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.

NEPSE Index Drops by Double Digits; Turnover Nears Rs 9.14 billion: The Nepal Stock Exchange (NEPSE) index witnessed a notable decline today, falling by 11.06 points to settle at 2,629.89. The trading session saw activity from 313 companies, with a total of 19,992,181 shares exchanged across 86,636 transactions. The total turnover for the day amounted to approximately Rs 9.13 billion. Despite the overall bearish trend, two sectors managed to post gains. The Hydropower group increased by 1.22%, while the Hotels and Tourism group rose slightly by 0.12%. In contrast, all other sectors experienced declines. The Banking sector dropped by 1.05%, Development Banks by 0.06%, Finance by 0.91%, Investment by 0.08%, and Life Insurance by 0.77%.

Finance Minister Warns Against Pressure on SEBON, Calls for Market Reforms: Finance Minister Bishnu Prasad Paudel has urged caution against those attempting to exert pressure and influence on the Securities Board of Nepal (SEBON) and emphasized the need to focus on market development. During the opening ceremony of the Board’s 33rd anniversary on Sunday morning, he directed that legal action should be taken against those involved in insider trading in the stock market. He said, “Those who commit mistakes should be punished, and those who perform well should be encouraged. Many try to pressure and influence the institution. We must protect it from such elements and strengthen regulation.”

NRB to Hold Auction for 42-Day Deposit Instrument Amid Increasing Liquidity: As demand for bank investments declines and liquidity steadily increases, Nepal Rastra Bank (NRB) has announced an auction for a 42-day deposit instrument. The banking sector has been under pressure from excess liquidity since the beginning of the current fiscal year, and liquidity pressure has increased further as the fiscal year draws to a close. With interbank interest rates dropping due to the liquidity surplus, NRB has introduced a long-term liquidity absorption tool. The central bank has stated it will auction NPR 2.5 billion worth of 42-day deposit instruments on Sunday.

Government Allocates Budget for New City Construction and Development Projects: The government has allocated a budget of NPR 1.7028 billion for new city construction and development projects in the upcoming fiscal year 2082/083 (2025/26). In the current fiscal year 2081/082 (2024/25), NPR 1.6279 billion was allocated for the same projects. Accordingly, the budget for the next fiscal year has been increased by NPR 74.9 million, which is 4.6 percent higher than last year’s budget. The government has announced that it will conduct studies to build infrastructure aligned with smart cities and eco-villages in the coming fiscal year.

Nepal Insurance Authority Opens Path for Insurance of Nepalis Abroad: The Nepal Insurance Authority (NIA) has opened the way for insuring Nepali citizens residing abroad. According to the “Branch Office Operation Directive 2079” issued by the NIA, insurance companies can now open branches, contact offices, or representative offices overseas. Some Nepali insurance companies have expressed interest in opening branches abroad but have not yet proceeded. In fact, they have not yet dared to establish branch offices abroad immediately.

Nepal Chamber of Commerce Welcomes Budget Focus on Policy Stability for Private Sector: The Nepal Chamber of Commerce has welcomed the budget for the fiscal year 2082/83 (2026/27) for prioritizing policy stability, which the private sector has long advocated. In a formal written response issued on Saturday, the Chamber stated that it has noted the acceptance of its economic reform suggestions and urged effective implementation of these measures. Recognizing the private sector as the backbone of the economy, the Chamber described the commitment to prioritize economic reforms as positive.

Corona Insurance Claim Payments Still Pending Five Years After Coverage: Despite five years passing since the introduction of corona insurance, insured individuals have not yet received claim payments. The government has also neglected the issue. Corona insurance, introduced by the Insurance Committee in Baishakh 2077, was prioritized by the government. However, insurance companies, the then Insurance Committee, and the government have shown little interest in claim settlements. As a result, insured persons have lost insurance amounts ranging from NPR 50,000 to 100,000. Now, after five years of the pandemic, responsible parties are passing the blame among themselves.

Country Self-Reliant in Eggs and Meat but Not Yet in Milk: Although Nepal is fully self-reliant in egg and meat production, statistics show it has yet to achieve self-sufficiency in milk production. According to the Economic Survey 2081/82 (2024/25) published by the Ministry of Finance, the country meets demand in eggs and meat production. According to the United Nations Food and Agriculture Organization, an adult requires at least 91 liters of milk, 14 kilograms of meat, and 48 eggs annually.

Industry Accuses Government of Benefiting One Iron Industry by Increasing Customs on MS Wire Rods: Industrialists have accused the government of benefiting a specific iron industry by increasing customs on MS (Mild Steel) wire rods. Finance Minister Bishnu Paudel raised the customs duty on MS wire rod imports from 5 percent to 10 percent through the Economic Bill, which industrialists say favors one industry. Industries producing iron wire mesh, which use MS wire rods as their main raw material, previously paid 5 percent customs and an internal tax of NPR 4,500 per ton. Now, customs duty alone has been raised to 10 percent.

Electricity Trade Agreement with Bangladesh Faces Uncertainty: According to the electricity trade agreement, Bangladesh was supposed to start purchasing 40 MW of electricity from Nepal from Ashad 1 (June 15). However, as the date nears, Bangladesh has not begun any import procedures. The Bangladesh Power Development Board has not yet opened a Letter of Credit for electricity imports from Nepal for this rainy season. Moreover, they have not paid for electricity purchased last year, raising uncertainty about the electricity trade.

