KATHMANDU: Welcome to Nepal News’ Evening Economic Brief—your go-to source on key financial updates in Nepal. Stay informed with concise insights on market trends, economic indicators, and policy shifts. Here are today’s top economic news highlights.

President Paudel Unveils Govt Policy for New Fiscal Year: President Ramchandra Paudel on Friday addressed the joint session of the Federal Parliament, presenting the government’s policy and program for the upcoming fiscal year.  The joint sitting of the House of Representatives and National Assembly began at 3 PM at the Parliament Building in New Baneshwor. The President’s address, mandated under Article 95 of the Constitution of Nepal, outlined the government’s strategic focus on reviving public optimism, especially among youth, by emphasizing entrepreneurship, skill development, startup promotion, and good governance.  The policy framework also aims to stimulate government spending in priority sectors. According to the Federal Parliament Secretariat, discussions on the proposed policy and program will take place from Baisakh 22 to 28 (May 5–11), after which it will be endorsed by the Parliament.

Govt Sets 13 Priorities for Upcoming Fiscal Year: The government has outlined 13 key priorities for the upcoming fiscal year, as presented by President Ram Chandra Paudel in his address to the joint session of the Federal Parliament. The first priority is to strengthen the federal democratic republic and counter any movements that oppose it. Additionally, the government plans to initiate a constitutional amendment process based on consensus to address gaps identified during its implementation.  Political and policy stability will be another key focus, ensuring consistent governance throughout the year.  The government will also prioritize the reprioritization of development projects, placing emphasis on feasibility and the elimination of non-viable or flawed initiatives.

Nepal Stock Market Drops 1.31% This Week: The Nepal Stock Exchange (NEPSE) fell by 1.31% this week, dropping 35 points from last week’s close of 2,658 to settle at 2,623. Due to the public holiday on Thursday for Labor Day, trading took place over four days. The market declined on three of those days. While it gained 3.58 points on Sunday, it dropped by 14.53 points on Monday, 15.08 points on Tuesday, and 8.14 points on Wednesday. Despite the market decline, trading volume remained significant. Transactions reached Rs 10.87 billion on Sunday, followed by Rs 8.91 billion on Monday, Rs 7.57 billion on Tuesday, and Rs 9.37 billion on Wednesday.

NEA Issues White Paper, Moves to Take Rs 10 billion Short-Term Loan: The Nepal Electricity Authority (NEA) has issued a white paper revealing a dire cash flow crisis despite showing large assets and profits on paper. On Friday, NEA Executive Director Hitendra Dev Shakya made public the white paper, stating that the authority’s account holds zero cash balance, prompting it to seek a short-term loan of Rs 10 billion. Speaking at the press event, Shakya said, “While we show assets worth Rs 600 billion and even profits, the NEA currently has no cash reserve. This is why we have initiated the process of acquiring a Rs 10 billion short-term loan.” He added that the authority has already sent a formal request to the government for approval. “We are compelled to move ahead with the borrowing plan simply because the institution lacks liquid funds,” Shakya explained. “Even though short-term loans carry higher interest rates, we have no alternative at this point.”

EPS of Commercial Banks Decreases: As of the end of Chait (March) in the current fiscal year, the average earnings per share (EPS) for commercial banks stands at 14.27 rupees. This is a slight decrease compared to the previous year’s 14.31 rupees for the same period. During this time, the EPS for commercial banks has generally decreased, but there has been a significant improvement in distributable profits. At the end of the last fiscal year (Chaitra), the total paid-up capital of commercial banks was 379 billion 2 million rupees, with a profit of 40.68 billion 31 million rupees. In the third quarter of the current fiscal year, the paid-up capital increased to 385.33 billion rupees, and profits rose moderately to 41.25 billion 11 million rupees. During this period, 10 banks saw an increase in return on shareholder investment, while 10 others experienced a decline.

