KATHMANDU: Nepal News presents today’s snapshot of Nepal’s economic activities. Here’s a concise update on key market movements, policy developments, and financial trends shaping the economy:

Nepal Government Moves to Terminate 234 Stalled Road and Bridge Contracts:
The government is preparing to cancel 234 long-delayed road and bridge construction contracts that have remained inactive for years. These include projects under the Postal Highway, Mid-Hill Highway, and several federal road divisions. Contracts are labeled “sick” if contractors failed to deliver progress despite multiple deadline extensions. Energy, Water Resources, and Infrastructure Minister Kulman Ghising said terminating such contracts is essential to end corruption, misuse of advance payments, and chronic delays. He warned that both negligent contractors and complicit officials would face investigation. Ghising pledged full backing for strict enforcement, calling the move a milestone toward accountability and good governance.

PM Sushila Karki Urges Promotion of Offbeat Tourism for Economic Growth:
Prime Minister Sushila Karki, also heading the Ministry of Culture, Tourism, and Civil Aviation, emphasized promoting and protecting off-the-beaten-path tourist destinations to attract visitors and boost Nepal’s economy. On the 46th World Tourism Day, she highlighted tourism’s role in earning foreign currency, generating employment, and increasing national income. Karki noted Nepal’s global appeal, citing its mountains, biodiversity, and rich cultural diversity. While the sector faced setbacks during the Gen-Z protests, she stressed that recovery is underway. The Prime Minister called for tourism to be treated as a central pillar of national economic development and sustainable growth.

Finance Minister’s Appointment of New Insurance Regulator Chief Defies Supreme Court Order:
Interim Finance Minister Rameshwor Khanal has sparked controversy after appointing Joint Secretary Janak Raj Sharma as chairman of the Insurance Board, despite a Supreme Court order barring any dismissal or fresh appointment. The Court had earlier reinstated ousted chief Sharad Ojha and instructed the government to maintain status quo until a scheduled hearing on October 12. Records show the order reached both the Insurance Board and the Prime Minister’s Office by October 5, contradicting Khanal’s claim of ignorance. Legal experts have denounced the move as a clear case of contempt of court, deepening tensions between the judiciary and the executive.

Nepal Introduces Payroll Protection Scheme to Safeguard Jobs Amid Gen-Z Protests:
The government has launched a Payroll Protection Scheme to support businesses hit by the Gen-Z movement and ensure timely salary payments for employees. According to Nepal Rastra Bank’s revised directive issued Friday, banks must provide loans at the base rate plus a maximum premium of 0.5 percent, with the government covering 2 percent interest subsidy for up to six months. The scheme applies to industries, businesses, and institutions directly impacted by the unrest. Loans will be available for one year or until business operations resume, whichever is shorter. Employers must apply through banks by mid-January 2026 (Poush-end 2082).

NEPSE Surges 140 Points as Government Reforms Restore Investor Confidence:
Nepal Stock Exchange (NEPSE) rebounded last week, gaining 140.09 points after government measures to reform the share market restored investor confidence. The index opened at 2,511.91 on Sunday and closed at 2,652 points on Thursday, with a high of 2,689.67 and a low of 2,483.15, reflecting 206.52 points of volatility. Him Star Urja led gains with a 46.36% rise, while Siddhartha Premier Insurance saw the largest drop at 9.24%. Total turnover reached Rs 21.85 billion, and market capitalization rose to Rs 4.433 trillion, delivering Rs 234 billion in capital gains to investors after losses of Rs 268 billion the previous week.

Nepal Rastra Bank Announces Relief Packages for Private Sector Affected by Gen-Z Protests:
Nepal Rastra Bank has unveiled relief measures to support private sector businesses impacted by the recent Gen-Z protests and resulting damages. A circular to Class A, B, and C banks and financial institutions instructs them to implement schemes including loan rescheduling, restructuring, low-interest financing, payroll protection, and interest subsidies. Affected enterprises can request loan restructuring or rescheduling by mid-January 2026 (Poush-end 2082), while linked borrowers can also benefit by paying a minimum of 5 percent interest. Loans must retain their original classification and loss provisions. The central bank aims to stabilize businesses and ensure continuity of employment amidst post-protest recovery.

