Chengdu.
Additionally, power cuts in the Sunsari-Morang industrial corridor have led to rising production costs, while Nepal’s plywood exports to India have been halted due to certification issues.
Amid rising global vehicle costs, Tata Motors and Maruti Suzuki plan price hikes in Nepal. The country’s growing commitment to electric vehicles is marked by the establishment of new manufacturing plants, signaling progress toward sustainable mobility.
NEPSE drops by 7.10 points
On the third trading day of the week, the Nepal Stock Exchange (NEPSE) index saw a decline of 7.10 points, finishing at 2,697.59 on Tuesday. A total of 77.71 million shares from 312 companies were traded, amounting to over NRs 4.12 billion.
The insurance sector faced losses, with the life insurance sub-index dropping by 0.70% and the non-life insurance sub-index falling by 0.54%.
Neco Insurance saw the highest gain, rising 0.71% to NRs 777.50, while LIC Nepal experienced the largest decline, falling 2.91% to NRs 1,034.
Gold price in Nepal rises by Rs 1,100 per tola
The price of gold in Nepal increased by Rs 1,100 per tola, reaching Rs 175,200 per tola on Tuesday. Silver prices also increased by Rs 10 to Rs 2,050 per tola, according to the Federation of Nepal Gold and Silver Dealers’ Association.
Nepal’s public debt reaches Rs 26.76 trillion
As of Falgun, Nepal’s total public debt has risen to Rs 26.76 trillion, which represents 46.91% of the country’s GDP.
This increase from Rs 24.34 trillion in Asar includes internal debt of Rs 13.15 trillion and external debt of Rs 13.60 trillion. The government had planned to raise Rs 5.47 trillion in public debt this year, with Rs 3.34 trillion raised by Falgun.
Kathmandu Police seize foreign currency worth Rs 250 million
Police in Kathmandu have seized foreign currency totaling nearly Rs 250 million, including US dollars and euros, from a vehicle in Tokha.
The Kathmandu Valley Crime Investigation Office arrested an individual involved in transporting the money. Authorities are continuing investigations, and a detailed briefing is expected later today.
Banks experience increased deposits
Nepal’s commercial banks are seeing higher demand for loans, but lending growth is lagging behind deposit increases.
As of mid-March, bank lending grew by 6.12%, while deposits rose by 5.62%. Despite an influx of Rs 40 billion in deposits in February, only Rs 22.74 billion was lent out.
Over two-thirds of Nepal’s remittance comes from Asia
A report by Nepal Rastra Bank shows that more than two-thirds of Nepal’s remittance comes from Asia, with the Middle East contributing 41.88% and the Asia-Pacific region 24.63%.
North America accounts for 13.25%, while other regions contribute 20.24%. Despite a rise in student migration, remittance from Europe and Australia remains low.
Urban Development Ministry’s Capital Budget Spending at 17.43%
The Ministry of Urban Development has spent just NPR 11.12 billion (17.43%) of its Rs 63.83 billion capital budget during the current fiscal year. Out of 3,716 new projects, 1,623 have invited bids, 1,098 have signed contracts, but only 124 projects have been completed.
First railway tanker containers deliver crude edible oil to Birgunj Dry Port
For the first time, crude edible oil has arrived at Birgunj Dry Port by railway tanker containers. The shipment, consisting of 90 containers carrying 20,000 metric tons of soybean oil from Argentina, reduces costs and transit time by 15%, compared to road transport.
Nepal Telecom to Invest Rs 5 Billion in New Billing System
Nepal Telecom plans to invest Rs 5 billion in a new Convergent Real-Time Billing (CRTB) and Customer Support (CS) system to improve service efficiency.
An international tender has been issued, and applications are due by April 24, 2025.
Sichuan Airlines begins regular charter flights on Pokhara-Chengdu route
Sichuan Airlines has launched weekly charter flights between Pokhara and Chengdu, marking a significant development for Pokhara International Airport. The first flight on March 18 was fully booked, highlighting the airport’s capacity to handle larger aircraft. This move is expected to boost tourism and connectivity between Nepal and China.
Tata and Maruti Suzuki vehicle prices to rise in Nepal from April
Tata Motors and Maruti Suzuki will increase vehicle prices in Nepal starting in April 2025. Tata will raise prices by up to 2% due to higher global automobile costs, while Maruti Suzuki will increase prices by up to 4% because of rising import and operational costs.
Nepal’s plywood exports to India halted
Plywood exports from Nepal to India have been halted after India’s Bureau of Indian Standards (BIS) failed to issue the necessary quality certificates.
This disruption, which affects exports worth over Rs 4.5 billion annually, could cost Nepal 2,500 jobs and push the country toward exporting veneer instead.
Electric vehicle manufacturing expands in Nepal
Nepal is seeing an increase in local vehicle assembly and manufacturing, with TBD Infratech setting up a plant in Makwanpur to produce electric motorcycles, scooters, and cars. This expansion reflects the country’s growing commitment to electric vehicles.
Sunsari-Morang industries face 12-hour power cuts
Industries in the Sunsari-Morang corridor now face 12-hour daily power outages, causing a 30% reduction in production. Steel manufacturers have raised TMT rod prices by Rs 8 per kg, with more increases expected. Industrialists blame power mismanagement, which could lead to higher costs for consumers.
Insurance sector experiences decline amid NEPSE volatility
The insurance sector faced losses on NEPSE, with life insurance down by 0.70% and non-life insurance down by 0.54%.
Among the nine gaining stocks, Neco Insurance rose by 0.71% to NRs 777.50, while LIC Nepal saw the biggest drop, falling 2.91% to NRs 1,034.
84 companies await IPO approval
A total of 84 companies, including three micro-insurance firms, are seeking approval for IPOs to raise Rs 53 billion.
The hydropower sector leads with 44 companies, while other sectors, including manufacturing and tourism, also have pending applications.
Insurance companies turn to rights shares to meet capital requirements
Following a directive from the Nepal Insurance Authority to raise paid-up capital, ten insurance companies are issuing rights shares. Life insurers are required to raise capital to Rs 5 billion, while non-life insurers must increase capital to Rs 2.5 billion.
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