KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s economy shows a mix of market optimism and structural challenges, as seen in NEPSE’s sixth consecutive gain and a robust Rs 9.5 billion turnover, buoyed by finance and insurance stocks, even as life insurance payouts declined by 2.45%.
Despite record-high gold prices and idle liquidity in banks exceeding Rs 520 billion, investment remains sluggish, prompting calls from the central bank for better fund mobilization. Meanwhile, lapses in governance—from fertilizer procurement inefficiencies to unchecked LPG subsidy misuse and the absence of a tea policy in Koshi—highlight systemic issues.
Infrastructure projects like the Siddhababa Tunnel near completion, but urban encroachment on key irrigation projects signals threats to long-term sustainability. Trade dynamics are shifting, with a surge in sugar and rice imports and a dip in large cardamom exports, underscoring supply-side vulnerabilities.
The IPO market remains active, reflecting investor interest, while gold traders’ protests and halted chick production point to growing discontent over regulatory and pricing concerns.
NEPSE index rises with Rs 9.5 billion turnover
Nepal Stock Exchange (NEPSE) climbed 2.40 points on Sunday to close at 2,706.36, marking its sixth consecutive day of gains. Market sentiment remained mixed, as 87 stocks advanced and 162 declined. Total trading volume reached Rs 9.5 billion, slightly below the previous session’s Rs 9.64 billion, with 27.1 million shares changing hands. Leading the rally were Nepal Finance (+10%), Guardian Micro Life Insurance (+7.36%), Rapti Hydro (+5.70%), Upper Hewakhola Hydropower (+5.18%), and Janaki Finance (+4.91%). Strong performances by reinsurance companies pushed the finance and other sectors up by 2.49% and 3.06%, respectively.
Hallmark gold price hits Rs 192,100 per tola
The price of hallmark gold rose to Rs 192,100.25 per tola as of Sunday. The rate for 10 grams of gold stands at Rs 164,695.00. Meanwhile, silver remains stable at Rs 2,170.09 per tola.
NEPSE’s 3,000‐point milestone crosses one‐year mark
It has been one year since NEPSE first crossed the 3,000-point threshold. After rising from 2,037 on June 30, 2024, the index reached a record 3,000.81 just 33 trading days later. It briefly peaked at 3,199.03 in mid-August but has not surpassed that level since.
Governor calls for investment as deposits swell
Nepal Rastra Bank Governor Biswo Nath Poudel highlighted the abundance of idle bank deposits—some Rs 520 billion in NRB alone—during a ‘pre-monetary policy’ discussion by SEJON. He urged the financial sector to mobilize these funds into productive investments, citing robust forex reserves as support for balanced economic growth.
NRB withdraws Rs 45 b to mop up excess liquidity
To manage growing liquidity, Nepal Rastra Bank (NRB) withdrew Rs 45 billion from the banking system on Sunday through its deposit-collection auctions. With total banking sector deposits now exceeding Rs 7 trillion, NRB is using tools such as the auction mechanism and Standing Deposit Facility to stabilize interest rates and absorb surplus funds.
Agriculture minister proposes separate body for fertilizer procurement
Agriculture Minister Ramnath Adhikari suggested establishing an independent agency to handle fertilizer procurement, citing delays blamed on the ministry’s involvement. Speaking before the Industry, Commerce, Labor, and Consumer Welfare Committee, he noted that despite efforts, fertilizer deliveries continue to lag.
Life insurance payouts decline by 2.45% this year
Life insurers in Nepal have reduced payouts to policyholders, with total claims settling at NPR 52.64 billion across 238,000 claims by mid-June—a 2.45% drop from last fiscal year’s 268,000 claims worth NPR 53.96 billion.
Gold and silver traders launch nationwide tax protest
Gold and silver merchants plan countrywide demonstrations from Asar 22 to 27 (July 6–11) against what they call an excessive “luxury tax” on jewelry. Organized by the Federation of Nepal Gold and Silver Dealers and the Nepal Gem and Jewelry Federation, the protests will include temporary shop closures until the tax is repealed.
