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.

Normalcy Returns as Nepal Counts Costs of Unrest

On Sunday, life across Nepal is gradually returning to normal following the appointment of former Chief Justice Sushila Karki as the new interim prime minister. Curfews have been lifted, and a sense of calm is returning. The new government is now tasked with both restoring order and rebuilding the economy. The previous estimates of a Rs 3 trillion economic loss and 10,000 jobless people could not be verified from official or widely cited sources and appear to be based on preliminary or anecdotal reports. The verified figures are more specific to the tourism sector.

Government Declares Protesters Martyrs, Pledges Relief for Victims

In her first official act after taking office, Interim Prime Minister Sushila Karki has declared those who died during the recent Gen Z protests as martyrs. She also signed a decision to provide free medical treatment for the injured and a relief payment of Rs 1 million to the families of the deceased.

New Prime Minister Pledges Support for Private Sector

Prime Minister Sushila Karki has expressed sorrow over the destruction caused to both public and private property during the protests and has promised government support to help the private sector recover. Speaking after taking office, she stated that the government is prepared to offer various forms of assistance, including soft loans, to affected businesses. She praised the resilience of business owners, many of whom have expressed determination to rebuild despite significant losses.

Government Payments and Revenue Collection Resume

Nepal’s government has resumed its payment system as of Sunday, as confirmed by the Ministry of Finance. Most customs and internal revenue offices are back in operation, though some offices that were completely damaged during the protests remain closed. With payments now a go, all government employees are guaranteed to receive their salaries before the Dashain festival. The government’s treasury currently has sufficient funds, with a total income of Rs 146.92 billion as of Saturday. The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has warned that the widespread damage to the private sector will make it difficult for the government to meet its revenue targets.

New Banknotes Available for Dashain Despite Recent Unrest

Nepal Rastra Bank (NRB) has begun the exchange of new and clean banknotes for the upcoming Dashain festival, with the service running until September 26, 2025. The central bank’s decision to proceed with the exchange came after initial uncertainty caused by the recent Gen Z protests. Notes can be exchanged at the Currency Management Department in Thapathali and at the central bank’s provincial offices. Officials confirmed that the infrastructure damage from the protests did not affect the distribution schedule.

NRB to Inject Funds into Financial System

Nepal Rastra Bank is set to invest Rs 1.2 billion in a fixed deposit with commercial banks and financial institutions. The investment, sourced from the bank’s pension and gratuity fund, is intended to be a boost to the financial system. Interested institutions have been asked to submit their applications by September 15. The central bank has specified that the investment will be allocated across different classes of financial institutions: Rs 1.04 billion for Class “A” commercial banks, Rs 195 million for Class “B” development banks, and Rs 65 million for Class “C” finance companies.

NRB Directs Companies to Resume Operations

The Nepal Insurance Authority has directed all insurance companies to resume office operations as of Sunday. This directive was issued as the adverse situation from recent protests is now returning to normal. With the easing of curfew and prohibitory orders, the Authority has urged all companies and their branch offices to operate at full strength. This follows a prior directive from the Authority to facilitate the payment of insurance claims for damages sustained during the demonstrations on September 8 and 9 across the country.

Share Market Reacts to Political Shift

The Nepal Stock Exchange (NEPSE) has historically shown a strong link to political events. While some research suggests the market quickly adjusts, a study by Nepal Rastra Bank found that political instability and unexpected events can cause significant volatility and generate abnormal returns. The new government’s formation has led to investor speculation about future policies, which could influence share prices and trading volumes in the coming days.

Gold Price Declines from Record High, Silver Gains

Gold prices in Nepal have declined by Rs 700 per tola from a record high, with the price now at Rs 215,100 per tola, the Federation of Nepal Gold and Silver Dealers’ Association (FENEGOSIDA) reported. Prices had reached a high of Rs 215,800 on Friday. Silver also saw a gain of Rs 5 per tola, rising to Rs 2,570 per tola. The fluctuation is influenced by global market trends.