Banking Sector Under Pressure Amid Economic Slowdown: The banking sector in Nepal is currently under pressure due to the economic slowdown and increasing non-performing loans (NPL). Financial statements have illustrated how the economic situation is affecting business contraction. Despite efforts by banks and financial institutions to recover loans, there has been little improvement. However, they remain hopeful for an improvement in the fourth quarter. In the third quarter of the current fiscal year, the average NPL ratio of commercial banks in Nepal reached 4.83%, which is a notable increase compared to 3.65% in the previous year. Himalayan Bank had an NPL ratio of 7.68%, and Kumari Bank had 6.98%, while Everest Bank had the lowest NPL ratio at 0.64%. The Nepal Rastra Bank has indicated in its Financial Stability Report that rising NPLs and a decline in capital adequacy ratios are major challenges for the banking sector.

Investment Board Approves Strategic Plan Targeting Ambitious PPP Goals: Aiming to meet ambitious infrastructure development targets under the Public-Private Partnership (PPP) model, the Investment Board Nepal (IBN) has approved its new “Strategic and Business Plan 2081–86 BS”. The decision was made during the board meeting held last Sunday. According to IBN spokesperson Pradyumna Prasad Upadhyaya, the plan outlines strategies and work schedules for the upcoming four years across various projects. “The strategic plan sets forth highly ambitious goals. It outlines both minimum and maximum investment targets. Our estimation is that if we can create a conducive investment environment, manage human resources, and formulate necessary laws, those targets are achievable,” said Upadhyaya.

Govt Makes Health Insurance Mandatory for Public Officials and Formal Sector Workers: The government has made health insurance mandatory for elected representatives, civil servants, and workers in the organized sector. This provision is part of the upcoming fiscal year’s policy and programs. Previously, health insurance was voluntary, and the government only encouraged participation. Now, the policy outlines that a structured system will be created to provide insurance coverage for all health services except basic care, including serious medical treatments. The proposal states: “To expand the scope of health insurance, elected representatives, all civil servants, and workers in the organized sector will be enrolled in the program, and a benefits package will be developed to ensure coverage of comprehensive and critical medical services.”

Koshi Province Investment Summit Focuses on 71 Projects Worth Rs 173.49 billion: The Investment Summit organized by the Koshi Province Government has officially begun in Biratnagar. The two-day event, being held yesterday and today, features the participation of both domestic and international investors. The summit aims to showcase 71 projects with a total estimated investment of Rs 173.49 billion. Among these, projects from eight key sectors—including tourism, agriculture, industry, energy, infrastructure, and IT services—are being featured. Out of 45 foreign investors consulted, 20 have attended the summit in person. The event was formally inaugurated by Prime Minister KP Sharma Oli.

Rs 32 billion Spent, But Bhairahawa Airport Faces Operational Hurdles: Parliamentary Probe:
Despite an expenditure of nearly Rs 32 billion on project development and land compensation, the upgraded Bhairahawa Airport is facing significant operational challenges, according to findings from a parliamentary subcommittee investigation under the Public Accounts Committee of the House of Representatives. The subcommittee pointed out that, while major investment was made in land acquisition and infrastructure, technical aspects were largely overlooked during the airport’s upgrade. It further emphasized that the airport suffers from both a lack of a commercial action plan and technical shortcomings. The subcommittee, formed on Jestha 27, 2081 BS (June 10, 2024) and led by CPN-UML MP Yogesh Bhattarai, completed a field study and other assessments.

Government Likely to Fall Short of 1.6 million Tourist Target in FY 2081/82: In the current fiscal year, with most of the set targets unfulfilled, the government is also likely to fail in its attempt to bring in tourists. The government had aimed to attract 1.6 million tourists this year. However, as of the 9 months into the current fiscal year (until Chaitra), only 798,800 tourists have arrived, averaging about 88,755 per month. Even if 1 lakh tourists arrive in the next three months (from Baisakh to Ashar), it is unlikely that the total number of tourists will exceed 1.1 million for the year. This represents about 69% of the set target. While presenting the budget for the fiscal year 2081–82, former Finance Minister Barshaman Pun had stated, “Programs will be conducted to promote tourism with the aim of attracting 1.6 million tourists in the coming fiscal year.”

