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:

IMF Releases Sixth Tranche of Nepal’s Extended Credit Facility After Delayed Review:
The International Monetary Fund (IMF) has approved the sixth tranche of Nepal’s Extended Credit Facility (ECF), disbursing about USD 41 million after a three-month delay. The review had stalled because Nepal Rastra Bank had not completed a loan portfolio review of major commercial banks—a key IMF condition. With progress on this and other structural reforms, the IMF’s executive board cleared the release. Nepal has so far received around USD 350 million under the seven-tranche program, signed in late 2021 to stabilize foreign reserves and the balance of payments. Only the final tranche remains pending under the four-year arrangement.

Nepal Sets New Limits on Foreign Currency: $5,000 Entry Without Declaration, $1,500 Cash Holding Cap:
The Finance Ministry has clarified new rules on foreign currency entry and holding. Nepali and foreign nationals may bring up to USD 5,000 (or equivalent in Indian rupees and other currencies) into Nepal without customs declaration; amounts above require declaration. Citizens may keep a maximum of USD 1,500 or equivalent in cash from legitimate sources such as remittances, business, or travel allowances. Unexplained cash will be investigated under money-laundering laws. The government also reminded that transactions above NPR 1 million must go through banking channels, urging wider use of electronic payments for transparency and to reduce illegal cash dealings.

Government Issues Special Agro-Met Bulletin as Monsoon Rains Intensify from October 3:
With the Department of Hydrology and Meteorology forecasting heightened monsoon activity from October 3–5, the government has issued a special agro-meteorological advisory. The bulletin urges farmers to ensure proper drainage in paddy fields, vegetable nurseries, and orchards, halt pesticide spraying, and store harvested crops and materials in safe locations away from flood risks. Livestock owners are advised to avoid feeding wet or moldy fodder, monitor animals for digestive illnesses, and maintain dry, clean storage for grains. Recommendations also include providing sugar syrup for bees, monitoring poultry sheds for parasites, and securing fishponds with mesh outlets to prevent losses.

Humla Karnali-2 Hydropower Project Moves Forward with EIA Submission:
The 335 MW Humla Karnali-2 Hydropower Project has advanced after the Ministry of Energy, Water Resources and Irrigation submitted its Environmental Impact Assessment (EIA) to the Ministry of Forests and Environment. Initially identified by Sichuan Wangping Energy Science and Technology, the project has since been transferred to Ruru Hydropower. Located in Kharpunath and Sarkegad rural municipalities of Humla, the run-of-river scheme will cost an estimated NPR 72.9 billion, with a 62-meter dam, two diversion tunnels, and 61 hectares of land acquisition. Construction (2026–2031) will affect 56 households, create 1,805 annual jobs during building, and 115 permanent jobs afterward.

Manang Falls Silent as Protests and Landslides Empty Tourist Trails:
Manang, usually packed with trekkers and domestic visitors during the autumn peak season, has turned eerily quiet this year. The Gen-Z uprising, which disrupted the country and scared off foreign tourists, combined with landslides and blocked roads, has left hotels empty and bookings canceled. Local businesses say tourism—the district’s lifeline—has collapsed overnight, threatening Nepal’s broader economy. Hot springs in Chame, once crowded with foreigners, now sit deserted. With most locals gone to celebrate festivals in Kathmandu and Pokhara, villages appear abandoned. Hoteliers and officials warn that without swift government support, Manang’s tourism-dependent economy will struggle to recover.

Nighttime Vehicle Ban Imposed on BP Highway Amid Monsoon Risk:
Authorities have banned nighttime travel on the BP Highway’s Kavrebhanjyang–Bhakundebesi–Sindhuli section from October 2–7 (Ashoj 16–21) due to heightened monsoon risks. From 5 p.m. to 5 a.m., all private and public passenger vehicles—except ambulances and essential services—will be restricted. The decision follows warnings of heavy rainfall and potential floods from the National Disaster Risk Reduction and Management Authority. Local officials caution that police may halt vehicles at any time if conditions worsen. Last year’s landslides severely damaged the highway, and incomplete reconstruction heightens current risks. Excavators and loaders have been kept on standby for immediate response.

Nepal Restarts Concessional Loan Scheme with Stricter Rules and 3% Interest Subsidy:
The government has revived its concessional loan program after a two-year pause, allocating around NPR 10 billion for interest payments. Under new procedures, the scheme aims to prevent misuse by tightening eligibility and clarifying responsibilities between Nepal Rastra Bank, financial institutions, and borrowers. Loan ceilings include NPR 50 million for agriculture and livestock, NPR 2.5 million for women entrepreneurs, NPR 2 million for returnee migrant workers, educated youth, and Dalit entrepreneurs, NPR 2.5 million for startups, NPR 5 million for boiler replacement in industries, and NPR 0.5 million for disaster-hit households. Interest subsidies are capped at 3% for five years.

