Issuu

ISSUE 66 | SEPTEMBER 2026

Digital Democracy How Democracy Is Practiced in the Digital Age

Nepal Factsheet

Koshi Province

2 Madhesh Province 3 Bagmati Province 4 Gandaki Province

5 Lumbini Province 6 Karnali Province 7 Sudurpashchim Province

3 2

KEY ECONOMIC INDICATORS GDP (Preliminary estimate for FY 2025/26)****

NPR 6,107 billion (USD 40 billion)

GDP growth rate (April 2026)*

2.3%

Inflation (y-o-y)***

5.04%

24.07%

Agriculture Sector (% of GDP)****

25.16%

HDI Value**

0.622

Industry Sector (% of GDP)****

12.83%

HDI Rank**

145

Service Sector (% of GDP)****

62.01%

GNI (per capita)**** Gross Capital Formulation (% of GDP)****

NPR 206,424 (USD 1,355.29)

* World Bank, Nepal Development Update1 ** HDI Figure from Human Development Report of UNDP2 *** Current Macroeconomic and Financial Situation of Nepal Based on Four Month Data 2025/263 **** Current Macroeconomic and Financial Situation of Nepal Based on Annual Data 2024/254

Contents NEPAL FACTSHEET 2 EDITORIAL 5

GENERAL OVERVIEW 7 Political Overview

International Economy

MACROECONOMIC OVERVIEW 18

SECTORAL REVIEW 28 Agriculture and Livestock 29 Education 32 Energy and Environment 35 Health 38 Information and Communication Technology 41 Infrastructure and Real Estate 44 Tourism 46

MARKET REVIEW 49 Financial Overview

SPECIAL SECTION: DIGITAL DEMOCRACY: HOW DEMOCRACY IS PRACTICED IN THE DIGITAL AGE OTHER WORKS BY NEPAL ECONOMIC FORUM 71 ENDNOTES

Issue 66: September 2026 Publisher: Nepal Economic Forum Website: www.nepaleconomicforum.org P.O Box 7025, Krishna Galli, Lalitpur – 3 Nepal Phone: +977 1 554-8400 Email: info@nepaleconomicforum.org Contributors: Aaryan Kuikel Aadit Kattel Aava Tamrakar Anushka Tuladhar Ankit Ghimire Prasidha Sangat Salina Kafle Sanjit Tuladhar Shubham Thapa Sunita Shahi Peer Reviewers: Arya Awale Rojesh Bhakta Shrestha Salina Kafle Sujeev Shakya Special Section – Authors: Dr. Sudhamshu Dahal, Associate Professor, Department of Languages and Mass Communication, Kathmandu University Anwesha Sen, Assistant Program Manager, Takshashila Institution Niraj Bhusal, Office of the Hon. Finance Minister, Ministry of Finance, Government of Nepal Kritika Ghimire, Project Manager, SpeakUp Nepal Design & Layout: Thuprai Solutions support@thuprai.com Coordinators: Salina Kafle Cover Design: Prince Manandhar Editor: Ankit Ghimire This issue of Nefport takes into account news updates from June 1, 2026 to August 31, 2026, with some sections covering news up to September 2026.. The USD conversion rate for this issue is NPR 152.31 to a dollar, the quarterly average for this issue. Special note: Near the end of the review period, on August 26, 2026, a flood originating from a rock-ice avalanche at the Langtang Lirung mountain near the Nepal-China border struck the Rasuwa, Nuwakot, and Dhading districts of Nepal, with other districts also affected. This issue reports the death toll, the number of people missing, and the number of people rescued as of the official count published through August 31, 2026, the cutoff date for the review period. Please note that these figures are likely to have changed since this cutoff.

Reproduction is authorized provided the source is acknowledged. The views and opinions expressed in the article/publication are those of the author(s) and do not necessarily reflect the official opinion of Nepal Economic Forum. Neither the organization nor any person acting on their behalf may be held responsible for the use which may be made of the information contained therein. Executive Board Members: Alpa B. Shakya Rojesh Bhakta Shrestha Shayasta Tuladhar Sudip Bhaju Sujeev Shakya Advisory Board: Elisabeth von Capeller Francois-Xavier Leger Giuseppe Savino Jawed Ashraf Kenichi Yokoyama Kul Chandra Gautam Mahendra Krishna Shrestha Saloni Sethia Shraddha Gautam Sneh Rajbhandari Senior Fellows: Isha Sharma Nasala Maharjan Rojika Maharjan Suman Basnet Tom Schneider

NEFPORT ISSUE 66 – SEPTEMBER 2026

Editorial In our last editorial, we wrote about the attention Nepal drew from the world after it turned a youth movement into a mandate at the ballot box and brought new, young faces into government. This quarter, for reasons unfortunate and unprecedented, Nepal is in the global limelight again. The Himalayan Tsunami of August 26, 2026, has, as of writing, taken more than 1,400 lives, with over 5,000 still missing. Beyond the human toll, the flood has caused large-scale damage to Nepal's connectivity and energy infrastructure. A key trade point with China has been ravaged, hydropower plants have been destroyed, and roads that took decades to build have been washed away. Many Nepalis have lost their livelihoods, and homes, schools, and businesses have been swept away. Because the disaster crossed borders, it has renewed the global discussion on regional early warning systems, resilience, and cooperation in times of crisis. Through the Himalayan Future Forum, NEF has been working on these interlinked issues, and we believe it is high time to create a platform for diverse voices from across the Himalayan region to come together, exchange perspectives, and shape a shared understanding of the region’s future. The response to the disaster was, at the same time, a reminder of what Nepal can draw on in the worst of times. Citizens gave generously, with the Prime Minister's Disaster Relief Fund collecting approximately NPR 15.44 billion (USD 100.60 million) in donations, and friends of Nepal from around the world offered support for relief and rescue. The country will carry on, rebuild, and become more resilient, and the local economy will slowly return to its track. The harder task will be helping the thousands of families who have lost their loved ones. Amid all of this, NEF stood in solidarity with those who lost their loved ones, while providing evidence-based analysis of the disaster. That analysis shows how far the damage extends. About 6% of Nepal's trade went through the now-destroyed Rasuwagadhi trade corridor. The flood wiped out a part of the country that contributes 3% to tourism, and 10% of national hydropower production has also been affected. These are losses that will take years to recover. The floods were also an early test for the new government. It responded commendably, setting up dashboards, regular updates, and visible actions that reflected a sense of accountability. The larger question is fiscal. In the previous NEFport, we examined the government's record budget, and it now remains to be seen how the flood and the cost of rebuilding will affect it. As we noted then, drawing up a budget is the easy part. Spending it well is where the government will be judged. The disaster is also a reminder of how climate-vulnerable Nepal is. The country contributes only marginally to climate change, yet it has been made to face its full consequences. Nepal should therefore make the case for climate

DOCKING NEPAL’S ECONOMIC ANALYSIS

compensation as a matter of moral liability. The world owes Nepal, and it should be held to account for that. This distinction matters because of the label that tends to follow Nepal after every crisis. With this fresh wave of attention comes the tag of an "aid-dependent" country, a description that does not hold up well. Aid makes up only 3% of Nepal's GDP, and this is an economy that has grown six times over the past 30 years. Changing this narrative will be one of the key tasks in the coming years. International partners working with Nepal now will need to see it as an investment destination, where support can help create jobs, boost tourism, and transform the economy, and not only as a recipient of relief. NEFport 66 is a commemorative issue marking the anniversary of the Gen Z-led protests of September 2025. We remember the sacrifices of the young Nepalis who pushed for change in a system that felt long overdue. What stood out to us about the protests was how digital spaces served as the spark. This edition therefore looks at how digital space, with its accessibility and connectivity, allows people to practice democracy. The issue explores how digital platforms have changed the way citizens access information, express grievances, and engage with public institutions, along with challenges including misinformation, algorithms, concentrated technological power, and unequal digital access. It looks at how digital public infrastructure, AI, data, and digital government are reshaping the relationship between citizens and the state, and how institutions can adapt while strengthening transparency, accountability, and public participation. It also asks who can participate in this digital transformation and who risks being left behind due to gaps in connectivity, language, documentation, digital literacy, and access. Together, these perspectives examine not only how technology is changing the way citizens participate in democracy, but also who gets to participate, how digital platforms shape what citizens see and discuss, and what institutions must do to ensure that the digital transformation strengthens democratic participation and accountability. As always, we would like to express our gratitude to everyone who has contributed voluntarily, as well as to our readers and patrons who have supported and engaged with us throughout our journey. We are working continuously on recalibrating our NEFports to make them more useful to our readers. Please feel free to write to us at info@nepaleconomicforum.org or to any of our social media handles for further comments or feedback.

Sujeev Shakya

Chair, Nepal Economic Forum

General Overview

NEFPORT ISSUE 66 – SEPTEMBER 2026

DOCKING NEPAL’S ECONOMIC ANALYSIS

Political Overview The review period, from June 1 to August 31, 2026, covered the fourth to sixth months of Prime Minister Balendra Shah's government. The period ended with the country's deadliest natural disaster in years, a glacier-rock breakoff near the Nepal–China border that killed more than thousands and left thousands missing. The floods drew the federal government's largest coordinated relief operation to date. Away from the disaster response, a government-appointed taskforce submitted its longawaited discussion paper on constitutional amendment, Home Minister Sudan Gurung returned to office alongside a newly created Ministry of Science, Technology and Innovation, and fatal communal violence in Sunsari led to parliamentary debate and a settlement between the government and victims' families. The Supreme Court issued a landmark ruling extending full marriage rights to same-sex and gender-minority couples. On the provincial level, governments saw unusual turnover, with three provinces installing new chief ministers within weeks of one another, while at the local level over a dozen municipalities entered a legal "budget holiday" after missing their constitutional spending deadline. Diplomatically, Prime Minister Shah broke a months-long pattern of avoiding one-on-one meetings with foreign envoys, engaging India, and China individually for the first time since taking office. KEY DEVELOPMENTS Flash Flood on Nepal–China Border Prompts Multi-Agency Response On the morning of August 26, an ice-and-rock avalanche above the Bhotekoshi River in Rasuwa

District triggered a flash flood and debris flow. It struck settlements along roughly 72 kilometers of the Trishuli River, across Rasuwa, Nuwakot, Dhading, Gorkha, Tanahun and Chitwan districts. The flood destroyed the Rasuwagadhi border crossing with China, along with dozens of

FACTSHEET

Nepal's Particulars Rank / Score Status

Democracy Index 20245

91st

4.60 /10

Freedom in the World Index 20256

Partly Free

62 /100

Press Freedom Index 20267

87th

54.80 /100

Fragile State Index 20248

55th

78 /120

Corruption Perception Index 20259

109th

34 /100

bridges, roads and hydropower installations.10 Nepal's earlywarning system sent alerts within about 15 minutes, issuing more than 679,000 warning texts.11 By August 31, NDRRMA recorded 903 deaths, 267 injuries, 4,247 missing and 10,451 rescued, including over 250 foreign nationals.12 The government activated a central command post. It deployed 15 sectoral coordination teams for health, communications, roads, and

NEFPORT ISSUE 66 – SEPTEMBER 2026

electricity. A Federal Response Team under the Prime Minister's Relief Committee worked with NDRRMA and humanitarian Meanwhile, 15 partners.13 municipalities declared local flood emergencies. The Cabinet allocated NPR 10 million (USD 65,656) each to Rasuwa and Nuwakot, and NPR 500,000 (USD 3,283) to Dhading.14 NDRRMA launched a digital reliefmanagement system to register missing persons and coordinate aid. The Prime Minister's Office opened an online portal for families to search for missing relatives.15 The Nepal Army, Armed Police Force and Nepal Police mobilized more than 21,000 personnel for search and rescue. Teams from South Korea, China and India joined them. The government also received aircraft and assistance from the United States and Singapore.16 The Ministry of Foreign Affairs initially declined offers of search-and-rescue assistance from several other countries, citing coordination difficulties experienced during the 2015 earthquake response.17

FEDERAL LEVEL Constitutional Amendment Taskforce Submits Discussion Paper On July 16, a taskforce submitted its report to the Prime Minister's Office. Prime ministerial advisor Asim Shah coordinated the taskforce. It began work on April 8, holding 22 formal meetings and consult 184 experts, including former presidents and prime ministers.18 The 500-page paper compiled suggestions to amend 245 of the constitution's 308 articles, including a directly

elected executive, electoral reform, judicial restructuring and a review of the federal structure, without recommending a specific amendment package.19 Sudan Gurung Returns as Home Minister; Government Forms New Science Ministry On June 9, President Ramchandra Paudel administered the oath of office to Sudan Gurung as Home Minister for a second time, 48 days after he resigned amid scrutiny of his financial dealings.20 His return followed a threemember inquiry panel's report, which found no evidence linking him to improper investments, though the report itself was not made public.21Independent lawmaker Mahabir Pun was sworn in on the same day as Minister for the newly created Ministry of Science, Technology and Innovation.22 Pun had long advocated for a dedicated ministry focused on science, research, and technological development. The government created the position as part of a broader restructuring that reduced the total number of ministries from 25 to 18.23 Fatal Clash in Sunsari Prompts Parliamentary Debate; Government Reaches Settlement with Victims' Families On the night of July 26, a dispute over a flag on an electricity pole and objections to loud music during a religious procession in Kaptanganj, Dewanganj Rural Municipality, Sunsari district, escalated into clashes between two communities.24 Nepal Police and the Armed Police Force fired rounds to disperse the crowd;

by early August, three people, Om Prakash Mehta, Jay Prakash Mehta and Rabindra Mehta, had died of gunshot injuries sustained in the incident, and roughly two dozen others, including security personnel, were injured.25 District authorities imposed prohibitory orders across the affected area and convened an all-party discussion to urge restraint while an investigation proceeded.26 On July 31, the government signed a seven-point agreement with the families of Om Prakash Mehta and Jay Prakash Mehta, committing to recommend that the two be declared martyrs, provide NPR 1 million (USD 6,566) in relief to each family, conduct an impartial investigation, and examine the legal status of a local madrasa. 27 On August 11, the government reached a separate sevenpoint agreement with Rabindra Mehta's family on similar termsm Mehta was also declared a martyr.28 Prime Minister Shah also chaired the 43rd meeting of the National Security Council on July 30, where officials reported that tensions had de-escalated and the Council resolved to strengthen inter-agency coordination on security and disaster preparedness29

JUDICIAL UPDATES Supreme Court Extends Full Marriage Rights to Same-Sex and Gender-Minority Couples On June 18, the Supreme Court issued its final verdict in Pinky Gurung v. Government of Nepal, ruling that the government must extend full and equal marriage rights to same-sex and genderminority couples and ordering it to remove discriminatory language from the Civil Code.30

DOCKING NEPAL’S ECONOMIC ANALYSIS

The verdict followed a final hearing on May 7 and dismissed a counter-petition filed by Yuvraj Paudel opposing the extension of marriage rights.31 It built on the Court's 2023 interim order, which had allowed same-sex couples to register their marriages temporarily through local government offices but had left them without full legal recognition, a gap that advocacy groups said had left couples uncertain and, in some cases, unable to register at all.32 The ruling made Nepal the first country in South Asia, and the 40th worldwide, to legally recognize marriage equality; implementation, including the Civil Code amendment the ruling requires, remained the government's responsibility as the review period closed.33

PROVINCIAL LEVEL Three Provinces Install New Chief Ministers: A Fourth Resolves an Internal Contest In Karnali, Chief Minister Yam Lal Kandel resigned on July 25. He resigned ahead of a scheduled no-confidence vote. Four Nepali Congress ministers had withdrawn from his cabinet in a dispute over power-sharing. On July 29, Mangal Bahadur Shahi of the Nepali Communist Party was sworn in as chief minister. He was backed by a new coalition between the Nepali Congress and the Nepali Communist Party.34 In Bagmati, CPN-U ML withdrew its support from Chief Minister Indra Bahadur Baniya's coalition government on July 22,

and Baniya resigned on August 17 ahead of a scheduled confidence vote; CPN-UML's Kiran Thapa Magar was appointed chief minister on August 20 and won a confidence vote on August 25 with 57 votes, backed by CPNUML, the Nepali Communist Party and the Rastriya Prajatantra Party.35 In Sudurpashchim, Khag Raj Bhatta was sworn in as chief minister on August 14.36 Similarly, in Lumbini, an internal CPNUML leadership contest among three rival claimants for the chief ministership was resolved on July 30, retaining Chet Narayan Acharya in the post.37

LOCAL LEVEL 13 Local Units Miss Budget Deadline Amid Vacancies and Local Disputes 13 municipalities and rural municipalities had not endorsed their annual budgets by the constitutional deadline in midJuly. This left them in what the Ministry of Federal Affairs and General Administration described as a "budget holiday", where they lacked legal authority to spend public funds or collect local taxes.38 Officials attributed the delays to disputes among elected local representatives and prolonged vacancies in the post of chief administrative officer.39 As of July 24, the ministry said it was holding continuous consultations with the affected local units, the Municipal Association of Nepal and the National Association of Rural Municipalities to resolve the deadlock.40

BILATERAL / MULTILATERAL UPDATES PM Shah Ends Diplomatic Pause, Engages India, and China After avoiding one-on-one meetings with foreign envoys since taking office in March, Prime Minister Shah met the Indian and Chinese ambassadors individually around August 10–11, followed by the United States Foreign chargé d'affaires.41 Minister Shisir Khanal had earlier travelled to New Delhi from June 5 to 7, in the government's first ministerial visit to India, and on August 11 the Indian Embassy signed memoranda of understanding with Nepali government agencies for eight community development projects worth NPR 803 million (USD 5.27 million) in education, health and agriculture.42 A prime ministerial visit to India, accepted from Prime Minister Narendra Modi, remained unscheduled as of late August.43

NEFPORT ISSUE 66 – SEPTEMBER 2026

Outlook The Rasuwa flood dominated the review period. The coming months will test whether Nepal's emergency response converts into durable reconstruction, of the Rasuwagadhi crossing, hydropower and transport links, and confidence in the early-warning systems credited with limiting casualties. At the federal level, how the utilization of the funds collected through the PM’s relief fund plays out will be a signal of the government’s accountability. Meanwhile, provincial administrations will need time to stabilize, even as the federal government looks to them as partners in disaster response and future constitutional reform. That reform process remains early. Similarly, the constitutional ammendment taskforce's discussion paper outlines possible changes without recommending a package, and cross-party consensus-building still lies ahead. At the local level, budget standoffs and unresolved disputes point to structural gaps in staffing and mediation that could recur in future fiscal years. Communal tensions, like those seen in Sunsari, remain at a live risk across the Terai-Madhesh belt. Separately, unresolved questions around the Home Ministry's leadership may continue to draw scrutiny, given its role in security and disaster coordination. On the judicial front, the Supreme Court's marriage equality ruling now shifts responsibility to Parliament and the executive. How quickly the Civil Code is amended, and how consistently it is applied locally, will determine how soon the ruling takes effect in practice. Externally, Prime Minister Shah's more routine engagement with India and China suggests a steadier foreign policy phase. Whether this yields a prime ministerial visit to India, and how flood recovery affects trade at Rasuwagadhi, will be worth watching.

DOCKING NEPAL’S ECONOMIC ANALYSIS

International Economy The June-August 2026 quarter was defined by a classic terms-of-trade shock, as the war in West Asia continued to push up import energy costs, with effects rippling into growth, inflation, poverty, trade, and currency markets well beyond the conflict zone. A second shock emerged alongside it in a fresh US-Canada trade war, weighing on output through lost market access rather than higher input costs. The World Bank projected global growth would slow to 2.5% in 2026, down from 2.9% in 2025 and the weakest pace since the pandemic, with forecasts downgraded for roughly two-thirds of economies since January. The IMF's July update held its 2026 growth forecast near 3.0% while raising inflation to 4.7%, its third consecutive upward revision, noting that AI-related investment was lifting technology-integrated economies even as energy importers and structurally weaker economies bore the brunt. Markets reflected this divergence as the Strait of Hormuz saw a ceasefire collapse and blockade reimposed before a late-August de-escalation proposal. Similarly, Red Sea shipping disruption persisted as a second chokepoint, gold and the Indian rupee saw historic volatility, the EU-US trade agreement entered into force, and Washington's tariff regime shifted onto a permanent legal footing. Food prices reached a three-year high and the World Bank recorded 847 million people in extreme poverty, with West Asia, North Africa, Afghanistan, and Pakistan the only region where poverty rose.

FACTSHEET

Global GDP growth in 2026 (expected)44

3.0%

Global inflation in 2026 (expected)45

4.7%

Global Multidimensional Poverty Index46

10.4%

World Population47

8.3 billion

Price of Brent Crude Oil in 2026 per barrel (expected)48

USD 89.27 (NPR 13,596.71)

Food Price Index49

131.1 (July 2026)

Energy Price Index50

198.70381 (July 2026)

NEFPORT ISSUE 66 – SEPTEMBER 2026

KEY COMMODITY MARKET DEVELOPMENTS Gold Swings Wildly as Central Banks Buy at a Record Pace Gold fell from a January peak above USD 5,600 (NPR 852,936) an ounce to around USD 4,000 (NPR 609,240) by mid-July, before rallying to USD 4,500 (NPR 685,395) in August. Central banks bought a net 288.9 tonnes in Q2, the strongest Q2 on record led by Poland, China, and Kazakhstan. The World Gold Council said the buying reflected continued diversification of reserves away from traditional holdings.51 OPEC+ Raises Output Repeatedly Through Volatility Organization of the Petroleum Exporting Countries Plus’s (OPEC+) core seven producers raised production quotas by roughly 188,000 barrels per day in each of June, July, and August, after the UAE formally exited OPEC+ on May 1, with its own exports surging to a record 3.7 million barrels per day. OPEC's own Monthly Oil Market Report cut its 2026 demand growth forecast for a third straight month over the same period.52

ECONOMIC CRISIS UPDATES Strait of Hormuz Ceasefire Collapses, De-escalation Efforts Emerge in Late-August The June 17 US-Iran ceasefire memorandum collapsed by late July, with the US reimposing its naval blockade by early August and Brent crude climbing back toward USD 90 (NPR 13,707.90) a barrel. A fresh push emerged on

August 25, when Iran and Oman proposed a joint temporary shipping corridor and mineclearing effort, sending Brent down to around USD 86.68 (NPR 13,202.23) and WTI to USD 80.74 (NPR 12,294.49).53 President Trump told reporters the US Navy had "already cleared all the mines," but Omani officials, in a joint statement with Iran, described mine clearance as a matter still under negotiation.54 Red Sea Shipping Stays Disrupted, a Second Chokepoint Alongside Hormuz Houthi attacks tied to the wider Iran-Israel war have kept about 12-15% of world trade, and 30% of Asia-Europe container traffic, diverting around the Cape of Good Hope, adding 10-14 days per voyage, with Asia-Europe rates sitting 25-40% above precrisis levels.55 Coming on top of the Strait of Hormuz disruption, that gives shippers two separate West Asia-linked chokepoints to route around at once, part of why global freight costs stayed elevated even in months when oil prices themselves eased.56

INTERNATIONAL FINANCIAL UPDATES Bitcoin Recovers, But Stays Below Where It Started the Year Bitcoin traded near USD 78,745 (NPR 11.99 million) in the final week of August, recovering from a low-USD 60,000s trough earlier in the month, though it remained below where it started 2026, a reminder that crypto markets moved through their own volatility this quarter largely independent of the currency and commodity swings driven by the

war.57 Indian Rupee Hits Record Lows as Foreign Investors Pull Out The rupee weakened to around 95 per dollar in 2026, depreciating roughly 9.6% for the fiscal year, a decline last seen during the 2013 “Fragile Five” crisis driven by a costlier oil import bill and over USD 19 billion (NPR 2.9 trillion) in foreign investors pulling money out of Indian stocks and bonds. Economists at Vajiram & Ravi noted the scale of the move was drawing direct comparisons to that earlier crisis period.58

INTERNATIONAL TRADE UPDATES EU-US Trade Agreement Formally Enters into Force The European Union's implementing regulations for the EU-US trade agreement took effect on July 1, 2026, eliminating customs duties on the vast majority of US-origin industrial goods and granting preferential market access for select US seafood and agricultural products, including processed lobster.59 Under the deal, the EU eliminated tariffs on US industrial goods in exchange for a 15% ceiling on tariffs applied to EU exports to the US.60 The main regulation is set to expire on December 31, 2029, with a Commission review due by June 2029 to determine whether to extend it; the Commission also retains power to suspend the regulation if the US fails to meet its commitments, including a threshold requiring resolution of steel and aluminum tariff rates above 15% by December 31, 2026.61

DOCKING NEPAL’S ECONOMIC ANALYSIS

US Global Tariffs Shift from Temporary to Permanent Footing Since February, the US had charged a flat 10% tariff on most imports under Section 122, put in place after the Supreme Court struck down its earlier tariffs. Because Section 122 has a hard 150-day limit, that tariff expired on July 24 and a new rule took effect the same moment under Section 301, which lets the government tariff countries with weak protection against forcedlabor practices in their supply chains62. The new tariff covers about 60 economies: 10% for most, 12.5% for a smaller group. The EU isn't included; it moved to a separate 15% deal on July 1. The key difference: Section 122 was built to expire, but Section 301 has no end date, so a temporary measure has effectively become permanent.63 China's Exports Defy Tariffs on AI-Driven Demand China's exports jumped 23.9% year-on-year to USD 397.85 billion (NPR 61 trillion) in July, even as the US applied its new 12.5% Section 301 levy on Chinese goods, with semiconductor exports nearly doubling in value and overall high-tech exports rising 40.7%, a sign that AI-driven demand for Chinese-made components has so far outweighed the drag from higher US tariffs.64

since January 2023, as energy costs linked to the Hormuz crisis and Black Sea shipping disruption pushed wheat prices up 5.8% and vegetable oil prices to a four-year high. The FAO said the increase reflected “tightening global supply prospects” for major grains.65 World Bank Data Shows 847 million People in Extreme Poverty The World Bank's latest global poverty update found that 10.4% of the world's population i.e., 847 million people were living in extreme poverty in 2024, defined as surviving on less than USD 2.15 (NPR 327.47) a day. Almost every region showed slow improvement, except one: West Asia, North Africa, Afghanistan, and Pakistan, where poverty rose. Two things drove that increase: ongoing crises in Yemen and Afghanistan, and newly available survey data from Pakistan that revised the country's poverty numbers upward, adding millions of people to the region's total who hadn't been counted before.66 IMF Raises Growth Outlook Amid War and AI Tailwinds

Food Prices Hit a Three-Year High as War Costs Spread to Farming

The IMF's July 2026 World Economic Outlook Update, released July 8, 2026, projected global growth of 3.0% for 2026 and 3.4% for 2027, broadly unchanged from April on a cumulative basis.67 The IMF said the West Asia war was weighing on energy importers, while AI-driven demand was lifting economies integrated into the global technology value chain.

