KATHMANDU: Welcome to Nepal News’ Evening Economic Brief—your go-to source on key financial updates in Nepal. Stay informed with concise insights on market trends, economic indicators, and policy shifts. Here are today’s top economic news highlights.
Nepal Stock Market Sees Decline of 8.14 Points; Trading Volume Increases: On Wednesday, the Nepal Stock Exchange (NEPSE) index dropped by 8.14 points, settling at 2,623 points. The highest point reached during the day was 2,642. Despite the decline in the index, the trading volume increased. The total transaction value rose from NPR 7.57 billion on the previous day to NPR 9.37 billion. Out of 107 companies, 136 saw a decrease in their stock value, 1 remained stable, and only a few companies saw an increase.
Most sectors witnessed a decline in their indices. The banking sector dropped by 0.70%, while development banks saw a decrease of 1.06%. The finance sector experienced a 1.24% fall, and hotel and tourism stocks dropped by 0.50%. Other sectors such as investment, life insurance, manufacturing, non-life insurance, and others also saw significant declines, with decreases ranging from 0.07% to 1.16%. However, there were slight increases in the hydropower, microfinance, and trade sectors, with respective growth rates of 0.61%, 0.04%, and 0.40%.
NRB to Withdraw NPR 50 billion from Market to Manage Excess Liquidity: With excess liquidity in the banking sector, Nepal Rastra Bank (NRB) is set to withdraw NPR 50 billion from the market on Wednesday. To manage excess funds, NRB will withdraw the amount through its deposit collection instrument for a 21-day period.
The central bank issued a notice calling on banks and financial institutions to participate in an online bidding process by 3 PM today. Citing an oversupply of money in the financial system, NRB has been regularly withdrawing liquidity from the market twice a week—on Sundays and Wednesdays—for the past one and a half years.
Nepal’s Economy to Grow by 4.61% This Fiscal Year: Nepal’s economy is projected to expand by 4.61% in the current fiscal year, according to preliminary national account estimates released by the National Statistics Office. Last fiscal year, the economy grew by 3.87%, but the revised growth rate has now been adjusted slightly down to 3.67%, the Office stated.
The projected growth is calculated at consumer prices, indicating a modest yet steady economic recovery. Furthermore, the size of Nepal’s economy is expected to reach NPR 6.107 trillion by the end of fiscal year 2081/82 BS. At the end of the previous fiscal year, the economy stood at NPR 5.704 trillion
Non-Agricultural Sector to Drive Economic Growth of 4.61% This Fiscal Year: The Central Statistics Office has released preliminary estimates for Nepal’s economic growth in the current fiscal year, forecasting a GDP growth rate of 4.61%. According to the report published on Wednesday for the fiscal year 2081/82 BS, the non-agricultural sector is expected to contribute significantly, with a projected growth of 4.28%.
Meanwhile, the agriculture sector is estimated to grow by 3.28%, as per Rishiram Sigdel, Director of the National Accounts Division at the Central Statistics Office. These projections reflect ongoing economic recovery, driven largely by industry and services outside of the agricultural domain.
Nepal’s Per Capita Gross National Income to Reach USD 1,517 This Fiscal Year: According to projections released by the National Statistics Office on Wednesday, Nepal’s per capita gross national income (GNI) is expected to reach USD 1,517 by the end of the current fiscal year. This marks a modest increase of USD 50 compared to the previous year.
At the end of the last fiscal year, Nepal’s per capita income stood at USD 1,467, which was an increase of USD 57 from the year before. Despite the continued growth, the pace of increase has slightly slowed compared to the previous fiscal year. The figure reflects the average national income per person, factoring in the country’s total income divided by its population.
Weak Report Submitted on Irregularities in GBIA Construction: A subcommittee formed by the Public Accounts Committee of Parliament to investigate irregularities in the construction of Gautam Buddha International Airport in Bhairahawa has submitted a very weak report. The subcommittee, led by Yogesh Bhattarai, a former tourism minister and an MP from the CPN-UML, was tasked with reviewing the project. However, the final report was criticized for not addressing financial discipline, cost transparency, and the system used to spend the NPR 31.82 billion on the airport.
The subcommittee, formed on 27th Jestha, 2081, included several MPs: Achyut Prasad Mainali, Dr. Amaresh Kumar Singh, Manju Khand, Manish Jha, Bikram Pandey, Shyam Kumar Ghimire, and Saraj Ahmad Faruqi. Since Bhattarai, the former tourism minister, was the head of the subcommittee, there were concerns in the Audit Committee that the report failed to include issues of discrepancies and irregularities seen during the field inspection.
