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 policy developments reflect a mixed picture of expansionary ambitions, structural reforms, and sector-specific stresses. Financial markets showed strong momentum as NEPSE gained 38 points with broad-based sectoral advances, while microfinance institutions reported robust 31% profit growth, indicating improved financial sector performance and investor confidence.
In parallel, the Nepal Rastra Bank has aligned macroeconomic planning for the 2026/27 budget through its annual review, reinforcing policy coordination between monetary and fiscal authorities. The government has also unveiled an expansive development agenda, including a 30,000 MW hydropower target, investment visas to attract foreign capital, a Nepal Carbon Authority for carbon trading, and tax reforms aimed at easing burdens on businesses and middle-class households.
However, these ambitions contrast with on-the-ground constraints, including delayed infrastructure projects in Karnali due to cost pressures, stalled bridge construction from budget shortages, and unpaid dues affecting dairy farmers. Trade and administrative bottlenecks—such as earlier customs disruptions at Birgunj and cooperative savings crises—highlight governance and liquidity challenges, even as digitalisation efforts like eSIM services and cashless transaction policies signal a push toward modernization.
Overall, the developments depict an economy pursuing high-growth structural transformation while simultaneously grappling with implementation gaps, fiscal constraints, and uneven sectoral resilience.
NEPSE rises by 38 points as all sectors post gains
The Nepal Stock Exchange (NEPSE) surged by 38.19 points, or 1.39 percent, on Monday to close at 2,783.85, driven by gains across all sectors. The Sensitive Index also climbed 6.08 points to 473.41, while the float index and sensitive float index increased by 1.43 percent and 1.32 percent respectively. A total of 10.43 million shares of 332 companies were traded through 68,444 transactions, generating a turnover of Rs 4.61 billion. Share prices of 247 companies advanced, while 18 declined and four remained unchanged. Among sectoral indices, the “Others” group led the gains with a 2.11 percent rise, followed by finance, hydropower and microfinance sectors.
NRB submits economic review report for 2026/27 budget preparation
In line with Section 69 (4) of the Nepal Rastra Bank Act, 2002, Governor Prof. Dr. Biswo Nath Poudel on Monday submitted the annual economic and financial review report to the Ministry of Finance. The report, handed over to Finance Minister Swarnim Wagle, presents a detailed assessment of the country’s current fiscal condition and financial stability, serving as a key reference for preparing the national budget for the fiscal year 2026/27. The mandatory submission is intended to ensure that the government’s budget targets are aligned with prevailing macroeconomic conditions and the monetary policies of Nepal Rastra Bank (NRB).
Govt to introduce investment visas for foreign investors
The government has announced plans to introduce investment visas for foreign investors in a bid to encourage and promote foreign investment in Nepal. The provision was included in the government’s policies and programmes for the fiscal year 2083/84 BS, presented at a joint session of the Federal Parliament on Monday. President Ram Chandra Paudel, while unveiling the policy and programme, said the investment visa policy is expected to help attract more foreign investment into the country.
Govt sets target of generating 30,000 MW of electricity
The government has set a target of generating 30,000 megawatts of electricity in the coming fiscal year. The target was announced in the government’s policies and programmes for the fiscal year 2083/84 BS, presented by President Ram Chandra Paudel at a joint session of the Federal Parliament on Monday. According to the policy document, the government plans to amend the Environment and Forest Act to help achieve the electricity generation target. The policy and programme also state that shares of hydropower projects will be provided to people affected by the projects.
Remittance inflow rises 39.1 percent to Rs 1.65 trillion in first nine months
Nepal’s remittance inflow increased by 39.1 percent to Rs 1.659 trillion during the first nine months of the current fiscal year, according to data released by the Nepal Rastra Bank on Monday. During the same period last fiscal year, remittance inflow had increased by 10.2 percent. In the month of Chaitra alone, Nepal received Rs 209.75 billion in remittance, compared to Rs 139.54 billion during the same month a year ago. In US dollar terms, remittance inflow rose by 31.9 percent to USD 11.55 billion during the review period, whereas it had grown by 7.5 percent in the corresponding period last year. According to the central bank, net secondary income (net transfer) reached Rs 1.820 trillion during the review period, up from Rs 1.303 trillion in the same period last fiscal year.
