KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Nepal’s recent economic and business landscape reflects a mixed outlook, with significant movements across sectors. The NEPSE index dropped by 35.09 points amid broad-based sectoral losses, signaling subdued investor sentiment, while gold prices rose modestly, indicating a shift to safer assets.
Despite optimism from the government and private sector support for the FY 2025/26 monetary policy, economic growth remains underwhelming, with the public yet to feel tangible benefits. In infrastructure and energy, notable developments include progress on hydropower projects like Super Trishuli and Betan Karnali, and initiatives by the Electricity Regulatory Commission to streamline PPAs and assess real project costs.
On the financial front, Nabil Bank’s upcoming debenture issuance and Bandipur Cable Car’s IPO indicate continued capital market activity. However, delays in government payments to NEA, underwriting issues in insurance, and unfinished infrastructure projects like pedestrian bridges in Kathmandu expose gaps in governance and accountability.
Meanwhile, the rise of e-commerce, foreign investment from ventures like CG-Reliance, and targeted local development efforts such as disaster mitigation in Jumla highlight both growing opportunities and persistent challenges in Nepal’s evolving economic narrative.
NEPSE drops by 35.09 points to settle at 2,726
The Nepal Stock Exchange (NEPSE) index saw a notable decrease today, sliding by 35.09 points to close at 2,725.71, representing a 1.27 % decline. A total of 211 million shares from 321 companies changed hands across 72,601 trades, generating NPR 8.17 billion in turnover. Sector-wise, hydropower was the only gainer with a 0.15 % uptick. All other sectors fell: banking led losses with a 2.46 % drop, followed by development banks (−1.48 %), finance (−1.13 %), hotels and tourism (−0.25 %), investment (−1.25 %), life insurance (−1.36 %), and manufacturing & processing (−0.78 %).
Gold price increases on Monday in Nepal’s market
The price of gold rose by NPR 400 per tola on Monday, as per data from the Federation of Nepal Gold and Silver Dealers Association. Hallmark gold is now priced at NPR 193,300 per tola, up from NPR 192,900 on Sunday. Silver prices also saw a slight rise.
Two thirds govt fails to spark economic growth
Despite being run by a two thirds majority coalition of the Nepali Congress and UML, the government has not delivered the anticipated economic boost within its first year. Although some indicators have improved since its inception, experts note that citizens have yet to feel substantial benefits. Nonetheless, the government and Finance Ministry maintain that economic activity has “taken a leap.”
ERC to review and simplify PPA templates
The Electricity Regulatory Commission (ERC) is set to revise its Power Purchase Agreement templates. Currently, distinct PPA formats are used depending on project ownership—such as Chhime and Rasuwagadhi under NEA, Khimti and Bhote Koshi with foreign investors, and those by private entities. ERC aims to streamline these templates to ease investor concerns.
NEA still unpaid by govt despite requests for loan
The Nepal Electricity Authority (NEA) has not received over NPR 1.4 billion from various government levels, despite requesting a nearly NPR 1 billion loan to settle contractors’ dues. According to Executive Director Hitendra Dev Shakya, the outstanding amount includes electricity sold at subsidized rates—up to 50 % discounts—during COVID 19 to cold storage and jute industries under government-directed policies.
FNCCI and NCC applaud FY 2025/26 monetary policy
The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and the Nepal Chamber of Commerce (NCC) have welcomed the FY 2025/26 monetary policy, viewing it as supportive of economic momentum and financial facilitation. They highlighted revised guidelines on working capital loans that better match business types with repayment cycles and urged extending similar provisions to production sectors and construction.
Electricity regulatory commission to study true cost of hydropower
The ERC announced in its FY 2025/26 annual plan a study to ascertain the actual production costs of hydropower projects, amid unclear cost distributions. While current estimates place average cost per megawatt at around NPR 200 million, government-run projects appear costlier than private ones. ERC intends to use this study to establish accurate benchmarking.
Paddy plantation at 59 % nationwide
Around 59 % of the nation’s paddy has been planted as of Asar 29 (July 13), covering 816,405 hectares, according to the Ministry of Agricultural Development. This is ~8 % less than last year. Sudurpaschim Province leads with approximately 164,000 hectares planted—about 93 % of its target.
Online shopping surging thanks to social media ads
The convenience of buying from home has fueled a boom in online shopping, especially after seeing ads on social platforms such as Facebook, Instagram, WhatsApp, and TikTok. While e commerce continues to grow with technological advances, consumer deception remains a significant concern.