Government to Introduce Policies Promoting Agricultural Exports and Loans: The government is preparing to introduce new policies and programs ranging from promoting agricultural exports to expanding agricultural loans in the upcoming fiscal year’s budget plan, which will be presented this Friday. According to the Ministry of Agriculture and Livestock Development, the new policies aim to make agricultural services and facilities more accessible and transparent by digitizing the agricultural service system. To support this, plans include capacity building of agricultural technicians and deployment of technical and expert personnel at the local level, along with the development of necessary basic infrastructure. “To improve the overall agriculture and livestock sector, the policy and program for FY 2082/83 (2025/26) will include measures such as upgrading quarantine and laboratory services, expanding agricultural insurance coverage, and updating subsidies on insurance premiums to reflect current needs,” a ministry source said.

Russian Company Shows Interest in Investing in Podway Transport in Koshi Province:
A Russian company has expressed its readiness to invest in Podway transport technology in Nepal’s Koshi Province during the ongoing Investment Summit. Unitsky String Technologies, the company that pioneered Podway transportation in Russia, has shown interest in introducing the system in various locations across Koshi in collaboration with Nepali investors. Speaking at the summit, the company’s CEO Oleg Zaretsky stated that they are ready to invest in Nepal if the government ensures a favorable investment environment. He noted that Podway technology has immense potential in mountainous countries like Nepal and could be a viable solution for difficult terrains, provided the government supports the initiative.

NRB Initiates Auction Process for Mangturam Group’s Collateral: Rastriya Banijya Bank has initiated the process of auctioning the collateral of companies belonging to the Mangturam Group in Biratnagar. The bank is moving forward with the auction process for the 9 companies under the Mangturam umbrella and the assets of their family members.

It has been five years since the once prominent and aggressive business group in Biratnagar, the Mangturam Group, collapsed. The bank had provided loans to the group’s companies under various categories such as AOC (Assignment of Contract), TL (Term Loans), Bills Purchase, Cash Credit, Industrial Goods, and Bank Guarantees. The companies involved include Annapurna Soap and Chemical, Narayan Vegetable Industries, Ganesh Plastic Industries, Jaikali Biscuit, Dantakali Packaging, Lakshmi Footwear, Annapurna Iron Industries, Ghatstaphana Enterprises, and Phulpati Enterprises.

Culture, Tourism, and Civil Aviation Ministry Spends 19.34% of Capital Budget in FY 2081/82: The Ministry of Culture, Tourism, and Civil Aviation has spent only 19.34% of its capital budget by the end of the FY 2081/82 first-quarter progress review. For the current fiscal year, the ministry’s total budget was 5.02 billion rupees, with 2.74 billion rupees allocated for capital expenditure and 2.49 billion rupees for recurrent expenditure. By the end of the quarter, 59% of the recurrent expenditure (1.44 billion rupees) and 56.41 million rupees of the capital expenditure had been spent. During the quarterly progress review meeting on Monday, it was reported that only 37% of the total budget had been spent. Additionally, the ministry had spent just 25.54% of its capital expenditure budget during this period.

Over 4,000 Electric Vehicles Imported via Rasuwagadhi Border Post: Over 4,000 electric vehicles (EVs) have been imported through the northern Rasuwagadhi border post between July and February of FY 2081/82. In total, 4,637 small and large electric vehicles have entered the country during this eight-month period. Of these, 4,500 electric vehicles were handled by the Rasuwagadhi Customs Office, as informed by Information Officer Rabindra Pyakurel. The imported vehicles primarily include electric cars, vans, microbuses, and some vehicles running on low fuel consumption. As of February, the customs revenue collection target was 19.47 billion rupees, and the actual revenue collected amounted to 19.14 billion rupees, according to Customs Chief Tulsi Prasad Bhattarai. In the same period of the previous fiscal year, the revenue target was 12.96 billion rupees, and the customs office successfully collected 12.70 billion rupees. The customs office also reported that a total of 7,377 vehicles were imported through the Rasuwagadhi border post in FY 2080/81.