The FAO Food Price Index reached 131.1 points in July, its highest level

KEY DEVELOPMENTS/ GLOBAL EVENTS UPDATE

KEY HIGHLIGHTS OF INTERNATIONAL REPORTS

AFRICA African Union and WHO Hold First Health-Dedicated Extraordinary Summit The African Union Assembly held its first-ever Extraordinary Session dedicated to health, focused on ending AIDS by 2030, on July 21-22, 2026, in Accra, Ghana, bringing together heads of state, AU Commission Chairperson Mahmoud Ali Youssouf, AU Chairperson Évariste Ndayishimiye and host President John Dramani Mahama, alongside partners including UNAIDS and the WHO.68 WHO Director-General Tedros Adhanom Ghebreyesus said Africa had cut new HIV infections by 40% since 2010, while warning that the continent still carries the heaviest global HIV burden and risks losing ground as external funding declines, a challenge compounded by an active Ebola outbreak amid armed conflict in DRC's Ituri Province.69 The summit closed with the adoption of the Accra Declaration, through which leaders reaffirmed commitments to end AIDS and tuberculosis as public health threats by 2030, reduce preventable maternal deaths, and strengthen health systems and local pharmaceutical manufacturing, framing greater "health sovereignty" as central to sustaining progress amid falling donor support.70 South Africa Extends a Run of Modest Growth South Africa's economy grew 0.5% in the first quarter of 2026, marking a sixth consecutive quarter of growth, with finance, agriculture, trade and transport driving the gain.71 Six straight

NEFPORT ISSUE 66 – SEPTEMBER 2026

quarters of expansion, however modest, is notable after a decade in which the economy barely grew at all, and it's the kind of momentum the National Treasury has been trying to build through electricity and logistics reforms.72 Nigeria Holds Rates Very High to Keep Fighting Years of Severe Inflation Nigeria's central bank held its benchmark rate at 26.5% in July, even as inflation eased to around 15.9% in May. Central Bank Governor Olayemi Cardoso said the improvement remained “fragile,” and that renewed hostilities in West Asia justified maintaining “a prudent monetary policy stance.”73 Egypt Pauses Its Rate-Cutting Cycle Egypt's central bank held its key rate unchanged at 19% for a third meeting in a row in July, pausing an almost year-long streak of cuts, even as inflation eased to about 14.3% in June. The bank's Monetary Policy Committee said its decision reflected an external environment "marked by elevated uncertainty."74 War-Driven Food Costs Threaten to Reverse Poverty Gains in Africa Fertilizer prices have surged since the Strait of Hormuz crisis began, since the Gulf region supplies a large share of the world's urea and other fertilizer inputs. The Council on Foreign Relations has warned this could push tens of millions of additional people into hunger and poverty, hitting SubSaharan Africa hardest, where

60-70% of workers depend on farming. One estimate puts the added extreme-poverty toll in the region at 15-30 million people by 2027, though that specific figure comes from a secondary aggregator site rather than a primary source that could be independently confirmed.75 AMERICAS US Manufacturing Expansion Continues but Loses Steam

quarter. Banxico kept its main rate unchanged at 6.50% during the quarter, and private analysts surveyed by the central bank raised their full-year growth forecast to around 1.2%, well below the government's own more optimistic 2.3% target.79;80 Brazil Cuts Rates Despite Above-Target Inflation, Betting on a Soft Landing

The Institute for Supply Management (ISM) Manufacturing Purchasing Managers Index (PMI) jumped to 55.6 in July, its highest reading since May 2022 before the S&P Global flash estimate for August eased back to 53.2. ISM's survey committee cited higher fuel costs, raw-material shortages, and longer supplier delivery times as the main drags.76

Brazil's central bank cut its benchmark Selic rate for a third consecutive meeting in July, to 14.25%, even as inflation ran at 4.64%, above its target ceiling. Brazil's monetary policy committee, Copom, said in its statement it saw room to continue easing given how restrictive the policy rate remained in real terms, while warning it would "not hesitate" to pause if inflation surprised to the upside.81

US Inflation Stays Well Above the Fed's 2% Target

Argentina's Disinflation Streak Breaks, Officials Shrug It Off

US CPI stood at 3.5% in June and eased only slightly to 3.4% in July, still nearly double the Fed's 2% target.77 The Fed voted 9-3 on July 29 to hold rates at 3.50%-3.75%, with three regional presidents dissenting in favor of a hike. Fed Chair Kevin Warsh, addressing the unusual split, told reporters he had asked for "a good family fight" and gotten one, adding that the Committee's 2% target was absolute: "there is no soft implicit target, only a target and it's 2%”.78

Argentina's monthly inflation rate accelerated to 2.1 percent in July, ending a three-month slowdown, while the 12-month figure reached 33.8 percent. The government has emphasized the longer trend rather than the monthly wobble; a deputy economy minister said this month that inflation is no longer, in his words, a subject he worries about. The July uptick is a reminder that Argentina's disinflation, while real, hasn't been a straight line down.82

Mexico's Economy Rebounds After a Weak Start to the Year

Latin America's Poverty Rate Holds Near a Record Low, but Growth Is Stalling

Mexico's economy grew 1.4-1.5% in the second quarter, bouncing back after shrinking in the first

The Economic Commission for Latin America and the Caribbean (ECLAC)'s latest data

DOCKING NEPAL’S ECONOMIC ANALYSIS

put multidimensional poverty at 27.4 percent of the region's population, even as the UN body forecasts four consecutive years of low growth averaging just 2.3 percent annually.83 Slow, grinding growth is historically harder to build political consensus around fixing than an outright recession, and ECLAC has warned that weaker private consumption and external demand leave the region little cushion if the wardriven energy and food costs documented elsewhere in this report worsen.84 ASIA China's Growth Slows, Falls Short of Target China's economy grew 4.3% yearon-year in the second quarter, its slowest pace since late 2022 and down from 5.0% in the first quarter. Real estate investment fell 18% for the half, while exports rose 27% in June alone despite shipping disruptions tied to the war.85 China's Factories Lose Momentum as Domestic Demand Cools China's official manufacturing PMI fell to 49.2 in July, a decrease of 1.1 percentage points, indicating a decline in the manufacturing climate, while the private RatingDog survey eased to a four-month low of 50.9. The gap between weak domestic factory readings and the strong export numbers logged the same month shows how much of China's current growth is being carried by trade rather than broad industrial demand at home.86

India Raises Its Growth Forecast Despite Currency Pressure

Japan's Inflation Accelerates as Energy Subsidies Fade

The RBI raised its FY2026-27 growth forecast to 6.7% from 6.6% in August, citing resilient rural and urban demand and strong exports, even as it held interest rates steady and watched the rupee weaken sharply.87 RBI Governor Sanjay Malhotra described the pressure on prices as reflecting "temporary supply factors" tied to the war rather than a deeper problem in the economy.88

Japan's core inflation rate, which strips out fresh food but includes energy, came in at 1.8 percent in July, it’s highest since March, as energy prices rose for the first time since November 2025 despite government subsidies, due to high oil costs tied to nepa conflict. That keeps the Bank of Japan on track for a possible rate hike as soon as September, putting it alongside the ECB as one of the few major central banks tightening this quarter rather than holding or cutting.92

India Breaches Its Inflation Target for the First Time in 17 Months Indian inflation reached 4.38% in June, above the RBI's 4% target for the first time since December 2024, though it stayed within the RBI's wider tolerance band. The central bank held rates rather than hiking.89 Japan's Growth Cools as Households Pull Back Japan's economy grew 0.3 percent quarter-on-quarter in the second quarter, an annualized 1.1 percent, below market expectations of 2.0 percent annualized growth, slowing from Q1's pace.90 Private consumption edged down 0.02 percent from the previous quarter, the first decline in eight quarters, even as real wage growth held up. This is the reverse of the "twotrack" pattern seen elsewhere this quarter, as Japan’s trade is propping up a wobbling domestic economy, not the other way around.91

Indonesia Keeps Growing at a Healthy Pace The Asian Development Bank's July 2026 outlook projected Indonesia's GDP would grow 5.2% in both 2026 and 2027, with inflation forecast at only around 3.0%, a notably steadier picture than most other emerging economies managed this quarter.93 EUROPE G7 Leaders Meet in Évian, Issue Growth and Supply Chain Declarations G7 leaders met in Évian, France, from June 15–17, 2026, under the French presidency, issuing a "Leaders' Statement for a More Balanced, Durable and Resilient Growth" and a declaration on securing critical minerals supply chains, both dated June 17, 2026. Brazil, India, Kenya, and South Korea were invited as partner countries.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Eurozone Factories Post Their Best Month in Four Years The S&P Global Eurozone Manufacturing PMI rose to 52.8 in August, its fastest pace of expansion in four years, centered around Germany, where production rose the most since January 2022. Input costs slowed to their weakest since before West Asia war began, letting factory-gate inflation ease too. Faster growth paired with cooling costs makes the Eurozone something of an outlier this quarter, since most other manufacturers have been dealing with the opposite combination.94 Eurozone and UK Inflation Both Run Hot Eurozone inflation hit 3.2% in June, with core inflation also rising to 2.5%, prompting the ECB's first rate hike since 2023 on June 11.95 The UK told a similar story: inflation fell to 2.6% in June, better than the Bank of England

had expected but the Bank held rates at 3.75% anyway on July 30, warning that high and volatile energy prices from West Asia conflict would push inflation back up later in the year. That warning had already started to play out by late August, when UK inflation had climbed to 2.9%, still above the Bank's 2% target.96 OCEANIA Reserve Bank of Australia Holds Cash Rate at 4.35% The Reserve Bank of Australia left the cash rate unchanged at 4.35% at its August 11 meeting, its most recent hold following three rate rises earlier in 2026.97 Headline inflation eased to 3.5% in the twelve months to July, down from 3.8% in June, but trimmed mean inflation, the RBA's preferred measure of underlying price pressure, held steady at 3.6%, still above the Bank's 2-3% target band.98 The Board noted that the impact of the Middle East conflict on inflation had so far

been less than expected, though oil and related commodity prices remained higher than before the war began, and said it could raise rates again if upside inflation risks materialize.99 Reserve Bank of New Zealand Delivers First Rate Hike in Three Years The Reserve Bank of New Zealand lifted the Official Cash Rate to 2.50% in July, its first increase in three years, citing the risk that ongoing effects of the Middle East conflict would keep inflation elevated even as fuel prices had eased somewhat.100 The move came despite New Zealand's economic recovery remaining fragile, with the Monetary Policy Committee saying it was acting pre-emptively against the risk of higher medium-term inflation becoming entrenched, while stressing that any further tightening would depend on incoming data on wages and inflation expectations.101

Outlook The international economy enters the final quarter of 2026 navigating two largely unrelated shocks: a war-driven energy and shipping crisis in West Asia and a US-Canada trade war eroding market access between two deeply integrated economies. With growth forecasts converging around 2.53.0%, the weakest pace since the pandemic, and inflation revised upward for a third consecutive quarter, the room for policy error has narrowed. The path of energy and shipping costs remains the key swing factor: the Iran-Oman shipping corridor proposal offers a tentative route to de-escalation, but the June ceasefire's swift collapse underscores how reversible any stabilization remains, while persistent Red Sea disruption keeps freight costs elevated independent of developments in the Strait. A dual-track global economy looks set to persist, with AI-linked technology exporters, including China, absorbing tariff and energy pressure better than energy-importing and fiscally constrained economies, as seen in India's rupee weakness. The permanence of the new US tariff regime suggests trade costs are now structural rather than transitory, compounding the energy shock. Food and fertilizer costs remain a key downside risk, particularly for Sub-Saharan Africa, where the World Bank has already flagged rising poverty against an otherwise improving global trend. Meanwhile diverging central bank responses, tightening in Japan and the eurozone against holds elsewhere, are likely to persist as long as the underlying shock does.

DOCKING NEPAL’S ECONOMIC ANALYSIS

Macroeconomic Overview

NEFPORT ISSUE 66 – SEPTEMBER 2026

Macroeconomic Overview Nepal's macroeconomic position over the review period, from June 1 to August 31, 2026, was shaped by the release of Nepal Rastra Bank's (NRB) annual data for FY 2025/26 AD (2082/83 BS), which reported the closing of the books on a year of slower growth, higher y-o-y inflation, and a strengthening external position.102 The National Statistics Office (NSO) put real GDP growth at 3.85% for the year, a step down from the revised 4.43% recorded in FY 2024/25, as industry grew by 5.67% while agriculture grew by 1.58%.103 Consumer price inflation reached 5.14% on a year-on-year basis by mid-July 2026, from 2.20% a year earlier, even as the annual average eased to 3.08%.104 The gross foreign exchange reserves rose 45.6% to NPR 3.90 trillion (USD 25.31 billion), and remittance inflows surged 37.1% to NPR 2.36 trillion (USD 16.19 billion).105 The Government of Nepal's fiscal deficit narrowed to 1.7% of GDP, though public debt-to-GDP rose to 45.07% and capital expenditure fell 14.8% to NPR 190.84 billion (USD 1.25 billion).106 NRB closed the period by unveiling its monetary policy for FY 2026/27 AD (2083/84 BS), targeting 7% economic growth and inflation within 5.5%, in line with the budget's own 7%-growth, 6%-inflation mandate.107 Gross Domestic Product (GDP) Nepal's GDP at current prices reached NPR 6.60 trillion (USD 43.33 billion) in FY 2025/26 AD (FY 2082/83 BS), a preliminary NSO estimate up from a revised NPR 6.20 trillion in FY 2024/25 AD (FY 2081/82 BS) and a finalized NPR 5.76 trillion in FY 2023/24 AD (FY 2080/81) BS.110 Real GDP growth slowed to 3.85% for the year, below the revised 4.43% of FY 2024/25 AD (FY 2081/82

BS) though still above the finalized 3.68% of FY 2023/24.111 Agriculture, forestry and fishing grew by 1.58%, while its share of GDP declined to 24.03% from 24.50% a year earlier.112 While industry grew by 5.67% on the back of newly commissioned hydropower capacity, services grew 4.21% and held a steady 61.81% share.113 Gross domestic saving stood at 9.71% of GDP and gross fixed capital formation at

FACTSHEET Particulars

Amount/ Percentage

GDP at current prices (FY 2025/26, preliminary)

NPR 6.60 trillion (USD 43.33 billion)

Year-on-year CPI (mid-July 2026)

5.14%

Food and beverage CPI (y-o-y)

5.25%

Non-food and service CPI (y-o-y)

5.08%

Net Foreign Direct Investment (equity)

NPR 28.49 billion (USD 187.05 million)

Remittance inflows

NPR 2.36 trillion (USD 16.19 billion)

Gross foreign exchange reserves

NPR 3.90 trillion (USD 25.31 billion)

Total Domestic Debt

NPR 1.38 trillion (USD 9.03 billion)

Total External Debt

NPR 1.60 trillion (USD 10.50 billion)

Government expenditure

NPR 1.58 trillion (USD 10.39 billion)

Government revenue

NPR 1.24 trillion (USD 8.15 billion)

Total merchandise exports

NPR 315.29 billion (USD 2.07 billion)

Total merchandise imports

NPR 2.10 trillion (USD 13.76 billion)

Total trade balance

NPR -1.78 trillion (USD -11.69 billion)

Current Account

NPR 923.56 billion (USD 6.33 billion)

Balance of Payments

NPR 1.03 trillion (USD 7.05 billion)

Source: Current Macroeconomic and Financial Situation of Nepal (based on annual data, FY 2025/26 AD (2082/83 BS)), Nepal Rastra Bank;108 National Accounts Statistics of Nepal 2025/26, National Statistics Office.109

DOCKING NEPAL’S ECONOMIC ANALYSIS

26.26%, both up from the previous year, while gross national saving, boosted heavily by remittances, reached 44.77% of GDP.114 For FY 2026/27 AD (2083/84 BS), both the federal budget and NRB's monetary policy set a real growth target of 7.0%.115

INFLATION Consumer Price Inflation (CPI) Nepal's year-on-year consumer price inflation rose to 5.14% in mid-July 2026, from 2.20% a year earlier, while annual average inflation for FY2025/26 AD (FY

2082/83 BS) eased to 3.08% from 4.06% in FY 2024/25 AD (FY 2081/82 BS) (Table 1).116 Food and beverage inflation averaged 1.04% during FY 2025/26 AD (FY 2082/83 BS), down from 4.69% a year earlier, but rose to 5.25% year-on-year by mid-July 2026. Non-food and services inflation averaged 4.21% and reached 5.08% year-on-year.117 Within food and beverages, ghee and oil ,and fruit increased by (+10.05%) and (+7.09%) respectively, while vegetables (-3.95%), spices (-3.66%), and pulses and legumes (-3.41%) declined.118 Among non-

Particulars

Table 1. Consumer Price Index over Two Consecutive Periods (in percentage) Source: Current Macroeconomic and Financial Situation of Nepal (based on annual data, FY 2025/26 AD (2082/83 BS)), Nepal Rastra Bank.122

food items, miscellaneous goods and services (+17.61%), education (+7.04%), and transportation By (+5.80%) increased.119 province, year-on-year inflation in mid-July 2026 ranged from 4.27% in Sudurpashchim Province to 5.94% in Madhesh Province, while urban areas (5.19%) ran slightly higher than rural areas (4.99%).120 Nepal's year-on-year consumer price inflation rose to 5.14% in mid-July 2026, up from 2.20% a year earlier and above India's 4.45% in July 2026.121

FY 2023/24

FY 2024/25

FY 2025/26

Consumer Price Inflation

5.44%

4.06%

3.08%

Food and Beverages

6.47%

4.69%

1.04%

Non-Food and Services

4.64%

3.71%

4.21%

Wholesale Prices and Wages Wholesale price inflation increased to 6.67% year-onyear in mid-July 2026 from just 1.05% a year earlier, with the annual average climbing to 4.27% from 3.84%.123 The national salary and wage rate index rose 5.79% on average for FY 2025/26 (FY 2082/83), up from 2.85% the previous yea r. Year-onyear growth reached 6.70 % in mid- July 2026, with the highest annual average increase recorded in Gandaki Province at 11.32% and the lowest in Karnali Province at 1.26%.124

Monetary Policy Highlights for FY 2026/27 AD (2083/84 BS) NRB unveiled its 25th monetary policy on July 7, 2026, continuing the cautious and flexible policy direction adopted the previous year to keep borrowing costs low and private sector sentiment steady. At the same time, it acknowledged that externally driven price pressure would persist for a few more months before easing from the fourth quarter of the fiscal year.125 Key targets and provisions include: An inflation target of around 5.5% and a real GDP growth target of

7.0% for FY 2026/27 AD (2083/84 BS), up from FY 2025/26's growth target of 6.0%.126 Foreign exchange reserves to be maintained to cover at least seven months of goods and services imports, unchanged from the prior policy.127 The Nepali rupee's fixed exchange rate with the Indian rupee retained as the policy's nominal anchor, with the weighted average interbank rate kept near the policy rate as the operating target.128 The policy rate, Standing Deposit Facility rate, and bank rate under

NEFPORT ISSUE 66 – SEPTEMBER 2026

the interest rate corridor, along with the Cash Reserve Ratio and Statutory Liquidity Ratio, held unchanged.129 Commercial banks to be encouraged to invest in foreign government securities to help absorb liquidity generated by NRB's foreign currency purchases, alongside continued sterilized intervention.130 New borrower-protection provisions flagged for the year ahead, including removing unlimited liability on personal loan guarantees, easing the blacklisting of borrowers over bounced cheques, mechanisms to manage non-performing loans in distressed industries, and revised loan-to-value norms for large electric vehicles used as public transport.131 A continued push to simplify NRB's directives to banks and financial institutions (BFIs),

starting with those governing credit flow, interest rates, and financial consumer protection, alongside a pending study on reclassifying BFIs by function.132

GOVERNMENT FIGURES Government Reserves Nepal's gross foreign exchange reserves rose by 45.6% to NPR 3.90 trillion (USD 25.31 billion) by mid-July 2026, from NPR 2.68 trillion (USD 19.50 billion) a year earlier. Of this, reserves held by NRB itself rose 43.8% to NPR 3.47 trillion, while reserves held by banks and financial institutions (BFIs) outside NRB rose faster still, up 61.4% to NPR 424.48 billion; the Indian rupee's share of total reserves stood at 22.3%.133 Based on FY 2025/26's import volumes, the reserve stock was sufficient to cover 23 months of prospective goods imports and 19.6 months of combined goods and services imports, compared

Particulars

Table 2: Outstanding Public Debt (NPR billion, with ratio to GDP) Source: Public Debt Management Office, cited in Current Macroeconomic and Financial Situation of Nepal (based on annual data, FY 2025/26 AD (2082/83 BS)), Nepal Rastra Bank.139

with NRB’s seven-month policy.134 The reserves-to-GDP ratio rose to 63.8% in mid-July 2026, from 43.8% a year earlier.135 Government Debt Nepal's total outstanding public debt rose to NPR 2.97 trillion by mid-July 2026, equivalent to 45.07% of GDP, up from 43.06% a year earlier and 42.26% two years earlier (Table 2).136 External debt, at NPR 1.60 trillion, grew faster than domestic debt, at NPR 1.38 trillion, over the year.137 During FY 2025/26, the Government of Nepal mobilized NPR 358.66 billion (USD 2.35 billion) in gross domestic borrowing against principal repayments of NPR 250.56 billion (USD 1.65 billion), resulting in a net domestic debt mobilization of NPR 108.10 billion (NPR 71 million), or 1.6% of GDP. It also received NPR 88.50 billion (USD 58 million) in external loans over the same period.138

FY 2023/24

FY 2024/25

FY 2025/26

External Debt

1,253.20 (21.76%)

1,401.42 (22.60%)

1,599.48 (24.23%)

Domestic Debt

1,180.90 (20.50%)

1,268.22 (20.46%)

1,375.42 (20.84%)

Total Debt

2,434.10 (42.26%)

2,669.65 (43.06%)

2,974.90 (45.07%)

Government Spending The Government of Nepal's total expenditure reached NPR 1.58 trillion (USD 10.39 billion) in FY 2025/26, up 4.6% from NPR 1.51 trillion the previous year (Table 3).140 Recurrent expenditure rose 9.1% to NPR 1.04 trillion, while capital expenditure fell 14.8% to

NPR 190.84 billion.141 Financial management expenditure, covering debt servicing and related outlays, rose 4.4% to NPR 347.33 billion.142 On the revenue side, total collections rose 5.3% to NPR 1.24 trillion (USD 8.15 billion), with tax revenue up 6.8% to NPR 1.12 trillion, while non-tax

revenue actually fell 6.8% to NPR 120.24 billion.143 As a result, the fiscal deficit narrowed to 1.7% of GDP for the year, from 2.0% in FY 2024/25, while the revenue balance surplus narrowed to 0.6% of GDP from 0.9%, and the primary balance deficit narrowed to 0.6% of GDP from 0.9%.144

DOCKING NEPAL’S ECONOMIC ANALYSIS

Table 3: Government Expenditure and Revenue (NPR billion)

Particulars

24/FY 2023

25/FY 2024

26/FY 2025

Recurrent Expenditure

929.13

956.59

1,043.99

Capital Expenditure

192.03

223.98

190.84

Financial Management

272.25

332.68

347.33

1,393.40

1,513.25

1,582.17

944.55

1,049.88

1,121.08

114.31

128.94

120.24

1,058.87

1,178.82

1,241.32

Total Expenditure Tax Revenue

Source: Financial Comptroller General Office, cited in Current Macroeconomic and Financial Situation of Nepal (based on annual data, FY 2025/26 AD (2082/83 BS)), Nepal Rastra Bank.145

Non-Tax Revenue Total Revenue

FINANCE STATUS Investments Net foreign direct investment (FDI) equity inflows into Nepal grew more than double in FY 2025/26, rising 137.0% to NPR 28.49 billion (USD 187.05 million) from NPR 12.02 billion the previous year, according to NRB's balance of payments data.146 The Department of Industry (DOI) approved FDI commitments worth NPR 58.1 billion (USD 38 million) for the full fiscal year, roughly NPR 7 billion (USD 45.96 million), or about 11%, lower than the NPR 64.96 billion approved in FY 2024/25, spread across 1,116 projects.147 Activity picked up heading into the review period: DOI approved 186 projects worth NPR 2.29 billion (USD 15.04 million) in Jestha (mid-May to mid-June 2026), rising to 202 projects worth NPR 10.38 billion (USD 68.15 million) in Ashad (mid-June to mid-July 2026), the fiscal year's final month, with

the latter expected to generate roughly 2,078 jobs.148

FOREIGN ASSISTANCE Aid Disbursements from Donor Agencies Nepal's foreign assistance during the months of June to August continued to arrive mainly as loans rather than grants, a pattern consistent with the last few fiscal years. The balance sheets for FY 2025/26 (BS 2082/83) (midJuly 2026), Nepal Rastra Bank recorded a foreign grant transfer of NPR 18.50 billion (USD 121.46 million), nearly double the NPR 9.84 billion (USD 64.61 million) recorded the previous year.149 Emergency Flood Relief Assistance Nepal received a wave of emergency humanitarian pledges after a catastrophic glacier collapse flash flood struck on August 26, 2026, in the Bhotekoshi and Trishuli

river valleys. A large rock and

glacier-ice collapse on Langtang Lirung triggered an ice-rock avalanche that transformed into a catastrophic debris flow and flash flood near the Nepal-China border.150 By mid-September, the disaster has killed about 1,400 people, while more than 5,000 remained unaccounted for, with search and identifications efforts continuing.151

The following relief funding is disaster-specific, grant-based, and was channeled mainly through the government's aidmanagement pipeline, the Prime Minister's Disaster Relief Fund.152

NEFPORT ISSUE 66 – SEPTEMBER 2026

Table 4: Top foreign assistance in the months of August and September 2026. Donor

United Arab Emirates

Amount pledged / Committed (NPR)

Dates

1523.1 million

27 Aug 2026

United Kingdom

1025.77 million

28 Aug 2026

United States

845.27 million

26 Aug – 10 Sept 2026

Asian Development Bank

784.35 million

28 Aug 2026

Australia

543.05 million

28 Aug 2026

European Union

351.59 million

28 Aug – 4 Sept 2026

China

335.06 million

30 Aug 2026

The purpose and structure of each pledge varied. The UAE pledged USD 10 million (NPR 1,523.10 million) in humanitarian assistance.153 The UK committed NPR 1,025.77 million (USD 6.74 million) through the UN, Red Cross, and other NGO partners. In addition, the US assistance totaled NPR 845.27 million (USD 5.55 million) through multiple channels, such as the World Food Programme, Nepal Police, Catholic Relief Services, health and WASH program via UNICEF, Jhpiego ,and FHI 360.154 On the other hand, the ADB's grant for a post-disaster needs assessment came through its Asia Pacific Disaster Response Fund, earmarked for searchand-rescue equipment, medical supplies, water, shelter and debris clearance.155 Australia's NPR 543.05 million (USD 3.57 million) was split three ways, NPR 217.22 million (USD 1.43 million) to the World Food Programme,

NPR 217.22 million (USD 1.43 million) through the Australian Humanitarian Partnership, and NPR 108.61 million (USD 0.71 million) to the Emergency Action Alliance.156 The EU's initial NPR 351.59 million (USD 2.31 million) (for food, healthcare, water and sanitation) was topped up by roughly NPR 89 million (USD 0.58 million) in early September.157 Lastly, China contributed through the Red Cross Society of China with cash assistance alongside tunnel rescue teams and relief supplies.158 India and Japan also mobilized significant support. India flew at least three relief aircraft carrying about 62 tonnes of tarpaulins, medicines and earthmoving equipment and positioned the National Disaster Response Force teams along the Nepal border in Uttar Pradesh and Bihar on 28 August 2026.159 Japan,

through the Japan International Cooperation Agency (JICA) and its embassy in Kathmandu, supplied emergency relief goods (tents, blankets and similar items) in two parts on 28 August and 2 September 2026, with the Ministry of Foreign Affairs stating it would consider further support "according to the needs in Nepal".160 BILATERAL AND MULTILATERAL AID The FY 2024/25 (BS 2081/82) multilateral institutions such as the WB, ADB, IFAD, IMF and others accounted for 68.1 % of actual aid disbursement, or NPR 166.02 billion (USD 1.09 billion) against 27.9% from bilateral partners and 4% channeled through UN system.161 Among agreements newly signed that year, the multilateral share was even higher, at 87%.162 The agreements concluded during

DOCKING NEPAL’S ECONOMIC ANALYSIS

the June-August 2026 review period, detailed below, span both multilateral facilities and bilateral grants.

servants to Japan for master's and doctoral studies. Since 2016, 231 Nepali civil servants have received this scholarship.166

International Monetary Fund

South Korea

On June 8, 2026, the IMF's Executive Board concluded the 2026 Article IV consultation with Nepal and completed the seventh and final review under the country's Extended Credit Facility (ECF) arrangement, approving a disbursement of Special Drawing Right (SDR) 31.32 million (USD 42.9 million / NPR 6.53 billion out the) and completing the multiyear ECF program.163

Nepal's Cabinet accepted a NPR 275.68 million (USD 1.81 million) grant from the Korea International Cooperation Agency (KOICA) on July 16, 2026, to build a "Nepal Legal Information Pilot System" for the Ministry of Law, Justice, and Parliamentary Affairs167.

