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:

Election Commission Enforces Financial Transparency for Candidates

To ensure transparency for the March 5 House of Representatives election, the Election Commission has mandated the use of dedicated bank accounts for all campaign expenses. Commission records show that 11 political parties and 1,670 candidates have successfully opened these accounts and reported their details. Additionally, under Article 37 of the Election Code of Conduct, 2026, candidates must submit their election manifestos to the commission. So far, 43 political parties have complied. These measures aim to monitor spending limits and ensure that all financial contributions are legally tracked during the race.

Govt. Forms Revenue Advisory Committee for 2026/27 Budget

The Ministry of Finance has initiated the budget preparation process for the fiscal year 2026/27. Finance Minister Rameshore Khanal formed the Revenue Advisory Committee on Friday, coordinated by Revenue Secretary Bhupal Baral. The committee includes representatives from the FNCCI, CNI, and Nepal Rastra Bank. Its mandate covers reviewing VAT, income tax, and digital service tax rates while identifying new revenue sources. Nine subcommittees will also study challenges in agriculture, energy, and the capital market. This early start follows the National Planning Commission providing the budget ceiling to the government on February 19.

Finance Ministry Initiates Budget Formulation Process

The Ministry of Finance has officially started the budget formulation process for the upcoming fiscal year. According to Spokesperson Tanka Prasad Pandey, the Revenue Advisory Committee was formed following a decision by Finance Minister Rameshore Khanal on February 11. Chaired by Revenue Secretary Bhupal Baral, the committee will suggest reforms for income tax, VAT, excise duty, and digital service tax. Subcommittees are tasked with submitting recommendations by April 13, while the main committee will present the final report to the finance minister by May 14.

Finance Commission Urges Govt. to Halt Grant Cuts

The National Natural Resources and Fiscal Commission (NNRFC) has directed the federal government to immediately stop reducing financial equalization grants for provincial and local levels. During its meeting on February 23, the commission emphasized that under Article 60 and Article 251 of the Constitution of Nepal, the power to determine these grants resides solely with the commission. Although the government cited a revenue shortfall, collecting only Rs 588.514 billion against a target of Rs 1.533 trillion, the commission insists that passed budget amounts must be fully transferred to ensure local administrative stability.

Election Commission Fines Candidates for Code of Conduct Violations

The Election Commission has finalized preparations for the 2026 House of Representatives election, transporting materials to all 77 districts. Spokesperson Narayan Prasad Bhattarai announced that the commission has received 254 complaints regarding code violations. Consequently, candidates Shakti Bahadur Basnet from Jajarkot-1, Dr Kamal Bhusal from Rupandehi-2, and the Shram Sanskriti Party were each fined Rs 25,000. To ensure fairness, international borders will close 72 hours before polling, and a nationwide alcohol ban will take effect seven days prior. Additionally, the commission flagged 612 instances of misleading digital information, including AI-generated ‘deepfakes’ used for election interference.

Major Political Parties Report Millions in Income from Contributions

Political parties in the country reported significant revenue from memberships, levies, and donations for the fiscal year 2024/25. According to Election Commission records, CPN (UML) earned the highest income at Rs 63.6 million, largely from membership fees and representative levies. The Rastriya Swatantra Party (RSP) collected Rs 44.1 million, including Rs 25.4 million from donations. The Nepali Congress reported Rs 38.8 million, while CPN (Maoist Centre) earned Rs 20.2 million. Despite high earnings, officials raised concerns regarding the transparency of individual donations exceeding Rs 25,000.

77 Candidates in Rautahat Fail to Initiate Mandatory Bank Accounts

In Rautahat, 77 out of 142 candidates for the House of Representatives have failed to apply for bank account recommendations required for election spending. According to District Election Officer Chhotelal Das, only 65 candidates have started the process as of Friday. In Constituency-1, 24 candidates have complied, while 15 in Constituency-2, 11 in Constituency-3, and 15 in Constituency-4 have followed the directive. With the election just five days away, Das warned that the lack of transparent accounts could lead to complications in financial reporting. Candidates are legally required to manage all income and expenditures through these verified accounts to ensure fiscal accountability.

Two Independent Candidates in Makwanpur Fail to Open Bank Accounts

With only five days remaining until the House of Representatives election, two independent candidates in Makwanpur have yet to open mandatory bank accounts for campaign expenses. Pradesh Election Officer Hari Prasad Dhakal identified the candidates as Rakesh Kumar Sharma and Sushila Subedi from Election Constituency-1. While 42 other candidates, including 13 from parties and 10 independents in Constituency-1 and 21 candidates in Constituency-2, have complied, these two individuals have not sought the required recommendation. The Election Commission directive from February 3 mandates that all financial transactions for election promotion must be processed through these dedicated, transparent bank accounts.

Janakpur-Jayanagar Railway to Suspend Service for Elections

The Nepal Railway Company has announced a total suspension of rail services on the Bhangaha-Janakpur-Jayanagar section for three days. To ensure peace and security during the House of Representatives election on March 5, the service will remain closed from March 3 to March 5. The central office in Janakpurdham issued the notice on Friday, requesting passengers to use alternative transportation during this period. Regular operations are scheduled to resume on Friday, March 6. The company apologized for the inconvenience caused by these essential security measures.