14 Km Paved on Rahughat–Tatopani Section of Beni–Jomsom–Korala Road: As part of the Beni–Jomsom–Korala road project, 14 kilometers of blacktopping work has been completed on the Rahughat–Tatopani section. A contract worth NPR 660 million was signed in 2017 (2074 B.S.) to pave 19 kilometers of road from Rahughat in Raghuganga Rural Municipality-3 to Nagdhunga in Bhrung Tatopani of Annapurna Rural Municipality-2. According to the construction company, the newly blacktopped stretch includes Rahupare–Baisari–Kunauta–Begkhola–Kaliodar–Tiplyang–Mahabhir–Bhirkate–Ghar Baisari–Ratopani–Pokharebagar–Bhrung Tatopani. The road was widened to 11 meters, and structures like drainage and retaining walls were completed before the blacktopping.

75 Road Projects Underway in Karnali’s 10 Districts via Federal Road Department: A total of 75 road construction projects—ranging from small to large—are currently being implemented in 10 districts of Karnali Province under the federal government’s Department of Roads. According to the Ministry of Physical Infrastructure and Urban Development of Karnali Province, road division and project offices are overseeing the construction of both major and mid-sized roads across the province. Out of the 2,218.29 kilometers of road planned for construction, 771.36 kilometers have already been blacktopped, and 264 kilometers have been graveled. Additionally, 676.5 kilometers of earthen roads have been constructed so far, informed Ministry spokesperson Ramesh Subedi.

Taxpayer Service Office Issues Ultimatum to Taxpayers: The Taxpayer Service Office in Kushma has issued a 15-day ultimatum to nearly 150 firms and companies for failing to submit their tax details on time. The office issued a notice on Baishakh 11, instructing 146 firms and companies in Parbat to update their tax details within the next 15 days. In Parbat, there are 826 excise taxpayers, 7,698 individual PAN users, 770 VAT taxpayers, and 139 income tax payers. According to the notice, taxpayers who have failed to submit their tax details for more than six months are being warned. The most notable case is Nexa Construction and Engineering Services, which has not submitted its tax details for 228 months, i.e., 76 quarters. This company has not filed its tax details for the past 19 years. Additionally, there are several other companies and firms that have failed to submit tax details for periods ranging from six months to nearly six years, according to the office head Nimesh Paudel.

Prabhu Mahalaxmi Life Insurance Proposes 8.42% Dividend to Shareholders: Prabhu Mahalaxmi Life Insurance has proposed to distribute a total dividend of 8.421% to its shareholders. According to the decision made at the company’s board meeting on the 17th (Baisakh 17), the dividend will be based on profits from fiscal year 2080/81. The proposal includes 8% bonus shares and a 0.421% cash dividend to cover tax obligations.
The proposal will be submitted to the Nepal Insurance Authority for approval and will be finalized after endorsement by the company’s upcoming annual general meeting.

Construction Begins on 6.5 MW Darkhola Hydropower Project in Myagdi: Construction has begun on the 6.5-megawatt Darkhola Hydropower Project located in Kunauta of Dhaulagiri Rural Municipality-3, Myagdi. The project, promoted by Darkhola Hydropower Limited, has completed the access road to the dam site, and structural works are underway.
Chairman Resham Bahadur Bhandari said construction of the track for laying the penstock pipe from Kunauta to the powerhouse has already started. A 2 km unpaved road on the right bank of Darkhola has been built, and three bulldozers are being used. A 3.1 km long penstock pipeline will be installed to channel water to the powerhouse at Solwang.

Gold Price Stable, Silver Edges Up in Nepali Market: Gold prices remained unchanged in the Nepali market on Friday. According to the Federation of Nepal Gold and Silver Dealers Association, hallmark gold continued to trade at NPR 183,500 per tola, the same rate as Thursday. However, silver prices increased slightly. Silver, which was traded at NPR 1,915 per tola on Thursday, rose to NPR 1,930 per tola on Friday.