Revenue Collection Targets and Shortfalls Over the Past Three Years: Although the government has set ambitious revenue collection targets over the past three years, there have been significant shortfalls. In the last two years, only around 75% of the target has been achieved. In the fiscal year 2078-79, the government collected 77.19% of its revenue target, and in the previous year, it was 74.43%. As of the 15th of Baisakh this fiscal year, only 61% of the revenue target has been achieved.
Despite these challenges, the government has not stopped increasing its revenue target each year. This year, a budget of NPR 1.86 trillion has been set, with a revenue collection target of NPR 1.42 trillion. The National Planning Commission has set a target of NPR 1.9 trillion for the next fiscal year, which means the revenue target will naturally be increased along with the budget.
Investment Board Approves Organizational Structure and Strategy: The 61st meeting of the Investment Board has approved the organizational structure along with the secretary’s position. The meeting, chaired by Prime Minister KP Sharma Oli, also approved the board’s strategy and business plan. The meeting decided to move forward with the implementation process based on the approved structure, which includes various necessary directorates.
“The meeting has directed the office to complete the organizational and management survey for the Investment Board as soon as possible, based on the approved structure,” said Spokesperson Pradyumna Prasad Upadhyaya. As per the business plan, the board aims to sign contracts for 42 projects worth USD 17.92 billion (NPR 2.45 trillion) by the fiscal year 2085/86.
No Progress on Social Media Registration Despite Repeated Government Directives: The government has repeatedly instructed social media platforms, including Facebook, to register in Nepal, but no progress has been made in the registration process. The government’s repeated extensions for registration deadlines have been criticized as ineffective. Minister for Communications and Information Technology, Pradeep Subba Gurung, recently gave a one-week deadline for registration, but even within this timeframe, no registration process has moved forward.
This has led to concerns that the government’s ultimatum will again go unfulfilled. Earlier, the government had opened registration for TikTok, which had been previously banned by the Pushpa Kamal Dahal-led government. However, Facebook’s parent company, Meta, along with other platforms, has been reluctant to register.
Procurement Rules Amended Again to Ease Deadline Extension for Contractors: To make it easier for contractors to extend deadlines for ongoing projects, Nepal’s procurement regulations have been amended for the 14th time, just 14 months after the last revision. The latest amendment allows project deadlines to be extended based on the nature of the work. Contractors must provide reasons for not being able to complete work within the agreed deadline to qualify for an extension.
For contracts with expired or unrenewed deadlines, the supplier, contractor, consultant, or service provider must submit details specifying which works could not be completed and why. Applications for deadline extensions must be submitted to the concerned public body within 30 days of the regulation’s publication in the official gazette.
Yarsagumba Collection Season Begins in Manang: The collection season of Yarsagumba (Cordyceps Sinensis) has begun this year. Normally starting in the second week of Baisakh, the collection period continues until the end of Asar. Collection permits are issued in various areas of Manang after consulting the calendar for auspicious dates. The valuable herb Yarsagumba is becoming a significant foundation for the prosperity of Manang.
Locals of Manang now obtain permits from the Annapurna Conservation Area Project’s regional conservation office in Manang to collect Yarsagumba and other herbs, in accordance with the Conservation Area Management Regulation 2053, the Management Guidelines 2056, the 2080 Directive on the Collection and Transportation of Yarsagumba in national parks, reserves, conservation areas, and buffer zones in Himalayan regions, as well as other existing laws.
Over 29% of Industries Fail to Pay Minimum Wage in Nepal: More than one-fourth of industrial establishments in Nepal have failed to implement the minimum wage set by the government. The minimum wage has been set at NPR 17,300 per month. However, a report released by the General Federation of Nepalese Trade Unions (GEFONT) on Tuesday states that 29% of industries have not implemented the new wage, which came into effect from the 1st of Shrawan, 2080 B.S.
GEFONT’s labor audit of 327 establishments across manufacturing, garments, jute, textiles, hotels, trekking, travel, printing press, cooperatives, private hospitals, private schools, construction, and labor-supplying companies revealed noncompliance with labor laws.
Nepal to Import Additional 119,000 Metric Tons of Fertilizer for Paddy: To prevent a shortage of fertilizer for paddy cultivation, the government of Nepal is set to import an additional 119,000 metric tons of fertilizer. According to the Ministry of Agriculture and Livestock Development, 94,000 metric tons of urea and 25,000 metric tons of DAP fertilizer are on the way and expected to arrive by the second week of Jestha.
