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 Declines for the Fifth Consecutive Day: The Nepal Stock Exchange (NEPSE) index dropped by 8.41 points on Thursday, the last trading day of the week, closing at 2,611 points. This marks the fifth consecutive day of market decline. Despite the downturn, the prices of 82 companies increased, while 164 saw a decline, and one remained unchanged. The total transaction volume for the day stood at NPR 7.08 billion, down from NPR 8.73 billion recorded the previous day. The Hotel and Tourism sector led the gains with a substantial rise of 4.91%, driven by positive third-quarter financial reports from companies within the sector. The Trading sector also grew by 0.70%. On the downside, the Development Bank sector saw the largest dip, falling by 2.12%.
PM Oli Claims Meritocracy Will Drive NRB Governor Appointment: Prime Minister KP Sharma Oli has expressed his commitment to appoint a capable individual as the Governor of Nepal Rastra Bank based on merit rather than personal connections. Speaking at the formal inauguration of the Former Planners Forum Nepal, Prime Minister Oli stated, “I have no intention of bringing someone of my own to the central bank. The selection will be based on meritocracy, focusing on capable individuals. If someone can work efficiently, it benefits the country. There is no need for ‘my person.’ I am the Prime Minister, but I am not the only one in the government. Therefore, I prioritize meritocracy as much as possible.
Corruption Case Filed vs. Mohan Basnet, 15 Others for NPR 3 billion: A corruption case has been filed against Congress lawmaker and former minister Mohan Bahadur Basnet along with 15 others. On Thursday, the Commission for the Investigation of Abuse of Authority (CIAA) filed a case in the Special Court seeking compensation and penalty amounting to NPR 3.21 billion against Basnet and others. The case alleges that Basnet and others were involved in corrupt practices during the procurement of the Telecommunication Traffic Monitoring and Fraud Control System (TERAMOX) while Basnet held the ministerial post, CIAA spokesperson Rajendra Kumar Paudel said.
Capital Expenditure Only 34% Two Months Before Fiscal Year-End: With just two months left for the fiscal year to end, the government’s capital expenditure has reached only 34%. Out of the Rs. 352.35 billion allocated under the federal government, only Rs. 120.37 billion had been spent by the end of Baisakh. This represents just 34.16% of the total allocated budget. During this period, the government spent a total of Rs. 1.157 trillion, which includes Rs. 773.22 billion in current expenditure and Rs. 264.28 billion in financial management, according to the Office of the Financial Comptroller General. The expenditure in current and financial management stood at 67.79% and 71.96%, respectively.
Revenue Advisory Committee Submits Report to Finance Minister Bishnu Prasad Paudel: The Revenue Advisory Committee has submitted its report to Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel. During the event at the Ministry of Finance, Revenue Secretary Dinesh Kumar Ghimire, who chairs the committee, presented the report. The committee recommended expanding the tax base to cover all economic activities, extending the scope of digital services tax, managing international service providers’ data, and classifying activities like real estate transactions as taxable.
SEBON Seeks Proof from IPPAN on Commission Claims for Hydropower IPO Approval: The Securities Board of Nepal (SEBON) has asked the Independent Power Producers’ Association, Nepal (IPPAN) to provide evidence supporting its claims that SEBON officials demanded commissions for approving IPOs of hydropower projects. SEBON has officially requested proof to substantiate these allegations. However, IPPAN Secretary-General Balram Khatri stated he was unaware of SEBON’s letter and mentioned that discussions between SEBON and IPPAN had already resolved the matter. Khatri added that instead of seeking evidence, SEBON should focus on approving the IPOs that have been pending for a long time.
Telecom Sector Owes Government NPR 8.65 billion in Unpaid Dues: The telecom sector in Nepal owes around NPR 8.65 billion in unpaid revenue, according to the 62nd Annual Report of the Auditor General. Auditor General Toyam Raya presented the report to President Ram Chandra Paudel on Wednesday, highlighting the need to recover the dues.
The report specified that two companies holding integrated licenses—United Telecom and Smart Telecom—have outstanding liabilities amounting to billions, though their names were not explicitly mentioned. However, the recovery of these dues remains uncertain.