Tourism Sector Suffers Heavy Losses, Stakeholders Respond

Nepal’s tourism industry is facing a significant setback after the Gen Z protests on September 8 and 9. Initial estimates by the Hotel Association Nepal (HAN) indicate losses exceeding Rs 25 billion. The demonstrations disrupted the start of the peak tourist season, leading to numerous booking cancellations. Despite the financial blow, industry leaders are hopeful for a quick recovery, citing the sector’s historical resilience after past crises.

Local Markets and Businesses Reopen Nationwide

Local markets and businesses have resumed operations across the country as normalcy returns. Retail chains like Bhatbhateni have reopened, with services restored in key locations. The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has called on the new government to ensure a stable business environment to facilitate reconstruction. The private sector is trying to play a crucial role in rebuilding effort in areas affected by the recent unrest.

Tea Exports Disrupted as Customs Office Burns

The recent Gen Z protests have severely impacted Nepal’s tea industry, particularly exports. On September 9, protesters set fire to the Mechi Customs Office in Jhapa, destroying 25,000 kilograms of tea ready for export to India. The Himalayan Orthodox Tea Producers Association (HOTPA) reported that the tea belonged to five factories. While tea factories have since reopened to process raw leaves, the incident has caused significant financial losses for the industry. In the first month of the current fiscal year, tea exports had reached a value of Rs 37.48 million.

Reconstruction Efforts Begin on Damaged Infrastructure

Reconstruction and repair work is commencing on public and private property damaged during the protests. The Ministry of Finance has confirmed that several of its offices were vandalized, while HAN reported damage to nearly two dozen hotels. These incidents will require significant resources to repair. A coordinated effort is now underway to restore critical infrastructure and commercial properties to full operation.

Consumers Face Soaring Prices as Markets Recover

As normalcy returns to Nepal, consumers are now grappling with rising prices for daily necessities just as the Dashain festival approaches. Many individuals, like street vendors and daily wage workers, lost their income during the Gen Z protests and are struggling to make ends meet. According to the Nepal Retailers Association, cooking oil has risen by Rs 10 per liter, while pulses and legumes are up Rs 5 to Rs 10 per kilogram. Retailers claim the price hikes began before the protests, but the recent situation has worsened the impact on consumers.

Customs Clearance Resumes at Nepal–India Border

Customs clearance of freight trucks stranded at the Nepal–India border has resumed. The clearance process had been obstructed for the past few days due to security concerns and shortage of staff at Nepal’s customs offices. With the resumption, the supply of essential goods into Nepal has become easier. Although there were no restrictions on truck movement from the Indian side, and Indian customs continuously requested facilitation, hundreds of trucks were stranded at the border due to delays on the Nepali side.

Ministry of Finance Recovers from Vandalism, Resumes Limited Services

The Ministry of Finance and related departments are gradually resuming operations following damage from the protests. While some areas are limited to basic services, a Ministry spokesperson confirmed that crucial software systems for budgeting and taxation are secure and functional. Customs services are now available, while the Inland Revenue Department is offering online services only. The Ministry is currently assessing the full extent of the damage.

Trade Deficit Remains High Despite Export Growth

Nepal’s trade deficit persists, primarily with its largest trading partners, India and China. However, a recent surge in exports, particularly of processed edible oils, has helped increase overall export volume. This has led to a record-breaking foreign trade total of over Rs 2 trillion in the last fiscal year, even as imports continue to grow. This growth highlights a reliance on re-exports, a model which has raised concerns among some economists.

Foreign Direct Investment Shows Modest Rise

Recent market data shows a modest increase in Foreign Direct Investment (FDI) inflows to Nepal. While a positive sign, the country still faces significant challenges in attracting a larger share of global investment. Policymakers are looking at reforms to create a more attractive environment for foreign capital. The government is aiming to make the FDI process more streamlined to encourage investment in key sectors like technology, tourism, and hydropower.

SY Panel Nepal IPO Postponed Until Further Notice

SY Panel Nepal Limited has officially announced the temporary postponement of its planned share issuance for residents of Chitwan and Nepali employed abroad. The shares were originally scheduled to be issued starting Sunday. According to the company, the decision was made due to the current adverse situation in Nepal. The company has requested all stakeholders to remain patient until a new notice is published when conditions are favorable.