KATHMANDU: President Ram Chandra Paudel has officially authenticated the Alternative Development Finance Mobilization Act, 2026, establishing a specialized framework to fund high-yield infrastructure projects worth at least Rs 1 billion.

Coming into effect in 31 days, the law allows the state to bypass traditional constraints and channel fresh capital into major national initiatives, including energy networks, expressways, airports, dry ports, and information technology parks.

Financial resources will be pooled through various instruments, including specialized bonds, public equity, asset monetization, and a dedicated Sovereign Diaspora Fund utilizing remittances and non-resident Nepalese investments.

To manage these resources, the Act institutes an Alternative Development Finance Fund with an authorized capital of Rs 100 billion.

The federal government will maintain a controlling 51 percent majority stake, while institutional entities like the Employees Provident Fund, Citizen Investment Trust, and Social Security Fund hold 25 percent, and commercial insurance firms claim the remaining 24 percent.

Administrative governance of the fund will be overseen by a Ministry Secretary-led board of directors, with daily operations handled by a Chief Executive Officer appointed directly by the Cabinet based on institutional recommendations from the Public Service Commission, Nepal Rastra Bank, and the Investment Board Nepal.