KATHMANDU: Nepal News presents today’s snapshot of Nepal’s economic activities. Get quick updates on major market movements, policy shifts, and financial developments shaping the economy of Nepal. Here are the key economic highlights for today:

NRB Struggles with Excess Liquidity Management

The Nepal Rastra Bank (NRB) is facing challenges in managing excess liquidity and stabilizing short-term interest rates. Despite deploying tools like NRB Bonds and deposit collection instruments, interbank rates dropped to 1.90% last week before settling at 2.4583% on Monday. This remains below the 2.75% lower limit of the interest rate corridor. Former Executive Director Nar Bahadur Thapa noted that sluggish economic activity and weak private sector morale have stalled credit expansion. Currently, total deposits stand at Rs 7.744 trillion, while loans are limited to Rs 5.804 trillion, resulting in a high liquidity surplus of Rs 838 billion.

Only 9 Political Parties Open Bank Accounts for Election

The Election Commission reported on Tuesday afternoon that only 1,213 out of 3,406 FPTP, or direct, candidates have opened required bank accounts for the March 5 election. Furthermore, only nine out of 68 participating political parties, including Nepali Congress and Janata Samajwadi Party, have complied. Assistant Spokesperson Kul Bahadur GC explained that the Election Support Bank Account Procedure 2026 mandates these accounts to ensure transparency and monitor spending limits. All financial assistance and campaign expenses for both proportional and first-past-the-post systems must be transacted through these designated accounts to maintain legal financial oversight.

Contractors Demand Forty Percent Capital Budget for Infrastructure

The Federation of Contractors’ Associations of Nepal has urged the government to allocate 40% of the total budget for capital expenditure to accelerate infrastructure development. President Ravi Singh argued that current allocations, hovering around 20.8% or Rs 407 billion, are insufficient. He criticized the government for reducing capital spending targets to Rs 243.30 billion during mid-term reviews. The federation proposed a policy where bids lower than 15% of the estimated cost are automatically disqualified to ensure quality. Additionally, General Secretary Roshan Dahal called for an integrated umbrella act and the immediate release of outstanding payments to prevent projects from becoming ‘ill.’

New PPA Rates Set to Attract Private Hydro Investment

The Electricity Regulatory Commission issued new guidelines on February 3, increasing Power Purchase Agreement (PPA) rates for reservoir-based hydropower projects. For projects up to 100 megawatts, the winter rate is now Rs 14.80 per unit, and the summer rate is Rs 8.45. Commission Chairman Dr Ram Prasad Dhital stated these attractive rates aim to balance the seasonal power deficit. Independent Power Producers’ Association, Nepal, Vice President Mohan Kumar Dangi welcomed the increase but criticized traditional conditions, such as the 17% return cap. The guidelines define reservoir projects as those capable of 15 days of continuous full-capacity operation with specific water storage criteria.

Govt. Removes Upper Limit for Automatic Route FDI

The Ministry of Industry, Commerce and Supplies removed the upper limit for Foreign Direct Investment (FDI) via the automatic route on February 16. Previously capped at Rs 500 million, FDI in sectors like energy, tourism, and IT can now be approved online without a maximum ceiling. Director General Jitendra Basnet noted that while IT industries have no minimum investment requirement, other sectors must propose at least Rs 20 million. The reform covers 23 service areas, including hospitals and energy production. This move follows the Third Investment Conference and recent legislative amendments granting the Department of Industry authority to approve all FDI amounts, regardless of size.

Only 36 Real Estate Companies Receive Mandatory Licenses

The Department of Land Management and Archive reported on Tuesday that only 36 companies have secured mandatory licenses for real estate transactions. While 135 firms are eligible, many have yet to pay the required fees. Under Land Revenue Regulations 2036, firms must pay Rs 500,000 for transactions up to Rs 50 million and Rs 1 million for higher amounts. Director Khimananda Acharya stated that 30 applicants were disqualified due to blacklisting. Licensed companies are authorized to handle transactions exceeding Rs 30 million within six metropolitan and 11 sub-metropolitan cities, ensuring legal oversight of high-value property deals.