Asian Development Bank On June 19 2026, ADB approved a NPR 17.52 billion (USD 115 million) concessional loan, on below market Asian Development Funds terms, to strengthen water supply, sanitation and climate resilience across 13 rapidly growing municipalities.164 The loan sits within a wider NPR 21.90 billion (USD 143.8 million) package that also includes NPR 4.386 billion (USD 28.8 million) in Government of Nepal cofinancing; NPR 11.46 billion (USD 75.27 million) of the total is earmarked for climate resilience activities. The project is expected to benefit more than 850,000 people.165 Japan On July 28, 2026, the Japan International Cooperation Agency (JICA) extended a JPY 410 million (NPR 390.4 million, USD 2.56 million million) grant to continue the Human Resource Development Scholarship program, which sends Nepali civil

India On August 12, 2026, the Government of India agreed to provide NPR 803 million (USD 5.27 million) in grant assistance for eight High Impact Community Development Projects spanning health, education, and agriculture, including hospital construction in Sunsari and Dailekh and agricultural centers in Bhojpur, Dhading and Humla.168 Loans dominated the review period's aid landscape, both in the individual agreements concluded and in the fiscal year as a whole. The ABD water supply loan was the largest concessional financing agreement of this review period, while the KOICA, JICA and Indian grants made up its bilateral grant assistance. The wider fiscal year picture shows the same skewedness: In FY 2025/26 (BS 2082/83) the government's external loans (88.50 billion) far outweighed grants (NPR 18.50) underscoring that Nepal’s foreign aid still relies more on loans than grants.169

GRANTS AND CONCESSIONAL LOANS Among

the

agreements

reached during the review period, ADB’s June 19, 2026, water supply project involved the largest concessional loan. Carrying below-market Asian Development Fund terms with NPR 17,514 million (USD 115 million) in concessional financing for water supply, sanitation, and climate resilience across 13 municipalities.170 The IMF's SDR 31.32 million (USD 42.9 million, NPR 6,534.10 million) disbursement followed by the completion of the seventh and final review under Nepal’s Extended Credit Facility (ECF) arrangement of June 8, 2026.171 In terms of grants, three separate bilateral agreements were concluded: South Korea's NPR 275.68 million (USD 1.81 million) KOICA grant (accepted 16 July 2026) for judicial sector Japan's NPR digitalization172, 397.99 million (USD 2.61 million) JICA scholarship grant (28 July 2026) for civil service capacity building173,and India's NPR 1.27 billion (USD 8.37 million) grant package (12 August 2026) for community infrastructure174. In FY 2025/26 (BS 2082/83), the government's external loans (NPR 88.50 billion) far outweighed grants (NPR 18.50 billion), showing that Nepal's foreign aid still relies more on loans than grants.175

REMITTANCES AND MIGRATION Remittance Inflows Workers' remittances remained Nepal’s largest external inflow during FY2025/26 (BS 2082/83) alongside a substantial increase in foreign exchange reserves. NRB recorded remittance inflows of NPR 2.36 billion (USD

NEFPORT ISSUE 66 – SEPTEMBER 2026

15.52 billion) for FY 2025/26 (BS 2082/83), which ended mid-July 2026, up 37.1% in rupee terms and 28.1% in dollar terms of NPR 1.723 billion (USD 11.31 billion) in FY 2024/25 (BS 2081/82).176 In the final month of FY 2025/26 (BS 2082/83) from mid-June to midJuly 2026, remittance inflows reached NPR 242 billion (USD 1.59 billion) compared with NPR 189 billion (USD 1.24 billion) in the same month a year earlier.177 The increase coincided with higher outflows of Nepali workers for foreign employment including both new and renewed labor approvals. The Nepali rupee also depreciated against the US dollar during the fiscal year, increasing the rupee value of remittances denominated in US dollars178.

Migration Volumes First-time approvals for foreign employment fell to 406,519 in FY 2025/26 (BS 2082/83), down 19.6% from 505,957 the previous year, while renewal approvals rose to 385,783, from 333,309 according to NRB.179 Foreign Exchange Reserves The combined effect of higher remittances and firm reserve accumulation pushed gross foreign exchange reserves to a record NPR 3,897.67 billion (USD 25.31 billion) as of mid-July 2026, up 45.6% over the year and sufficient to cover roughly 19.6 months of prospective merchandise and services imports, demonstrating a wide comfort margin by regional

standards.180 In the previous quarter, reserves stood at NPR 3.39 trillion (USD 23.31 billion) as of mid-April 2026, sufficient to cover 21.8 months of merchandise imports.181 Top Ten Labor Destinations The United Arab Emirates (UAE) remained Nepal's largest foreign employment destination in FY 2025/26, with 183,580 labor approvals (new and renewed permits combined). Malaysia, Qatar, and Saudi Arabia followed, while Romania was the largest European destination.

Table 5: Top ten labor destinations in FY 2025/26 (BS 2082/83), by labor approvals (new and renewed permits) Destination

Approvals (new + renewed)

United Arab Emirates

183,580

Malaysia

132,646

Qatar

132,051

Saudi Arabia

124,583

Kuwait

43,360

Romania

33,920

Japan

22,266

Oman

11,633

Cyprus

11,069

Bahrain

9,336

DOCKING NEPAL’S ECONOMIC ANALYSIS

TRADE STATUS Foreign Trade Scenario Nepal's merchandise trade continued to expand faster on imports than exports throughout the review period. For FY 2025/26 (BS 2082/83) as of midJuly 2026, total foreign trade reached roughly NPR 2.41 trillion (USD 15.82 billion)182. Exports rose 13.8% to NPR 315.29 billion (USD 2.07 billion). Imports rose 16.2% to NPR 2,096.38 billion (USD 13.76 billion).183 This left a trade deficit of NPR 1,781.09 billion (USD 11.69 billion), up 16.6% over the year.184 As a result, the export-to-import coverage ratio slipped slightly to about 15.0%, down from 15.4% a year earlier.185 Trade Concentration by Partner As of July 2026, India accounted for 58% of total imports (roughly NPR 1.21 trillion / USD 7.94 billion) and absorbed about 82 percent of total exports (about NPR 258.65 billion / USD 1.70 billion); China supplied a further 20% of imports (about NPR 425.24 billion / USD 2.79 billion)186. In

addition, from mid-July 2025 to mid-July 2026, Nepal’s exports to India rose 15.1% and exports to other countries rose 10.1%, while exports to China fell 28.0 percent. On the other hand, purchases from India grew 13.0%, from China 24.7%, and from other countries 17.5%.187 Department of Customs data show the country running a deficit with 134 of its 162 trading partners in FY 2025/26 (2082/83), and a surplus with 28 partners.188 Terms of Trade NRB's export unit value price index rose 6.5% over the year (mid July 2025 to mid-July 2026) while the import unit value price index rose 15.1%, a combination that produced a 7.5% deterioration in Nepal's terms of trade, meaning each unit of exports bought progressively less in imported goods over the course of the year.189 By broad economic category, exports remained skewed toward final consumption goods, which made up 69% of the total. Intermediate goods accounted for 30.4% of exports, while capital goods were

negligible at just 0.6%. Imports, on the other hand, were dominated by intermediate goods at 51.4%. Final consumption goods made up 39% of imports, and capital goods accounted for 9.6%. This pattern is consistent with an economy that imports raw materials and fuel for domestic consumption, while re-exporting a narrow slate of processed consumer goods. Top Imports and Exports According to Department of Customs data for FY 2025/26, reported in the financial press in late July 2026, Nepal's exports remain concentrated in just a handful of processed agricultural products. Meanwhile, imports continue to be led by petroleum fuels and a small number of industrial inputs.

Table 5: Top five export commodities in FY 2025/26 (BS 2082/83) mid-July (in NPR billions) Top Five Export Commodities

Value NPR (billion)

Share of total exports

Processed soybean oil

128.74

40.8%

Large cardamom

12.64

4.0%

Woolen carpets

10.38

3.3%

Sunflower oil

8.94

2.8%

Jute products

7.14

2.3%

NEFPORT ISSUE 66 – SEPTEMBER 2026

Table 6: Top five import commodities in FY 2025/26 (BS 2082/83) mid-July (in NPR billions) Top five import Commodities

Vaule NPR (billion)

Share of Total Imports

Diesel

172.42

8.20%

Crude soybean oil

132.76

6.30%

Petrol

77.26

3.70%

Liquefied petroleum gas

60.28

2.90%

Iron/steel raw material

58.52

2.80%

Outlook Nepal enters FY 2026/27 AD (2083/84 BS) with a strong external cushion but a more fragile growth and price outlook. Foreign exchange reserves covering 19.6 months of imports, record remittances, and a sizeable balance of payments surplus give policymakers ample room to absorb shocks, while NRB's unchanged policy rates should keep borrowing costs low and support private sector credit. However, the 7.0% growth target set by both the budget and the monetary policy appears ambitious against 3.85% growth in FY 2025/26 and will depend on a strong agricultural recovery and continued momentum in industry. The August glacier flood adds to these risks. The loss of thirteen hydropower projects and a section of the China–Nepal highway could weigh on industrial output and trade, while reconstruction needs will strain public finances. Capital expenditure, which fell 14.8% last year, is likely to be tested further as recurrent spending and debt servicing compete for limited resources, with public debt already at 45.07% of GDP. Inflation is expected to remain elevated for a few more months, driven by rising import prices and a weaker rupee, before easing from the fourth quarter as NRB anticipates, though the 5.5% target leaves little margin for error. The decline in first-time foreign employment approvals also raises questions about how long remittance growth can be sustained. Ultimately, turning external strength into durable growth over the medium term will depend on faster capital spending, timely reconstruction, and export diversification, with grant-based flood assistance helping recovery without adding to the debt burden.

DOCKING NEPAL’S ECONOMIC ANALYSIS

Sectoral Review

NEFPORT ISSUE 66 – SEPTEMBER 2026

Agriculture and Livestock

FACTSHEET Particulars

Amount/ Percentage

Agriculture sector’s contribution to GDP (FY2025/26)193 Growth rate for agriculture

24.0% 1.58% NPR 1.58 trillion (USD 10.89 billion) 4.95%

GDP of agriculture sector

Nepal’s agriculture, forestry and fishing sector remained a major part of the economy in FY 2025/26 (FY 2082/83 BS), contributing 24% of GDP and employing around 61% of the country’s economically active population.190 However, sectoral growth slowed to 1.58%, compared with 3.05% a year earlier, reducing its contribution to overall economic growth to 12.6%, from 23.6% in the previous year.191 The quarter also saw several developments shaping the sector’s operating environment. A new National Agriculture Policy replaced the 2004 framework, while an H5N1 outbreak spread across 11 districts. At the same time, a government taskforce began reviewing a decade of agriculture and livestock grants. A delayed monsoon also slowed paddy transplantation, adding to seasonal pressures. The Ministry also set a target of 550,000 tonnes of fertilizer for the new fiscal year, backed by a budget of around NPR 32 billion (USD 220.6 million), with tenders for 240,000 tonnes completed by late August.192

Food & Beverage CPI Price increase of ghee and oil Price increase of fruits Price increase of vegetable Price increase of meat and fish Price increase of milk products and egg Price increase of nonalcoholic drink Price increase of sugar and sugar product Price decrease of spices Price decrease of cereal grains and their products Price decrease of pulses and legumes

15.10% 17.40% 4.14% 5.26% 2.36% 3.06% 1.52% -1.64% +0.25% -0.93% Crude Soyabean Oil Chemical Fertilizer

Top 5 Agricultural Imports FY2025/26 (mid-July 2025 to mid-June 2026)

Rice/ Paddy Edible Oil

Vegetables Top 4 Agricultural Exports FY2025/26 (mid-July 2025 to mid-June 2026)

Soyabean Oil Cardamom

Jute Goods Palm Oil

NPR 110.69 billion (USD 763 million) NPR 49.83 billion (USD 344 million) NPR 37.61 billion (USD 259 million) NPR 19.79 billion (USD 136 million) NPR 17.85 billion (USD 123 million) NPR 113.18 billion (USD 780 million) NPR 12.00 billion (USD 83 million) NPR 8.45 billion (USD 58 million) NPR 7.31 billion (USD 50 million)

Note: 1 NPR = 145.04 USD (Based on 11-month average

DOCKING NEPAL’S ECONOMIC ANALYSIS

GOVERNMENT PLAN UPDATE Nepal Introduces National Agriculture Policy 2026 The Cabinet approved Nepal's National Agriculture Policy 2026 on July 8, 2026, publicly issuing it on August 5, 2026, to replace the National Agriculture Policy 2004. Formulated by the Ministry of Agriculture, Forest and Environment, the new policy contains seven strategic pillars, 26 strategies and 151 action policies.194 It is applicable across Nepal's federal, provincial, The and local governments. government cited major changes since the 2004 policy, including federalization, increasing commercialization, climate-related risks and foodsafety concerns, and aims to modernize the sector through coordinated action across the three tiers of government, improved productivity and commercialization, climateresilient agriculture, stronger food systems and institutional reforms.195 Government Agricultural Grants

and

Investigates Livestock

The Minister for Agriculture, Forest and Environment Geeta Chaudhary formed a fivemember taskforce to investigate grants distributed to the agriculture and livestock sectors over the previous decade. The taskforce was formed on 19 June 2026 and was coordinated by Ministry Joint Secretary Badri Prasad Dahal196. The government sought to review previous reports, assess whether grants had been misused, identify gaps in subsidy delivery, and

recommend reforms to make the program more effective197. The taskforce is required to submit a detailed report to the Ministry within six months .198 PRODUCTION UPDATES Delayed Monsoon Slows Paddy Transplantation The 2026 monsoon entered Nepal on June 19, around six days later than expected, then stalled nationwide after reaching Lumbini Province.199 By early July, paddy transplantation had reached only 32.4% of the country's estimated 1.37 million hectares, raising concerns among farmers about the rice production season.200 Rice is Nepal's most important staple crop, and timely rainfall is critical for paddy transplantation. Farmers were also facing declining groundwater levels and difficulties using shallow tube wells.201 Farmers delayed transplantation, relied on irrigation where available and faced higher cultivation risks as rainfall remained insufficient. Experts nevertheless said the season could recover if monsoon rainfall improved by the end of July .202 That recovery materialized by early August, with paddy transplantation reaching 92.57% of the target area, ahead of the same point last year.203 Agricultural Insurance Expands, but Crop Coverage Remains Limited By August 2026, Nepal had issued 704,864 agricultural insurance policies over five years, covering an insured value of NPR 238.36 billion (USD 1.56 billion).204 However, livestock and fish insurance accounted for far more policies than crop insurance,

leaving crop farmers with limited coverage. Agricultural insurance protected farmers against losses from floods, droughts, landslides, hailstorms, fires, and livestock diseases. To make these policies more accessible, the government subsidized insurance premiums, covering 80% of premiums for policies worth up to NPR 5 million, 65% for NPR 5-10 million and 50% for policies above NPR 10 million under a scheme introduced in July205. However, delayed subsidies, difficulties in processing claims, and irregularities in insurance practices remained as challenges. Bhotekoshi Floods Cause Over NPR 2 billion in Agricultural Losses A massive flash flood struck Nepal's Bhotekoshi and Trishuli river corridors on August 26, triggered by an ice-and-rock collapse on Langtang Lirung, killing 903 people, and leaving thousands missing, as of August 31, 2026 A Rapid Damage and Needs Assessment jointly prepared by the National Planning Commission and the National Disaster Risk Reduction and Management Authority (NDRRMA), released in midSeptember, put total agricultural crop damage at NPR 1.09 billion (USD 7.22 million), including 1,669 hectares of paddy (an estimated 5,843 tonnes of lost production) and 137 hectares of vegetable farmland (1,843 tonnes lost).206 Livestock and poultry losses added a further NPR 1.11 billion (USD 7.29 million).207 The toll reflects the flood's impact on river systems that irrigate Nepal's Terai farmland, a rice-growing region already stressed by this quarter's delayed monsoon. For

NEFPORT ISSUE 66 – SEPTEMBER 2026

scale, a smaller flood just one year earlier damaged 46,500 hectares of paddy in Madhesh Province alone and killed over 26,000 livestock nationwide, pushing agricultural losses above

NPR 6 billion (USD 39.4 million).208 This year's confirmed agricultural damage, a combined NPR 2.2 billion (USD 14.4 million), is smaller in monetary terms, even though the death toll was far

higher and the flood ranks among the country's worst disasters in recent years.209

Outlook Agriculture's slide to 1.58% growth is its weakest performance outside general administration, even as the sector continues to employ almost 61% of the active population. The gap points to falling productivity, meaning output is growing more slowly than the workforce that depends on it, while the amount of land under cultivation has not expanded to match the number of people still working it. The new National Agriculture Policy sets an ambitious reform agenda, but policy alone will not speed up paddy transplantation. The nearer-term test is the next rice season, and the outlook has only become more difficult as fertilizer supplies remain below the 250,000-tonne benchmark, with only part of the 550,000-tonne annual target tendered. Similarly, the late-August floods in Madhesh Province have added fresh paddy and livestock losses to an already fragile transplantation season. Insurance expansion helps hedge against climate shocks, but coverage remains concentrated in livestock rather than crops, leaving the sector's largest and most disasterexposed output thinly insured. Unless fertilizer deliveries accelerate, damage assessments remain manageable, and the rest of the monsoon proceeds normally, next quarter's growth looks more fragile than it did a month ago.

DOCKING NEPAL’S ECONOMIC ANALYSIS

Education During the review period, Nepal’s education sector reflected a mix of increased public spending, tighter regulation, and persistent financial pressures. While the Government raised education and sports allocation in the FY 2026/27 AD (2083/84 BS) budget, their share of the national budget declined, even as spending on overseas education continued to rise. The quarter also saw stronger regulatory oversight of education consultancies and foreign-affiliated colleges, alongside efforts by the University Grants Commission to standardize credit transfers across institutions. However, the withdrawal of the 3% Education Equity Fee highlighted challenges in introducing additional costs in the education sector. Meanwhile, the August floods placed education infrastructure across the three affected districts at significant risk, damaging 20 schools, and affecting more than 17,000 children. Together, these developments pointed to a sector balancing expansion and reform with concerns over affordability, quality, and resilience. KEY DEVELOPMENTS Education Allocation Rises While Budget Share Falls Amid High Overseas Study Spending Nepal increased its education budget for FY 2026/27 AD (FY 2083/84 BS) even as the sector received a smaller share of overall government spending. The Government allocated NPR 218.30 billion (USD 1.45 billion) to education and sports, around NPR 7 billion (USD 46.4 million) more than the previous fiscal year.210 However, the allocation accounted for 10.28% of the national budget, down by 0.47 percentage points from the previous year.211

School education received the largest share, followed by higher education, technical and vocational education, and sports.212 The increase came as Nepali households continued to spend heavily on education abroad. Nepal Rastra Bank data showed that overseas education spending reached NPR 138.48 billion (USD 917.3 million) in FY 2024/25 AD (FY 20281/82 BS), up from NPR 125.13 billion (USD 828.9 million) a year earlier.213 The trend continued into FY 2025/26 AD (FY 2082/83 BS), with Nepalis spending NPR 93.89 billion (USD 622 million) on overseas education during the first eight months alone.214 In July 2026, a

FACTSHEET

Education Indicators

Mean Years of Schooling239

4.5

Net Enrolment rate at Secondary Level240

55.8%

Retention Rate up to Grade 12241

40.6%

Literacy Rate (5 years and above)

77.4%

Ratio of Gender Equality (based on the secondary net enrolment rate) 243

1.01

242

government trade assessment identified education as Nepal’s largest service import.215 Government Tightens Regulations on Education Consultancies and Foreignaffiliated Colleges The Government of Nepal tightened oversight of education consultancies and foreignaffiliated colleges after the Cabinet approved two new regulations on July 8, 2026.216 The regulations replaced a system largely governed by Ministry-issued directives and introduced formal requirements for licensing, financial reporting, infrastructure, and institutional

NEFPORT ISSUE 66 – SEPTEMBER 2026

accountability.217 The new regulations mandated education consultancies to maintain a NPR 2.5 million (USD 16,600) security deposit, renew licenses annually, and conduct financial transactions through banks or digital channels.218 They also held consultancies accountable for misleading students and allowed authorities to revoke licenses and confiscate deposits for violations.219 For foreign-affiliated colleges, the new regulations mandated security deposits of NPR 3.5 million (USD 23,185.5) for undergraduate programs and NPR 2.5 million (USD 16,600) for postgraduate programs.220 They further required their partner universities to participate in QS or Times Higher Education rankings for five consecutive years and rank within the top 1,000 at least once.221 Existing colleges received three years to meet the ranking requirements and obtain required quality accreditation.222 Government Withdraws Equity Fee on Private Education The Government of Nepal introduced a 3% Education Equity Fee on private schools, colleges, and other educational institutions under the FY 2026/27 (FY 2083/84 BS) Budget, effective July 2026, to generate resources for improving access to quality education and strengthening education infrastructure.223 However, private educational institutions and stakeholders opposed the fee, arguing that it would increase tuition costs and place an additional financial burden on students and parents.224 Following public criticism, the government withdrew the fee, and the Cabinet subsequently approved

a full exemption from the 3% levy.225 The reversal highlighted the challenges of introducing additional levies in essential social sectors, particularly when such measures could increase the cost of accessing education.226 Flash Floods Disrupt Education Services Across Affected Districts The flash floods that struck Rasuwa, Nuwakot, and Dhading on August 26, 2026, affected at least 17,000 children, with several teachers and students reported missing or out of contact following the floods.227 The floods also caused significant disruption to education services, with 20 schools damaged across the three districts, including five in Rasuwa, seven in Nuwakot, and eight in Dhading.228 Damage to classrooms and other essential infrastructure further disrupted access to education.229 The floods showed the importance of disaster preparedness and early warning systems for schools.230 In Nuwakot, timely warnings allowed students and staff to move to safety before floodwaters caused further destruction, demonstrating how early evacuation measures can help protect students during extreme weather events.231

PLANS AND PROGRAMS UGC Introduces National Framework for Academic Credit Transfers The University Grants Commission (UGC) introduced a national framework on August 7, 2026 to standardize academic

credit transfers across higher education institutions in Nepal and abroad.232 Previously, universities handled transfers under separate rules, leaving students without a common system when they changed institutions or resumed interrupted studies.233 The need for uniform rules gained attention after Nepali students at India’s Kalinga Institute of Industrial Technology sought transfers to Nepal following disruptions in 2025, but Nepali universities offered admission under a different criteria.234 UGC responded through the Academic Credit Bank Establishment and Operation Directive, 2082, which established common rules for verifying, storing and transferring eligible credits.235 Students could transfer up to 50% of a program’s required credits, subject to approval by the receiving institution.236 Undergraduate credits remained transferable for seven years and postgraduate credits for five years.237 UGC planned to store verified credits in individual digital Academic Bank Accounts, although the centralized platform still required technical and administrative work before becoming fully operational.238

DOCKING NEPAL’S ECONOMIC ANALYSIS

Outlook The education sector is likely to face continued pressure to strengthen domestic opportunities while containing the financial outflow associated with overseas education. Against this backdrop, rising spending on foreign education and the declining share of the national budget allocated to education could increase pressure on the Government to improve the quality and relevance of domestic higher education. At the same time, new regulations for consultancies and foreign-affiliated colleges may strengthen accountability and student protection, while the Academic Credit Bank could make higher education more flexible and portable. However, the impact of these measures will depend on effective implementation. Meanwhile, recent flood damage underscores the need to strengthen disaster-resilient education infrastructure and school preparedness. Overall, the next quarter is likely to see continued efforts to balance access and affordability with quality, regulation, and resilience.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Energy and Environment From June to August 2026, Nepal made considerable advancements in its energy and environment sector. Growth was primarily driven via publicprivate partnerships and came as a signal of the new administration’s commitment to translating promises into actions. With this growth, the sector saw new financing pathways open from both domestic and foreign bodies, highlighting the renewed confidence amongst investors and policymakers for Nepal’s renewable energy industry. Unfortunately, due to the Bhotekoshi River flash flood, much of the nation’s attention in this sector will be focused on rebuilding lost and damaged hydropower projects for the upcoming quarters. Nonetheless, Nepal has made measurable steps in becoming a renewable energy exporter as it capitalizes on its ability to evade price shocks catalyzed by conflicts in West Asia. ENVIRONMENT AND ECOLOGY National Tiger Population Grows On July 29, 2026, the national tiger census was released and recorded an increase from 355 in 2022 to 429.253 Bardia National Park had 112 tigers, an increase from 18 in 2009 but a decline of 13 from its 2022 population.254 Banke National Park recorded 51 tigers, compared with an estimated carrying capacity of 28, raising concerns about the sustainability of its population.255 Parsa National Park recorded the largest increase, with 30 additional tigers, while Shuklaphanta recorded 14

Nepal’s additional tigers.256 focus on tiger conservation is based in its pledge at the St. Petersburg Declaration, 2010 where it, alongside 12 other countries, agreed to double the tiger population by 2022.257 The census shows continued growth in Nepal’s tiger population but also highlights the need to address population declines and ecological pressures in individual parks.

RENEWABLE ENERGY Bhotekoshi-Trishuli Flood Damages Significant Infrastructure On August 26, 2026, a glacial-rock collapse in the northern Langtang mountain range triggered a rock-

Indicators Total petroleum product imports (FY 2025/26 AD (2082/83 BS))244

NPR 349.84 billion (USD 2.29 billion)

National Peak Demand245 (FY 2025/26 AD (2082/83 BS))

2,479 MW

Total Peak Demand246 (FY 2025/26 AD (2082/83 BS))

2,995 MW

Hydropower generation capacity247 (FY 2025/26 AD (2082/83 BS))

4,120 MW

Increase in Hydropower production248 (FY 2025/26 AD (2082/83 BS))

529 MW

Power Generation in Solar Generation249 (FY 2025/26 AD (2082/83 BS))

675 MW

Population Receiving Access to Electricity from the National Grid250 (FY 2025/26 AD (2082/83 BS))

97.6%

Total Domestic Electricity Consumption251 (FY 2025/26 AD (2082/83 BS))

12,376 GWh

Per Capita Electricity Consumption252 (FY 2025/26 AD (2082/83 BS))

496 kWh

DOCKING NEPAL’S ECONOMIC ANALYSIS

ice avalanche-based flooding with a reported death toll of 903 and 4,247 unaccounted for as of August 31.258 Hydropower generation plants transmission lines, villages, bridges, and roads in the area were damaged as the flood cascaded downstream. The flood damage means that over 430 MW of the country’s power generation capacity is currently partially damaged or fully destroyed.259 This accounts for roughly 10% of the nation’s power grid. Nepal’s Pushes into Green Hydrogen On June 9, Nepal announced a pilot green hydrogen project at the Jhimruk Hydropower Station in Pyuthan, which will host the country’s first green hydrogen plant.260 The World Bank provided technical guidance with financial backing from the United Kingdom’s Department for International Development.261 Nepal aims to use green hydrogen to reduce its reliance on coal, diesel, and LPG and expand the use of its hydropower resources beyond electricity generation.262 The government is testing green hydrogen for residential uses and plans to expand its application to areas such as commercial agriculture and public transport, supported by investment incentives, carbon trading, and regulatory frameworks.263 A commercial 2.5 MW green hydrogen plant is also planned for construction in Hetauda.264 Social Security Fund Plans to Invest in Large Energy Projects On June 6, 2026, Rohit Regmi, a director at the Social Security

Fund (SSF), announced that the fund has accumulated NPR 111.07 billion (USD 730.5 million) since inception in 2019.265 The announcement stated that the fund will focus its investments on energy projects, with industrial projects as a secondary focus. The SSF will prioritize hydropower projects while also considering solar projects and electricity transmission lines.266 Regmi said that the fund will not consider projects below 20 MW and has received proposals for four projects with two of them currently under review.267 The SSF will finance projects either by providing loans to investors or by investing directly as part of a consortium.268

NON-RENEWABLE ENERGY Liquefied Petroleum Gas (LPG) Supply Shortage Continues Despite High Imports The shortage of LPG cylinders on the market began in February due to the US-Iran-Israel war in West Asia, however, consumers continued to report difficulty obtaining cylinders as of August 11.269 As a proactive measure to reduce the risk of potential supply disruptions, on March 13, Nepal Oil Corporation (NOC) introduced 7.1 kg LPG cylinders instead of the standard 14.2 kg cylinders and did not return to full-size cylinders until July 15. Although supply and demand appeared to stabilize temporarily, consumers again reported shortages, despite NOCs LPG imports from February to mid-July ranging from 46,503 tonnes at the lowest, to 51,192 tonnes at the highest.270 The mismatch has been attributed to weak monitoring of

cylinder distribution, limited LPG storage capacity, and Nepal’s dependence on Indian LPG tankers.271

KEY DEVELOPMENTS Germany Expands Development Partnership in Energy Sector On June 17, 2026, Barbara Schäfer, head of the South Asia Division at the German Federal Ministry for Economic Cooperation and Development, pledged EUR 37.6 million (NPR 6.63 billion) to support Nepal’s energy sector, with a focus on renewable energy production, distribution, and efficiency.272 Schäfer reasserted Germany’s long-term partnership with Nepal and its support for the United Nations Sustainable Development Goals. The funding will also support gender equality and infrastructure programs with an emphasis on sustainable development.273 Nepal-India Plan to Increase Electricity Import-Export Capacity Nepal and India are set to increase the electricity trade between the two countries. This agreement was agreed to by the representatives of each country’s government at the 13th meeting of the Nepal-India Joint Steering Committee on July 15, 2026.274 This endeavor works to support Nepal’s export ambitions and help solve India’s energy deficit. This plan is centered on increasing overall import-export capacity as well as upgrading and building cross-border 275 transmission lines.