Tourist Influx Plummets in Pokhara, Sector Faces Rs 2.5 Billion Loss:
Despite Machhapuchhre shining in the autumn skies, Pokhara’s tourism sector is facing an unprecedented downturn. Normally experiencing 70–80% hotel occupancy this season, rates have fallen to just 15–20%, with around 40% of September bookings canceled, according to Hotel Association chair Laxman Subedi. The slump has affected hotels, restaurants, travel agencies, and related businesses, causing estimated losses of Rs 2.5 billion. Pokhara’s tourism industry, valued at Rs 800 billion and employing nearly 15,000 people, has been hit hard. Officials, including Visit Pokhara Year 2025 coordinator Gopi Bahadur Bhattarai, urge promotion of Nepal as a safe destination via campaigns like #IamInNepalNow to restore visitor confidence.

Dashain Tourism Season Falters as Gen-Z Protests Leave Hotels Empty, Bookings Cancelled:
Tourism in Nepal has been hit hard by the Gen-Z protests, just as Dashain—normally the peak season for domestic and international travel—gets underway. From Bandipur to Pokhara, Sauraha, Lumbini, Bardiya, and Kathmandu, hotels are reporting mass booking cancellations, with occupancy dropping below five percent in many destinations. The Nepal Hotel Association estimates property damages of up to Rs. 25 billion, including severe losses to Hyatt Regency, Hilton Kathmandu, Chandragiri Cable Car, and multiple resorts. Tourism Board CEO Deepak Raj Joshi said arrivals are slowly recovering, but warned the industry is still in crisis recovery mode after unprecedented destruction.

India’s GST 2.0 Brings Cheaper Goods to Nepal, But Local Industries Warn of Rising Informal Trade:
India’s newly revised GST, or GST 2.0, has lowered taxes on food, electronics, and automobiles, offering Nepali consumers cheaper imports due to open border trade. Entry-level hatchbacks and processed foods have already seen significant price cuts. However, trade experts warn the reform may boost informal imports, threatening local industries, employment, and government revenue. With Nepal’s informal trade already exceeding 50 percent of overall trade, cottage and small industries face heightened competition. Officials urge stricter border monitoring and customs enforcement. Indian authorities highlight benefits for Nepali businesses and startups, emphasizing lower input costs and export opportunities despite concerns over local market impacts.

Climate Change Driving Child and Forced Labor in Nepal’s Carpet and Brick Sectors, Report Finds:
A new report by GoodWeave International and New ERA links climate change to rising child and forced labor in Nepal’s carpet and brick industries. Combining 30 years of climate data with interviews of over 1,000 participants, the study finds that droughts, floods, landslides, and heat waves push rural families to send children and adults into hazardous work. About 35% of workers said climate events influenced their decision, with 17% citing extreme impact. The report urges targeted protections, climate-resilient agriculture, livelihood diversification, and strengthened education and labor safeguards. Experts warn immediate action is needed to prevent exploitation amid worsening climate shocks.

Bridge Delays on Tamor Corridor Leave Travelers Stranded During Monsoon:
Construction delays on the Tamor Corridor, a 110-kilometer highway connecting Nepal’s eastern hills to India and China, are causing severe travel disruptions. While 54 kilometers of the Mulghat–Ganeshchowk stretch has been blacktopped, most rivers along the route remain without bridges. Vehicles frequently halt midstream during sudden monsoon floods, particularly at Henwa, Nawa, Lakhwa, and Chharuwa rivers. According to Deepak Jha, chief of Dharan Bridge Sector Office, stalled funding—nearly Rs. 40 million pending from the previous fiscal year—and contractor delays are slowing progress. Some bridges are only 15–50 percent complete, including the 165-meter Chharuwa River bridge, the corridor’s largest. Locals urge urgent completion.

Government Enforces Green Mark System to Ensure Safe Goat Meat for Dashain:
With Dashain festivities driving high demand for goat meat, the government has mandated health checks to prevent the sale of sick animals. The Department of Livestock Services has introduced a color-coded system: healthy goats are marked with green paint on their horns, while unhealthy ones receive a red mark and are barred from sale. Ten checkpoints across the Kathmandu Valley have been set up, staffed with 58 veterinary professionals. As of Saturday morning, over 14,100 goats and 324 buffaloes had entered the Valley. Officials said no serious diseases have been detected so far, urging consumers to buy only green-marked goats.

US Introduces $1 Fee for Nepali Diversity Visa Lottery Applicants:
Nepali applicants for the US Diversity Visa (DV) lottery will now pay a $1 application fee, starting with the DV-2027 program in October 2025. Previously free, the fee aims to curb fraud and fairly distribute administrative costs. Other requirements remain unchanged, including the need for a valid passport and the standard $330 visa processing fee at the consular stage. Payment must be made through the US government’s official online portal, with Visa, MasterCard, PayPal, and American Express accepted. In Nepal, local Visa and MasterCard cards are the most reliable options. Detailed guidelines on payment procedures will be issued soon.