Life Insurance Coverage Reaches Highest Level in History: Life insurance coverage has reached its highest point ever, according to data published by the Nepal Insurance Authority up to the end of Baishakh. The data shows life insurance coverage has reached 47.39 percent of the population. By Baishakh, 15,360,993 life insurance policies were active, compared to 13,955,887 active policies in the previous fiscal year’s Baishakh, when coverage was 43.56 percent. Some individuals hold more than two insurance policies.

Over 729,000 Workers Obtain Labor Permits for Foreign Employment by June 3: By Jestha 20 (June 3) of the current fiscal year, 729,651 workers have obtained labor permits for foreign employment. Based on data for this period, an average of 2,281 youths per day have sought labor permits for overseas jobs. Director of the Foreign Employment Department, Tikaram Dhakal, reported that up to Jestha 20, 116,817 new labor permits were issued, 311,488 through manpower companies, 3317 re-issued permits, and 1029 permits under government-to-government arrangements.

Over 501,000 Tourists Arrived in Nepal by May 2025: As of May 2025, a total of 501,264 tourists have visited Nepal. The number of tourists arriving in May alone was 86,216. According to data from the Department of Immigration, including Nepalis returning from abroad, the total number of arrivals in May was 194,000. Among them, 108,000 Nepalis arrived from various countries. In April 2025, 116,490 foreign tourists arrived in Nepal, a figure higher than any previous April.

Luxury Tax Sparks Protest by Gold, Silver, and Diamond Traders in Kathmandu: Traders in Kathmandu staged a protest on Sunday against the government’s recent decision to impose luxury taxes on precious metals and stones. The protest comes in response to the fiscal year 2082/83 (2025/26) budget announcement, which introduced a 2% luxury tax on gold and silver, and a 13% tax on diamonds, studded jewelry, and other precious stones. During the demonstration, business owners carried banners and placards with slogans such as “Withdraw the 2% luxury tax on gold,” “Scrap the 13% VAT on diamonds, studded jewelry, and gemstones,” and “Immediately introduce a consumer-, worker-, and artisan-friendly law.”

Ruling Party Lawmakers Oppose Sudurpaschim Province Budget and Policy: Lawmakers from the ruling party have opposed the policy and program of the Sudurpaschim Province government for the fiscal year 2082/083 (2025/26). During the provincial assembly debate that began on Friday, both ruling and opposition lawmakers said the policy and program do not address the province’s needs and importance. They criticized it as being focused on the federal government’s plans. Nepali Congress MP and Special Rights Committee Chairperson Tulsi Devkota accused the province’s policy and program of ignoring provincial pride projects and emphasizing federal government projects instead.

Nepalgunj Airport Terminal Construction Ahead of Schedule Despite Payment Delays: The construction of the new terminal building at Nepalgunj Airport is progressing ahead of schedule, with the construction company preparing to complete the work earlier than planned. Sharma & Company Pvt. Ltd. signed the contract on December 16, 2022, to build Block A, Block B, and Block C of the terminal building, along with associated structures such as the apron, vehicle parking area, guest house, drainage system, walkways, and restrooms. However, the government has expressed concerns that it has not released payments to the construction company based on the progress made so far.

Headrace Tunnel Construction Begins at Upper Myagdi-1 Hydropower Project: Construction work on the headrace tunnel outlet of the 53.5 MW Upper Myagdi-1 hydropower project, under construction in Dhawalagiri and Malika rural municipalities of Myagdi, has started. The tunnel excavation has commenced from the outlet located in Malika Rural Municipality-7, Bharbang. Malika Rural Municipality Chairperson Beg Prasad Garbuja inaugurated the tunnel excavation work and urged the deployment of necessary equipment and manpower to complete the project within the scheduled time.

Subsidized Distribution of Organic Fertilizer Begins for Farmers in Jumla: The distribution of organic fertilizer on a 50 percent subsidy basis has started for farmers in Jumla, according to Rambhakta Adhikari, Acting Chief of the Agriculture Development Office. The initiative aims to stop the use of chemical pesticides and fertilizers and increase local production. Out of 396 bags of 50 kg organic fertilizer received in Jumla, 235 bags have already been sold. Due to high demand, supply is currently insufficient. Farmers have been asked to submit a photocopy of their citizenship and an application to receive fertilizer.

Physical Progress of Siddhababa Tunnel Reaches 54 Percent: The national pride project Siddhababa Tunnel has reached 54 percent physical progress and 48 percent financial progress. The breakthrough in the tunnel has accelerated the work. According to engineer Sabita Gyawali, work on the ‘invert and lining’ is rapidly progressing. Of the total 1,089 meters of the main tunnel, 990 meters of invert work and 660 meters of lining work out of 1,126 meters have been completed.

Hotel Garima Limited to Launch Initial Public Offering: Hotel Garima Limited is preparing to issue an Initial Public Offering (IPO). The company has signed an agreement with NIBL Ace Capital Limited. According to the agreement, NIBL Ace Capital Limited will act as a corporate advisor for the IPO process, assisting the hotel with preparation, coordination with regulatory bodies, and strengthening the company’s institutional management.

Gold Price Drops by Rs 3,000 per Tola:  According to the Federation of Nepal Gold and Silver Dealers’ Association, the price of hallmark gold settled at Rs 190,700 per tola on Sunday. Earlier, on Friday, the price of hallmark gold was Rs 193,700 per tola. Meanwhile, the price of silver also decreased on Sunday. The price of silver, which was Rs 2,150 per tola on Friday, dropped to Rs 2,145 per tola on Sunday.