Over 30K Projects Stranded Due to Funding Shortage

The Federation of Contractors’ Associations of Nepal revealed that over 30,000 infrastructure projects are currently stranded across the country. Since 2016/17, nearly 100,000 projects worth approximately Rs 1.9 trillion have been initiated, but impractical policies and budget shortages have halted progress. General Secretary Roshan Dahal highlighted that even national pride projects like the Melamchi Water Supply and Nagdhunga Tunnel face delays despite foreign involvement. The federation is demanding amendments to the Public Procurement Act 2007, a simplified monthly payment system, and an integrated “Umbrella Act” to revitalize the construction sector, which employs over 2.5 million people.

New Standards Proposed to Regulate Public Energy Companies

The Electricity Regulatory Commission has drafted the Institutional Governance Standards for Licensed Entities 2026 to enhance transparency in public limited energy companies. The guidelines mandate that companies cannot leave director positions vacant and must include at least one female member on their boards. Additionally, a “cooling-off period” of two years is proposed for high-ranking officials. Commissioner Dr Madhusudhan Adhikari stated the rules aim to protect shareholder investments and ensure accountable procurement practices. Companies must now align their purchasing with public procurement principles, preventing conflict-of-interest contracts with firms directly related to their board members or executive staff.

Health Insurance Board to Distribute Rs 1 billion to Hospitals

The Health Insurance Board will distribute Rs 1 billion to service-providing hospitals following a budget transfer of Rs 750.9 million from the Ministry of Health and Population. Executive Director Dr Krishna Paudel stated the funds were pulled from 22 different programs, including a Rs 500 million cut from basic hospital operations. Despite this, the board still owes over Rs 10 billion in outstanding liabilities since mid-August 2025. Several government hospitals had threatened to halt insurance services due to non-payment. The redistributed funds will prioritize settling dues for poor citizens’ treatment and partially addressing the massive arrears owed to medical institutions nationwide.

Consumer Protection Department Inspects 26 Firms in Kuleshwor

The Department of Commerce, Supplies and Consumer Protection inspected 26 business firms in the Kuleshwor area on Monday. The operation targeted food and fruit traders to prevent black marketing, artificial shortages, and price hiking during the election period. While 25 firms received corrective instructions, Ramesh Fruit Traders was ordered to present its legal documents at the department within three days due to detected irregularities. Officials, accompanied by local representatives and consumer rights activists, emphasized that businesses must strictly follow consumer laws. The department has intensified monitoring to protect public interests and ensure price stability as the national election approaches.

FCAN Demands Apology from Politician Over Disrespectful Remarks

The Federation of Contractors’ Associations of Nepal (FCAN) held a press conference on Monday to protest remarks made by Rastriya Swatantra Party leader Balendra Shah. During a rally in Dhangadhi on February 18, Shah allegedly suggested “tying contractors to trees” or “locking them in cages” to finish projects. President Ravi Singh condemned the speech as uncivilized and a violation of the election code of conduct. The federation, representing over 30,000 builders, demanded a public apology and called on the Election Commission to take action. They argued such populism ignores the legal and administrative hurdles causing infrastructure delays.

Local Unit to Launch Door-to-Door Revenue Collection Campaign

Siddharthanagar Municipality in Bhairahawa will initiate a door-to-door campaign to bring unregistered businesses into the tax net. Deputy Mayor Uma Adhikari announced on Monday that the “broaden the base, not the rate” initiative aims to educate shopkeepers across 13 wards about revenue compliance. Administrative Officer Kamal Kant Khanal stated the campaign will commence after the upcoming election. Additionally, the municipal executive decided to issue a notice to operationalize Block A of the local agricultural market building. This strategic move is expected to boost local revenue while clarifying misconceptions regarding the municipal taxation system for small business owners.

Construction Begins for Rs 208.7 Million Engineering Campus in Ghorahi

Construction of the Tribhuvan University Institute of Engineering building has commenced at Mahendra Multiple Campus in Ghorahi, Dang. The five-story facility, costing Rs 208.7 million, is being built by Khadka Nirman Sewa Private. Per the agreement signed on February 20, the project must be completed by the fiscal year 2027/28. Although work has started, the formal foundation stone-laying ceremony is postponed until after the election due to the code of conduct. This campus aims to establish Dang as an information technology hub, with university-level classes scheduled to begin in the fiscal year 2027/28 upon the building’s completion.