NEFPORT ISSUE 66 – SEPTEMBER 2026

PLANS AND PROGRAMS Air Pollution Restoration Project Advances On June 13, 2026, the Government of Nepal announced that the Nepal Clean Air and Prosperity Project (NCAP) had entered the implementation stage.276 The project gained approval in March

following the World Bank granting a concessional loan and grant package amounting to USD 57 million (NPR 8.71 billion).277 The project aims to reduce industrial pollution by supporting cleaner and more efficient technologies. The project is centered on helping Nepali industrial companies adopt less ecologically harmful

practices and more efficient technologies without harming competitiveness.278 The Ministry of Industry, Commerce and Supplies, Department of Industry, and Department of Environment will oversee the project, with Rastriya Banijya Bank as the primary banking partner.279

Outlook The Bhotekoshi flood captured much of the spotlight in the last week of the review period, with the nation facing devastating losses of life and the destruction of vital infrastructure that the people of the region relied on for personal and economical purposes. In order to repair the damaged infrastructure and restore one-tenth of the nation’s power grid, Nepal will require foreign aid, and it will be the nature of that foreign aid which will largely determine the magnitude of growth the nation experiences in the coming years. Nonetheless, Nepal has capitalized on the synergy between public policy, private industry, and international aid to catalyze growth in the energy and environment sector and further the nation’s economic development. In particular, this sector will continue to deepen and widen concurrently as evidenced by the new development capital made available to the energy industry via foreign and domestic bodies in this quarter. The new avenues of financing will aid the hydropower industry as it continues its rapid expansion, and the introduction of green hydrogen will broaden the foundation for Nepal to gain self-sufficiency in the energy sector. This development is contingent upon the administration prioritizing sustainable development and maintaining its course of action.

DOCKING NEPAL’S ECONOMIC ANALYSIS

Health

FACTSHEET

Nepal's health sector during the review quarter reflected growing efforts to strengthen accountability and access while exposing persistent weaknesses in financing, service delivery, and emergency preparedness. Compared with the previous quarter's emphasis on expansion, the current quarter centered more on implementation, accountability, and financing pressures. The government increased oversight of free treatment through digital monitoring and reached an agreement with doctors on legal protections for health workers following nationwide service disruptions. However, the withdrawal of the proposed Health Equity Fee following public criticism highlighted the sensitivity of introducing additional costs in a system already characterized by high outof-pocket expenditure. Meanwhile, mounting unpaid claims strained the national health insurance program, prompting reforms in financing, enrolment, and provider participation. Concurrently, the August flash floods and an H5N1 outbreak across multiple districts underscored risks to lives and livelihoods, alongside disruptions to health services and infrastructure, reinforcing the need for coordinated preparedness and response. KEY DEVELOPMENTS Government and Doctors Agree on Health Worker Safety Measures The Government of Nepal and the Nepal Medical Association (NMA) reached a five-point agreement on July 29, 2026, ending a nationwide protest by doctors over attacks on health workers and safety concerns.286 The protest followed an assault on health workers and damage to hospital

property at Narayani Hospital in Birgunj, which led doctors to suspend non-emergency services nationwide.287 Under the agreement, the government committed to enforcing the Health Workers and Health Institutions Security Act, 2009 (2066 BS), taking legal action against perpetrators, and amending relevant laws to strengthen protections for health workers.288 A task force with NMA representation was established to support implementation

Health Indicators

Average life expectancy (at birth)280

71.3

Fertility rate (per woman)281

2.1

Infant mortality rate (per 1,000 live births)282

Neonatal mortality rate (per 1,000 live births)283

Number of total health facilities284

8,976

Healthcare workers285

104,756

and monitoring.289 The NMA subsequently withdrew the protest, and regular health services resumed nationwide.290 Digital Monitoring Tightens Enforcement of Free Hospital Treatment The Ministry of Health and Population tightened enforcement of the requirement for hospitals to allocate at least 10% of their beds to free treatment for economically disadvantaged and vulnerable patients in June 2026.291 The Ministry issued the Free Health Portal (Operation and Management) Procedure,

NEFPORT ISSUE 66 – SEPTEMBER 2026

2083, on June 10, 2026, and subsequently directed hospitals nationwide to implement the system by publicly tracking free-bed availability and use across participating hospitals.292 The digital portal enabled realtime monitoring of free-bed availability and utilization across government, community, and private hospitals.293 By early July, 213 hospitals had registered on the system and more than 2,200 people had received free services.294 However, private hospitals opposed the requirements, citing unclear procedures and inadequate consultation.295 By August, the portal recorded 3,080 free beds nationwide, but only 869 were occupied, while patients continued to face access barriers296 Government Withdraws Health Equity Fee on Private Healthcare The Government of Nepal had introduced a 3% Health Equity Fee on services provided by private hospitals, laboratories, nursing homes, polyclinics, and other private healthcare institutions in July 2026.297 The fee aimed to mobilize resources for improving access to quality healthcare and developing health infrastructure, however it increased treatment costs for patients using private health services.298 The policy faced widespread criticism from patients, healthcare providers, and consumer groups, who argued that the additional levy would further increase out-ofpocket healthcare expenses.299 On July 21, the government withdrew the Health Equity Fee following public criticism, stating that its implementation would

place an additional financial burden on citizens.300 The subsequent Cabinet decision approved a full exemption of the fee, reversing the policy shortly after its implementation.301

PLANS AND PROGRAMS Financial Strain Pushes Reforms in Health Insurance Nepal’s national health insurance program came under growing financial pressure during the review period, as unpaid claims disrupted services at In participating hospitals.302 June, government officials estimated an annual funding gap of NPR 6.75 billion (USD 44.32 million) and said nearly NPR 16 billion (USD 105.05 million) was needed to clear outstanding hospital payments.303 Limited premium collection, voluntary enrolment, questionable claims and weaknesses in risk pooling had strained the program’s finances.304 The government responded with plans to tighten claims, expand mandatory enrolment, and restructure the program.305 In July, the Ministry of Health cleared around NPR 4 billion (USD 26.26 million) in dues, while Tribhuvan University Teaching Hospital and Manmohan Cardiothoracic Vascular and Transplant Centre resumed insured services after suspending them over delayed payments.306 Financial pressure nevertheless persisted. By August, the Ministry reported roughly NPR 15 billion (USD 98.48 million) in unpaid liabilities and planned to settle NPR 1012 billion (USD 65.66-78.79 million) by mid-month.307 The government also began pursuing broader reforms to improve the

program’s financing, strengthen participation among healthcare providers, and amend the Health Insurance Act to address its structural weaknesses.308

HEALTH RISKS Bird Flu Outbreak Highlights Animal Health Risks Nepal experienced a widespread outbreak of highly pathogenic H5N1 avian influenza during the review period, affecting poultry farms across multiple districts.309 By July 23, 2026, the outbreak had affected 162 poultry farms across 12 districts, leading authorities to cull more than 835,000 birds.310 The government had provided NPR 510 million (USD 3.3 million) in compensation to 104 affected farmers and poultry farms.311 The outbreak also affected the Jawalakhel Central Zoo, which remained closed for 27 days from June 19 and reported estimated losses of NPR 30 million (USD 0.20 million).312 On July 23, the Department of Livestock Services announced that the outbreak had been brought under control, with no new cases reported since July 17 following expanded testing and containment measures.313 The outbreak highlighted the economic and public health risks associated with zoonotic disease outbreaks and the importance of effective surveillance and containment measures.314 Flash Floods Disrupt Health Infrastructure Flash floods originating in near the Nepal-Tibet border poured downstream of the Bhotekoshi and Trishuli river systems striking Rasuwa and neighboring districts on August 26, 2026. This disrupted critical infrastructure

DOCKING NEPAL’S ECONOMIC ANALYSIS

and health services and prompted the government to declare 15 municipalities disaster crisis-affected areas for three months.315 The Ministry of Health and Food Safety activated the Health Emergency Operation Centre (HEOC) and the Health Cluster on the day of the disaster and deployed Emergency Medical Teams to support affected communities.316 As of August 31, four health posts had been fully damaged, three hospitals had

sustained partial damage, and access to two hospitals had been affected, disrupting the delivery of essential health services.317 International support included medical assistance from India and Bangladesh, while UNICEF deployed hygiene kits to affected communities to address urgent sanitation needs.318 Meanwhile, WHO mobilized emergency medical supplies, including an Interagency Emergency Health Kit capable of supporting nearly

10,000 people for three months, and released USD 150,000 (NPR 22.84 million) from its South-East Asia Regional Health Emergency Fund to support the response.319 The response prioritized treatment for injured populations, continuity of essential health services, disease surveillance, and the management of emerging post-disaster public health risks.320

Outlook The coming quarter will test the government's ability to translate policy commitments into effective implementation. In this context, progress on health worker safety, free treatment monitoring, and health insurance reform will depend on stronger enforcement, adequate financing, and coordination with healthcare providers. In particular, the financial sustainability of the national health insurance program will remain particularly critical, as unresolved payment liabilities could continue to affect provider participation and access to insurance services. Beyond these systemic pressures, the H5N1 outbreak a highlighted the need for stronger disease surveillance and coordination to improve preparedness for future zoonotic disease risks. Similarly, the Bhotekoshi floods underscored the importance of resilient health infrastructure and emergency preparedness to maintain essential services during disasters. Going forward, continued recovery efforts following the floods will be necessary to restore health services and reduce public health risks in affected communities.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Information and Communication Technology Throughout the review period spanning June 1 to August 31, 2026, Nepal followed through with its stated intention of designating technology as a key factor for economic development. This quarter saw strategic developments in the information and communications technology sector, with a particular focus on the telecommunications, financial technology, and artificial technology industries. The nation is converting its discussions with India from last quarter into actionable projects which are symbiotic in nature. While some bureaucratic challenges have stalled certain areas of the sector, the overall trend is positive. KEY DEVELOPMENTS Telecom Industry Sees Improved Financials and Expands Operations Nepal’s telecommunications sector is showing signs of stronger financial performance alongside continued investment in network expansion and service improvements. Nepal Telecom’s net profit rose 47.6% year-onyear to NPR 8.86 billion (USD 58.17 million), as shown in the company's unaudited financial results for FY 2025/26 AD (2082/83 BS).332 The company has stated it will continue to expand networks and improve service quality in under-served areas.333 Similarly, Ncell also paid about NPR 5 billion (USD 32.8 million) toward renewing its operating license.334 Starting August 18,

Ncell moved to a 60-second call pulse rate for international calls to 198 countries, lowering costs for its customers.335 Nepal-India Collaborate to Build Multilingual AI Public Infrastructure In a step toward regional digital integration, the BHASHINI Division of Digital India Corporation, a government-backed non-profit organization, and Kathmandu University officially came together in New Delhi on June 6, 2026, to sign a Memorandum of Understanding aimed at developing an AI-powered multilingual language translation platform.336 This collaborative effort was established with the primary goal of bridging language barriers and promoting digital inclusion, thereby enhancing

FACTSHEET Indicators Government AI Readiness Index Rank (2025)321

106

Number of fixed phone users322

416,168

Number of Mobile Phones323

29.83 million

Total Broadband Internet Subscriptions324

30.98 million

Fixed Broadband (Wired) Subscriptions325

11.15% (3.45 million)

Fixed Broadband (Wireless) Subscriptions326

0.10% (31,641)

Mobile Broadband Subscriptions327

88.74% (27.49 million)

Number of transactions from e-wallets (MidJune 2026-MidJuly 2026)328

57.04 million

Number of QRBased Payments (Mid-June 2026-Mid-July 2026)329

69.59 million

Number of transactions through mobile banking (Mid-June 2026-Mid-July 2026)330

82.60 million

Total amount transacted through mobile banking (Mid-June 2026-Mid-July 2026)331

NPR 696.94 billion (USD 4.57 billion)

DOCKING NEPAL’S ECONOMIC ANALYSIS

access to essential services and information for the people of Nepal in their own native tongues. To achieve this, the partnership intends to leverage India’s innovative "Bhashini" AI technology stack, working closely with the university to localize and implement the platform so that it effectively meets the unique linguistic needs of the region.337 New Payment Infrastructure Simplifies Nepal-India Household Transactions National Payments Corporation of India (NPCI) International and Nepal Clearing House Limited (NCHL) launched a real-time cross-border remittance link between India and Nepal on June 6, 2026, to facilitate instant and cost-effective person-toperson (P2P) money transfers.338 By integrating India’s Unified Payments Interface (UPI) and Nepal’s National Payments Interface (NPI), the collaboration enables migrant workers and residents of both countries to send funds directly from their bank accounts using identifiers like UPI IDs or mobile numbers, thereby digitizing and simplifying the financial connection between the two neighboring nations.339

POLICIES AND REGULATIONS Draft Telecommunications Policy Sets a Ten-Year Roadmap The Nepal Telecommunications Authority (NTA) released a draft of the Integrated Telecommunications Policy 2026 for public comment. The policy

aims to bring 50 Mbps broadband to 80% of the population within five years, and 98% within ten.340 To support this expansion, the NTA will require service providers to directly invest in neglected areas in order to maintain operating licenses.341 It also seeks to cap basic broadband costs at 2% of per capita income within five years, and to 1.5% within ten. In addition, the draft seeks to increase ICT's share of GDP to 4% in five years and 7% in ten by supporting economy-wide digitisation efforts spanning multiple sectors.342 Public feedback on the draft stayed open through August, so the final version has yet to be released. Judicial System Embraces Digital Transformation Following deliberations, on July 3, the Supreme Court of Nepal passed its approval for the adoption of the Judicial ICT Policy 2026 which will enable judicial services to incorporate artificial intelligence in its routine processes.343 This policy will allow for legal professionals to utilize AI systems to automate tasks such as legal research and drafting procedural documents but forbids its use in any activity that requires legal reasoning.344 The Supreme Court has also vowed to update the infrastructure of its records database to support this endeavour and to promote “e-courts”.345 US Drone Technology Supports Supply Drops in Everest Region In June 2026, Nepali drone operators completed multiple flights on Ama Dablam in Nepal's

Everest region, flying a USmanufactured drone between Base Camp at 4,600 meters and Yak Camp at approximately 5,050 meters, carrying oxygen cylinders and equipment across 1.6 kilometers of steep mountain terrain, as part of a demonstration organized by the US Embassy and Seven Summit Treks.346 Despite strong winds and volatile mountain weather, the drone completed every flight successfully, showing that it could reduce the physical burden on Sherpas, improve climber safety, and move essential equipment with greater speed and efficiency.347 Potential applications across Nepal also include expedition logistics, mountain cleanup, search and rescue, disaster response, and emergency deliveries in remote areas.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Outlook With advancements in both policy and digital infrastructure in this quarter, Nepal’s ICT sector is poised to grow in line with the administration’s designation of it as a priority sector for economic growth. While there was minimal action in this quarter to explicitly advance the goal of establishing Nepal as an ICT service exporter, the sector’s focus on upgrading the baseline of domestic ICT infrastructure for the general public demonstrates the administration’s commitment to sustainable development, rather than unbridled growth at the expense of its citizens. This trajectory coupled with the breadth of the policy and initiative developments will concurrently raise the floor and ceiling of the ICT sector. To accomplish this, alignment between governmental and commercial bodies is crucial. The integration of artificial intelligence into the foundations of Nepal’s infrastructure, beyond simply economy, will continue as domestic operators gain AIfluency and expand the use-cases of AI-systems. This corresponds with the administration’s goal of economy-wide digitisation, which itself will proceed as sector-specific governing bodies develop tailor-made policy as the NTA and Supreme Court did. However, sustainable growth in the field of AI will be contingent upon the cultivation and retention of domestic talent.

DOCKING NEPAL’S ECONOMIC ANALYSIS

Infrastructure and Real Estate Nepal’s infrastructure and real estate sectors recorded notable shifts during June–August 2026, as major projects reached operational milestones and changes in land regulation shaped property activity. The previous quarter had shown a gradual recovery in real estate transactions alongside renewed attention to infrastructure planning and land administration. This period saw several of those trends develop further. The opening of the Nagdhunga–Sisnekhola Tunnel marked a major transport milestone, while new Asian Development Bank financing strengthened investment in municipal water and sanitation systems. The property market also gathered pace, with annual real estate revenue reaching a threeyear high amid a rush to complete transactions before higher capital gains taxes took effect. Land management, however, remained uneven across the country. Delays in mandatory land classification halted subdivision in 363 local governments, even as the government introduced a new land-bank procedure to channel unused private land toward productive use. Overall, the quarter combined visible infrastructure delivery with stronger property activity and continued efforts to formalize Nepal’s land administration system. KEY DEVELOPMENTS Nagdhunga–Sisnekhola Tunnel Reshapes Nepal’s Highway Infrastructure Nepal inaugurated the 2.68 km Nagdhunga–Sisnekhola Tunnel, the country’s first modern highway tunnel, on July 27, 2026,.349 The project connected Kathmandu with Dhading through the Nagdhunga pass and

aimed to improve movement between the capital and other major cities.350 Construction began in November 2019 with concessional financing from the Japan International Cooperation Agency.351 Japan provided approximately USD 141.49 million (NPR 21.66 billion) in ODA loans for the project .352 Authorities initially allowed only emergency vehicles to use the tunnel after inauguration.353 Authorities also

FACTSHEET FY 2025/26 AD (2082/83 BS) up to August 2026348 Total Length of Road

36,806 km

New Road Constructed

76 km

introduced RFID-based N-Tags for electronic toll payments as operations began.354

Nepal’s Property Market Gains Momentum as Revenue Reaches a ThreeYear High Nepal’s real estate market recorded its strongest revenue cparticipants expediteds in FY 2025/26 AD (FY 2082/83 BS ), as transactions rallied toward the end of the fiscal year.355 The government collected NPR 60.74 billion (USD 397.12 million) from real estate transactions during the year, with nearly NPR 12 billion (USD 78.78 million) collected in the final month alone.356 Market participants expedited deals before higher capital gains taxes took effect on July 17, 2026.357 The government raised the tax rate by 2.5%.358 Concurrently, land subdivision restrictions returned in local governments that had not completed mandatory land classification under the Land Use Regulations and banks had slashed interest rates, yielding

NEFPORT ISSUE 66 – SEPTEMBER 2026

a friendly buyers.359

environment

for

Incomplete Land Classification Halts Subdivision Across 363 Local Governments Nepal suspended land subdivision in 363 of its 753 local governments from mid-July 2026 after failure to complete mandatory land classification within the extended deadline.360 The restriction followed the expiry of a temporary relaxation to the Land Use Regulations. 361 By the deadline, only 390 local governments had completed classification, while 38 had not started the process.362 Under the Land Use Act, local governments had to classify land into ten categories, including agricultural, residential, commercial and industrial areas, using maps and technical data.363 The suspension applied specifically to land subdivision; transfers of entire plots, inheritance, family partition and court-ordered transfers continued.364 Local governments

cited limited budgets and shortages of technical staff as key reasons for the delays, with classification estimated to cost NPR 1.5–2 million per local unit.365

ADB Provides Loan for Nepal’s Municipal Water and Sanitation The Asian Development Bank approved a USD 115 million (NPR 17.6 billion) concessional loan in June 2026 to improve water supply and sanitation services in 13 municipalities across Nepal.366 The project responded to growing pressure on basic urban services as expanding municipalities struggled with unreliable water supply and limited sanitation access.367 The project aimed to provide piped water connections to about 72,000 households and improve sanitation services for more than 120,000 properties.368 The Government of Nepal contributed USD 28.8 million (NPR 4.4 billion), bringing the project’s total value to USD 143.8 million (NPR 22 billion).369

Government Introduces Land Bank Procedure to Mobilize Unused Land The government introduced the Land Bank (Establishment and Operation) Procedure, 2026, to bring unused private land into productive use through local governments.370 The framework followed the Land Use Act, 2019 and amended Land Use Landowners Regulations.371 could register unused plots with their local government while retaining legal ownership.372 Local authorities verified eligible land and invited landowners to apply to use it under agreed terms.373 The procedure also required local governments to create land-bank sections, committees and accounts to administer the system.374

Outlook The next quarter will test whether recent progress in infrastructure delivery can translate into smoother implementation and stronger urban services. The opening of the Nagdhunga–Sisnekhola Tunnel marked an important shift from construction to operation, making effective traffic management, safety systems, and toll administration increasingly important. Meanwhile, the ADBbacked water and sanitation project could move further into procurement and implementation, although its scale across 13 municipalities will require strong coordination. In real estate, the late surge in transactions may moderate after higher capital gains taxes took effect, particularly as subdivision remains restricted in 363 local governments that have not completed land classification. This could keep regulatory compliance at the center of property-market activity. The new land-bank procedure may also begin to show whether local governments can convert policy into functioning land-management mechanisms, following initial approvals in five municipalities. Overall, the next quarter will likely be shaped less by new policy announcements and more by how effectively existing infrastructure and land reforms are implemented.

DOCKING NEPAL’S ECONOMIC ANALYSIS

Tourism

FACTSHEET

Nepal's tourism sector during the review quarter reflected continued growth alongside emerging challenges related to infrastructure, disaster resilience, and regulatory reform. Compared to the previous quarter, when international arrivals were affected by the West Asia conflict before recovering through strong regional demand, the sector continued to benefit from growing interest from South Asian visitors. The record 508,476 foreign visits to the Annapurna Conservation Area and the growing contribution of domestic tourism highlighted the expanding role of both regional and domestic markets. At the same time, the Bhotekoshi floods exposed the sector's vulnerability to natural disasters, requiring coordinated rescue efforts for stranded tourists. Meanwhile, proposed amendments to the Tourism Bill and new international connectivity through Pokhara signaled continued efforts to strengthen Nepal's tourism infrastructure, safety standards, and product diversification. KEY DEVELOPMENTS Tourist Arrivals Reach a Decade High Nepal recorded 248,582 international tourist arrivals during the June to August review quarter of 2026, the highest number recorded during the same three-month period in the past decade, as shown in Figure 1.385 Arrivals surpassed the previous high of 240,548 recorded in 2019 and increased by 5.6% compared to 235,298 arrivals in the corresponding period from 2025.386 However, the quarter showed varying monthly trends, with arrivals reaching 91,363 in June before declining

to 71,775 in July and recovering to 85,444 in August. 387 However, August arrivals declined by 3.65% year-on-year from 88,680 in August 2025, partly reflecting disruptions caused by the August 26 flash floods in the Bhotekoshi and Trishuli river systems, which affected tourism activities and access to destinations in the affected regions.388 India remained Nepal's largest source market, contributing 26,373 visitors, followed by China with 10,304 visitors.389 Authorities Rescue 289 Tourists Stranded by Bhotekoshi Floods Flash floods originating in the Langtang Lirung area in

INDICATORS International Visitor Arrivals (June 2026 - August 2026)375

248,582

Proposed FDI Commitments in Tourism (FY 2025/26)376

24% of total FDI NPR 13.99 billion (USD 91.85 million)

Number of FDI Projects in Tourism377

20% of total projects 227

Average Length of Stay (2026)378

16.34

Foreign Exchange Earnings from Tourism (mid-July 2025 to midJuly 2026)379

NPR 90.05 billion (USD 591.23 million)

Total Tourism Revenue (2026)380

USD 628.40 million (NPR 95.71 billion)

Average Daily Spending per Tourist (2025)381

USD 33.09 (NPR 5,040)

Number of Registered Star Hotels (2025)382

222

Government Royalty from Mountaineering Expeditions (2026)383

NPR 1.26 billion (USD 8.27 million)

Number of Registered Travel Agencies (2026)384

5,099

NEFPORT ISSUE 66 – SEPTEMBER 2026

Figure 1: Tourism Arrival Trend During the Quarter (20162026) Source: Current Macroeconomic and Financial Situation - Tables (Based on Annual Data of 2025/26)410

Nepal struck the Bhotekoshi and Trishuli rivers in Rasuwa, Nuwakot, Dhading and Gorkha districts on August 26, 2026.390 In response, authorities conducted search, rescue, evacuation and assistance operations for affected tourists.391 As of August 31, 2026, 315 foreign nationals had been rescued, while 583 foreign nationals remained out of communication.392 The Ministry of Culture, Tourism and Civil Aviation, Nepal Tourism Board, Tourist Police and other concerned stakeholders worked in close coordination with government agencies, security authorities and local administrations to establish the whereabouts and safety of foreign nationals affected by the disaster.393 Flydubai Receives Approval for Direct Pokhara-Dubai Flights On June 8, 2026, Flydubai received permission from the Civil Aviation Authority of Nepal to operate direct flights between Pokhara and Dubai from Pokhara

International Airport.394 The service is scheduled to begin on September 23, 2026 from Pokhara International Airport.395 The service will operate under a code-share arrangement between Flydubai and Emirates Airlines, allowing passengers to travel directly between Pokhara and Dubai.396 The route is expected to shorten travel time and reduce costs for passengers who currently have to route through Kathmandu.397 Annapurna Conservation Area Records Historic Tourist Surge The Annapurna Conservation Area recorded a surge in visitor numbers, with 508,476 foreign tourist visits in FY 2025/26 AD (2082/83 BS).398 The surge was driven by an influx of tourists from South Asian countries, particularly India, which accounted for 375,797 visitors.399 According to the Chief of the Annapurna Conservation Area Project, the increase was driven by infrastructure improvements, strategic promotion of

destinations like Pokhara and the pilgrimage site of Muktinath, and social media marketing.400 Domestic Tourism Contributes 2.65% to GDP Domestic tourism contributed 2.65% to Nepal’s gross domestic product (GDP) in FY 2024/25 AD (2081/82 BS), according to the first nationwide Domestic Tourism Survey conducted by the National Statistics Office (NSO).401 Around 3.62 million, or 52.4%, of resident households undertook tourism activities, with domestic visitor consumption reaching NPR 407.18 billion (USD 2.67 billion) and generating tourism gross value added of NPR 144.5 billion (USD 948.73 million).402 Travel was driven more by social and practical needs than leisure, with visiting friends and relatives accounting for 65.6% of overnight trips and shopping for 32.6% of same-day excursions.403 Kathmandu dominated business, health and education-related travel, while Kaski led holidays and leisure activities.404

DOCKING NEPAL’S ECONOMIC ANALYSIS

POLICIES AND REGULATIONS Lawmakers Propose 263 Amendments to Tourism Bill On July 22, 2026, 58 lawmakers registered 263 amendments to the Tourism Bill, 2024, proposing reforms across Nepal’s tourism sector as the bill entered clausewise deliberation by the House committee.405 Endorsed by Speaker Dol Prasad Aryal for

discussion, the amendments propose changes to tourism regulation, safety, environmental standards and governance.406 Proposals include stricter climbing requirements for Everest and other 8,000-meter peaks, mandatory acclimatization in Nepal, limits based on mountain carrying capacity, and permit auctions.407 The amendments propose reserving expedition roles for Nepali citizens, requiring medical and rescue insurance

for workers, and strengthening tourism governance through an autonomous Nepal Tourism Authority and a Tourism Ombudsman.408 They also seek to regulate online tourism services and introduce new tourism products, including digital nomad visas and community-based cultural experiences.409

Outlook Nepal's tourism sector is expected to continue expanding in the next quarter, with a focus on improving visitor safety, sustainability, and infrastructure preparedness. Record visitor inflows to the Annapurna region and rising domestic tourism indicate expanding demand, while the Bhotekoshi floods highlighted the sector's vulnerability to natural disasters and the need for stronger response mechanisms. Proposed amendments to the Tourism Bill could strengthen safety, environmental standards, and tourism governance, while Flydubai's upcoming Pokhara-Dubai service may improve international connectivity and reduce dependence on Kathmandu as the primary aviation gateway. Together with efforts to diversify tourism products, these developments could broaden Nepal's tourism base, although their long-term impact will depend on effective policy implementation, reliable infrastructure, and improved disaster resilience.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Market Review

DOCKING NEPAL’S ECONOMIC ANALYSIS

Financial Overview During the review period from June 1 to August 31, 2026, based on the annual data of FY 2025/26 AD (2082/83 BS), Nepal's Balance of Payments (BoP) recorded a strong surplus, reflecting strong growth compared to the previous year, underpinned by sustained remittance inflows and a significant build-up in foreign exchange reserves. Nepal Rastra Bank (NRB) maintained its cautiously flexible monetary policy stance with key rates unchanged, though domestic financial pressures persisted as non-performing loans continued to rise and credit growth remained modest, reflecting slowdown in the private sector borrowing. On the capital markets front, the Nepal Stock Exchange (NEPSE) index declined broadly across all sub-indices during the review period, even as regulators unveiled an ambitious slate of structural reforms signaling a concerted push to deepen and modernize Nepal's financial markets amid ongoing macroeconomic headwinds. Fourth Quarter Performance Analysis of Commercial Banks423 As per the unaudited fourthquarter results of commercial banks for FY 2025/26 AD (2082/83 BS), the operating profit of commercial banks decreased by 2.66%, while net profit declined by 3.17% compared to the same period in the previous FY 2024/25 AD (2081/82 BS). In the fourth quarter of FY 2025/26 AD (2082/83 BS), Nabil Bank reported the highest net profit of NPR 7.91 billion (USD 51.93 million), followed by Kumari Bank with NPR 7.39 billion (USD 48.52 million) and Global IME Bank with NPR 6.23 billion (USD 40.90

million). Additionally, compared to the same period in the previous FY 2024/25 AD (2081/82 BS), Kumari Bank recorded the highest year-on-year growth in net profit of 249.04%, reaching NPR 7.39 billion (USD 48.52 million). Meanwhile, Prabhu Bank recorded the lowest net profit, posting a net loss of NPR 241.24 million (USD 1.58 million), down from a profit of NPR 5.44 billion (USD 35.72 million) in the same period last year. In terms of reserves and surplus, Rastriya Banijya Bank led with NPR 39.99 billion (USD 262.56 million), followed by Nabil Bank with NPR 39.85 billion (USD 261.64 million), and Nepal Investment Mega Bank

FACTSHEET411 Indicators Weighted Average 91-day Treasury Bill Rate (mid-July 2026)412

2.32%

Weighted Average Interbank Transaction Rate (mid-July 2026)413

2.75%

Weighted Average Lending Rate (midJuly 2026)414

6.55%

Weighted Average Deposit Rate (midJuly 2026)415

3.21%

Average Base Rate of Commercial Banks (mid-July 2026)416

4.83%

NEPSE Index (endAugust)417

2,513.42

Stock Market Capitalization (end-August)418

NPR 4.32 trillion (USD 28.36 billion)

Number of Companies Listed at NEPSE (midJuly)419

302

Consumer Price Index (mid-July 2026)420

5.14%

Gross Foreign Exchange Reserve (mid-July 2026)421

NPR 3.90 trillion (USD 25.61 billion)

Buying Exchange Rate per USD (midJuly 2026)422

NPR 153.72

NEFPORT ISSUE 66 – SEPTEMBER 2026

(NIMB) at NPR 33.35 billion (USD 218.97 million). Overall, seven banks surpassed the reserves and surplus industry average of NPR 19.69 billion (USD 129.28 million). According to the fourth quarter data of the current FY 2025/26 AD (2082/83 BS), deposits at commercial banks grew by 14.92% compared to the corresponding period in FY 2024/25 AD (2081/82 BS). Rastriya Banijya Bank mobilized the highest deposits of NPR 686.13 billion (USD 4.50 billion), followed by Global IME Bank with NPR 669.17 billion (USD 4.39 billion) and Nabil Bank with NPR 592.56 billion (USD 3.89 billion). Meanwhile, Standard Chartered Bank reported the lowest customer deposits at NPR 147.68 billion (USD 969.59 million). Compared to the same period in the previous FY 2024/25 AD (2081/82 BS), Rastriya Banijya Bank recorded the highest deposit growth of 37.19%, reaching NPR 686.13 billion (USD 4.50 billion). Total credit growth expanded by 5.98% compared to the same

period in the previous FY 2024/25 AD (2081/82 BS). Nabil Bank held the largest loan portfolio of NPR 460.32 billion (USD 3.02 billion), followed by Global IME Bank at NPR 439.35 billion (USD 2.88 billion) and Rastriya Banijya Bank with NPR 332.08 billion (USD 2.18 billion). Meanwhile, Standard Chartered Bank had the lowest credit disbursement of NPR 66.03 billion (USD 433.52 million). Lastly, the average NonPerforming Loan (NPL) ratio of commercial banks increased to 5.27% from 4.23% in the same period last FY 2024/25 AD (2081/82 BS), while the average cost of funds declined to 3.45% from 4.38%. The average base rate stood at 4.93% during the review period. Kumari Bank recorded the highest base rate at 6.44%, while Rastriya Banijya Bank had the lowest at 4.20%.