Industrialists exploiting LPG subsidy loopholes
Corporate users have been abusing subsidies intended for household LPG, with many claiming both the subsidy and VAT refunds. Nepal Oil Corporation spends Rs 7.8 b annually on LPG subsidies. Shiva Prasad Ghimire of the Nepal LP Gas Industry Association denounced the practice as unfair and urged redirecting subsidies to domestic consumers.
NOC’s new headoffice nears completion
The Nepal Oil Corporation’s 14-storey central office in Babarmahal is 98% complete, at an estimated cost of Rs 910 million. While construction will wrap up by mid-July, full occupancy may take an additional two months for testing and relocation processes.
British envoy urges easier profit repatriation for tech investors
UK Ambassador Rob Fenn emphasized the need to streamline profit repatriation for foreign investors in Nepal’s tech sector during a Nepal–UK Tech Forum. He also announced plans to form a ‘Nepal–UK Digital Working Group’ to facilitate this process and strengthen bilateral digital collaboration.
Sugar and rice imports surge via Nepalgunj border
Imports of sugar and rice through the Nepalgunj border surged in 2024/25, with sugar imports rising from 214,645 kg (Rs 10.264 m) to 6.422 million kg (Rs 448.891 m) over the first 11 months.
Large cardamom exports fall despite strong global demand
Large cardamom exports dropped in fiscal 2024/25 due to lower domestic output. Customs data shows 3.996 million kg worth Rs 7.198 b was exported in the first 11 months, down from 4.720 million kg worth Rs 7.477 b the previous year.
Urban development encroaches on Sunsari–Morang irrigation canal
The Sunsari–Morang Irrigation Project, serving 68,000 ha, is being encroached upon due to urban expansion. Structures, paved roads, trees, electric poles, and bridges have been built on its service road and canal banks, project chief Manohar Kumar Sah reported.
Key concrete work completed in Siddhababa tunnel
The Siddhababa Tunnel project on the Siddhartha Highway has completed the concrete flooring (invert) of the main tunnel. The project office reported that 1,089 meters of the total 1,126-meter tunnel has now been floored, while 834 meters of internal wall lining is also finished. Project Chief Krishna Raj Adhikari confirmed the work is progressing steadily.
No tea policy in Koshi despite Rs 10 billion annual exports
Stakeholders in Koshi Province have raised concerns over the absence of a dedicated tea policy or legislation to support the local tea industry. The province produces over 50,000 metric tons of green tea leaves annually and exports tea worth more than Rs 10 billion to countries including India, the U.S., Germany, Japan, and various European markets. Despite its significance to the region’s agricultural economy, farmers report being denied fair prices due to the lack of government regulation and support.
Hatchery Association halts chick production to combat syndicate practices
The Nepal Hatchery Industry Association has announced a one-week suspension of chick production and supply—from Asar 23 to 29 (July 7 to 13)—to curb syndicate and price-fixing behavior in the poultry sector. The decision applies to all broiler and colored broiler producers affiliated with the association and is aimed at promoting a fairer marketplace.
Global IME launches new mutual fund ‘Samunnat Yojana 2’
Global IME Bank has launched a new mutual fund scheme, ‘Samunnat Yojana 2’, now open for public subscription. Applications will be accepted until July 9, with a possible extension to July 20 if the issue is not fully subscribed. According to fund manager Global IME Capital, the scheme is projected to offer an average annual return of 22.4%. Applications can be submitted online via MeroShare.
Mabilung Energy opens IPO for migrant workers and locals
Mabilung Energy has opened the first phase of its IPO targeting Nepali migrant workers and project-affected local residents. The company is offering 1,890,530 shares at a face value of Rs 100 each, representing 48.99% of its issued capital of Rs 385.825 million. The IPO opened on Sunday.
Bungal Hydro to issue IPO from July 13
Bungal Hydropower will begin its IPO issuance on Asar 29 (July 13), with shares offered to local project-affected communities and Nepalis living abroad. The company plans to issue 2.9 million shares worth Rs 290.5 million, or 35% of its authorized capital of Rs 830 million.
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