UAE Emerges as Top Destination for Nepali Migrant Workers

The Department of Foreign Employment reported that 472,577 Nepalis received labor permits in the first seven months of the current fiscal year. The United Arab Emirates (UAE) remains the primary destination, attracting 106,687 workers. Qatar followed with 79,571, Saudi Arabia with 78,397, and Malaysia with 51,629 permits. Spokesperson Chandra Bahadur Siwakoti noted that the UAE has held the top spot for two years. Expert Rameshwar Nepal attributed this surge to massive post-pandemic investments in the UAE’s construction and service sectors, which have significantly increased the demand for migrant labor.

Potato Farming Generates Millions for Salyan Farmers

Over 550 households in Baphukhola of Bagchaur Municipality, Salyan, are earning millions through commercial potato farming. Ward Chairman Tikaram Oli reported that his ward alone generates over Rs 100 million annually, with the wider region exporting potatoes worth Rs 180 million. Farmers plant from late December 2025 to mid-February and harvest in mid-July. Local farmer Gopilal Oli noted that traders now purchase crops directly from the fields, paying between Rs 6,000 and Rs 7,000 per quintal. The produce is supplied to major cities, including Dang, Nepalgunj, and Butwal. Improved electricity access has further boosted production by facilitating better irrigation systems.

Advanced Wheat Farming Training Empowers Rupandehi Farmers

A farmer from Sammarimai Rural Municipality, Rupandehi, transitioned from traditional methods to modern practices following an advanced wheat cultivation training. Organized by the National Wheat Research Program, the one-week session taught 25 farmers and 15 students from 24 districts about certified seed selection, balanced fertilization, and disease management. Program Coordinator Dr Roshan Basnet emphasized line-sowing and soil-testing techniques. According to Director Dr Tek Prasad Gotame, the program has developed 54 advanced varieties over six decades. Scientists claim new strains like Zinc Wheat-1 and Borlaug-2020 can produce 5.5 tons per hectare, potentially making the country self-sufficient.

Kathmandu Dialogue Highlights Chinese Poverty Alleviation Strategies

A dialogue titled “Friends on the Cloud” was held in Nepal to discuss Chinese President Xi Jinping’s economic theories on poverty reduction. Speakers, including Dr Kusum Shakya and Dr Bishnu Hari Nepal, emphasized that adapting China’s successful strategies could significantly benefit Nepal. The discussion focused on branding Nepal’s mineral water, developing physical infrastructure, and enhancing tourism to create sustainable economic growth. Participants suggested that implementing these targeted poverty alleviation concepts would help improve local livelihoods. The event brought together diplomats, journalists, and social workers to explore how international economic models could be tailored to address Nepal’s specific developmental challenges.

Palpa Cement Industries to Launch 450 Million IPO

Palpa Cement Industries will open its Initial Public Offering (IPO) for the general public starting today. Following successful allotments for local residents and migrant workers, the company is now offering 4.5 million shares valued at 450 million. Investors can apply for a minimum of 10 shares and a maximum of 100,000 shares at a par value of Rs 100. The subscription remains open until February 27. Nabil Investment Banking Limited serves as the issue manager. Infomerics Credit Rating Nepal assigned an IRN Double B Plus rating, indicating moderate risk in the company’s ability to meet financial obligations.

Gold Price Rises by Rs 1,300 while Silver Drops Today

The price of gold has increased by Rs 1,300 per tola (11.66 grams) in the domestic market today as compared to Monday. However, the price of silver has declined by Rs 10 per tola. According to the Federation of Nepal Gold and Silver Dealers’ Association, gold is being traded at Rs 314,800 per tola today against Rs 313,500 per tola on Monday. Similarly, the Federation has fixed the price of silver at Rs 5,885 per tola today. It was traded at Rs 5,595 per tola on Monday.