NRB are highlighted below. These are based on nine-months data of FY 2025/26 AD (2082/83 BS) ending in mid-April of 2026 AD. Deposit and Credit Mobilization The deposits at Banks and Financial Institutions (BFIs) grew by 13.9% in the review period as compared to 12.6% in the same period last FY 2024/25 AD (2081/82 BS). Among the total number of deposits, demand deposits, saving deposits, and fixed deposits accounted for 8.1%, 47.0%, and 35.3%, respectively. These proportions have experienced a change compared to a year ago when the respective shares were 7.1%, 36.8%, and 48.3%.

KEY BANK AND FINANCIAL INSTITUTIONS INDICATORS424 Some of the key banking sector indicators, as per the Current Macroeconomic and Financial Situation report published by 2025 (Mid-July)

2026 (Mid-July)

Source: Current Macroeconomic and Financial Situation (Based on Annual Data of FY 2025/26)425

35.3

48.3

DEMAND

SAVING

FIXEDO

DEPOSITS AT BANKS AND FINANCIAL INSTITUTIONS

9.5

7.8

7.5

8.1

7.1

5.8

30.3

PERCENTAGE SHARE

Figure 2. Deposit Mix at Banks and Financial Institutions by mid-April (Percentage Share)

36.8

56.4

2024 (Mid-July)

DO THER

DOCKING NEPAL’S ECONOMIC ANALYSIS

Similarly, in the review period, credit provided to the private sector by BFIs witnessed a rise of 6.5%, compared to the corresponding period last year. This increase contrasts with the annual data of FY 2024/25 AD (2081/82 BS), where credit grew by 8.4%.

Additionally, BFIs witnessed an increase in outstanding loans to various sectors. The construction sector witnessed a rise of 18.6%; consumable sector increased 17.8%; the transportation, communication and public sector increased 15.0%; industrial production sector increased

5.2%; finance, insurance, and fixed assets sector increased 5.0%; the service industry sector increased 4.4%, while the agriculture sector decreased 1.8% compared to the annual data of last FY 2024/25 AD (2081/82 BS).

absorption consisted of NPR 3.62 trillion (USD 23.77 billion) through the deposit collection auction, NPR 38.50 trillion (USD 252.77 billion) through the Standing Deposit Facility (SDF), and NPR 400.00 billion (USD 2.63 billion) through NRB bond. NRB also injected NPR 12.50 billion (USD 82.07 million) on turnover basis through Overnight Liquidity Facility (OLF). In conclusion, NPR 42.50 trillion (USD 279.04 billion) was absorbed through various monetary instruments in the review period. In the corresponding period of the previous year, NPR 24.65 trillion (USD 161.84 billion) net liquidity was absorbed through various instruments of monetary operations on transaction basis.

Moreover, NRB injected liquidity amounting to NPR 1,172.14 billion (USD 7.70 billion) through the net purchase of USD 8.05 billion from the foreign exchange market. In comparison, in the corresponding period of the previous year, a liquidity of NPR 787.00 billion (USD 5.17 billion) was injected through the net purchase of USD 5.83 billion.

Figure 3. Sector-wise Outstanding Credit of Banks and Financial Institutions (Amount in NPR billions) Source: Current Macroeconomic and Financial Situation (Based on Annual Data of FY 2025/26)426

Compared to the corresponding period of last FY 2024/25 AD (2081/82 BS), trust receipt loans for import extended by BFIs increased by 32.2%, margin nature loan increased by 18.3%, hire purchase loan increased 11.1%. Moreover, demand and other working capital loans increased by 7.3%, real estate loans (including residential personal home loans) extended by BFIs increased by 6.9%, overdraft loan increased by 5.2%, and term loan increased by 4.3%, while cash credit loan decreased by 1.8%. Liquidity Management In the annual data of FY 2025/26 AD (2082/83 BS), NRB absorbed a total liquidity of NPR 42.52 trillion (USD 279.18 billion) on a transaction basis. This liquidity

Additionally, NRB purchased Indian Rupees (INR) equivalent to NPR 710.36 billion (USD 4.66 billion) through the sale of USD 4.84 billion in the review period. Comparatively, in the corresponding period last year, INR equivalent to NPR 567.61 billion (USD 3.73 billion) was purchased through the sale of USD 4.16 billion.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Foreign Exchange Reserves and Adequacy According to the annual data of FY 2025/26 AD (2082/83 BS), the total value of foreign exchange reserves rose by 45.6% to NPR 3.90 trillion (USD 25.61 billion) in

mid-July 2026, compared to NPR 2.68 trillion (USD 17.60 billion) in mid-July 2025. Moreover, the reserves held by BFIs, excluding NRB, increased by 61.4% to NPR 424.48 billion (USD 2.79 billion) in mid-July 2026 from NPR 263.04 billion (USD 1.73 billion) in

mid-July 2025. Within this, the proportion of Indian currency in the total reserves amounted to 22.3% as of mid-July 2026.

FY 2024/25 AD (2081/82 BS) (Mid-July)

FY 2025/26 AD (2082/83 BS) (Mid-July)

Total Foreign Reserve In NPR

2.68 trillion

3.90 trillion

In USD

17.60 billion

25.61 billion

Ratios

Table 1. Foreign Exchange Adequacy Indicators Source: Current Macroeconomic and Financial Situation (Based on Annual Data of FY 2025/26)427

Reserves-to-GDP

43.8%

63.8%

Reserves-to-Imports

128.1%

163.4%

Reserves-to-M2

34.1%

43.8%

Additionally, based on the imports of FY 2025/26 AD (2082/83 BS), the foreign exchange reserves of the banking sector have been deemed sufficient to cover approximately 23 months of prospective merchandise imports and 19.6 months of both merchandise and services imports. Interest Rates The weighted average rate for the 91-day treasury bills declined to 2.32% as of mid-July 2026 AD, compared to 2.95% in the corresponding month of the previous fiscal year. Meanwhile, the weighted average inter-bank transaction rate among BFIs,

which was 2.96% a year ago, decreased to 2.75% as of midJuly 2026. In the same period, the average base rate of commercial banks experienced a decrease, falling from 6.02% a year ago to 4.83% by mid-July 2026. Furthermore, the weighted average deposit rate and lending rate of commercial banks stood at 3.21% and 6.55%, respectively. Comparatively, these rates were 4.19% and 7.85% respectively a year ago. Balance of Payment According to the annual data of FY 2025/26 AD (2082/83 BS), ending in mid-July 2026 AD, the

BoP was at a surplus of NPR 1.03 trillion (USD 6.76 billion), which witnessed an increase of 72.75% compared to the corresponding period of the previous year, where the BoP was at a surplus of NPR 594.54 billion (USD 3.90 billion).

DOCKING NEPAL’S ECONOMIC ANALYSIS

Key Highlights from the Third Quarter Review of the Monetary Policy 2025/26 AD (2082/83 BS) Published on May 15, 2026428 Key Highlights from the Third Quarter Review of the Monetary Policy

Nepal Rastra Bank projected that inflation would remain within 5.5% for FY 2083/84, easing from the fourth quarter onward, in support of the Government's 7.0% economic growth target. The policy rate, standing deposit facility rate, bank rate, CRR, SLR, and SLF were all kept unchanged, continuing the Bank's "cautiously flexible" policy stance. Foreign exchange reserves were targeted to cover at least seven months of imports, with the fixed NPRINR exchange rate maintained as the monetary anchor. Commercial banks were encouraged to invest in foreign government bonds, and sterilized intervention provisions were introduced to manage liquidity from foreign currency inflows. Special provisions were planned to address personal-guarantee liability, cheque-dishonor blacklisting, non-performing loans in sick industries, stressed loan revival, share-collateral loan limits, and LTV facilitation for large electric public-transport vehicles. The interest rate corridor would be narrowed gradually if inflationary pressure persisted, or macroeconomic stability came under strain.

KEY SECURITIES MARKET INDICATORS Table 2: Sub-indices during the review period Index

31-May-2026

31-August-2026

% Change

Main Indices NEPSE

2,782.10

2,513.42

-9.66

Sensitive

475.51

444.43

-6.54

Float Index

188.96

172.24

-8.85

Banking

1,469.80

1,414.12

-3.79

Development Banking

5,915.63

5,385.72

-8.96

Finance

2,385.35

2,236.65

-6.23

Microfinance

4,824.54

4,368.48

-9.45

Hydropower

3,949.19

3,437.13

-12.97

Hotels and Tourism

7,927.36

6,989.28

-11.83

Sub-Indices

NEFPORT ISSUE 66 – SEPTEMBER 2026

Manufacturing and Processing

11,328.89

10,485.66

-7.44

Life Insurance

12,616.09

11,062.72

-12.31

Non-Life Insurance

10,992.63

9,243.71

-15.91

Trading

3,802.97

3,180.71

-16.36

Mutual Funds

21.99

19.49

-11.37

Investment

103.55

92.82

-10.36

2,018.99

1,777.44

-11.96

Others

Source: Nepal Stock Exchange429

Secondary Market During the review period, from May 31, 2026, to August 31, 2026, the NEPSE index closed at 2,513.42 points, reflecting a decline of 268.68 points (-9.66%). The index reached its highest on June 3, 2026, at 2,799.15 points, and its lowest on August 31, 2026, at 2,508.49 points, during intra-day sessions. Within this, the total market capitalization at the end of the review period was NPR 4.32 trillion (USD 28.36

billion). Among the main indices, the Sensitive index decreased by 6.54% to 444.43 points, while the Float Index fell by 8.85% to 172.24 points. In the subindices, the Trading sub-index recorded the highest decline of 16.36%, followed by the Non-Life Insurance sub-index at 15.91%, the Hydropower sub-index at 12.97%, the Life Insurance subindex at 12.31%, the Others subindex at 11.96%, the Hotels and Tourism sub-index at 11.83%,

and the Mutual Funds subindex at 11.37%. Meanwhile, the Investment sub-index decreased by 10.36%, the Microfinance subindex by 9.45%, the Development Banking sub-index by 8.96%, the Manufacturing and Processing sub-index by 7.44%, the Finance sub-index by 6.23%, and the Banking sub-index by 3.79%. Figure 3 shows the daily changes of the NEPSE index during the review period.

2,850.00 2,800.00 2,750.00

NEPSE Index

2,700.00 2,650.00 2,600.00 2,550.00 2,500.00 2,450.00

Figure 4. NEPSE Movement Over the Review Period Source: Nepal Stock Exchange (NEPSE)430

2,400.00

Closing Date

DOCKING NEPAL’S ECONOMIC ANALYSIS

PRIMARY MARKET During the review period, no companies in the Initial Public Offering (IPO) pipelines receieved SEBON’s approval.

KEY DEVELOPMENTS GOVERNMENT EXPANDS ALTERNATIVE DEVELOPMENT FINANCING On August 20, 2026, the Government of Nepal authorized the International Finance Corporation (IFC) and Asian Development Bank (ADB) to each issue up to USD 200 million (NPR 30.46 billion) and USD 400 million (NPR 60.92 billion) respectively, in Nepali rupee-denominated bonds in international markets to finance private-sector projects.431 The move aims to mobilize alternative development financing as concessional loans and grants decline, while giving Nepali companies access to longer-term foreign capital through domestic banks, subject to project and environmental due diligence.432 NRB Expands Lending Access for EVs and MSMEs NRB revised digital lending rules for micro, small and medium enterprises (MSMEs) on June 8, 2026, enabling working capital loans up to NPR 1 million (USD 6,565.55) through digital channels using transaction data.433 It also expanded credit access through amendment to the Unified Directives, 2082 (2025) on July 15, 2026, by allowing banks and financial institutions in Nepal to lend up to 80% of the cost of large electric passenger vehicles for public

transport, and for replacement of vehicles damaged during the Gen Z movement.434 SEBON Unveils Policy Reforms for FY 2026/27 SEBON unveiled the Capital Market Policy for FY 2083/84 BS (FY 2026/27 AD) on July 14, 2026, aimed at strengthening Nepal’s capital market and facilitating the restructuring of NEPSE.435 The reforms include introducing intraday trading, short selling, and securities lending and borrowing to allow investors to earn returns during market downturns and improve market efficiency.436 SEBON also proposed attracting non-resident Nepalis and encouraging greater participation of institutional investors, including the Employees Provident Fund, Citizen Investment Trust, Social Security Fund, and pension funds.437 It further proposed removing the six-month lockin period applicable to mutual funds after IPO allocations.438 The board plans to coordinate with relevant authorities to implement recommendations from previous studies and advance necessary legal and structural reforms.439 SEBON Unveils 10-Year Capital Market Roadmap Along with the policy for FY 2026/27, on July 14, 2026, SEBON unveiled the Capital Market Development Roadmap 2026 AD–2036 AD, outlining a threephase plan to modernize Nepal’s capital markets and establish the country as a leading financial hub in South Asia.440 The immediate-term measures include replacing the Securities Act, 2063 BS (2009 AD), with separate Securities Market

Management and Crime and Punishment Acts, establishing a dedicated Small and Medium Enterprise (SME) platform on the NEPSE, and introducing an Artificial Intelligence-based market surveillance system.441 The roadmap also proposes restructuring the ownership of NEPSE and the Central Depository Services and Instruments (CDSC), issuing infrastructure and green bonds, introducing Real Estate Investment Trusts, Infrastructure Investment Trusts, and Exchange Traded Funds, and allowing institutional funds to act as market makers.442 By 2036, SEBON targets market capitalization equivalent to 150% of Gross Domestic Product (GDP), more than 500 listed companies, 12 million Demat accounts, and average daily turnover exceeding NPR 30 billion (USD 196.97 million).443 SEBON Unveils Primary Market White Paper SEBON unveiled the White Paper on the Development of Nepal’s Primary Capital Market, 2026 as part of its regulatory reform initiatives under the capital market policy for FY 2026/27 on August 6, 2026.444 The white paper provided an integrated policy framework to make Nepal’s primary market more transparent, fair, competitive, efficient, technology-driven, and aligned with international best practices.445 It outlined reforms covering the market’s regulatory development, current state, key challenges, proposed solutions, future strategies, and relevant international practices.446 The reforms were planned for implementation in three phases over the coming five years,

NEFPORT ISSUE 66 – SEPTEMBER 2026

beginning with policy and legal reforms and a review of the existing book-building system.447 The second phase proposed developing a Digital IPO Platform, electronic Know Your Customer (e-KYC), Regulatory Technology (RegTech), and Supervisory Technology (SupTech) systems, while the third phase focused on advanced market development, including market-based price discovery and participation of Qualified Institutional Buyers and anchor investors.448 SEBON Proposes Margin Lending Regulations SEBON published the draft Margin Lending Transaction Regulations, 2026, on August 18, 2026, to strengthen the framework for margin lending as more stockbrokers prepared to offer the facility.449 The draft proposed that margin lenders meet SEBON’s prescribed paid-up capital or net-worth requirements, maintain adequate

financial capacity and liquidity, and establish systems to operate margin transactions, value collateral daily, issue margin calls, and manage collateral.450 Investors would be required to maintain separate margin accounts, finance at least 30% of a transaction from their own funds, and meet a 20% maintenance margin.451 The draft also proposed allowing margin lenders to provide financing of up to five times their certified net worth, with collateral valued at its closing market price on each trading day.452 SEBON said it would finalize the regulations after considering feedback from capital market stakeholders.453 SEBON Seeks Feedback on Debenture Rules On August 20, 2026, SEBON published the draft Debenture Registration and Issue Regulations, 2026, for public consultation.454 The draft aimed to transform Nepal’s capital

market from one focused mainly on company shares into a broader, multi-product market by enabling eligible corporate companies, beyond banks and financial institutions, to raise long-term funds through bonds and debentures.455 It also sought to make the domestic bond market more diverse, competitive, transparent, and aligned with international best practices, while increasing market activity, improving cash flow, and supporting more effective financial risk management.456 Stakeholders and the general public were invited to submit feedback, suggestions, and comments within seven days of the notice publication, after which SEBON would review the feedback before giving final approval to the regulations.457

Outlook A broad package of capital market and financial sector reforms is laying the groundwork for a more competitive and investment-friendly economy. The Securities Board of Nepal's 10-year Capital Market Development Roadmap and accompanying FY 2026/27 AD (FY 2083/84 BS) policy outline an ambitious modernization agenda aimed at deepening market efficiency, broadening the investor base, and aligning Nepal's capital markets with international best practices. Complementing these efforts, the authorization of IFC and ADB to issue rupee-denominated bonds signals a meaningful shift toward alternative development financing, while NRB's expanded lending provisions for MSMEs and electric public transport vehicles reflect a targeted approach to broadening credit access in productive sectors. Despite this positive reform momentum, persistent structural weaknesses in credit quality and investor confidence remain significant challenges, and the ultimate success of these reforms will depend on effective implementation, institutional capacity, and sustained policy continuity to translate this ambitious agenda into sustainable long-term growth.

DOCKING NEPAL’S ECONOMIC ANALYSIS

Special Section Digital Democracy: How Democracy Is Practiced in the Digital Age

Introduction A year has passed since the Generation Z-led September 2025 protests of Nepal, which saw a total upheaval of Nepal's old guard and a new mandate on the ballots. The movement that organized, accelerated, and made itself visible through social media has raised a question that outlasts the protests themselves: Where does democracy reside in the digital age, and what do political activism and civic participation mean when so much of public discourse has moved online? The 66th issue of NEFport aims to understand how digital platforms have changed the way citizens access information, express grievances, and engage with public institutions, along with challenges including misinformation, algorithms, concentrated technological power, and unequal digital access. It looks at the role of digital public infrastructure, AI, data, and digital government in reshaping the relationship between citizens and the state and considers how institutions can adapt to these changes while strengthening transparency, accountability, and public participation. At the same time, the issue asks who can participate in this digital transformation and who risks being left behind due to gaps in connectivity, language, documentation, digital literacy, and access. This issue of NEFport follows that question through four pieces, each taking up a different part of it. “When Grievances Go Viral: Digital Media and Nepal’s Changing Democracy,” Dr. Sudhamshu Dahal (Associate Professor, Department of Languages and Mass Communication, Kathmandu University) opens by tracing how private frustration turned into the Gen Z protests and how the platforms and algorithms carrying that movement rewarded outrage over explanation, before asking what it would take to convert that same energy into lasting, everyday civic participation. “Democracy in the Loop: Fixing Ordinary Failures Before Dramatic Ones,” Anwesha Sen (Assistant Program Manager, Takshashila Institution) turns from the disruption itself to the institutions meant to absorb it, arguing that the deeper risk is not some dramatic AI rupture but the ordinary, fixable weaknesses in regulators, courts, and oversight bodies, and the exclusion that follows when only a few countries control the technology everyone else depends on. “Government Services in Our Pocket: Building Nepal's Digital Democracy,” Niraj Bhusal (Office of the Hon. Finance Minister, Ministry of Finance, Government of Nepal) examines Nepal's own attempt at institutional resilience, tracing how digital identity, payments, and data infrastructure are reshaping the relationship between citizens and the state, and what is still missing before that infrastructure becomes genuine accountability. “The Majority We Cannot See: Designing Nepal's Digital State for the Citizens Left Out,” Kritika Ghimire (Project Manager, SpeakUp Nepal) closes the section by asking who this new digital state was actually built for, showing how unequal access to devices, documentation, language, and connectivity leaves a majority of Nepalis designed out of the system meant to represent them.

DOCKING NEPAL’S ECONOMIC ANALYSIS

When Grievances Go Viral: Digital Media and Nepal’s Changing Democracy Dr. Sudhamshu Dahal

(Associate Professor, Department of Languages and Mass Communication, Kathmandu University) Nepal’s Gen Z protests revealed more than the organizing power of social media. They showed that digital platforms have become places where people practice citizenship. People encounter public issues, compare experiences, question authority, and decide whether to act through these platforms. For Nepal, the democratic challenge is clear: how can the energy of rapid online mobilization be converted into informed, inclusive, and sustained participation? In early September 2025, following an official registration deadline, the government directed the Nepal Telecommunications Authority (NTA) to deactivate unregistered social media platforms. The restrictions became an immediate trigger for the Gen Z demonstrations that began at Maitighar in Kathmandu on September 8 and developed into a nationwide political crisis. The movement also expressed deeper anger over corruption, political exclusion, lack of transparency, and weak public accountability. From private frustration to public action Collective action begins when people discover that a private difficulty is widely shared. A young Nepali may experience

unemployment, an unfair recruitment process, or poor public services as a personal setback. When similar accounts appear repeatedly in videos, memes, and posts, the problem acquires a public meaning. “My frustration” becomes “our condition.” Social media accelerates this change. Likes, comments, and shares offer visible evidence that others recognize the same problem. Messaging groups circulate meeting points, safety information, and updates at little cost. Short videos give distant citizens an immediate view of events, while humor and cultural references make political messages easier to understand and repeat. Before people assemble in a street, they may already have formed a networked public online. Yet platforms do not solely manufacture discontent. Nepal’s protests drew force from conditions that preceded the restrictions, including limited opportunities, anger at privilege, and declining confidence in institutions. Digital networks connected these grievances and compressed the time between recognition and action. That speed is politically powerful but institutionally fragile. A movement

can become nationally visible before it has agreed leadership, negotiation procedures, or a long-term program. Digital mobilization is often better at opening a political moment than governing what follows. How platforms shape political importance Platforms do not simply display public opinion. Their recommendation systems organize attention. They select what appears first, what repeats, and what reaches audiences beyond a user’s immediate contact. Because platforms compete for attention, content that produces anger, fear, surprise, or moral outrage often travels more easily than a careful policy explanation. This affects what citizens perceive as urgent. A problem may dominate discussion because it can be reduced to a striking image, memorable phrase, or compelling personal story. Repetition can make a claim appear true, while a high number of reactions can make a view seem nationally representative. Visibility becomes a form of political power. Nepal’s digital reach makes these effects consequential. At the end of August 2026, the NTA recorded

NEFPORT ISSUE 66 – SEPTEMBER 2026

around 31.3 million broadband subscriptions against a census population of 29.16 million. These figures represent subscriptions rather than unique users, but they show how deeply mobile communication is embedded in Nepali life. Participation nevertheless remains uneven because cost, education, and limited digital skills can restrict access, especially among women and marginalized communities. The democratic promise and developmental stakes Digital media can reduce longstanding barriers to public visibility. Citizens no longer need access to a newsroom, political party, or powerful organization to report a service failure, question an official account, or gather support. This creates opportunities for young people, women, marginalized communities, and citizens outside Kathmandu to participate in public debate. However, the democratic promises and dangers of digital media arise from the same features. Publishing without institutional permission gives previously unheard citizens a voice, but it also allows inaccurate information to circulate without verification. Personal networks build solidarity, but they can spread rumors through trusted relationships. Emotional narratives make distant problems understandable, but they may reduce complex policy questions to accusations, personalities, and opposing camps. Nepal-specific research confirms these risks. One study in the Center for Media Research-

Nepal’s 2025 anthology drew on 29 key-informant interviews across all seven provinces to examine the actors, content, and tactics involved in information manipulation. A publicperception study in the same collection identified social media as the main channel through which respondents encountered misinformation, with Facebook especially prominent. These dangers became visible during the Gen Z uprising. Nepalbased research documented exaggerated casualty figures and political and religious falsehoods circulating during the crisis. Emotionally charged claims moved faster than correction, showing how weak official communication can increase uncertainty, distrust, and polarization. From a development perspective, the quality of the information environment matters because citizens, businesses, and governments make decisions with incomplete information. Digital platforms can reduce this gap by helping communities identify failures in roads, schools, healthcare, drinking water, waste management, and local procurement. They can also lower the cost of organizing collective responses and communicating public needs to the government. Digital democracy should therefore be understood as part of Nepal’s development infrastructure. Just as roads connect people to markets and services, a reliable digital information environment connects citizens to institutions, knowledge, and opportunities. Its value depends not simply on how

many people are connected, but on whether connectivity expands access, improves participation, and helps institutions make better decisions. The appropriate response is neither unrestricted platform power nor broad state control. Regulation must operate within Nepal’s constitutional protection of expression and communication. Restrictions require a clear legal basis, a legitimate public purpose, and meaningful safeguards against arbitrary enforcement. Platform companies should explain how political content is recommended, provide usable appeals, and invest in Nepalilanguage expertise. Government agencies should provide timely, verifiable information rather than leave an information vacuum.

From protest to democratic practice The larger task is to make digital participation useful between crises. Public institutions should create permanent channels through which citizens can comment on draft laws, budgets, and major projects. Each consultation should show who participated, what was heard, and how public input affected the final decision. Collecting comments without explaining their effect merely digitizes disappointment. Local government offers the strongest starting point because citizens can connect participation with visible services. Municipalities could combine digital and in-person systems for reporting failures,

DOCKING NEPAL’S ECONOMIC ANALYSIS

tracking responses, monitoring budgets, and setting ward priorities. The Susasan project, implemented from 2017 to 2021, worked with municipal bodies and community organizations in six districts to test how familiar digital tools could support public accountability and participation. These systems can also improve how scarce public resources are allocated. Government agencies do not always possess timely information about where services are failing. Citizens experience these failures

directly but may lack effective channels to communicate them. Digital reporting can reduce this information gap by connecting local knowledge with public decision-making.

instead needs to connect digital participation with responsive administration, fairer resource allocation, and stronger institutional accountability.

