KATHMANDU: The ‘Annual Performance Review of Public Enterprises 2026’, released by the government, reveals a mixed performance among the country’s public enterprises.

The report states that out of a total of 45 public enterprises in existence by the end of the fiscal year 2024/25, six are inactive. Though these six enterprises legally exist, they remain completely non-operational.

According to the report made public by the Ministry of Finance yesterday, entities where the government controls more than a 50 percent share capital and which are established with the objective of producing and distributing goods and services have been classified as public enterprises.

Based on the nature of their work, there are 10 enterprises in the industrial sector, 10 in the financial sector, 11 in the service sector, four in the trading sector, five in the social sector, and five in the public utility sector.

The six enterprises that legally exist but have no ongoing business operations are Janakpur Cigarette Factory Limited, Nepal Metal Company Limited, Nepal Orient Magnesite Private Limited, Butwal Yarn Factory Limited, Nepal Engineering Consultancy Services Center, and National Construction Company Nepal Limited.

Because financial statements have not been received for a long time from the Nepal Engineering Consultancy Services Center and the National Construction Company Nepal Limited, only 43 out of the 45 enterprises were included in the report for analysis.

Udayapur Cement Industries Limited, Hetauda Cement Industries Limited, and Nepal Drugs Limited did not operate at full capacity during the review period.

The Nepal Infrastructure Construction Company has yet to take a full commercial shape, while Dhaubadi Iron Company Limited is in its pre-production stage.

Public enterprises have been playing a crucial role in strategic infrastructure development, market stabilization, financial expansion, social security, and crisis management.

The government has concluded that public enterprises have contributed to maintaining market balance by controlling potential monopolies, artificial shortages, cartels, syndicates, and black marketing by the private sector.

The report notes that the role of public enterprises is significant in the expansion of the banking and financial sector, resource mobilization, and price stability. These enterprises have made remarkable contributions to the state coffers through taxes and dividends.

According to the report, out of the 45 enterprises existing up to the fiscal year 2024/25, 20 are fully owned by the Government of Nepal, while 25 are jointly owned by the government and government entities with more than 50 per cent ownership.

The government holds more than 90 percent share ownership in 32 enterprises and more than 60 percent share ownership in 36 enterprises.

All five enterprises in the social sector are fully owned by the government. In the industrial sector, the government has 100 percent investment in the Dairy Development Corporation, Udayapur Cement Industries, Hetauda Cement Industries, Janakpur Cigarette Factory, and Dhaubadi Iron Company.

In the service sector, enterprises like Nepal Transit and Warehousing Company, Nepal Airlines Corporation, Civil Aviation Authority of Nepal, and Nepal Railway Company are also fully owned by the government.

In the public utility sector, Nepal Water Supply Corporation and Nepal Electricity Authority are under full government ownership.

The report shows that the government does not hold 100% ownership in any financial sector enterprise. Rastriya Banijya Bank Limited has the highest government ownership in this sector at 99.97 percent.

In the fiscal year 2024/25, the paid-up capital of public enterprises increased by 2.38 percent, reaching Rs 437.80 billion. However, the government’s share in total equity ownership decreased by 0.29 percentage points compared to the previous year, limiting it to 91.68 percent.

The remaining 8.32 percent of shares are held by other institutions and the private sector.

Sector-wise, the government holds 100 percent ownership in the social sector, 99.54 percent in the service sector, 99.81 percent in the trading sector, 98.84 percent in the public utility sector, and 95.67 percent in the industrial sector.

The government’s ownership is lowest in the financial sector, standing at 64.41 percent.