Govt announces plan to establish Nepal Carbon Authority
The government has announced plans to establish the Nepal Carbon Authority as part of its policies and programmes for the fiscal year 2083/84 BS. President Ram Chandra Paudel made the announcement while presenting the government’s policy and programme at a joint session of the Federal Parliament on Monday. According to the policy document, the government aims to expand the REDD+ programme through the formation of the Nepal Carbon Authority. The initiative is expected to ensure direct benefits from carbon credit mechanisms for community forests. The government has also pledged to promote the use of domestically produced timber in construction and industrial sectors through policy reforms.
Govt unveils policy to ease tax burden on businesses and middle-class families
The government has introduced a policy aimed at reducing the tax burden on entrepreneurs and middle-class households. Presenting the government’s policies and programs at a joint session of the Federal Parliament today, President Ram Chandra Paudel said the existing tax structure would be reviewed to provide relief to entrepreneurial and middle-class families. The government also announced plans to link all economic transactions to digital platforms in an effort to build a cashless, transparent and revenue leakage-free economy. According to the policy document, the revenue system will be made more business-friendly through voluntary tax compliance, technology-based revenue administration and a fast-track mechanism for resolving tax disputes. The government further stated that double taxation avoidance agreements would be signed with various countries. A new policy has also been proposed to transform pollution-related, infrastructure and other fragmented taxes into a green tax system.
Govt to establish Unified Savers’ Protection Fund for cooperative depositors
The government has announced plans to establish a Unified Savers’ Protection Fund aimed at returning the savings of cooperative depositors. President Ram Chandra Paudel shared the information while presenting the government’s policies and programmes for the fiscal year 2083/84 BS at a joint session of the Federal Parliament. The government had earlier introduced provisions through an ordinance to create a revolving fund for refunding deposits of troubled cooperatives. The newly unveiled policies and programmes now include a plan to establish a unified fund for the same purpose.
Gold prices decline while silver gains in domestic market
Gold prices declined in the domestic market today, according to the Federation of Nepal Gold and Silver Dealers’ Association. The price of gold fell by Rs 400 per tola (11.66 grams) and is currently being traded at Rs 298,500 per tola. On Sunday, the price stood at Rs 298,900 per tola. Meanwhile, silver prices increased by Rs 40 per tola. Silver is now being traded at Rs 5,340 per tola, up from Rs 5,300 the previous day.
Microfinance sector posts 31 percent profit growth in third quarter
Nepal’s microfinance sector recorded strong financial improvement in the third quarter of the current fiscal year, with 32 listed institutions reporting a combined net profit of Rs 5.374 billion. The figure represents a 30.97 percent increase compared to the Rs 4.103 billion earned during the same period in the previous fiscal year 2024/25. Chhimek Laghubitta posted the highest profit at Rs 906.4 million, followed by Deprosc Laghubitta with Rs 680.1 million. Mahuli Laghubitta registered profit growth of more than 1,270 percent, while institutions such as Nirdhan Utthan and Sana Kisan reported declines of 67.74 percent and 11.33 percent respectively.
Chitwan dairy farmers awaiting Rs 550 million in pending payments
Dairy farmers in Chitwan are facing growing financial hardship as the Dairy Development Corporation (DDC) and several private dairy industries have failed to clear dues amounting to Rs 550 million. The government-owned DDC has reportedly not made payments since mid-December 2025, while private dairy companies have delayed payments for the past three months. Around 40,000 farmers affiliated with 115 cooperatives produce approximately 350,000 litres of milk daily in the district, but only 25 percent of dairy industries are making regular payments. To ease the crisis and directly market their products, the Chitwan District Milk Producers’ Cooperative Union has established Dairy Marts at Telecom Road, Bharatpur-3 Belchowk, and behind Chitwan Medical College. The outlets sell milk, ghee, paneer and other dairy products.