NRB Demands Clarification from Karnali Bank Directors

Nepal Rastra Bank has issued a second directive to five former directors of the troubled Karnali Development Bank, including former Chairman Dr. Om Prakash Mishra. The Financial Institution Supervision Department ordered members Yuvraj Adhikari, Usha Kumari Bhandari, Tanka Bahadur Basnet, and Nisar Ahmed Darji to submit explanations within 10 days. This follows an initial notice on October 14, 2025, which received no response. The directors must explain why they should not be dismissed for regulatory failures. Failure to comply with this second notice at the Nepalgunj or central office will lead to further legal action under prevailing banking laws.

Labor Department to Continue Work Permits During Election Period

The Department of Foreign Employment will maintain labor permit services during the upcoming election holidays to assist migrant workers. Director General Mira Acharya stated that teams will be stationed to issue permits even on election day, especially for those with confirmed flight tickets. Since destination countries do not observe Nepal’s election holidays, the department aims to prevent disruptions for workers. Currently, the department issues approximately 2,300 permits daily, including 500 new and 1,800 renewals. Officials noted that the high volume of applicants suggests that the election cycle has not slowed the economic momentum of youth seeking employment abroad.

FNCCI Requests Extension for Nepal’s LDC Graduation to 2029

Chandra Prasad Dhakal, president of the Federation of Nepalese Chambers of Commerce and Industries (FNCCI), has formally requested postponing Nepal’s graduation from Least Developed Country (LDC) status. During a meeting with UN Resident Coordinator Lila Peters Yahia on Friday, Dhakal proposed moving the deadline from November 2026 to November 2029. He argued that Nepal is not structurally prepared and that premature graduation could harm 300,000 small agricultural industries due to lost subsidies in European markets. The FNCCI emphasized that while per capita income has slightly improved, economic sensitivity remains high, necessitating a more sustainable transition period.

Investment Board CEO Stresses Strategic Investment in Digital Economy

At the Nepal-India Tech Forum 2026, Sushil Gyewali, CEO of the Investment Board Nepal, emphasized the necessity of strategic investment to harness the digital economy. Gyewali highlighted that Nepal offers an attractive destination for IT parks and data centers due to cheap energy rates and natural cooling systems in high-altitude regions. He noted that the government has already developed the Digital Nepal Framework to create a stable policy environment. To maximize benefits from emerging technologies like artificial intelligence (AI), he called for systematic collaboration between the private sectors and governments of both Nepal and India to capitalize on the country’s tech-friendly youth population.

Life Insurance Companies Collect Rs 16.67 Billion

In the first seven months of the current fiscal year, 14 life insurance companies in Nepal collected a total premium of Rs 16.67 billion. According to the Nepal Insurance Authority, this marks a 13.28% increase compared to the Rs 14.722 billion collected during the same period last year. Nepal Life Insurance led the market with Rs 4.083 billion, followed by National Life Insurance at Rs 1.938 billion. Himalayan Life and LIC Nepal both crossed the Rs 1.81 billion mark. The growth highlights a rising public interest in insurance services across the country.

Cabinet Approves Investment Model for Budhigandaki Hydropower

The Council of Ministers officially approved the investment modality for the 1,200 MW Budhigandaki Reservoir Hydropower Project on February 25. The total cost is estimated at Rs 406 billion, which includes a base cost of USD 2.77 billion and Rs 32 billion in interest during the eight-year construction period. Under a 70:30 debt-to-equity structure, the government will provide Rs 97.04 billion in equity and Rs 150 billion in concessional loans. Additionally, Rs 90 billion will be raised through public shares, while Rs 30 billion in energy bonds will be issued to financial institutions. The project aims for commercial operation by 2034.

Tanahu Hydropower Clears Trees for Transmission Line Construction

The Tanahu Hydropower Project has received government approval to remove 9,127 trees across 92.7 hectares of forest land in Tanahu and Chitwan. Project Chief Shyamji Bhandari stated that an agreement was signed with the Department of Forest and Soil Conservation for the 220 KV Damauli-Bharatpur line. Currently, KEC International Limited from India has completed 69 out of 94 towers, with overall package progress at 75%. Meanwhile, the main dam construction under Songda Kalika JV has reached 54% completion, and the powerhouse construction by Sinohydro Corporation of China is at 73%.

CBFIN Welcomes Monetary Policy Review for Economic Stability

The Confederation of Banks and Financial Institutions Nepal (CBFIN) has praised the Nepal Rastra Bank’s half-yearly review of the fiscal year 2025/2 monetary policy. In a press release on Friday, CBFIN stated the policies will boost economic activity and strengthen financial stability. The review includes expanding sectoral credit, encouraging small enterprise loans, and flexible blacklisting rules. CBFIN believes these steps will facilitate investment in productive and employment-generating sectors. The organization also urged further discussions to resolve challenges related to non-performing loans and non-banking assets while modernizing the national payment system through digital infrastructure.

Price Hikes in Kalikot Burden Consumers During Election Season

Consumers in Manma, the district headquarters of Kalikot, are facing a sharp rise in the cost of daily essentials. Over the past few weeks, the price of cooking oil has increased by over Rs 200 per case, while rice and lentils have risen by Rs 6 per kilogram. Local traders cite increased transportation costs and international raw material prices as reasons for the adjustment. Daily wage workers, earning between Rs 800 and Rs 1,000, struggle to meet basic needs as wages remain stagnant. Assistant Chief District Officer Janak Sharma stated that regular market monitoring has been delayed due to election preparations but promised strict action afterward.