Pedestrian overpasses in Kathmandu languish unfinished
Several pedestrian overpasses along Kathmandu’s Ring Road remain in disuse. Some, like the Balkhu overpass, previously abandoned, are now under construction, yet pedestrians continue to risk unsafe crossings due to incomplete infrastructure.
Rising complaints in financial underwriting at insurance regulator
The Nepal Insurance Authority is seeing an uptick in complaints about financial underwriting, where agents sell policies unaffordable to clients to earn higher commissions. Regulations require agents to assess clients’ financial capacity before setting premiums, but this isn’t always followed. The Authority stresses the need for tighter controls.
Super Trishuli hydropower project 35 % complete
The 100 MW Super Trishuli Hydropower Project, straddling Gorkha and Chitwan, has reached 35 % completion. So far, three out of five gates have been built. Project head Gangesh Karn said that despite challenges, progress is swift. The plant, employing Taiwanese technology, is designed for a capacity of 7,800 cusecs and built to endure major floods.
Uplift project invests NPR 7 million in disaster risk mitigation in Jumla
The Uplift Project in Jumla has allocated NPR 7 million for disaster risk and earthquake resilient infrastructure. Partnering with Sinja Rural Municipality, Caritas Germany, and PACE Nepal Jumla, the initiative has been building preparedness and capacity in wards 2, 3, and 6 of Sinja.
Export subsidies to be replaced by production based incentives
The government plans to replace export subsidies with incentives tied to production, as detailed in point 372 of the FY 2025/26 budget’s “frugality policy.” A new subsidy policy will target funding more efficiently across federal, provincial, and local governments to avoid duplication.
Nepal Oil Corporation wins land dispute case in Jhapa
The Nepal Oil Corporation (NOC) has won a land dispute concerning 23 bigha, 3 kattha, and 13 dhur in Mechinagar–13, Jhapa. Local claimants Chhatrabahadur and sister Rita Karki had alleged encroachment on 2 bigha of land and fencing. On Sunday, Judge Prakash Kumar Adhikari ruled the claim unfounded.
Nabil Bank to issue NPR 3 billion in debentures
Nabil Bank is preparing to issue debt securities worth NPR 3 billion starting from Shrawan 6 (July 22). The “Nabil Debenture 2032” will span a 7 year term, offering 3 million units at a face value of NPR 1,000 each. Of these, 60% (1.8 million units) will be allocated privately, while the remaining 40% (1.2 million units) will be offered to the general public.
InDrive hosts ‘Drivers Meet & Greet’ in Kathmandu
Ride-hailing platform InDrive organized a ‘Drivers Meet & Greet’ event in Kathmandu to recognize the efforts of its drivers and promote engagement. The gathering featured direct conversations with drivers, who shared their personal experiences and challenges.
Betan Karnali hydro project receives generation license
The 439 MW Betan Karnali Hydropower Project has received an official generation license from the government. The Ministry of Energy, Water Resources, and Irrigation issued the permit on Sunday, with Secretary Suresh Acharya presenting the license to Krishnaprasad Acharya, CEO of Betan Karnali Sanchayakarta Hydropower Co. Ltd. The project is located on the Karnali River.
Bandipur Cable Car & Tourism IPO to open from July 22
Bandipur Cable Car & Tourism Limited will open its initial public offering (IPO) on Shrawan 6 (July 22), with initial allotments set aside for locals affected by the project and Nepali workers abroad. Out of the company’s NPR 2.83 billion capital, 20.70%—or 5.86 million shares—will be made available to the public. Each share is priced at NPR 100. Of this, 566,000 shares are reserved for affected locals. Nepal SBI Merchant Banking will manage the issuance.
Life Care Distributor’s revenue falls by 13 %
Life Care Distributor reported a 13% drop in business in 2024 compared to the previous year. Revenue declined from NPR 1.06 billion in 2023 to NPR 875 million in 2024, continuing a downward trend in the company’s financial performance.
Reliance–Chaudhary Group JV acquires soft drink plant in Makwanpur
Reliance Group of India, led by billionaire Mukesh Ambani, has entered Nepal’s beverage manufacturing sector through a joint venture with the Chaudhary Group (CG). Their joint company, CG Reliance Beverage Pvt. Ltd., has acquired Ventuchura Bottlers Pvt. Ltd., a soft drink plant based in Manahari, Makwanpur.
Comment