Customs clearance resumes at Birgunj after MRP dispute
Importers at the Birgunj customs point have resumed clearing goods following a two-week deadlock triggered by the mandatory Maximum Retail Price (MRP) sticker rule. Traders are now being allowed to release their shipments after committing to place MRP stickers at their own warehouses before products enter the market. The dispute had slowed customs revenue collection, but daily revenue at Birgunj has now recovered to more than Rs 500 million. The government has granted businesses a grace period until the end of the current fiscal year 2025/26 for full compliance. After that, MRP labeling at entry points will become compulsory for all imported goods.
IPPAN submits 53-point proposal for national energy development drive
The Independent Power Producers’ Association, Nepal (IPPAN) has submitted a 53-point recommendation to the Ministry of Finance for the upcoming 2026/27 budget, urging the government to declare a “National Energy Development and Consumption Increase Decade.” IPPAN has called for the reopening of Power Purchase Agreements (PPAs) under the “take or pay” model and the removal of the single-buyer system to enable private sector participation in domestic and cross-border electricity trade. The association’s key demands include a 10-year tax holiday with an additional five-year 50 percent concession, reducing customs duties on machinery imports to 1 percent, and accelerating IPO approvals for energy companies. IPPAN said the recommendations are aimed at supporting Nepal’s target of generating 30,000 megawatts of electricity within the next decade.
Contractors’ federation urges budget assurance before project tenders
The Federation of Contractors’ Associations of Nepal (FCAN) has proposed several recommendations for the 2026/27 budget, calling on the government to announce tenders only after ensuring budget allocation and financial resources. The federation noted that many development projects remain stalled due to inadequate preparation and lack of funding. It also urged the government to introduce a monthly payment system to improve cash flow in the construction sector. Among its major demands are the removal of local taxes on construction materials such as stone and sand within road corridors, and the elimination of double taxation on river- and mine-based materials. FCAN has also proposed a minimum three-year “cooling period” before companies are removed from blacklists and requested waivers on interest and penalties for businesses that clear principal dues related to income tax and VAT.
Construction begins on access road for Rs 1.8 billion Super Ghalemdi project
Construction of a 5.5-kilometre access road has begun for the Rs 1.8 billion Super Ghalemdi Hydropower Project in Annapurna Rural Municipality-4. The 9.14-megawatt project, located in Narchyang, has already completed two kilometres of road connecting the confluence of the Ghalemdi and Rele rivers to the proposed dam site near the base of Mount Annapurna. The project is being financed through a 70:30 debt-to-equity ratio with support from Global IME Bank and Machhapuchchhre Bank, and is expected to be completed within two years. Narchyang is emerging as a major hydropower hub and currently hosts five operational projects with a combined capacity of 162 megawatts, including the 42 MW Mistri Khola and 71 MW Nilgiri-II hydropower projects.
More than 26,000 families living on unregistered land in Kailali and Kanchanpur
Data from the recently dissolved Land Problem Resolution Commission shows that 26,674 families are living as landless squatters on public and unregistered land in Kailali and Kanchanpur districts. In Kailali, authorities have verified 21,545 families, including 7,631 landless Dalits and 13,914 squatters. More than 11,672 hectares of land have already been mapped for possible registration. In Kanchanpur, 58,635 applications have been processed across nine local levels. Although the commission had planned to distribute land ownership certificates for housing and agricultural purposes with minimal fees, the dissolution of the body has left the process uncertain. Local leaders in Kailali have argued that only settlements located in high-risk or forest areas should be relocated, while land already identified for landless communities should remain protected.
Nepal Airlines increases Humla flights to ease passenger pressure
Nepal Airlines Corporation has increased the number of regular flights to the Himalayan district of Humla in response to growing passenger demand and travel difficulties. The Nepalgunj–Surkhet–Simikot route will now operate four times a week instead of three. The revised schedule came into effect on May 9. Flights between Simikot–Surkhet and Simikot–Nepalgunj will operate on Mondays, Wednesdays and Fridays. The airline has also announced fare concessions for senior citizens, persons with disabilities, children under 12 and students. The standard ticket fare has been fixed at Rs 18,000 per passenger.
