KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
The compiled reports depict a mixed but largely cautious economic and development landscape in Nepal, marked by financial market weakness, policy adjustments, and uneven sectoral performance. The stock market declined alongside softer trading, reflecting investor caution, while commodity prices showed divergence with gold easing and silver rising.
Authorities responded to excess liquidity through monetary tightening measures, even as financial institutions announced dividends, leadership changes, and new IPO plans, signaling underlying stability in banking and insurance. On the policy front, the government moved to ease public burdens by reversing migrant medical fees and considering lower embossed plate costs, while also seeking to stimulate investment through revised hydropower tariffs and new large-scale energy proposals.
Infrastructure and development challenges persist, highlighted by delayed road projects, abandoned hydropower equipment, and climate-related agricultural losses, yet targeted interventions—such as solar mini-grids in remote areas and grant invitations for subnational governments, show continued efforts toward inclusive growth.
Overall, the narrative reflects an economy balancing short-term pressures, governance corrections, and long-term development ambitions amid structural and environmental constraints.
NEPSE index drops by 19.92 points
The Nepal Stock Exchange (NEPSE) slipped below the 2,600 level on Sunday, shedding 19.92 points to close at 2,595. Trading activity also weakened slightly, with turnover declining to Rs 4.52 billion from Rs 4.57 billion in the previous session. While SY Panel reached the 10 percent upper circuit, share prices of 207 companies declined. The hotel and tourism index recorded the biggest loss, falling 1.63 percent. Sindhu Bikash Bank hit the 10 percent lower circuit, while Swastik Laghubitta recorded the highest turnover of the day.
Gold price dips as silver records gains
Gold prices declined slightly on Sunday, while silver prices moved upward. According to the Federation of Nepal Gold and Silver Dealers’ Association, gold is being traded at Rs 258,300 per tola, down Rs 100 from the previous day. Silver, however, rose by Rs 100 to reach Rs 4,105 per tola. In the international market, gold was trading at USD 4,341 per ounce.
NRB to mop up Rs 20 billion to manage excess liquidity
Nepal Rastra Bank (NRB) has announced plans to withdraw Rs 20 billion from the banking system today through a deposit collection instrument. The decision comes as total deposits in banks and financial institutions have surged to a record Rs 7.5 trillion, creating excess liquidity and putting downward pressure on interest rates. Institutions from categories A, B, and C are eligible to participate in the bidding process. The central bank said the move aims to stabilize the financial system, with the collected funds set to mature on March 15, 2026.
Commission proposes dual-tariff option for storage hydropower projects
The Electricity Regulatory Commission has released a draft guideline proposing a new tariff structure for storage-based hydropower projects, offering developers a choice between single-part and dual-part tariffs. Under the existing single-part system, rates are set at Rs 12.40 for winter (December 2, 2025 to May 29, 2026) and Rs 7.10 for summer. The proposed dual-part tariff separates charges for energy and declared capacity availability to attract investment. Eligible projects must have water storage sufficient for 15 days of full-capacity operation, with at least 35 percent of annual energy generated during the dry season. For tariff calculations, equity investment will be capped at 30 percent.
Govt restores previous medical test fees for migrant workers
The Ministry of Labor, Employment, and Social Security has reversed the recent increase in medical examination fees for migrant workers, reinstating the earlier rates. Labor Minister Rajendra Singh Bhandari overturned the decision taken by former minister Sharat Singh Bhandari, which had raised the fee from Rs 6,500 to Rs 9,500. The hike had drawn strong criticism for placing an additional Rs 3,000 burden on workers. Ministry spokesperson Pitambar Ghimire confirmed that health institutions must now charge the old rates, easing costs for those seeking employment in the Gulf countries and Malaysia.
Ministry invites grant proposals for next fiscal year
The Ministry of Federal Affairs and General Administration has called on provincial and local governments to submit proposals for federal supplementary and special grants. Following the first amendment to the Supplementary and Special Grant Procedures, 2025, proposals must be submitted by mid-February 2026 through the National Planning Commission’s electronic system. The ministry said the timeline aligns with constitutional requirements for the federal budget, ensuring that proposed projects are considered in planning and resource allocation for the upcoming fiscal year.
Minister Ghising warns Narayanghat–Butwal contractor during site visit
Minister for Physical Infrastructure and Transport Kulman Ghising has warned that the contractor of the Narayanghat–Butwal road section could face contract termination if work does not accelerate. During an inspection, he noted that although overall physical progress stands at 76 percent, blacktopping and bridge construction remain far behind schedule despite four deadline extensions. The minister also inspected the Model District Headquarters project in Kawasoti, which has a total master plan cost of Rs 16.255 billion. He instructed that the current phase of integrated office buildings, worth Rs 3.61 billion, be completed without further technical delays.
Minister Kulman Ghising floats 225 MW Saptagandaki hydropower plan
Minister for Physical Infrastructure and Transport Kulman Ghising has proposed developing the 225 MW Saptagandaki Multipurpose Hydropower Project near the Devghat religious site. Speaking at a program in Narayangarh on Saturday, he said the dam height could be reduced to prevent submergence of the pilgrimage area while still utilizing storage benefits from upstream projects such as Budhigandaki. First studied by JICA in 1985, the project is designed to control river erosion in Chitwan and Nawalparasi and support irrigation and inland water transport. Ghising described it as a key project for boosting the Bharatpur–Butwal–Pokhara “Green Triangle” economic corridor.