Nepal’s Gen Z protests did not prove that platforms have replaced politics. They demonstrated that platforms have changed speed, language, and points of entry into political activism. Treating digitally active citizens only as audiences to persuade or risks to control will deepen distrust. Nepal

The opportunity is to build a democracy in which digital expression contributes to public reasoning, better services, and inclusive development. Protest can open the door, but lasting value will come from converting citizen voice into institutional learning and improved public outcomes.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Democracy in the Loop: Fixing Ordinary Failures Before Dramatic Ones Anwesha Sen

(Assistant Program Manager, Takshashila Institution)

Every few months brings a fresh set of headlines that seem to demand civilizational reckoning. A model that claims to solve near-impossible problems, a platform used to shift public opinion, an essay warning that the end is nigh. The temptation is to treat these as discrete emergencies requiring separate fixes: a new content moderation policy here, an AI safety pledge there. But a piecemeal and reactive posture misses the more important question. As social media, AI, and other emerging technologies continue to evolve, the real challenge for democratic societies is to build democratic institutions that are resilient enough to absorb the disruptions that these technologies may produce. The Doomsday Framing Is a Distraction A great deal of public discourse about AI and social media is shaped by narratives of imminent and dramatic rupture. Platforms "breaking" democracy, models "going rogue," or algorithms achieving a kind of autonomous malevolence. These narratives are appealing because they are dramatic, and because the firms building these technologies have every incentive to encourage them. A company that produces

the narrative of its models being nearly like Artificial General Intelligence (AGI) also, conveniently, justifies why access to it should be restricted. But simultaneously, it’s the same models that frequently end up in the hands of bad actors, and whose internal decisions about deployment remain hidden from public scrutiny. None of this means the risks are fictional. It means the risks are usually more mundane, more procedural, and more addressable than the doomsday framing suggests. And democratic societies should be suspicious of narratives that concentrate power in the hands of those telling the story. Consider how most technologyenabled harms to democratic processes actually unfold. Not through some emergent, intention-laden AI conspiracy, but through ordinary chains of failure, such as a poorly secured system, an underresourced election commission, or a platform's recommendation engine optimizing for engagement without anyone specifically willing electoral harm. The lesson is not that these technologies are safe. It is that the failure points are usually institutional and infrastructural. Treating every incident as evidence of an approaching singularity distracts

from the unglamorous work of fixing the systems that make technology's ordinary failures survivable. Some readers may object that the warnings are justified. Capabilities are advancing quickly, and it would be reckless to dismiss every concern about frontier systems as marketing. That is fair, and nothing in this argument requires dismissing them. The point is that institutional resilience is the sensible response under either assumption. If the most dramatic warnings prove overstated, societies that have invested in strengthening institutions will still be better protected against the ordinary harm that occurs. If the warnings prove accurate, those same institutions are the only mechanism through which any society could respond in time. Exclusion Is the More Serious Threat For democracies outside the small handful of nations that host frontier AI labs and dominant social platforms, there is a second risk that gets far less attention than rogue algorithms: exclusion. When a small number of corporations control access to the most capable models and

DOCKING NEPAL’S ECONOMIC ANALYSIS

the platforms with the greatest reach, they also control who gets to benefit from the productivity gains, the improvements in public service delivery, and the tools for civic organization that these technologies make possible. A restrictive, doomsday-inflected posture toward AI access, however well-intentioned, can end up serving the interests of incumbents by keeping the technology's benefits concentrated among a few. For most democracies, the equitable diffusion of these tools is not an abstract debate about technological ethics. It is a question of national capacity. A country that cannot meaningfully build, audit, or adapt the AI systems shaping its information environment is a country whose democratic institutions are, in a way, on lease from someone else. Any serious democratic strategy toward emerging technology must therefore hold two goals in tension: preventing harmful concentration of power in the hands of technology firms, while also ensuring citizens and institutions are not locked out of the tools that increasingly mediate civic life. The Human and the Institution Remain the Common Denominator It has become fashionable to speak of "keeping a human in the loop" as though this alone inoculates a system against harm. But the more honest lesson

from recent incidents is that the human-in-the-loop framing understates the problem. It is not merely individual humans who need to be present at decision points. Robust institutions such as courts, regulators, election bodies, journalists, and civil society need the capacity, independence, and technical literacy to evaluate what these technologies are actually doing. An individual reviewer glancing at an AI-generated recommendation before approving it is a weak safeguard if the institution around that reviewer has no meaningful power to challenge, audit, or reverse the decision. Democratic societies should focus their energy now, before the next wave of disruption arrives, on building institutions that can absorb technological shock. That means investing in the unglamorous basics: cybersecurity infrastructure for public systems; technical capacity within regulatory bodies; and reduced dependence on any single foreign platform or model for functions critical to democratic life, such as election administration or public communication. It also means resisting the urge to legislate reactively in response to the incident of the month, and instead building durable and adaptable oversight mechanisms that can evaluate new technologies as they emerge rather than only after they have caused visible harm.

The Question to Ask The question democratic societies should now ask is not whether social media or AI will someday behave in a dramatic, uncontrollable way. It is whether the ordinary, foreseeable ways these technologies already fail are addressed with the seriousness they deserve. Technology will keep evolving, and each new wave will bring its own headline-grabbing incidents and a chorus of warnings. What determines whether that evolution strengthens or weakens democratic institutions is not the technology itself, but whether the institutions meant to govern it are adequately and in time resourced. Regulation alone will not answer that question, but institutional readiness will.

NEFPORT ISSUE 66 – SEPTEMBER 2026

Government Services in Our Pocket: Building Nepal's Digital Democracy Niraj Bhusal

(Office of the Hon. Finance Minister, Ministry of Finance, Government of Nepal) Digital democracy is usually discussed as citizens voting, debating, or protesting online. That is the visible part. The larger part is quieter. It asks whether the state itself has become reachable, understandable and accountable to its people; whether citizens can see what the government receives and does; whether information reaches them when they need it; and whether they have meaningful control over the data that describes their lives. Nepal is beginning to build that kind of digital democracy through digital identity, public services, payments, data, artificial intelligence (AI), and the institutional systems behind them. The standard I apply to government services is simple: they should be as accessible as the services citizens already use every day. Mobile banking is the clearest example as it puts banking services in the pockets of millions of accountholders, making them accessible 24/7. Government services should meet a similar standard, so that every government office sits in the pocket of every citizen. However, government cannot simply digitize queue and paperwork and call that transformation. It must redesign

the relationship between citizens and the state. That distinction matters. Digital governance is the infrastructure. Digital democracy is what that infrastructure enables. Data Rich Before Economically Rich Nepal is more digitally ready than we tend to admit. As of 2025, there were 32.4 million mobile connections and 16.6 million internet users. Digital payments are equally embedded in everyday economic life, with Nepal Rastra Bank (NRB) reporting millions of e-wallets, mobile banking, and card users, and 2.34 million merchants accepting QR payments, handling transactions worth about NPR 1.7 trillion in FY 2025/26 AD alone. Nepalis generate enormous amounts of digital information simply by living ordinary lives: making payments, receiving salaries, paying taxes, communicating, traveling, and accessing services. We have become data rich before becoming economically rich. Data becomes valuable when someone can refine it, interpret it and act on it. The question is therefore not only who collects data, but who gets to use it, for

what purpose, and who benefits. Left unchecked, that cycle produces extraction without local benefit, concentration of digital power and personal data exploitation. This is not a technical problem. It is a democratic one. A democratic approach to data Imagine a young Nepali freelancer earning NPR 200,000 a month who cannot get a bank loan while a salaried employee earning just a quarter of that easily can. The freelancers may not be less economically viable; they may simply be less documented. Their bank, payment platform, tax records, and professional activity may each hold a piece of their economic history. The information exists, but it does not necessarily move, with their knowledge and consent, to where it could create value for them. A digital democracy approach therefore changes the question from ‘How can data be used to solve the institution’s problem?’ to ‘How can data be used to empower the citizen?’ This requires several foundations: clear rights over personal and public data, interoperability between systems, meaningful consent for data sharing, strong privacy protection, and digital

DOCKING NEPAL’S ECONOMIC ANALYSIS

rails through which transactions can move securely. Citizens should be treated as beneficiaries of the digital economy, not simply as raw material. From Digital Government to Digital Democracy: The Backbone Nepal already has much of the basic infrastructure: digital identity through National Identity (NID), government services through Nagarik App, and payments through connectIPS, e-wallets and QR. Recent developments are beginning to extend this backbone. On September 17, 2026 (Bhadra 31, 2083), the Cabinet approved the Government Decision Process Simplification and Digitalization Rules, 2026, giving legal standing to a digital decision chain that builds on the Cabinet Automation System. Digital counters mean little if the file behind them still moves on paper. The nepal.gov.np portal is emerging as a single national address, one portal for everything government-related, with live updates, public suggestions, and a Policy Forum for draft policies. Initiatives such as digital tax incentives show how technology can reshape citizen behavior. And the government is setting up a Software Development and Operations Centre to build and run its own software in-house. That is the difference between renting digital government and owning it. These systems matter not simply because they are convenient.

They create the possibility of a different relationship between citizen and state. Identity can reduce repeated verification. Interoperability can reduce repeated paperwork. Digital payments can make transaction easier to trace. Online services can reduce importance of physical location. A digital government serves citizens. A digital democracy also gives citizens greater visibility into the government. AI as an integrity tool Immediately after the August 26 Rasuwa–Bhotekoshi flood, I built a bilingual public-information portal overnight. It aggregated verified updates from different government departments and security agencies into one searchable place. I used an AI coding agent to build it while manually verifying every information before publication. The experience taught me something simple: in a crisis, verified information must travel at least as fast as misinformation. The Ministry of Finance later adopted the model as an official portal. This is where I see an important role for AI in government. It can help officials organize information, build tools, identify patterns, and communicate faster. But AI can accelerate publication; it cannot replace verification. It can help produce an answer, but it cannot become the authority responsible for that answer. That is the principle that the National AI Policy 2082 should codify.

Software is the new selfexpression Software is the new selfexpression, and AI has just expanded the possibilities. Nepal’s civil service already has technically skilled people. Give them sandboxes, open data, clear rules and modern tools, and government can develop solutions much faster. AI has drastically lowered the cost of turning an idea into a working prototype. The opportunity is therefore not simply to consume technology, but to build publicsector capacity around it. Government must learn, build, and adapt at the speed at which citizens’ expectations are changing. What must follow Nepal now has momentum. But momentum is not a system. Four things will decide whether these pieces become a durable digital democracy: First, interoperability, so citizens do not repeatedly provide information government already has. Second, proactive, machine-readable, bilingual disclosure under the Right to Information Act, Third, an enforceable data protection framework with independent oversight. And fourth, consentbased data sharing that allows citizens to benefit from their own information. We shape our tools, and then our tools shape us. Nepal is beginning to prove that the government can come to the citizen rather than requiring the citizen to repeatedly go to government offices. The

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ultimate goal is not simply to put government in every pocket. It is to put citizens at the center of how government works.

A digital government can make the state faster. A digital democracy must also make the state more visible, more participatory, and more accountable.

This is the transformation Nepal now has the opportunity to build.

DOCKING NEPAL’S ECONOMIC ANALYSIS

The Majority We Cannot See: Designing Nepal's Digital State for the Citizens Left Out Kritika Ghimire

(Project Manager, SpeakUp Nepal) In several districts where SpeakUp Nepal works, it is common to find one smartphone serving a household of six or seven people. It belongs, in the way things belong in Nepali households: to whoever earns, traveling with them. In the evening, it returns and is passed around according to an order nobody writes down: the wife after cooking, the school going son for his homework, the daughter-in-law, if she asks, the grandmother almost never. Every person in that house uses the internet. But only one of them has easy access to it. For the reporting period ending in mid-August 2026, the Nepal Telecommunications Authority (NTA) recorded 31.3 million broadband subscriptions in a country of roughly 29 million people, a penetration rate of 148.73%. Independent estimates put the share of Nepalis actually online at around 56%, and the Nepal Living Standards Survey found home internet in roughly four in ten households. A man in Lalitpur with a fiber line, a data plan and a spare SIM appears in our national figures three times. The household above appears once, and is recorded as a connected household. Public services are then designed for the country those figures

describe: a country of literate, Nepali speaking individuals who own their devices privately, hold the documents the system asks for, and can be reached at any hour. Such people exist. They are my colleagues and my friends. However, they are not the entire nation. The Sentence that Keeps Repeating When this gap is raised in Kathmandu meeting rooms, it is usually settled by a sentence of one kind. “She does not know how to use a phone,” “He is too old for this”, “Those communities do not really use these things.” These sentences are not technical observations. They are moral ones. They place failure inside the citizens: their age, readiness, or their community's habits, and leave the interface, the language, the documentation requirement and the service providers’ funding choices entirely uninspected. It is the same grammatical habit an earlier generation of development work in Nepal had with the word awareness. Digital literacy has become our new awareness, and it performs the same quiet service. It converts a design failure into a personal deficiency, in a register gentle enough that nobody in the room feels unkind.

I have used those sentences myself. Most of us in this sector have. What follows is my attempt to answer them, because the evidence that Nepalis know perfectly well how to use a phone has been in front of us the whole time. Two Things Already Known Consider where digital infrastructure succeeded without much difficulty. Some of the most digitally fluent Nepalis alive are the ones who left for opportunities abroad. Workers in the Gulf and Malaysia move money through wallets and applications daily, and remittance arrives electronically, at speed, in villages routinely described as unconnected. The rails reach all the way down when what travels along them is money. They stop at the district headquarters when what travels along them is a citizen's voice. That difference is not a limit of technology. It is a record of what the service providers are willing to solve. Consider too what people built while waiting for accessible digital service. Nepalis who cannot read did not retreat from technology. They made an oral internet. Voice notes instead of typing, Viber audio instead of email, YouTube instead of written instruction, a photograph of a

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document instead of a form. This is inventive, self-taught, wholly competent adaptation by people who reports file under digitally excluded. Meanwhile Nepali government portals still open with an empty text field and an error message in English. Design in Nepal is not ahead of ordinary users. It is some years behind them, and it calls them slow. The Document Before the Interface The deepest exclusion happens before anyone touches a screen. The National Identity Card, which the state intends as the spine of digital service delivery, requires a citizenship certificate. So do a SIM card, a bank account, and a place on the voter roll. Yet an estimated 6.7 million Nepalis do not hold a citizenship certificate, and the reasons are structural rather than personal: landless families with no proof of residence, Dalit communities in the Terai whose exclusion is generations old, children of mothers who cannot document an absent father, people whose names or caste histories complicate a registrar's paperwork. Digital identity presumes legal identity. However, legal identity in Nepal has never been evenly distributed, and every service requiring a login inherits that unevenness and hardens it. A paper counter could be argued with. A verification screen cannot. This constructs a front door to the state that checks a document which millions of citizens were never able to obtain, and describes it as modernization.

Access Is Something People Borrow Current metrics treat access as a possession. You have a phone or you do not. In most Nepali households it behaves like a loan, and loans carry conditions and a hierarchy. Gender shapes that hierarchy sharply. Women are roughly 13% less likely than men to own a smartphone globally, and more than two-thirds of the world's unconnected women live in South Asia and Sub-Saharan Africa. It is unremarkable in the districts where we work for a woman's SIM to be registered to a husband, a son, or a father-in-law. But the same logic governs anyone in a household who does not earn: the elderly parent, the unmarried dependent, the adolescent, the daughter-in-law who arrived last. This has consequence services rarely design for. When a service is tied to a phone number, the account belongs to whoever registered the SIM. A citizen who files a grievance about a ward, asks after a social security payment, or reports the conduct of a local official does so on an instrument somebody else controls. She is anonymous to the state and entirely visible to the people she may most need privacy from. Her civic life becomes known inside her home before it is ever known in an office. Cost works similarly, and affordability studies that stop at rupees miss it. For a dependent of any kind, buying data means spending household money on oneself, which requires justification the earner's identical

spending does not. The barrier is not only price. It is who is permitted to be the beneficiary of an expense. And migration thins out what remains, since rural households are increasingly made up of women and elders while the confident user of the family is the one who emigrated. What is left behind is recorded as inability. Distance, Current, Age and Body Geography still decides a great deal. In parts of Karnali and Sudurpaschim, students walk to the ward office and queue for a turn at a usable signal. Connections shift between 2G and 3G by the hour and vanish in a power cut or a storm. Monsoon takes out roads and towers together. Pilots are run in Kathmandu Valley, where the connectivity and the literacy and the airport happen to be, and their results are reported national models. Age has been almost entirely overlooked, which is strange, because it’s precisely those services with older users that are being digitized. The social security allowance, the widow's allowance, the disability allowance, the old age pension: these reach people least likely to own a smartphone, most likely to need help reading a screen, and most likely to be told by a young official that the system is down and they should come back. The most technically demanding front door was built for the citizens with the least reason to have practiced on it. Disability is overlooked more completely still. Screen reading

DOCKING NEPAL’S ECONOMIC ANALYSIS

software in Nepali is barely developed. Sign language provision in public digital services is close to absent. A blind citizen and a deaf citizen in Nepal are not marginal cases in a design review. They are a test of whether we mean the word universal. A Default that Is Really a Policy The 2021 census recorded 124 mother tongues. Nepali is the first language of 44.86% of the population, a plurality rather than a majority, and roughly three in ten adults cannot read at all. The Constitution declares every mother tongue a language of the nation, and the Language Commission has recommended 14 additional official languages. In digital practice, multilingual has come to mean Nepali and English. A portal available only in Nepali continues the linguistic centralization of the Panchayat years with a more comfortable alibi. It does not present itself as a policy. It presents itself as a settings choice. The reading barrier is also not quite about reading. Fully literate citizens are regularly defeated by government forms, because a form is a genre with rules nobody is taught. This is why Nepal has such a deep economy of people who help: the document writer outside the land revenue office, the education consultancy, the manpower agent, the neighbor who knows the way through. Digitization promises to remove them. What it usually does is move them to the internet café, unregulated, and paid for by the citizen.

When Absence Begins to Look Like Satisfaction Exclusion from paper bureaucracy was at least visible. An empty chair. A queue nobody joined. Digital exclusion behaves differently, because it generates evidence. When a ward in Karnali produces no petitions, no feedback, and no grievance tickets, the dashboard does not suggest that Karnali could not access the service. It suggests that Karnali has no problems. Absence is coded as contentment, and contentment is convenient for everyone holding a budget. The civic technology sector itself deepens this, and I say so as someone inside it. Funders buy platforms because a platform demonstrates well and has an end date. They are reluctant to fund facilitators because salaries recur and do not photograph. The hardest money to raise in Nepali civic technology is money for a person who sits in a ward office and helps somebody through a form, which happens to be the intervention with the strongest evidence behind it. Designing for The Person Actually There None of this argues against technology. It argues for building around the person in the room rather than the person in the dataset. Assume the device is shared and the number belongs to somebody else. Build for sessions that are borrowed, interrupted and overheard. Prefer

voice to text, and meet the oral internet that people have already made. The multilingual voter support lines we are developing with the Election Commission matter less as technology than as an admission that speaking is more democratic than typing in this country. Never let a service require a document that millions of citizens cannot obtain, and keep a staffed human route open beside every digital one. Treat the people who help others through institutions as public infrastructure worth training and paying. Disaggregate every participation figure by district, age, gender, disability, and mother tongue, so that silence becomes visible instead of comforting. Fund radio, television, and ward level facilitators as the delivery mechanism rather than as outreach. Nepal has shown the world what digital political energy can do. My worry is that we will mistake the people who generated that energy for the country that must live with its consequences. A system that reaches only those who are already heard is not a democracy in miniature. It is a mirror, and we have spent a long time mistaking it for a window.

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NEFPORT ISSUE 66 – SEPTEMBER 2026

Endnotes 1 Nepal Development Update: Reforms to Accelerate Public Investment, World Bank, November 1, 2025, https:// documents.worldbank.org/en/publication/documents-reports/ documentdetail/099548411112541261 2 Human Development Report 2025, UNDP, May 6, 2025, https://hdr.undp.org/content/human-development-report-2025 3 Current Macroeconomic and Financial Situation (Based on four months data of 2025/26), Nepal Rastra Bank, December 15, 2025, https://www.nrb.org.np/category/current-macroeconomic-situation/?depart ment=red&fy=2082-83&subcategory=four-months 4 Current Macroeconomic and Financial Situation (Based on Annual Data of 2024/25), Nepal Rastra Bank, August 24, 2025, https://www.nrb.org.np/category/current-macroeconomic-situation/?depart ment=red&fy=2081-82&subcategory=annual 5 "Democracy Index," Our World in Data, 2024, https:// ourworldindata.org/grapher/democracy-index-eiu . 6 "Nepal: Freedom in the World 2025 Country Report," Freedom House, n.d., https://freedomhouse.org/country/nepal/freedomworld/2025. 7 "Nepal Leads South Asia in Press Freedom Index Despite 'Difficult' Conditions," DevPulse, May 5, 2026, https://devpulse.info/newsand-articles/nepal-leads-south-asia-in-press-freedom-index-despitedifficult-conditions. 8 "The Fund for Peace," Fragile States Index, accessed August 2026, https://fragilestatesindex.org/country-data/. 9 "2025 Corruption Perceptions Index," Transparency International, February 2025, https://www.transparency.org/en/cpi/2025 . 10 "What Caused Nepal Flood? Scientist Says It Was Enormous Landslide, Glacier Fall," ABC News, August 27, 2026, https://abcnews.com/ International/deadly-nepal-flood-caused-enormous-landslide-glaciertumble/story?id=135984405; "Nepal-Tibet Floods: What Happened, What Caused Them and Who Is Missing?" Al Jazeera, August 27, 2026, https://www.aljazeera.com/ news/2026/8/27/nepal-tibet-floods-what-happened-what-causedthem-and-who-is-missing. 11 "Nepal Disaster Was a Warning to Fix Its Early-Warning System," Nepali Times, August 30, 2026, https://nepalitimes.com/nepaldisaster-was-a-warning-to-fix-its-early-warning-system. 12 "Nepal: Rasuwa Flood Flash Update #4 (as of 31 August 2026)," UN Office for the Coordination of Humanitarian Affairs, August 31, 2026, https://www.unocha.org/publications/report/nepal/nepal-rasuwaflood-flash-update-4-31-august-2026 13

Ibid.;

"Nepal Flash Floods 2026: CARE's Emergency Response," CARE, accessed September 2026, https://www.care.org/news-and-stories/nepal-flashfloods-2026-care-emergency-response/. 14 "Nepal: Rasuwa Flood Flash Update #4 (as of 31 August 2026)," UN OCHA, August 31, 2026. 15 "Rasuwa-Bhotekoshi Flood: Search, Rescue and Relief Response Situation Report," National Disaster Risk Reduction and Management Authority, accessed September 2026, https://ndrrma.gov. np/mediafiles/rasuwa/Rasuwa_Flood_SitRep_Temp_ENG_01_01092026. pdf; "Rasuwa Flood Rescue Portal," Office of the Prime Minister and Council of Ministers, accessed September 2026, https://rescue.opmcm.gov.np/.

18 "Constitution Amendment Taskforce Submits Report to PM," Radio Nepal, July 16, 2026, https://radionepalonline.com/ en/2026/07/16/432718.html. 19 "Task Force Submits Sweeping Amendment Proposals, but Consensus Elusive," The Kathmandu Post, July 18, 2026, https:// kathmandupost.com/national/2026/07/18/task-force-submitssweeping-amendment-proposals-but-consensus-elusive. 20 "Sudan Gurung Returns as Home Minister, Pun Appointed Technology Minister," The Kathmandu Post, June 9, 2026, https:// kathmandupost.com/national/2026/06/09/sudan-gurung-returns-ashome-minister-pun-appointed-technology-minister 21 . "Inquiry Panel Clears Sudan Gurung; Return as Home Minister Likely," MyRepublica, June 6, 2026, https://myrepublica. nagariknetwork.com/amp/news/inquiry-panel-clears-sudan-gurungreturn-as-home-minister-likely-23-39.html. 22 Ibid., "Sudan Gurung Returns as Home Minister, Pun Appointed Technology Minister." 23 "Mahabir Pun Appointed as Minister for Science, Technology and Innovation," Khabarhub, September 2026, https://english.khabarhub. com/2026/09/553062/. 24 "Inside Kaptanganj: How a Religious Flag Dispute and a Loudspeaker Turned a Border Village Deadly," The Kathmandu Post, August 3, 2026, https://kathmandupost.com/province-no-1/2026/08/03/ inside-kaptanganj-how-a-religious-flag-dispute-and-a-loudspeakerturned-a-border-village-deadly. 25 "Death Toll in Sunsari Kaptanganj Clash Rises to Three," Khabarhub, August 3, 2026, https://english.khabarhub. com/2026/04/561768/; "Family Blames Delayed Response for Deadly Sunsari Violence," The Kathmandu Post, July 30, 2026, https:// kathmandupost.com/national/2026/07/30/family-blames-delayedresponse-for-deadly-sunsari-violence. 26 "DAO Sunsari Holds All-Party Discussion Following Fatal Clashes in Kaptanganj," Nepal News, accessed September 2026, https://english.nepalnews.com/s/nation/dao-sunsari-holds-all-partydiscussion-following-fatal-clashes-in-kaptanganj/. 27 "Government, Victims' Families Sign Seven-Point Agreement on Sunsari Incident," Radio Nepal, July 31, 2026, https://radionepalonline. com/en/2026/07/31/433377.html. 28 "Seven-Point Deal Signed Between Govt, Deceased Mehta's Family," Nepal Press, August 11, 2026, https://english.nepalpress. com/2026/08/11/seven-point-deal-signed-between-govt-deceasedmehtas-family/. 29 "Nepal News Evening Briefing | Thursday, July 30, 2026," Nepal News, July 30, 2026. 30 "Supreme Court of Nepal Rules in Favour of Marriage Equality," QNews, June 21, 2026, https://qnews.com.au/supreme-courtof-nepal-rules-in-favour-of-marriage-equality/. 31

Ibid.

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17 "Nepal Declines Foreign Rescue Teams, Says Its Own Security Agencies Can Handle Operation." The Kathmandu Post, August 27, 2026. https://kathmandupost.com/national/2026/08/27/nepal-declinesforeign-rescue-teams-says-its-own-security-agencies-can-handleoperation.

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"Bagmati Chief Minister Gets Vote of Confidence," Radio Nepal, August 25, 2026, https://radionepalonline.com/en/2026/08/25/434726.html.

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60 European Commission, “The EU-US Trade Deal: Restoring Stability and Predictability,” European Commission, updated July 27, 2026.

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Ibid

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66 World Bank, “March 2026 Global Poverty Update from the World Bank: New Data and Insights,” March 2026,

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NEFPORT ISSUE 66 – SEPTEMBER 2026

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79 Rio Times, “Mexico GDP Second Quarter 2026: Inflation in August,” August 2026,

99 Reserve Bank of Australia, "Statement by the Monetary Policy Board," August 11, 2026,

https://www.riotimesonline.com/mexico-gdp-second-quarter-2026inflation-august/ 80 Mexico Business News, “Banxico Expected to Hold Interest Rate at 6.50%, Reuters Poll,” 2026, https://mexicobusiness.news/finance/news/banxico-expected-holdinterest-rate-650-reuters-poll 81 Rio Times, “Brazil Cuts Selic to 14.25%, COPOM Issues Hawkish Communiqué Amid Inflation Concerns,” June 2026, https:// www.riotimesonline.com/brazil-cuts-selic-14-25-copom-hawkishcommunique-inflation-june-2026/ 82 Rio Times, “Argentina Daza, Inflation, and Central Bank Confidence Shock,” 2026, https://www.riotimesonline.com/argentina-daza-inflation-central-bankconfidence-shock-2026/ 83 Caribbean National Weekly, “ECLAC Report Flags Persistent Poverty across Latin America and Caribbean,” 2026, https://www. caribbeannationalweekly.com/business/eclac-report-flags-persistentpoverty-across-latin-america-and-caribbean/ 84 ECLAC, “ECLAC Indicates Region Has Registered Four Straight Years of Low Growth.”, https://www.cepal.org/en/pressreleases/eclacindicates-region-has-registered-four-straight-years-low-growth-andwill-face 85 National Bureau of Statistics of China, “National Bureau of Statistics of China.” https://www.stats.gov.cn/english/ 86 Trading Economics, “China Manufacturing PMI,” accessed September 1, 2026, https://tradingeconomics.com/china/manufacturing-pmi 87 India Infoline, “RBI Policy Update August 2026: Repo Rate Unchanged at 5.25%, FY27 GDP Growth Raised to 6.7%, Inflation Forecast Cut,” August 2026, https://www.indiainfoline.com/news/economy/rbipolicy-update-august-2026-repo-rate-unchanged-at-5-25-fy27-gdpgrowth-raised-to-6-7-inflation-forecast-cut 88 FocusEconomics, “India Central Bank Meeting: RBI Holds Again in August,” August 5, 2026, https://www.focus-economics.com/ countries/india/news/monetary-policy/india-central-bank-meeting-0508-2026-rbi-holds-again-in-august/ 89 Bloomberg, “India’s Inflation Tops RBI Target for First Time in 17 Months,” July 13, 2026, https://www.bloomberg.com/news/ articles/2026-07-13/india-s-inflation-tops-rbi-target-for-first-time-in17-months.

https://www.aussie.com.au/insights/news/expert-predictions-rbarates/

https://www.rba.gov.au/media-releases/2026/mr-26-19.html 100 Naked Finance NZ, "RBNZ Delivers First Official Cash Rate Increase in 3 Years, Lifting OCR to 2.50%," July 2026, https://www. nakedfinance.nz/post/official-cash-rate-increase-2026 101 Reserve Bank of New Zealand, "The Official Cash Rate (OCR)," Te Pūtea Matua, accessed September 1, 2026, https://www.rbnz.govt.nz/ monetary-policy/about-monetary-policy/the-official-cash-rate 102 Nepal Rastra Bank, "Current Macroeconomic and Financial Situation of Nepal Based on Annual Data (Mid-July 2026) of FY 2025/26," Economic Research Department, August 26, 2026, https://www.nrb.org. np/contents/uploads/2026/08/Current-Macroeconomic-and-FinancialSituation-English-1.pdf. 103 National Statistics Office, "National Accounts Statistics of Nepal 2025/26," Government of Nepal, July 6, 2026, https://nsonepal.gov. np/content/13488/national-accounts-statistics-of-nepal-2025-26/. 104 Nepal Rastra Bank, "Current Macroeconomic and Financial Situation." 105

Ibid.