Bagmati Province introduces new project selection and budgeting guidelines
The Ministry of Economic Affairs and Planning of Bagmati Province has issued the Annual Project Proposal and Selection Guidelines, 2026 to streamline budget planning for the fiscal year 2026/27. Under the new system, each district will form a project selection recommendation committee led by a directly elected provincial assembly member. The committee, which will also include proportional representation lawmakers, local government heads and chiefs of thematic offices, will identify projects that cannot be funded through local resources. According to the guidelines, proposed projects must align with periodic development plans and sectoral policies. Each proposal must also include a medium-term expenditure framework for the next three years to ensure balanced regional development and prevent duplication of projects.
Rising costs and shortages disrupt infrastructure projects in Karnali
Infrastructure development projects in Karnali Province have slowed significantly due to soaring prices and shortages of key construction materials such as fuel and bitumen. Construction companies have formally informed the Road Division Office in Chaurjahari — responsible for Jajarkot, Rukum West and Dolpa — that they are unable to continue work under the current economic conditions. As a result, the provincial government has completed only 53 kilometres of its annual blacktopping target of 161 kilometres. Major national pride projects, including the Bheri-Babai Diversion Project, have also been affected. Contractors say diesel and kerosene prices have nearly doubled since February 28 this year, limiting physical progress on major roads such as the Madan Bhandari Highway to around 40 percent.
Budget shortage slows construction of Tikuliaghat bridge project
Construction of the bridge over the Lalbakeya River at Tikuliaghat, linking Gaur and Ishnath municipalities, has slowed sharply due to a funding shortage. The project, awarded to Azad Dipu and Company JV for Rs 276.6 million, has achieved around 35 percent physical progress, with five of the six bridge spans already cast. However, the allocated budget of Rs 20 million for the current fiscal year has already been exhausted. The contractor claims that Rs 40 million in payments for completed work remains pending and says rising construction material costs have added to the challenges. The bridge is scheduled to be completed by July 14 this year. The previous contract awarded to Pappu Construction was terminated in 2023 due to non-performance.
Rs 25 million office building in Jumla left unused after office closure
A newly built office complex in Jumla worth Rs 25 million has remained unused after the federal government dissolved the Federal Water Supply and Sewerage Management Project office. The office had previously overseen water supply projects in five districts of Karnali Province but has now been downgraded to a field unit with only four staff members operating from a smaller building. The closure has also left the Rs 1.26 billion Dhauligad Water Supply Project in uncertainty. Local activists have locked the gates of the newly constructed three-storey building in protest, describing the decision as contrary to the spirit of federalism.
Nepal Telecom launches online service for prepaid eSIM registration
Nepal Telecom has launched a digital platform that allows customers to obtain prepaid eSIMs online without visiting service centres. Through the portal esim.ntc.net.np, users can register by selecting the “Get New Prepaid eSIM” option and complete payment through digital wallets or QR code systems. After payment verification, customers receive a QR code for mobile activation. The portal also enables users to convert physical SIM cards into eSIMs and submit Know Your Customer (KYC) details online. Nepal Telecom said the service is part of its broader effort to digitize customer services and improve convenience.
Big Group to invest Rs 6 billion in industrial village in Saptari
Big Group is investing Rs 6 billion to develop a private industrial village in Surunga Municipality-3, Padamnagar, covering around 30.476 hectares of land. The project, named Big Indus, plans to establish seven factories, including Nepal’s first industries producing finished iron and glass using raw materials sourced from domestic mines. The company has secured mining rights in Lapha, Udayapur, where deposits of iron and silica were discovered. Within two years, the project aims to produce 300 tonnes of iron ingots and 90 tonnes of glass daily. The industrial village will later expand to include factories producing bitumen, lubricants, paints and tyres. Authorities have already approved a 20-megawatt electricity supply for the project.
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