Agricultural Inputs Company Limited is importing 64,000 metric tons of urea and 25,000 metric tons of DAP, while Salt Trading Corporation will bring 30,000 metric tons of urea. The ministry claims all of it will arrive between the third week of Baisakh and second week of Jestha. So far in fiscal year 2081/82, from Shrawan to Baisakh 14, Nepal has already imported 276,705 metric tons of fertilizer.
Hilsa Border Point Open, But Kailash-Mansarovar Pilgrimage Still Banned: Although Nepal’s Hilsa border point with China reopened on Baisakh 18 last year (April 30, 2024), the ban on pilgrimages to Mansarovar remains in place. China closed the route during the COVID-19 pandemic and has not reopened it for nearly five years. Before the pandemic, about 15,000 Indian pilgrims annually visited Kailash-Mansarovar via Hilsa between Baisakh and Asoj.
Indian pilgrims began using the Hilsa route in 2006, and its use surged after the Tatopani border was closed following the 2015 earthquake. Last year, Kathmandu-based Pathil Holidays and India’s Trip to Temple arranged aerial darshan of Kailash-Mansarovar via mountain flights. However, due to high costs and limited interest, the flights were stopped.
Wheat Production Expected to Decline in Kailali This Year: Wheat production in Kailali district is expected to decline this year compared to last year. This estimate is based on a productivity test conducted in the final week of Chaitra by the Agricultural Knowledge Center.
According to Madan Raj Joshi, head of the Planning and Statistics Division of the center, average productivity is estimated at 3.35 metric tons per hectare this year, slightly down from last year’s 3.42 metric tons per hectare. The estimate is based on productivity assessments conducted in 11 local units of the Terai region, excluding Chure and Mohanyal rural municipalities.
Gold Traders’ Associations Barred from Charging Fees for Purchase Recommendations: Gold traders’ associations and federations are no longer allowed to charge fees when recommending traders for gold purchases. The Nepal Rastra Bank’s Foreign Exchange Management Department issued a directive to this effect on Tuesday, following complaints about arbitrary charges.
According to the new provision, associations must now provide purchase recommendations to traders free of charge. The NRB notice states, “As per the provision that associations/federations of gold traders cannot charge any kind of recommendation fee for gold purchases from commercial banks, all concerned are instructed to comply accordingly.”
Helicopter Flights Banned in Sagarmatha Region During Peak Climbing Season: Helicopter flights have been banned in the Sagarmatha region during the peak mountaineering season. The Khumbu Pasang Lhamu Rural Municipality has urged to cease helicopter flights within its jurisdiction and also discouraged the purchase or sale of any packages related to helicopter services.
On Monday, the rural municipality issued a public notice warning helicopter companies to stop commercial flights in the area. It has also stated that any situation arising from such operations or package sales will be the responsibility of the relevant authorities. A formal letter with a cautionary warning was also made public.
Removal of Mandatory Provision for Manpower Companies to Send 100 Workers Abroad Annually: The mandatory provision that required licensed manpower companies to send at least 100 workers abroad annually has been removed. This change was made as part of amendments to the Foreign Employment Act. Previously, in 2019, a provision was introduced stating that a manpower company’s license would be revoked if it failed to send 100 workers abroad for two consecutive years.
Manpower businesses had been protesting against this provision and lobbied for its removal. The provision was amended through the “Some Nepal Act Amendment Bill,” which was passed by the House of Representatives on Tuesday, allowing changes to the Foreign Employment Act and other related laws.
Securities Board Approves IPO for Bikash Hydropower: The Securities Board of Nepal (SEBON) has granted approval to Bikash Hydropower Company to issue an Initial Public Offering (IPO). SEBON gave the company permission to issue the IPO on Tuesday.
With the approval, the company will now issue 4.45 million shares worth NPR 445,459,600 at a face value of NPR 100 per share. The securities issuance and sales management work has been assigned to Prabhu Capital.
Gold and Silver Prices Drop Slightly in Nepal: The Federation of Nepal Gold and Silver Dealers’ Association has published the prices of gold and silver for Wednesday. According to the federation, the price of hallmark gold has been set at NPR 188,100 per tola.
The previous day, hallmark gold was priced at NPR 188,800 per tola, indicating a drop in price today. The price of silver has also declined. On Tuesday, silver was priced at NPR 1,970 per tola, but it dropped to NPR 1,965 per tola on Wednesday.