Committee recommends cutting embossed number plate fees
A government-formed study committee has recommended reducing the cost of embossed number plates, stating that current fees are excessively high for the public. Present charges range from Rs 2,500 for two-wheelers to Rs 3,600 for heavy vehicles. The committee found that production costs are around Rs 2,200, with higher fees imposed to cover infrastructure and software expenses. It also noted that the 2016 contract with a Bangladesh–USA joint venture for producing 2.5 million plates remains incomplete, while changing the plate language from English to Nepali poses legal complications.
Electrical equipment worth Rs 110 million left unused in Jumla
Electrical equipment valued at Rs 110 million for the Tila Hydroelectric Project in Jumla has been left abandoned on the streets following the project’s suspension. The 1 MW project, launched in fiscal year 2017/18 with funding from the Infrastructure Development Fund, is currently inactive. Local residents have protested the neglect, saying the equipment—purchased with public funds to expand electricity access in remote areas—is being wasted. Current officials said the materials were procured during the tenure of the previous leadership but remain unused.
Solar mini-grids light up remote Himalayan settlements
Two solar mini-grid projects have begun delivering electricity to remote areas of Sudurpashchim that are beyond the national grid. In Darchula, the 53 kW Chhangru Solar Mini-Grid, built at a cost of Rs 41.3 million, is now supplying power to 112 households and four government offices. In Saipal Rural Municipality of Bajhang, a 68 kW mini-grid costing Rs 62.2 million is nearing completion and is expected to become operational between mid-January and mid-March 2026. Supported by the Alternative Energy Promotion Center with a 10 percent local labor contribution, the projects have replaced unreliable micro-hydropower plants that often failed during snowfall and floods.
Baglung orange growers struggle with low farm-gate prices
Orange farmers in Baglung, particularly in well-known production areas such as Sigana, are facing financial strain due to low prices offered by traders. While oranges sell for more than Rs 120 per kilogram in city markets, farmers receive only Rs 40 to Rs 50 per kilogram at the farm gate. The district produced 4,071.6 metric tons of oranges last year, valued at Rs 264.6 million. Farmers say the lack of direct market access has allowed middlemen to earn disproportionate profits, leaving both producers and consumers disadvantaged.
Nepalgunj amends economic law, reallocates budget for repairs
The municipal assembly of Nepalgunj Sub-Metropolis has endorsed amendments to the Economic Act 2025 along with the Public Policy Partnership Act. In response to infrastructure and vehicle damage caused during Gen Z-led protests, the assembly redirected 5 percent of ward-level budget ceilings toward reconstruction and maintenance. Operating with an annual budget of around Rs 1.64 billion, the sub-metropolis also approved a monthly allowance of Rs 1,000 for 200 contract employees, effective from this month. The meeting, chaired by Mayor Prashant Bista, emphasized urban beautification and better management of e-rickshaws.
NIC Asia Bank chairman Tulsiram Agrawal steps down
NIC Asia Bank chairman Tulsiram Agrawal has resigned from his post, citing personal reasons. The resignation was tendered and accepted during a board meeting on Sunday, according to Chief Information Officer Jayendra Rawal. The bank has yet to name a successor, though a decision is expected soon. The move follows a recent change in the bank’s chief executive leadership and signals an ongoing strategic shift toward more balanced governance.
Erratic rainfall reduces paddy output in Bhojpur
Paddy production in Bhojpur declined this year as irregular weather disrupted the farming cycle. Output dropped to 36,998 metric tons from last year’s 37,790 metric tons due to delayed monsoon rains during transplantation and unseasonal rainfall afterward. The cultivated area also decreased from 12,154 hectares to 11,500 hectares. Around 78 hectares of farmland suffered partial or complete damage from floods. Although 96 percent of the district completed plantation, shifting climate patterns significantly affected yields, particularly in low-lying river basin areas.
Around 30,000 people from Karnali seek foreign jobs each year
Nearly 30,000 individuals from Karnali Province apply for foreign employment permits annually. In fiscal year 2024/25 alone, 28,049 people obtained labor permits, with Salyan leading at 7,587 applicants, followed by Surkhet with 6,387. Speaking at an event marking International Migrants Day, SaMi program manager Kamal Bahadur Rokaya said that 264 migrants from Karnali have died abroad so far. Government officials noted that the SaMi program now operates in 51 local units, offering counseling and fraud prevention support as limited domestic job opportunities continue to push youth overseas.
Global IME Microfinance and Suryajyoti Life declare dividends
Two financial institutions have announced dividend proposals after concluding board meetings. Global IME Microfinance has proposed a 5 percent dividend, comprising 4.75 percent bonus shares and 0.25 percent cash to cover tax obligations. Meanwhile, Suryajyoti Life Insurance has announced a 13 percent cash dividend from its profits for the last fiscal year. Both proposals await regulatory approval from Nepal Rastra Bank and the Nepal Insurance Authority before being tabled at their respective Annual General Meetings.
Salapa Bikas Bank to open IPO on December 31
Salapa Bikas Bank is set to launch its Initial Public Offering for the general public from December 31. The bank will issue 1,439,179 shares at a face value of Rs 100 each, raising Rs 143.9 million. This follows an earlier allocation to migrant workers and mutual funds. Upon completion, the bank’s paid-up capital will increase to Rs 694.7 million. Established in 2012, Salapa is the last private-sector bank to go public ahead of Rastriya Banijya Bank.
Comment