Auditor General Questions SEZ Staff Recruitment: The Office of the Auditor General has raised questions regarding staff appointments at the Special Economic Zone Authority (SEZ). In its 62nd Annual Report, the Auditor General’s Office pointed out that SEZ appointed temporary and contract-based staff instead of civil service employees. According to the report, 18 employees were appointed instead of the allocated 5 positions. Section 17(3) of the Special Economic Zone Act, 2016 (2073 BS) mandates that the government should provide the required staff for SEZ. Similarly, Section 7(C) of the Civil Service Act, 1993 (2049 BS) states that individuals cannot be appointed on a daily wage or contract basis for jobs meant for civil servants.
DPM Singh States Deadline Extension for Parliament Building Only with Clear Action Plan: Deputy Prime Minister and Minister for Urban Development Prakash Man Singh has said that the deadline for the under-construction Parliament Building will only be extended if there is a clear action plan for its completion. In a meeting held to discuss the current progress of the Federal Parliament Building under construction in the Singha Durbar premises, the Joint Monitoring and Evaluation Committee on the Implementation of State Directives, Policies, and Responsibilities raised the issue. Singh clarified that extensions would not be granted merely for the sake of it.
Auditor General Questions Tax Exemptions on Dividends of Merged Companies: The Office of the Auditor General has raised concerns over tax exemptions provided on dividends distributed to public shareholders of merged companies. It has asked for an investigation into tax payments on dividends received by shareholders of acquiring entities and those of newly merged ones. According to the Income Tax Act 2058, dividends distributed within two years of a merger are tax-exempt for shareholders of the original company. Following this, tax exemptions were provided on dividends to shareholders of the original companies in the merger.
90 MW Marsyangdi Hydropower Project Signs Investment Agreement: An investment agreement for the 90 MW Marsyangdi Semi-Reservoir Hydropower Project was signed on May 14 (Baisakh 31), led by Kumari Bank. The project, to be constructed by M.A. Power Pvt. Ltd., will be located along the Marsyangdi River, passing through Palungtar Municipality of Gorkha District, Rainas Municipality of Lamjung District, and Bhanu Municipality of Tanahun District. The project is being funded by a consortium of banks, including Kumari Bank, Prabhu Bank, Siddhartha Bank, Agricultural Development Bank, Sanima Bank, Employees Provident Fund, Garima Development Bank, Lumbini Development Bank Limited, and Shangrila Development Bank Limited, with a total investment of Rs. 15.1875 billion.
JICA Agrees in Principle to Fund BP Highway Reconstruction: The Japan International Cooperation Agency (JICA) has agreed in principle to provide a grant for the reconstruction of a damaged section of the BP Highway. During bilateral discussions with the Ministry of Physical Infrastructure and Transport, JICA committed to providing a grant of 2.8 billion Japanese Yen (around NPR 2.59 billion) for the reconstruction. According to Arjun Aryal, the spokesperson for the Department of Roads, discussions are ongoing to finalize the modality, including JICA and the government’s role, land compensation, environmental impact assessments, and other key aspects.
Government Provided Rs. 100 billion in Tax Exemptions to Industrialists Last Fiscal Year: The government provided tax exemptions worth Rs. 100 billion to industrialists last fiscal year 2080/81 BS. This was revealed in the 62nd Annual Report published by the Office of the Auditor General on Wednesday. According to the ASYCUDA system of the Customs Department, the government provided customs revenue exemptions amounting to Rs. 79.87 billion during the fiscal year 2080/81 BS. Section 18 of the Finance Act, 2080 allows the government to reduce, increase, or partially or fully exempt duties, fees, or taxes as prescribed by law. Sections 14 and 15 of Schedule 1 of the Act also allow full or partial exemption of customs duties. Accordingly, the government provided exemptions to industrialists under this provision.
Supreme Court Allows Continuation of Pathivara Cable Car Construction: The Supreme Court has decided not to extend the interim order previously issued to halt the construction of the Pathivara Cable Car in Taplejung. This decision clears the path for the cable car’s construction to proceed. The bench of Justices Nahakul Subedi and Abdul Aziz Musalman issued the order, lifting the previous interim stay.