Digital Dakshina: How Dashain Traditions Meet Nepal’s Cashless Future:
Dashain, Nepal’s biggest festival, is evolving with the rise of digital payments. Once centered on distributing new banknotes as dakshina, the custom is shifting toward mobile banking, wallets, and apps. The Covid-19 pandemic accelerated this trend, making cashless dakshina faster, safer, and more convenient. Benefits include reduced printing costs, lower theft risks, and stronger financial discipline. Yet challenges remain: elders still prefer cash, and cultural attachment to new notes is strong. Experts say awareness and training are key. With Nepal Rastra Bank promoting digital transactions, digital dakshina is set to become a modern symbol of tradition blended with technology.

India’s New Monetary Policy Floats Cross-Border Loans—but Legal Hurdles Block Nepali Borrowers:
The Reserve Bank of India’s new monetary policy hints at promoting the Indian rupee internationally and even allowing Indian banks to lend directly to countries like Nepal, Bhutan, and Sri Lanka. However, the proposal faces major legal and regulatory obstacles. Both India’s FEMA and Nepal’s Foreign Exchange Regulation Act require separate approvals. Loans would fall under dual regulation by the RBI and Nepal Rastra Bank, while collateral enforcement, taxation, and cross-border dispute settlement remain unresolved. In practice, such lending is viable only for large corporations or government-backed projects—not individuals or small businesses, who face prohibitive legal and financial barriers.

Kathmandu Valley’s Ancient Water Systems: Lessons from 1,500 Years of Ingenuity:
Kathmandu Valley’s water crisis today contrasts sharply with its historic, scientifically managed water systems. Ancient residents developed intricate networks of kulo (canals), ponds, and dhunge dhara (stone spouts) for drinking, irrigation, and religious use. Evidence traces back to the Kirati and Lichchhavi periods, with royal canals (rajkulo) connecting natural springs and rivers to settlements. Stone spouts incorporated carbon filters, multiple channels, and storage mechanisms to ensure year-round potable water. Over centuries, urban expansion, neglect, and modernization eroded these systems. Experts emphasize reviving traditional water knowledge to restore sustainability, highlighting that Kathmandu’s ancestors had already achieved sophisticated water management 1,500 years ago.

Nepal’s Eastern Trade Sees Export Dip Amid Rising Imports:
In the first two months of fiscal year 2082/83, Nepal’s exports through Kankhavitta fell 21 percent to NPR 3.06 billion compared to last year, despite a 43.9 percent surge in cardamom exports. Tea shipments, however, dropped 34 percent, while other products like ginger, chhurpi, and lentils continued to reach regional markets. Meanwhile, imports rose 9 percent to NPR 8.9 billion, dominated by petroleum, jute, pulses, and ready-made goods. Customs revenue increased nearly 9 percent. Analysts highlight the need for export diversification, infrastructure improvements, and value addition to balance trade and sustain economic growth.

Delayed Roads, Growing Frustration: Infrastructure Woes in Parbat:
Two major road projects in Parbat, Gandaki Province—Milanchok–Salyan–Ghaket–Dharapani Thotneri and Lunkhudeurali–Milanchok–Balakot–Hoshrrangdi—remain incomplete years after construction began. Despite contracts promising completion within two years, progress has stalled: Milanchok–Dharapani is only 64% finished, and Lunkhudeurali–Hoshrrangdi 35%. Contractors cite material shortages and geographic challenges, yet repeated deadline extensions have drawn criticism from local officials. Daily transport suffers, straining communities like Mahashila Rural Municipality. Infrastructure authorities now warn of contract termination if work does not resume. Residents express mounting frustration as delayed roads hinder mobility, economic activity, and regional connectivity in this mountainous district.

Nepal’s Mutual Funds Declare Dividends for FY 2081/82:
For the fiscal year 2081/82, 40 mutual funds in Nepal have announced dividends for their unit holders, completing book closure. Payouts range from 3.8% by Muktinath Mutual Fund 1 to 21.05% by Sanima Large Cap Fund. Major funds such as Laxmi Unnati, Siddhartha Equity, RBB Mutual Fund 1, and Sunrise Bluechip also announced returns between 13% and 20%. Funds like NIC Asia, Nabil, NMB, and Prabhu distributed cash dividends ranging from 4.27% to 15%. These payouts reflect the sector’s performance and provide investors with tangible returns from last fiscal year’s profits.