106

Ibid.

107 Ministry of Finance, Government of Nepal, "बजेट वक्तव्य आर्थिक वर्ष २०८३/८४" [Budget Speech, Fiscal Year 2083/84], May 29, 2026, https:// giwmscdnone.gov.np/media/pdf_upload/budget%20speech%202083_ nz9wmgt_cix58wu.pdf. 108 Nepal Rastra Bank, "Current Macroeconomic and Financial Situation." 109 National Statistics Office, "National Accounts Statistics of Nepal 2025/26." 110

Ibid.

111

Ibid.

112 Nepal Rastra Bank, "Current Macroeconomic and Financial Situation." 113

Ibid.

114

Ibid.

115 Nepal Rastra Bank, "आर्थिक वर्ष २०८३/८४ को मौद्रिक नीति"; Ministry of Finance, "बजेट वक्तव्य आर्थिक वर्ष २०८३/८४." 116 Nepal Rastra Bank, "Current Macroeconomic and Financial Situation." 117

Ibid.

118

Ibid.

119

Ibid.

https://tradingeconomics.com/japan/gdp-growth-annualized

120

Ibid.

91 Economy Global, “Japan GDP Grows 1.1 Percent in Q2 2026 as Consumption Slips,” 2026,

121

Ibid.

https://economyglobal.com/news/japan-gdp-grows-1-1-percent-in-q22026-as-consumption-slips/

122

Ibid.

123

Ibid.

124

Ibid.

92 2026,

Trading Economics, “Japan GDP Growth Annualized.”,

CNBC, “Japan Inflation, Iran War and Energy,” August 21,

125

Nepal Rastra Bank, "आर्थिक वर्ष २०८३/८४ को मौद्रिक नीति."

https://www.cnbc.com/2026/08/21/japan-inflation-iran-war-energy. html

126

Ibid.

127

Ibid.

128

Ibid.

https://www.adb.org/where-we-work/indonesia/economy

129

Ibid.

130

Ibid.

131

Ibid.

132

Ibid.

133

Ibid.

134

Ibid.

135

Ibid.

136

Ibid.

137

Ibid.

138

Ibid.

139

Ibid.

140

Ibid.

Asian Development Bank, “Indonesia: Economy,”, Trading Economics, “Euro Area Manufacturing PMI.”,

https://tradingeconomics.com/euro-area/manufacturing-pmi Trading EconomicsTrading Economics 95

European Central Bank, “Monetary Policy Decisions.”,

https://www.ecb.europa.eu/press/govcdec/mopo/html/index.en.html 96

Bank of England, “The Interest Rate (Bank Rate).”,

https://www.bankofengland.co.uk/monetary-policy/the-interest-ratebank-rate 97 Reserve Bank of Australia, "Statement by the Monetary Policy Board: Monetary Policy Decision," Media Release No. 2026-19, August 11, 2026, https://www.rba.gov.au/media-releases/2026/mr-26-19.html

141

Ibid.

142

Ibid.

143

Ibid.

144

Ibid.

145

Ibid.

146

Ibid.

147 "Foreign Direct Investment Commitment Reaches NPR 58.1 Billion in FY 2082/83," Ratopati, July 17, 2026, https://english.ratopati.com/ story/70749/decrease-in-foreign-direct-investment-commitmentsonly-58-billion-in-the-last-fiscal-year. 148

Ibid.

149 Nepal Rastra Bank, Economic Research Department, Current Macroeconomic and Financial Situation of Nepal: Based on Annual Data of 2025/26 (fiscal year ended mid-July 2026), published 26 August 2026. nrb.org.np/red/current-macroeconomic-and-financial-situationenglish-based-on-annual-data-of-2025-26/ 150 World Weather Attribution, "Rapid Warming in the Himalaya Exacerbates Geohazard Cascades Beyond Adaptation Limits," 17 September 2026. https://www.worldweatherattribution.org/rapidwarming-in-the-himalaya-exacerbates-geohazard-cascades-beyondadaptation-limits/ 151 "Nepal flooding deaths surpass 900 as needs climb," UN News, 31 August 2026; UN OCHA/ReliefWeb, Nepal Flood Response Situation Report #2, 31 August 2026.https://news.un.org/en/ story/2026/08/1168233

152 Republica, "Nepal's Foreign Aid Faces Tighter Checks under Nine-Point PAC Directives," myRepublica, 20 August 2026. https:// myrepublica.nagariknetwork.com/news/nepals-foreign-aid-facestighter-checks-under-nine-point-pac-directives-79-77.html

Executive Board Concludes the 2026 Article IV Consultation with Nepal and Completes the Seventh Review under the Extended Credit Facility," 8 June 2026. https://www.imf.org/en/news/articles/2026/06/08/pr26188nepal-imf-exec-board-concludes-2026-article-iv-consult-completesseventh-review-ecf 164 Asian Development Bank, "ADB Responds Immediately to Nepal Floods with $5 Million Grant," News Release, 28 Aug 2026. https:// www.adb.org/news/adb-responds-immediately-nepal-floods-5-milliongrant 165 Asian Development Bank, News Release, "ADB Approves $115 Million Loan to Strengthen Water Supply, Sanitation, and Resilience in Nepal's Municipalities," 19 June 2026. https://www.adb.org/news/adbapproves-115-million-loan-strengthen-water-supply-sanitation-andresilience-nepal-municipalities 166 "Japan provides grant for Nepal civil service scholarship programme," Khabarhub (English), 28 July 2026.https://english.khabarhub. com/2026/28/560702/ 167 "Government accepts USD1.81 million grant from South Korea," Nepalnews (English), 16 July 2026.https://english.nepalnews.com/s/ business/government-accepts-usd1-81-million-grant-from-southkorea/ 168 "Nepal, India sign MoUs for education, health and agriculture projects," Nepalnews (English), 12 August 2026.https://english.nepalnews. com/s/diplomacy/nepal-india-sign-mous-for-education-health-andagriculture-projects/ 169 170 Asian Development Bank, News Release, "ADB Approves $115 Million Loan to Strengthen Water Supply, Sanitation, and Resilience in Nepal's Municipalities," 19 June 2026.https://www.adb.org/news/adbapproves-115-million-loan-strengthen-water-supply-sanitation-andresilience-nepal-municipalities

153 WAM (Emirates News Agency), "UAE allocates $10 million for urgent relief for flood, landslide victims in Nepal," 27 Aug 2026. https:// www.wam.ae/en/article/c1y1b2t-uae-allocates-10-million-for-urgentrelief-for

171 International Monetary Fund, Press Release No. 26/188, "IMF Executive Board Concludes the 2026 Article IV Consultation with Nepal and Completes the Seventh Review under the Extended Credit Facility," 8 June 2026.https://www.imf.org/en/news/articles/2026/06/08/pr26188nepal-imf-exec-board-concludes-2026-article-iv-consult-completesseventh-review-ecf

154 UK Foreign, Commonwealth & Development Office, "NepalChina floods: what you can do to help," GOV.UK, 31 Aug 2026. https:// www.gov.uk/government/news/nepal-china-floods-what-you-can-doto-help

172 "Government accepts USD1.81 million grant from South Korea," Nepalnews (English), 16 July 2026. https://english.nepalnews.com/s/ business/government-accepts-usd1-81-million-grant-from-southkorea/

155 Asian Development Bank, "ADB Responds Immediately to Nepal Floods with $5 Million Grant," News Release, 28 Aug 2026. https:// www.adb.org/news/adb-responds-immediately-nepal-floods-5-milliongrant

173 "Japan provides grant for Nepal civil service scholarship programme," Khabarhub (English), 28 July 2026. https://english. khabarhub.com/2026/28/560702/

156 Australian Government, "Australia's response to NepalChina floods," Minister for Foreign Affairs, 28 Aug 2026. https://www. foreignminister.gov.au/minister/penny-wong/media-release/australiasresponse-nepal-china-floods 157 European Civil Protection and Humanitarian Aid Operations (DG ECHO), "The EU allocates €2 million in humanitarian aid to support victims of flash flood in Nepal," 28 Aug 2026. https://civilprotection-humanitarian-aid.ec.europa.eu/news-stories/news/euallocates-eur2-million-humanitarian-aid-support-victims-flash-floodnepal-2026-08-28_en 158 Embassy of the People's Republic of China in Nepal, "Ambassador Zhang Maoming Hands over Emergency Flood Relief Cash Aids to Finance Minister of Nepal Swarnim Wagle," 30 Aug 2026. https:// np.china-embassy.gov.cn/eng/News/202608/t20260830_12012675. htm 159 "Nepal's Flood Tragedy Becomes Regional Crisis: How India Is Responding as Himalayan Disaster Deepens," Open (openthemagazine. com), 29 August 2026https://openthemagazine.com/india/nepals-floodtragedy-is-now-indias-concern-too-what-new-delhi-is-doing-as-thecrisis-deepens 160 Ministry of Foreign Affairs of Japan, "Emergency Assistance to Nepal in Response to the Flash Flood," press releases of 28 August and 2 September 2026. https://www.mofa.go.jp/press/release/ pressite_000001_02657.html 161 Government of Nepal, Ministry of Finance, International Economic Cooperation Coordination Division, Development Cooperation Report, Fiscal Year 2024/25, published March 2026. https://mof.gov. np/divisions/ierd/content/1702/development-cooperation-reportfy-2024-2025/ 162

Ibid.

163

International Monetary Fund, Press Release No. 26/188, "IMF

174 "Nepal, India sign MoUs for education, health and agriculture projects," Nepalnews (English), 12 August 2026. https://english.nepalnews. com/s/diplomacy/nepal-india-sign-mous-for-education-health-andagriculture-projects/ 175

Ibid.

176 Nepal Rastra Bank, Economic Research Department, Current Macroeconomic and Financial Situation of Nepal: Based on Annual Data of 2025/26 (fiscal year ended mid-July 2026), published 26 August 2026. 177

Ibid.

178

Ibid

179

Ibid.

180

Ibid.

181

Ibid.

182

Ibid.

183

Ibid.

184

Ibid.

185

Ibid.

186

Ibid.

187

Ibid.

188

Ibid.

189

Ibid.

190 Nepal Rastra Bank, Macroeconomic Report, July 2026 (Kathmandu: Nepal Rastra Bank, 2026), https://www.nrb.org.np/contents/ uploads/2026/07/Macroeconomic_Report_July_2026.pdf 191 Trading Economics, “Nepal – Employment in Agriculture (% of Total Employment),” Trading Economics, accessed September 18, 2026, https://tradingeconomics.com/nepal/employment-in-agriculture-

NEFPORT ISSUE 66 – SEPTEMBER 2026

percent-of-total-employment-wb-data.html

HumanitarianNeedsPriorities_Floods%20Response%20Plan.pdf

192 Ministry of Agriculture and Livestock Development, “Details of Subsidized Chemical Fertilizers (2083) from,” Government of Nepal, accessed September 18, 2026,

209 The Kathmandu Post, “Nepal Floods: A Preventable Disaster,” August 5, 2025, https://kathmandupost.com/columns/2025/08/05/ nepal-floods-a-preventable-disaster.

https://moald.gov.np/content/821/details-of-subsidized-chemicalfertilizers--2083--from/

210

193 Nepal Rastra Bank, “Current Macroeconomic Situation: Eleven Months of 2082/83.”

211 “Education, Sports Sector in Government’s Top Priority: Education Minister Pokharel,” Radio Nepal, June 18, 2026, accessed September 10, 2026.

https://www.nrb.org.np/category/current-macroeconomic-situation/?de partment=red&fy=2082-83&subcategory=eleven-months 194 Ministry of Agriculture and Livestock Development, National Agricultural Policy, 2083, Government of Nepal, https://moald.gov.np/content/581/national-agricultural-policy--2083/ 195 Business 360, “Ministry Issues National Agriculture Policy 2083,” Business 360, https://www.b360nepal.com/detail/29599/ministry-issues-nationalagriculture-policy-2083

“Giwms.” 2025. Mof.Gov.Np. 2025.

https://www.mof.gov.np/category/budget-speech/

https://radionepalonline.com/en/2026/06/18/431392.html 212 “Giwms.” 2025. Mof.Gov.Np. 2025. https://www.mof.gov.np/ category/budget-speech/ 213 Yagya Banjade. 2026. “As Students Leave Nepal to Study Abroad, Billions Flow Out.” The Kathmandu Post. The Kathmandu Post. 2026. https://kathmandupost.com/money/2026/04/12/as-studentsleave-nepal-to-study-abroad-billions-flow-out 214

Ibid

196 Kantipur, “Five-Member Task Force Formed to Investigate Agriculture and Livestock Subsidies,” June 19, 2026,

215 Sudeep Kaini, “Foreign Study Costs Outpace Growth in Nepal’s Service Exports,” The Kathmandu Post, July 20, 2026.

https://ekantipur.com/business/2026/06/19/en/five-member-taskforce-formed-to-investigate-agriculture-and-livestock-subsidies-31-39. html

https://kathmandupost.com/money/2026/07/20/foreign-study-costsoutpace-growth-in-nepal-s-service-exports

197 The Annapurna Express, “Agriculture Subsidy Policy under Scrutiny,” The Annapurna Express,

216 Sudeep Kaini.. “Nepal Introduces Tough Rules to Rein in Educational Consultancies, Foreign-Linked Colleges.” The Kathmandu Post. 2026.

https://theannapurnaexpress.com/story/65144/ 198 Kantipur, “Five-Member Task Force Formed to Investigate Agriculture and Livestock Subsidies,” June 19, 2026, https://ekantipur.com/business/2026/06/19/en/five-member-taskforce-formed-to-investigate-agriculture-and-livestock-subsidies-31-39. html 199 The Himalayan Times, “Agriculture and Livestock Subsidies under Investigation,” The Himalayan Times, https://thehimalayantimes.com/ampArticle/1039049 200 The Kathmandu Post, “Late Monsoon Slows Nepal’s Paddy Transplantation, but Experts Say There’s No Need to Worry,” The Kathmandu Post, July 6, 2026, https://kathmandupost.com/money/2026/07/06/late-monsoon-slowsnepal-s-paddy-transplantation-but-experts-say-there-s-no-need-toworry 201 Asia News Network, “Nepali Farmers Battle Surging Costs as Delayed Monsoon Dims Paddy Outlook,” Asia News Network, https://asianews.network/nepali-farmers-battle-surging-costs-asdelayed-monsoon-dims-paddy-outlook/ 202 The Kathmandu Post, “Late Monsoon Slows Nepal’s Paddy Transplantation, but Experts Say There’s No Need to Worry,” The Kathmandu Post, July 6, 2026,

https://kathmandupost.com/national/2026/07/09/nepal-introducestough-rules-to-rein-in-educational-consultancies-foreign-linkedcolleges. 217

Ibid

218 “Govt Tightens Rules for Foreign-Affiliated Colleges and Education Consultancies.” 2026. GorakhaPatra. 2026. https://risingnepaldaily.com/news/83179. 219

Ibid

220 “नेपाल कानून आयोग | Nepal Law Commission.” 2026. Lawcommission.Gov.Np. 2026. https://lawcommission.gov.np/category/volume-of-regulation/ 221 Sudeep Kaini. 2026. “Nepal Introduces Tough Rules to Rein in Educational Consultancies, Foreign-Linked Colleges.” The Kathmandu Post. 2026. https://kathmandupost.com/national/2026/07/09/nepalintroduces-tough-rules-to-rein-in-educational-consultancies-foreignlinked-colleges 222 “नेपाल कानून आयोग | Nepal Law Commission.” 2026. Lawcommission.Gov.Np. 2026.

https://lawcommission.gov.np/category/volume-of-regulation/

https://kathmandupost.com/money/2026/07/06/late-monsoon-slowsnepal-s-paddy-transplantation-but-experts-say-there-s-no-need-toworry

223 “Cabinet Approves Decision to Scrap 3% Equity Tax on Education, Health,” The Rising Nepal, July 23, 2026, https:// risingnepaldaily.com/news/83878

203 The Kathmandu Post, “Paddy Transplantation Races Ahead as Monsoon Rains Revive,” The Kathmandu Post, August 2, 2026,

224

Ibid

225

Ibid

https://kathmandupost.com/money/2026/08/02/paddytransplantation-races-ahead-as-monsoon-rains-revive

226

Ibid

204 The Kathmandu Post, “More Farmers Are Getting Insurance, but Crops Are Still Left Behind,” The Kathmandu Post, August 19, 2026, https://kathmandupost.com/money/2026/08/19/more-farmers-aregetting-insurance-but-crops-are-still-left-behind 205 AgroInsurance, “Nepal – Ministry of Agriculture,” AgroInsurance,

227 Sudeep Kaini, “20 Schools in Three Districts Damaged by Wednesday’s Floods,” The Kathmandu Post, August 27, 2026, https://kathmandupost.com/national/2026/08/27/20-schools-in-threedistricts-damaged-by-wednesday-s-floods “Flash Floods in Nepal Leave More Than 17,000 Children in Need of Urgent Humanitarian Assistance,” UNICEF, August 27, 2026,

https://agroinsurance.com/en/News/Nepal---Ministry-of-Agri

https://www.unicef.org/asia-pacific/press-releases/flash-floods-nepalleave-more-17000-children-need-urgent-humanitarian-assistance

206 The Himalayan Times, “Nepal’s Agricultural Insurance Coverage,” The Himalayan Times,

228 Sudeep Kaini, “20 Schools in Three Districts Damaged by Wednesday’s Floods,” The Kathmandu Post, August 27, 2026,

https://thehimalayantimes.com/ampArticle/1040262

https://kathmandupost.com/national/2026/08/27/20-schools-in-threedistricts-damaged-by-wednesday-s-floods

207 National Planning Commission and NDRRMA, Rapid Damage and Needs Assessment (RDNA), as reported in myRepublica, "Bhotekoshi flood causes over Rs 1 billion in agricultural losses," September 14, 2026, https://myrepublica.nagariknetwork.com/news/bhotekoshi-floodcauses-over-rs-1-billion-in-agricultural-losses-25-79.html 208 United Nations in Nepal, Humanitarian Needs and Priorities: Floods Response Plan (United Nations, 2024), https://nepal.un.org/sites/default/files/2024-10/NPL_

229 “Flash Floods in Nepal Leave More Than 17,000 Children in Need of Urgent Humanitarian Assistance,” UNICEF, August 27, 2026, https://www.unicef.org/asia-pacific/press-releases/flash-floods-nepalleave-more-17000-children-need-urgent-humanitarian-assistance

DOCKING NEPAL’S ECONOMIC ANALYSIS

230

Ibid

231 “‘I Didn’t Know Where My Parents Were’: A 13-Year-Old’s Escape from the Floods,” UNICEF Nepal, August 28, 2026, https://www.unicef.org/nepal/stories/i-didnt-know-where-my-parentswere-13-year-olds-escape-floods

232 University Grants Commission Nepal, “एकेडे मिक क्रेडिट बैङ्कको स्थापना र सञ्चालन निर्दे शिका २०८२,” August 7, 2026

254 Abhaya Raj Joshi, “Nepal’s newest national parks drive tiger recovery, but new concerns arise,” Mongabay, August 15, 2026, https://news.mongabay.com/2026/08/nepals-newest-national-parksdrive-tiger-recovery-but-new-concerns-arise/ 255

Ibid

256 Tika R Pradhan, “Nepal’s tiger population rises to 429, latest census shows,” The Kathmandu Post, July 29, 2026,

https://ugcnepal.edu.np/content/193/academic-credit-bankestablishment-and-operation-guidelines/

https://kathmandupost.com/national/2026/07/29/nepal-s-tigerpopulation-rises-to-429-latest-census-shows

233 Sudeep Kaini. 2026. “Nepali Students Can Now Transfer Academic Credits between Universities.”

257 Abhaya Raj Joshi, “Nepal’s newest national parks drive tiger recovery, but new concerns arise,” Mongabay, August 15, 2026,

The Kathmandu Post. 2026.

https://news.mongabay.com/2026/08/nepals-newest-national-parksdrive-tiger-recovery-but-new-concerns-arise/

https://kathmandupost.com/national/2026/08/10/nepali-students-cannow-transfer-academic-credits-between-universities 234

Ibid

235 University Grants Commission Nepal, “एकेडे मिक क्रेडिट बैङ्कको स्थापना र सञ्चालन निर्दे शिका २०८२,” August 7, 2026

258 Post Report, “Death toll from Bhotekoshi flood reaches 903,” The Kathmandu Post, August 31, 2026, https://kathmandupost.com/national/2026/08/31/death-toll-frombhotekoshi-flood-reaches-903

https://ugcnepal.edu.np/content/193/academic-credit-bankestablishment-and-operation-guidelines/

259 Courtney Weatherby, “A Cascading Disaster on the ChinaNepal Border: What to Know About the August 2026 Rasuwa Flood,” Stimson Center, August 28, 2026,

236 “Academic Credit Bank: Everything You Need to Know about Nepal’s New System for Transferring University Credits.” 2026. Nepal News. 2026.

https://www.stimson.org/2026/a-cascading-disaster-on-the-chinanepal-border-what-to-know-about-the-august-2026-rasuwa-flood/

https://english.nepalnews.com/s/explainers/academic-credit-bankeverything-you-need-to-know-about-nepals-new-system-fortransferring-university-credits/. 237 University Grants Commission Nepal, “एकेडे मिक क्रेडिट बैङ्कको स्थापना र सञ्चालन निर्दे शिका २०८२,” August 7, 2026 https://ugcnepal.edu.np/content/193/academic-credit-bankestablishment-and-operation-guidelines/ 238 Sudeep Kaini. 2026. “Nepali Students Can Now Transfer Academic Credits between Universities.”Kathmandupost. The Kathmandu Post. 2026. https://kathmandupost.com/national/2026/08/10/nepali-students-cannow-transfer-academic-credits-between-universities 239 Ministry of Finance,” आर्थिक सर्वेक्षण २०८१/८२,Government of Nepal, Accessed on February 28 https://mof.gov.np/content/1520/economic-survey-2081-82/ 240

Ibid

241

Ibid

242

Ibid

243

Ibid

244 Nepal Rastra Bank, “Current macroeconomic and financial situation- English (Based on Annual Data of 2025-2026),” Nepal Rastra Bank, August 26, 2026 https://www.nrb.org.np/red/current-macroeconomic-and-financialsituation-tables-based-on-annual-data-of-2025-26/currentmacroeconomic-and-financial-situation-tables-12-months-3/ 245 Nepal Electricity Authority, Homepage, accessed on September 10, 2026 https://www.nea.org.np/

260 Uttam Maharjan, “Stepping Into Green Hydrogen Era” The Rising Nepal, June 23, 2026, https://risingnepaldaily.com/news/82342 261

Ibid

262

Ibid

263 THT Online, “Green Hydrogen Key to Nepal’s Green Future: Energy Minister Shrestha,” The Himalayan Times, June 6, 2026, https://thehimalayantimes.com/environment/green-hydrogen-key-tonepals-green-future-energy-minister-shrestha 264

Ibid

265 Ratopati News, “111 billion contributions collected to the Social Security Fund,” Ratopati, June 6, 2026, https://english.ratopati.com/story/65698/111-billion-contributionscollected-to-the-social-security-fund 266 Republica Reporter, “SSF collects Rs 111 billion, seeks to invest in energy projects,” MyRepublica, June 6, 2026, https://www.myrepublica.nagariknetwork.com/news/ssf-collects-rs-111billion-seeks-to-invest-in-energy-projects-38-35.html 267 NepalNews Business, “SSF hydro and renewable energy investments; contributions reach Rs 111 billion,” NepalNews, June 6, 2026, https://english.nepalnews.com/s/business/ssf-hydro-and-renewableenergy-investments-contributions-reach-rs-111-billion/ 268 Republica Reporter, “SSF collects Rs 111 billion, seeks to invest in energy projects,” MyRepublica, June 6, 2026, https://www.myrepublica.nagariknetwork.com/news/ssf-collects-rs-111billion-seeks-to-invest-in-energy-projects-38-35.html 269 Krishana Prasain, “LPG imports are up; why are consumers still queuing for it?” The Kathmandu Post, August 11, 2026, https://kathmandupost.com/money/2026/08/11/lpg-imports-are-upwhy-are-consumers-still-queuing-for-it

246 Nepal Electricity Authority, Homepage, accessed on September 10, 2026,

270

Ibid

https://www.nea.org.np/

271

Ibid

272 TRN Online, “Germany to provide 37.6 million Euro for Nepal's socio-economic development” The Rising Nepal, June 17, 2026,

247 Nepal Electricity Authority, “A Year in Review- Fiscal Year 2025/2026,” Kathmandu: Nepal Electricity Authority, 2026 https://nea.org.np/en/detail/annual-report-20252026

https://risingnepaldaily.com/news/82049

248

Ibid

273 TRN Online, “Germany to provide 37.6 million Euro for Nepal's socio-economic development” The Rising Nepal, June 17, 2026,

249

Ibid

https://risingnepaldaily.com/news/82049

250

Ibid

251

Ibid

274 Ratopati News, “Game-changing decision in electricity export,” Ratopati, July 16, 2026,

252

Ibid

253 Tika R Pradhan, “Nepal’s tiger population rises to 429, latest census shows,” The Kathmandu Post, July 29, 2026, https://kathmandupost.com/national/2026/07/29/nepal-s-tigerpopulation-rises-to-429-latest-census-shows

https://english.ratopati.com/story/70526/game-changing-decision-inelectricity-export 275

Ibid

276 Ratopati News, “Nepal Launches "Clean Air and Prosperity Project" with World Bank Support,” Ratopati, June 13, 2026, https://english.ratopati.com/story/66555/871-billion-rupees-project-to-

NEFPORT ISSUE 66 – SEPTEMBER 2026

remove-polluted-air 277 World Bank, “World Bank Supports Nepal’s Clean Air and Prosperity Project to Reduce Air Pollution from Industries, Strengthen Air Quality Management,” World Bank Group, https://www.worldbank.org/en/news/press-release/2026/03/11/worldbank-supports-nepal-s-clean-air-and-prosperity-project-to-reduceair-pollution-from-industries-strengthen-air-qual 278 Ratopati News, “Nepal Launches "Clean Air and Prosperity Project" with World Bank Support,” Ratopati, June 13, 2026, https://english.ratopati.com/story/66555/871-billion-rupees-project-toremove-polluted-air 279

Ibid

280 Government of Nepal, Ministry of Finance. Economic Survey 2082/83. Kathmandu: Ministry of Finance, 2026. https://mof.gov.np/ content/1738/economic-survey-2082-83/. 281 Ministry of Health and Population and ICF. "Nepal Demographic and Health Survey 2022." Kathmandu: Ministry of Health and Population, 2023. https://dhsprogram.com/pubs/pdf/FR379/FR379. pdf 282

Ibid

283 Government of Nepal, Ministry of Finance. Economic Survey 2082/83. Kathmandu: Ministry of Finance, 2026. https://mof.gov.np/ content/1738/economic-survey-2082-83/ 284

Ibid.