Life Insurance Corporation Declares Dividends for Shareholders: Life Insurance Corporation (LIC) has announced dividends for its shareholders. The board of directors, in its meeting held on Wednesday evening, decided to distribute a 10.526% dividend from its distributable profit up to the last fiscal year. This includes a 10% bonus share and 0.526% cash dividend for tax purposes. The announced dividend will be distributed after approval from the Insurance Regulatory Authority and the upcoming annual general meeting.
Gandaki Province Government Preparing Budget Amid Accusations of Political Infighting: The Gandaki Province government is preparing the budget for the upcoming fiscal year amidst accusations of political infighting and priority-based budget delays. The government, led by the Nepali Congress and CPN-UML coalition, stated that it would bring a priority-based and categorized budget this time. Chief Minister Surendra Pandey presented the budget last year without the support of UML and the Maoist party. Despite UML’s previous objection to the budget, it now supports the government after forming an alliance at the federal level.
Millions Worth of Equipment Remain Unused in Government Hospitals: Medical equipment worth millions of rupees is lying unused in government hospitals, resulting in wasted investment and patients being deprived of proper treatment. The 62nd Annual Report of the Auditor General pointed out that ventilators and five types of equipment worth NPR 20.86 million at Koshi Hospital are left unused. Similarly, ventilators, patient monitors, and seven types of equipment worth NPR 42.96 million provided by the Department of Health Services, and portable USG machines and 11 ventilators worth NPR 55.94 million at BP Koirala Institute of Health Sciences in Dharan, remain unutilized.
Mahabharat Rural Municipality Achieves Zero Irregularities: Among the 753 local levels and 761 governments nationwide, Mahabharat Rural Municipality in Kavrepalanchok District has been found with zero irregularities. According to the 62nd Annual Report published by the Office of the Auditor General, the municipality reported not even a single rupee of irregular expenditure. Chairperson Kanchhalal Jimba attributed this achievement to strict adherence to public procurement acts and regulations, regular training for employees, and a collective commitment to compliance.
Heritage Hotel ‘Arya Hotel & Spa’ Opens in Thamel Reflecting Nepali Culture: ‘Arya Hotel & Spa,’ showcasing Nepali art, culture, and hospitality, has opened in Thamel. Owned solely by Krishna Simkhada, a Non-Resident Nepali from Dhading who spent nearly two and a half decades in Japan, the hotel has officially launched operations. At a press conference held on Wednesday, Simkhada expressed his belief in Nepal’s tourism potential, prompting him to invest back in his homeland.
KMC Automobiles Pvt. Ltd.’s Bid Approved for Supreme Court Vehicle Purchase: KMC Automobiles Pvt. Ltd., based in Jhamsikhel, has won the contract to supply 61 vehicles to the Supreme Court for a total of NPR 200.7 million. The Supreme Court stated: “Among the submitted bids, KMC’s proposal was the lowest evaluated and substantially responsive, leading to its selection and recommendation for approval under Sub-clause 27(2) and Clause 47 of the Public Procurement Act 2063. This notice is published for the information of all bidders.”
The notice also mentions that the price quoted includes Value Added Tax (VAT). Accordingly, each vehicle costs NPR 3.395 million.
Garima Development Bank Expands Branches in SyangjaL: Garima Development Bank has expanded its branches in Biruwa and Arjun Chaupari of Syangja and started operations. The inauguration of the Biruwa branch was jointly conducted by Biruwa Rural Municipality Chairperson Suryabahadur Kunwar and Bank Chairman Dilip Pratap Khand.
Similarly, the Arjun Chaupari branch was inaugurated by Arjun Chaupari Rural Municipality Vice-Chairperson Sapana Gurung and Chairman Khand. The bank stated that it is committed to providing top-quality services to local residents, business firms, and institutions from its newly opened branches.
Gold Price Drops by Rs. 3,500 Per Tola in Nepali Market: The price of gold in the Nepali market dropped by Rs. 3,500 per tola on Thursday. According to the Federation of Nepal Gold and Silver Dealers Association, the price of hallmark gold stood at Rs. 181,800 per tola on Thursday. On Wednesday, the price of hallmark gold was Rs. 185,300 per tola. Meanwhile, the price of silver also declined. The price of silver, which was Rs. 1,960 per tola on Wednesday, fell to Rs. 1,925 per tola on Thursday, as reported by the Federation.