285

Ibid.

286 “Doctors’ Nationwide Protest Ends after Five-Point Agreement with Government.” The Rising Nepal, July 30, 2026. https://risingnepaldaily.com/news/84235 287 . “Government, Doctors Reach Agreement, Nationwide Medical Protest Ends.” Onlinekhabar, July 29, 2026. https://english.onlinekhabar.com/government-doctors-reachagreement-nationwide-medical-protest-ends.html 288 “What Is in the 5-Point Agreement between Doctors and the Government?” Ratopati, July 29, 2026. https://english.ratopati.com/ story/72279/what-is-in-the-5-point-agreement-between-doctors-andthe-government-with-letter 289

Ibid

290 “Government, Doctors Reach Agreement, Nationwide Medical Protest Ends.” Onlinekhabar, July 29, 2026. https://english.onlinekhabar.com/government-doctors-reachagreement-nationwide-medical-protest-ends.html 291 Republica. 2023. “Health Ministry Directs Health Facilities to Allocate 10 Percent Beds to Indigent, Helpless Groups.” Nagariknetwork. Com. MyRepublica. June 4, 2023. https://www.myrepublica. nagariknetwork.com/news/ministry-reminds-health-facilities-toallocate-10-percent-beds-to-indigent-helpless-groups. 292 Ministry of Health and Population. “लक्षित वर्ग नि:शुल्क उपचार पोर्टल (सञ्चालन तथा व्यवस्थापन) कार्यविधि, २०८३.” June 10, 2026. https://mohp.gov.np/category/directives PABITRA SUNAR. 2026. “Private Hospitals Resist Free Care Mandate for Poor Patients.” Nagariknetwork.Com. MyRepublica. June 26, 2026. https://myrepublica.nagariknetwork.com/index.php/amp/news/privatehospitals-resist-free-care-mandate-for-poor-patients-47-81.html. 293 Ministry of Health and Population. “Free Health Portal सञ्चालन सम्बन्धमा.” June 19, 2026. https://mohp.gov.np/category/circulars/?page=1& 294 Radio Nepal Online . 2026. “Health Ministry Reports Major Service and Good Governance Reforms in Its First 100 Days,” July 4, 2026. https://radionepalonline.com/en/2026/07/03/432075.html 295 Ratopati. “Private Hospitals Association Objects to Government Directive on Free Beds.” Ratopati, 2026. 296

Ratopati. 2026. “Government Allocates Over 3,000 Free

Hospital Beds for Indigent Citizens, But Access Remains Complex.” Rato_ Pati. 2026. https://english.ratopati.com/story/75140/patients-are-suffering-due-tolack-of-treatment-but-the-beds-allocated-by-the-state-are-unused. 297 “Government Imposes 3% Health Equity Fee on Private Healthcare Services, Raising Treatment Costs.” Ratopati, July 16, 2026. https://english.ratopati.com/story/70501/treatment-in-privatehospitals-to-become-more-expensive-from-tomorrow-patients-tobe-burdened-with-3-percent-health-equity-fee 298 Pawan Mudbhari. “Nepal’s 3% ‘Health Equity Fee’ on Private Hospitals Draws Backlash.” Khabarhub, July 20, 2026. https://english. khabarhub.com/2026/20/559433/ 299

Ibid

300 “Govt Withdraws 3 Percent Equity Tax on Health and Education amid Public Criticism.” myRepublica, July 21, 2026. https:// myrepublica.nagariknetwork.com/news/govt-withdraws-3-equity-taxon-health-and-education-amid-public-criticism-91-37.html 301 “Cabinet Approves Decision to Scrap 3% Equity Tax on Education, Health.” The Rising Nepal, July 23, 2026. https:// risingnepaldaily.com/news/83878 302 essenadmin. 2026. “A ‘Fresh Start’ in a Health Insurance Scheme: Health Minister.” Public Service Broadcasting, Radio Nepal. June 9, 2026. https://radionepalonline.com/en/2026/06/09/431051.html. 303 “Legal Reforms Underway to Improve Health Insurance System.” 2026. Nepal News. 2026. https://english.nepalnews.com/s/ health/legal-reforms-underway-to-improve-health-insurance-system/. 304

Ibid

305 RSS. 2026. “Government Discusses Health Insurance Program Reforms.” Rato_Pati. 2026. https://english.ratopati.com/story/67282/ preparations-begin-for-health-insurance-restructuring. 306 Arjun Poudel. 2026. “TU Teaching Hospital, Manmohan Hospital Resume Health Insurance Scheme.” The Kathmandu Post. 2026. https://kathmandupost.com/health/2026/07/24/tu-teaching-hospitalmanmohan-hospital-resume-health-insurance-scheme. 307 Ratopati. 2026. “Ministry of Health and Population to Clear Health Insurance Dues by Mid-August.” Rato_Pati. 2026. https://english. ratopati.com/story/73365/government-prepares-to-pay-healthinsurance-arrears-of-rs-15-billion-within-bhadra. 308

Ibid

309 Binod Dhakal, “Bird Flu Returns: How H5N1 Is Tearing Through Nepal’s Poultry Sector,” Nepal News, June 8, 2026, https://english. nepalnews.com/s/explainers/bird-flu-returns-how-h5n1-is-tearingthrough-nepals-poultry-sector/ 310 Prakriti Dahal, “Bird Flu Hits 162 Poultry Farms; Rs507 Million Paid in Compensation,” The Kathmandu Post, July 23, 2026, https:// kathmandupost.com/money/2026/07/23/bird-flu-hits-162-poultryfarms-rs507-million-paid-in-compensation 311

Ibid

312 RSS, “Bird Flu Costs Jawalakhel Zoo Rs 30 Million in Losses,” myRepublica, July 20, 2026, https://myrepublica.nagariknetwork.com/ news/bird-flu-costs-jawalakhel-zoo-rs-30-million-in-losses-33-22. html 313 “Bird Flu Outbreak Brought under Control, Government Says,” Onlinekhabar, July 23, 2026, https://english.onlinekhabar.com/bird-fluoutbreak-brought-under-control-government-says.html 314

Ibid

315 World Health Organization (WHO), “2026 Rasuwa Flash Floods,” WHO Nepal, 2026, https://www.who.int/nepal/ emergencies/2026-rasuwa-flash-floods 316 Health Emergency Operation Center (HEOC), “2026 Rasuwa Flash Floods,” Ministry of Health and Population, August 31, 2026, https:// heoc.mohp.gov.np/events/2026-rasuwa-flash-floods?doc=91035 317

Ibid

318 Basanta Basnet. “Nepal Weighs Foreign Rescue Offers as over 12 Countries Pledge Rasuwa Flood Aid.” Onlinekhabar English News. August 30, 2026. https://english.onlinekhabar.com/nepal-weighs-foreign-rescue-offers-

DOCKING NEPAL’S ECONOMIC ANALYSIS

as-over-12-countries-pledge-rasuwa-flood-aid.html 319 World Health Organization (WHO), “WHO Releases US$150,000 Emergency Funds to Support Nepal’s Flood Response,” WHO Nepal, August 30, 2026, https://www.who.int/nepal/news/detail/3008-2026-who-releases-us150-000-emergency-funds-to-supportnepal-s-flood-response 320 World Health Organization (WHO), “WHO Nepal Statement on Rasuwa Floods,” WHO Nepal, August 26, 2026, https://www.who.int/ nepal/news/detail/26-08-2026-who-nepal-statement-on-rasuwafloods 321 Kate Iida et al., “Government AI Readiness Index 2025,” Oxford Insights, Accessed on September 11, 2026, https://oxfordinsights. com/ai-readiness/government-ai-readiness-index-2025/ 322 “Telecommunication Indicators Baisakh, 2083,” Nepal Telecommunications Authority, Accessed on September 11, 2026, https://nta.gov.np/uploads/contents/MIS_Baisakh_2083.pdf 323

Ibid

324

Ibid

325

Ibid

326

Ibid

327

Ibid

328 “Monthly Payment Systems Indicators: Asar, 2083 (Mid-July 2026)” Nepal Rastra Bank, August 26, 2026, https://www.nrb.org.np/contents/uploads/2026/08/2083_03_PS.pdf 329

Ibid

330

Ibid

331

Ibid

332 “Nepal Telecom’s Net Profit Rises 47.6% to Rs. 8.86 Billion,” The Himalayan Times, August 15, 2026, https://thehimalayantimes.com/ business/nepal-telecoms-net-profit-rises-476-to-rs-886-billion 333

Ibid

334 “Ncell Pays Rs. 4.96 Billion Installment for Mobile Licence Renewal,” Fiscal Nepal, August 19, 2026, https://www.fiscalnepal. com/2026/08/19/27721/ncell-pays-rs-4-96-billion-instalment-formobile-licence-renewal/ 335 “Ncell Implements 60-Second Pulse Rate for International Outgoing Calls,” August 19, 2026, 336 Abhiyan Dahal, "India and Nepal Sign Language AI Deal to Expand Digital Access," DevPulse, June 8, 2026, https://devpulse.info/news-and-articles/india-and-nepal-sign-languageai-deal-to-expand-digital-access 337

"India and Nepal Partner to Build Multilingual AI and

Strengthen Digital Public Infrastructure," IV Government, June 8, 2026, https://ivgovernment.com/news/india-and-nepal-partner-to-buildmultilingual-ai-and-strengthen-digital-public-infrastructure 338 "NPCI International and Nepal Clearing House launch realtime cross-border remittance link between India and Nepal", Nepal Clearing House Limited, June 9, 2026, 339

Ibid

340 Binod Dhakal, “50 Mbps Broadband, Cheaper Internet and 5G: Everything You Need to Know about Nepal’s New Telecom Policy,” August 24, 2026, https://english.nepalnews.com/s/sciencetechnology/50-mbps-broadband-cheaper-internet-and-5geverything-you-need-to-know-about-nepals-new-telecom-policy/ 341 Kaushal Kaphle, “Nepal Integrated Telecom Policy,” August 23, 2026, https://english.onlinekhabar.com/nepal-integrated-telecom-policy. html 342 Binod Dhakal, “50 Mbps Broadband, Cheaper Internet and 5G: Everything You Need to Know about Nepal’s New Telecom Policy,” August 24, 2026, https://english.nepalnews.com/s/sciencetechnology/50-mbps-broadband-cheaper-internet-and-5geverything-you-need-to-know-about-nepals-new-telecom-policy/ 343 Durga Dulal, “Nepal’s courts embrace AI, keep judgment writing human”, The Kathmandu Post, July 3, 2026, https://kathmandupost.com/national/2026/07/03/nepal-s-courtsembrace-ai-keep-judgment-writing-human 344

Ibid

345

Ibid

346 U.S. Embassy Kathmandu, “American Drone Technology Strengthens Expedition Safety in Himalayas,” July 27, 2026, https:// np.usembassy.gov/american-drone-technology-strengthensexpedition-safety-in-himalayas/ 347

Ibid

348 “Economic Survey 82/2081 (FY 25/2024),” Ministry of Finance, May 29, 2025, https://mof.gov.np/content/1520/economicsurvey-2081-82/ 349 “Nagdhunga Tunnel Project Marks Completion, Ushering in a New Era of Transport Connectivity in Nepal.” July 28, 2026. https://www.jica.go.jp/english/overseas/nepal/information/ press/2026/1583892_70955.html. 350 “Signing of Japanese ODA Loan Agreement with Nepal: Contributing to Smooth Transportation Network through Constructing the Country’s First Road Tunnel.”2026. https://www.jica.go.jp/english/information/press/2026/20260529_11. html. 351 “Nagdhunga Tunnel Project Marks Completion, Ushering in a New Era of Transport Connectivity in Nepal.” July 28, 2026. https://www.jica.go.jp/english/overseas/nepal/information/ press/2026/1583892_70955.html. 352 “Nagdhunga Tunnel Project Marks Completion, Ushering in a New Era of Transport Connectivity in Nepal.” July 28, 2026. https://www.jica.go.jp/english/overseas/nepal/information/ press/2026/1583892_70955.html

“Signing of Japanese ODA Loan Agreement with Nepal: Contributing to Smooth Transportation Network through Constructing the Country’s First Road Tunnel.”2026. https://www.jica.go.jp/english/information/press/2026/20260529_11. html 353 Shrestha, Hemant. 2015. “Nepal’s First Road Tunnel Inaugurated after over Six Years of Construction.” Kathmandupost. The Kathmandu Post. July 27, 2026. https://kathmandupost.com/visual-stories/2026/07/27/nepal-s-firstroad-tunnel-inaugurated-after-over-six-years-of-construction 354

Ibid.

355 “Real Estate Revenue Hits Three-Year High as Buyers Rush before Tax Hike.” The Kathmandu Post, July 20, 2026. https://kathmandupost.com/national/2026/07/20/real-estatetransaction-revenue-hits-three-year-high-as-buyers-rush-before-taxhike. 356

Ibid

357

Ibid

358

Ibid

359 Ministry of Land Management, Cooperatives and Poverty Alleviation. “Land Use (Third Amendment) Regulations, 2082.” Government of Nepal. 2026. https://molcpa.gov.np/content/379/landuse--third-amendment--regulations--2082/; Ministry of Land Management, Cooperatives and Poverty Alleviation. “Regulations.” Government of Nepal. Accessed September 25, 2026. https://molcpa.gov.np/category/regulations/. 360 Tamang, Seema. 2026. “Land Subdivision Halted Again in 363 Local Units over Classification Delays.” Kathmandupost. The Kathmandu Post. Sept 25, 2026. https://kathmandupost.com/national/2026/07/22/land-subdivisionhalted-again-in-363-local-governments-over-classification-delays 361 Tamang, Seema. 2026. “Land Subdivision Halted Again in 363 Local Units over Classification Delays.” Kathmandupost. The Kathmandu Post. Sept 25, 2026. https://kathmandupost.com/national/2026/07/22/land-subdivision-

NEFPORT ISSUE 66 – SEPTEMBER 2026

halted-again-in-363-local-governments-over-classification-delays; Ministry of Land Management, Cooperatives and Poverty Alleviation. “Land Use (Third Amendment) Regulations, 2082.” Government of Nepal. 2026. https://molcpa.gov.np/content/379/land-use--third-amendment-regulations--2082/ 362 Tamang, Seema. 2026. “Land Subdivision Halted Again in 363 Local Units over Classification Delays.” Kathmandupost. The Kathmandu Post. Sept 25, 2026.

(Based on Annual Data of 2025/26),” Nepal Rastra Bank, August 26, 2026, https://www.nrb.org.np/category/current-macroeconomic-situation/?dep artment=red&fy=2082-83&subcategory=annual 380 “Nepal Tourism Statistics, 2025,” Ministry of Culture, Tourism and Civil Aviation, Accessed on August 31, 2026, https://giwmscdnone. gov.np/media/pdf_upload/Nepal%20tourism%20statistics%202025_ ibddtm6.pdf 381

Ibid

https://kathmandupost.com/national/2026/07/22/land-subdivisionhalted-again-in-363-local-governments-over-classification-delays

382

Ibid

363 Tamang, Seema. 2026. “Land Subdivision Halted Again in 363 Local Units over Classification Delays.” Kathmandupost. The Kathmandu Post. Sept 25, 2026.

383

Ibid

384

Ibid

385

Ibid

https://kathmandupost.com/national/2026/07/22/land-subdivisionhalted-again-in-363-local-governments-over-classification-delays;

386

Ibid

https://lawcommission.gov.np/pages/alphabetical-index-of-acts/.

388 “Nepal Tourism Insights (August 2026),” Nepal Tourism Board, accessed August 31, 2026, https://trade.ntb.gov.np/wp-content/ uploads/2026/09/August-2026.jpg.pdf ; “Nepal Saw 3.65pc Drop in Tourist Arrivals in August,” The Himalayan Times, September 2, 2026, https://thehimalayantimes.com/business/nepal-saw-365pc-drop-intourist-arrivals-in-august.”

“ऐनहरुको वर्णानुक्रमणिका | Nepal Law Commission.” 2026. Government of Nepal. 2026. 364 Tamang, Seema. 2026. “Land Subdivision Halted Again in 363 Local Units over Classification Delays.” Kathmandupost. The Kathmandu Post. Sept 25, 2026. https://kathmandupost.com/national/2026/07/22/land-subdivisionhalted-again-in-363-local-governments-over-classification-delays. 365

Ibid

366 “ADB Approves $115 Million Loan to Strengthen Water Supply, Sanitation, and Resilience in Nepal’s Municipalities.” Asian Development Bank. June 19, 2026. https://www.adb.org/news/adb-approves-115-million-loan-strengthenwater-supply-sanitation-and-resilience-nepal-municipalities. 367

Ibid

368

Ibid

369

Ibid

370 Tamang, Seema. 2026. “New Land Bank Procedure Aims to Revive Unused Plots, but Challenges Persist.” The Kathmandu Post. 2026. https://kathmandupost.com/national/2026/07/22/land-subdivisionhalted-again-in-363-local-governments-over-classification-delays 371 Tamang, Seema. 2026. “New Land Bank Procedure Aims to Revive Unused Plots, but Challenges Persist.” Kathmandupost. The Kathmandu Post. 2026. https://kathmandupost.com/ national/2026/07/22/land-subdivision-halted-again-in-363-localgovernments-over-classification-delays; Seema Tamang ÒWhich Municipalities Have Received Approval to Establish Land Banks?.” Ekantipur. Kantipur. August 13, 2026. https://ekantipur.com/business/2026/08/13/which-municipalities-havereceived-approval-to-establish-a-land-bank-01-31.html. 372 Tamang, Seema. 2026. “New Land Bank Procedure Aims to Revive Unused Plots, but Challenges Persist.” The Kathmandu Post. 2026. https://kathmandupost.com/national/2026/07/22/land-subdivisionhalted-again-in-363-local-governments-over-classification-delays. 373

Ibid

374

Ibid

375 “Nepal Tourism Insights (June 2026),” Nepal Tourism Board, Accessed on September 1, 2026, https://trade.ntb.gov.np/wp-content/ uploads/2026/07/June-2026.jpg-1.pdf; “Nepal Tourism Insights (July 2026),” Nepal Tourism Board, Accessed on September 1, 2026, https:// trade.ntb.gov.np/wp-content/uploads/2026/08/July-2026.jpg.pdf; “Nepal saw 3.65pc drop in tourist arrivals in August,” The Himalayan Times, September 2, 2026, https://thehimalayantimes.com/business/nepal-saw365pc-drop-in-tourist-arrivals-in-august 376 “Monthly Report of Foreign Direct Investment Approval of Ashad -2083,” Department of Industry, July 17, 2026, https://doind.gov. np/detail/98e27e9f-59f1-4f2b-91dd-0c180e9ef655 377

Ibid

“Nepal Tourism Statistics, 2025,” Ministry of Culture, Tourism 378 and Civil Aviation, Accessed on August 31, 2026, https://giwmscdnone. gov.np/media/pdf_upload/Nepal%20tourism%20statistics%202025_ ibddtm6.pdf 379

“Current Macroeconomic and Financial Situation – Tables

387 “Tourist Arrivals in Nepal in 2026: Monthly Statistics and Updates,” Nepal Trekking in Himalaya, September 7, 2026, https://www. nepaltrekkinginhimalaya.com/pages/tourit-arrival-in-nepal-in-2026

389 Ibid ; “Nepal Welcomes 85,444 International Tourists in August 2026, Indian Market Leads Arrivals,” ShareSansar, September 1, 2026, https://www.sharesansar.com/newsdetail/nepal-welcomes85444-international-tourists-in-august-2026-indian-market-leadsarrivals-2026-09-01 390 “SITUATION UPDATE – 10,” Nepal Tourism Board, August 30, 2026, https://trade.ntb.gov.np/wp-content/uploads/2026/08/Situationupdate-10_page-0001.jpg 391

Ibid

392

Ibid

393

Ibid

394 “flydubai to launch direct Pokhara-Dubai flights from September,” The Himalayan Times, June 22, 2026, https:// thehimalayantimes.com/nepal/flydubai-to-launch-direct-pokharadubai-flights-from-september 395 "Flydubai Set to Launch Daily Flights to Pokhara, Boosting Tourism Prospects,” Tourism Mail, June 22, 2026,, https://www. tourismmail.com/news/detail/110873/ 396 “flydubai to launch direct Pokhara-Dubai flights from September,” The Himalayan Times, June 22, 2026, https:// thehimalayantimes.com/nepal/flydubai-to-launch-direct-pokharadubai-flights-from-september 397

Ibid

398 “Indian tourists power record-breaking 508,000 visits to Annapurna region,” The Himalayan Times, July 21, 2026, https:// thehimalayantimes.com/nepal/indian-tourists-power-record-breaking508000-visits-to-annapurna-region 399 “Annapurna Conservation Area Sees Record-Breaking Tourist Influx,” Tourism Mail, July 18, 2026, https://www.tourismmail.com/news/ detail/111167/ 400

Ibid

401 “Nepal's domestic tourism contributes 2.65% to country's GDP,” Nepal Republic Media, July 5, 2026, https://myrepublica. nagariknetwork.com/news/nepals-domestic-tourism-contributes-265to-countrys-gdp-69-98.html 402 “Domestic Tourism Contributes 2.65% to GDP: NSO Survey,” New Business Age, July 2, 2026 https://www.newbusinessage.com/ news/49315/domestic-tourism-contributes-2-65--to-gdp--nsosurvey/ 403

Ibid

404 “Nepal's domestic tourism contributes 2.65% to country's GDP,” Nepal Republic Media, July 5, 2026, https://myrepublica. nagariknetwork.com/news/nepals-domestic-tourism-contributes-265to-countrys-gdp-69-98.html 405 Sandeep Sen, “Everest rules could get tougher as lawmakers push sweeping tourism reforms,” The Himalayan Times, July 23, 2026, https://thehimalayantimes.com/nepal/everest-rules-could-get-tougheras-lawmakers-push-sweeping-tourism-reforms 406 Sangam Prasain, “Lawmakers seek tougher Everest climbing rules with 263 amendments to Tourism Bill,” The Kathmandu Post, July 22 2026, https://kathmandupost.com/money/2026/07/22/lawmakers-seek-

DOCKING NEPAL’S ECONOMIC ANALYSIS

tougher-everest-climbing-rules-with-263-amendments-to-tourismbill

436

Ibid

437

Ibid

407

438

Ibid

439

Ibid

408 Sandeep Sen, “Everest rules could get tougher as lawmakers push sweeping tourism reforms,” The Himalayan Times, July 23, 2026, https://thehimalayantimes.com/nepal/everest-rules-could-get-tougheras-lawmakers-push-sweeping-tourism-reforms 409

Ibid

410 “Current Macroeconomic and Financial Situation – Tables (Based on Annual Data of 2025/26),” Nepal Rastra Bank, August 26, 2026, https://www.nrb.org.np/category/current-macroeconomic-situation/?d epartment=red&fy=2082-83&subcategory=annual; “Nepal saw 3.65pc drop in tourist arrivals in August,” The Himalayan Times, September 2, 2026, https://thehimalayantimes.com/business/nepal-saw-365pc-dropin-tourist-arrivals-in-august 411 “Current Macroeconomic and Financial Situation – English (Based on Annual Data of 2025/26),” Nepal Rastra Bank, August 26, 2026, https://www.nrb.org.np/category/current-macroeconomic-situation/?de partment=red&fy=2082-83&subcategory=annual 412 “Current Macroeconomic and Financial Situation – English (Based on Annual Data of 2025/26),” Nepal Rastra Bank, August 26, 2026, https://www.nrb.org.np/category/current-macroeconomic-situation/?de partment=red&fy=2082-83&subcategory=annual 413

Ibid

414

Ibid

415

Ibid

416

Ibid

417 “Datewise Indices,” Nepal Stock Exchange, Accessed on September 18, 2026, https://nepalstock.com/indices 418 “Market Capitalization,” Nepal Stock Exchange, Accessed on September 18, 2026, https://nepalstock.com/marcap 419 “Current Macroeconomic and Financial Situation – English (Based on Annual Data of 2025/26),” Nepal Rastra Bank, August 26, 2026, https://www.nrb.org.np/category/current-macroeconomic-situation/?de partment=red&fy=2082-83&subcategory=annual 420

Ibid

421

Ibid

422

Ibid

423 “Nepse Alpha Earnings Scoreboard”, nepsealpha, Accessed September 16 May, 2026, https://nepsealpha.com 424 “Current Macroeconomic and Financial Situation – English (Based on Annual Data of 2025/26),” Nepal Rastra Bank, August 26, 2026, https://www.nrb.org.np/category/current-macroeconomic-situation/?de partment=red&fy=2082-83&subcategory=annual 425

Ibid

426

Ibid

427

Ibid

428 “Monetary Policy 2082-83 Third Quarter Review”, Nepal Rastra Bank, May 15, 2026. https://www.nrb.org.np/contents/uploads/2026/05/Monetary-Policy3rd-Qtr-Review-2082-83.pdf 429 “Datewise Indices,” Nepal Stock Exchange, May 27, 2026, https://www.nepalstock.com.np/indices 430

Ibid

431 Bijay Damase, “Govt Clears $400 Million Offshore Bond Route for Private Sector,” New Business Age, August 21, 2026, https://www. newbusinessage.com/news/49881/govt-clears--400-million-offshorebond-route-for-private-sector/ 432

Ibid

433 “विद्यु तीय माध्यमबाट प्रवाह हुने कर्जा (Digital Lending) सम्बन्धी मार्गदर्शन, २०७८ संशोधन गरिएको सम्बन्धमा ।,“ Nepal Rastra Bank, June 8, 2026, https://www.nrb.org.np/contents/uploads/2026/06/विद्यु तीय-माध्यमबाटप्रवाह-हुने-कर्जा -Digital-Lending-सम्बन्धी-मार्गदर्शन-२०७८-संशोधन.pdf 434 “परिपत्र नं. १९ (क, ख, ग) २०८२/८३: नेपाल राष्ट्र बैंकबाट “क”, “ख” र “ग” वर्गका इजाजतपत्रप्राप्त संस्थाहरुलाई जारी गरिएको एकीकृत निर्दे शन, २०८२ मा संशोधन/ परिमार्जन/थप ।,” Nepal Rastra Bank, July 15, 2026, https://www.nrb.org.np/ contents/uploads/2026/07/Circular19_Final0331.pdf 435 “नेपाल धितोपत्र बोर्ड आर्थिक वर्ष २०८३/८४ को पूँजी बजार नीति |,” Securities Board of Nepal, July 14, 2026, https://www.sebon.gov.np/pressrelease/नेपाल-धितोपत्र-बोर्ड-आर्थिक-वर्ष-२०८३-८४-को-पूँजी-बजार-नीति-%7C

440 “Capital Market Development Blueprint of Nepal, 2026,” Securities Board of Nepal, July 14, 2026, https://www.sebon.gov.np/ uploads/2026/07/14/APKDPuKPVGILGdewYEZpAs0KfKAZtcCWwpUOTfKr. pdf 441

Ibid

442

Ibid

443

Ibid

444 “प्राथमिक पूँजी बजारमा गुणस्तरीय विकास (Qualitative Development) गर्न बोर्ड बाट "नेपालको प्राथमिक पूँजी बजार विकास सम्बन्धी श्वेतपत्र, २०८३" सार्वजनिक।,” Securities Board of Nepal, August 6, 2026, https://www.sebon.gov.np/ news/प्राथमिक-पूँजी-बजारमा-गुणस्तरीय-विकास-qualitative-development-गर्नबोर्ड बाट-नेपालको-प्राथमिक-पूँजी-बजार-विकास-सम्बन्धी-श्वेतपत्र-२०८३-सार्वजनिक 445

Ibid

446

Ibid

447

Ibid

448

Ibid

449 “मार्जिन ऋण कारोवार नियमावलीको मस्यौदामा राय/सुझाव पेश गर्ने सम्बन्धमा।,” Securities Board of Nepal, August 18, 2026, https://www.sebon. gov.np/news/मार्जिन-ऋण-कारोवार-नियमावलीको-मस्यौदामा-राय-सुझाव-पेश-गर्नेसम्बन्धमा 450

Ibid

451

Ibid

452

Ibid

453

Ibid

454 “ऋणपत्र दर्ता तथा निष्काशन नियमावली, २०८३ को मस्यौदामा राय/सुझाव पेश गर्ने सम्बन्धमा।,“ Securities Board of Nepal, August 20, 2026, https:// www.sebon.gov.np/news/ऋणपत्र-दर्ता-तथा-निष्काशन-नियमावली-२०८३-कोमस्यौदामा-राय-सुझाव-पेश-गर्ने-सम्बन्धमा। 455

Ibid

456

Ibid

457

Ibid

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