AGP Executive Report

Bhotekoshi-Trishuli Flood Response: Nepal has halted the search-and-rescue phase after the Aug. 26 floods, keeping only essential operations, as hopes of finding survivors fade; confirmed deaths stand at 1,455 with 5,285 still missing, while the government shifts focus to reconstruction and rehabilitation. Disaster Budget Push: The Cabinet-level National Council for Disaster Risk Reduction and Management recommended Rs 5.59 billion for post-disaster bids and plans across 504 programmes, with more allocations to follow once project costs are finalized. NEPSE Slide: The Nepal Stock Exchange fell 20.48 points to 2,566.76 as turnover dropped by over Rs 1 billion to Rs 3.279 billion. Energy & Household Costs: Gas shortages are pushing households toward electric stoves; imports of induction and infrared stoves have surged in the first two months of the fiscal year. Power Infrastructure: The stalled Hetauda–Dhalkebar 400kV transmission line is expected to be operational right after Dashain, with remaining towers to be completed within weeks. Road Resilience: Nepal’s road authorities are revising bridge and road standards after floods and landslides, including designs for long-span bridges and higher freeboard. Climate Diplomacy: Nepal is taking flood and glacier risk to global forums, while Pacific leaders at pre-COP talks in Fiji press for climate finance and stronger action.

Nepali Congress Convention: NC President Gagan Thapa urged a reset in political culture and priorities, saying democracy must translate into jobs, rural revival and better public services, while the party should rebuild trust and make space for public questions. Private-sector push: NC also unveiled an economic policy placing private investment, production and employment at the center, calling for policy stability and using remittances for productive sectors. Digital costs: ISPAN warned it may discontinue low-priced, low-speed internet packages from Monday due to higher operating costs, including fiber prices and fuel impacts. Power infrastructure: Nepal Electricity Authority expects the long-stalled Hetauda–Dhalkebar 400 kV transmission line to be charged right after Dashain, and ADB signed PPP support deals for transmission and battery storage worth over $200m. EV demand: EV imports surged to 2,834 units worth Rs 6.70bn in the first two months of FY27, led by China via Korala. Dashain economy: Kathmandu open markets saw a customer surge as festival shopping picks up. Climate diplomacy: Pacific leaders kicked off a pre-COP summit in Fiji pushing 1.5°C, ocean protection and faster climate finance. Regional energy trade: Experts called for South Asia energy partnerships to cushion global trade and supply shocks.

Nepal Policy & Economy: Nepal’s government has tabled a Building Bill in Parliament with housing support—grants up to Rs 75,000 for low-income families and subsidised “smart homes” for middle-income households—along with relocation plans for unsafe disaster-affected settlements. Energy & Consumer Impact: Nepal Oil Corporation decided to keep petrol, diesel, kerosene and LPG retail prices unchanged despite higher procurement costs after the Bhotekoshi floods, citing Dashain/Tihar demand and consumer interest, even as it estimates large losses. Finance & Digital Commerce: Siddhartha Bank and Daraz launched a “10-10 Dashain Dhamaka” offer with up to 15% discounts on online purchases using the bank’s cards. Capital Market: NEPSE slipped below 2,600 points as selling pressure broadened, with turnover reported around Rs 4.29 billion. Business Environment: Six construction companies were blacklisted for contract violations, raising pressure on project delivery and procurement compliance. Social Protection: Sudurpaschim Province reported over 732,000 people enrolled in health insurance, expanding access to basic healthcare. Governance & Institutions: Nepal’s air-safety delisting plan is at risk as two key civil aviation reform bills stalled in Parliament before prorogation. Sports Governance: A dispute in the Nepal Skating and Skateboarding Association over treasurer and bank operations triggered an NSC investigation. International Finance: Finance Minister Swarnim Wagle is in Washington for meetings with the US Treasury and the World Bank to strengthen economic partnerships.

NEPSE & Markets: Nepal Stock Exchange slipped for a fourth straight week, falling 1.62% (42.56 points) with turnover down to about Rs 4.8bn; investors reportedly lost around Rs 73bn in market value. Gold & Food Imports: Gold dropped Rs 3,800 per tola and silver fell Rs 170 per tola; meanwhile, Nepal imported 106m kg of paddy and rice worth Rs 5.61bn in the first two months of FY—paddy led imports. Aviation Regulation: Government is drafting tougher rules to fine airlines up to Rs 1.5m for charging fares above approved rates during festivals and emergencies. Road Safety Law: A new Road Safety Act draft would make people liable for accidents caused by piling construction materials or blocking roads/footpaths. Banking Tech: Machhapuchchhre Bank launched “MAB Chat” to handle routine customer queries online. Local Business Push: “Chamber Bazaar” in Jamal promotes women entrepreneurs’ products and affordable daily essentials. Energy & Transport Disruptions: Fuel shortages are delaying restoration of the Beni–Jomsom–Korala road after landslides; hydropower projects in Myagdi also suffered flood damage. Politics & Elections: RSP formed candidate-selection and department committees for local elections; Nepali Congress is holding its 15th General Convention as a policy-selection event.

Bus Accident Update: A passenger bus overturned on the East-West Highway at Daunne, Nawalparasi East, killing six and injuring 12; victims were identified and injured passengers were sent to Chitwan and Madhyabindu hospitals. Parliament Accountability: As Nepal’s budget session ended, opposition lawmakers criticised PM Balendra Shah’s frequent absence from the House, raising questions on government accountability. Festival Security: Kathmandu District Police Range plans to mobilise about 3,500 personnel for Dashain, Tihar and Chhath, with tighter checks at entry points, sniffer dogs, CCTV coverage and a 13-point safety advisory for people leaving the Valley. Power Sector PPP: ADB signed its first Nepal PPP transaction advisory deals with NEA to expand power transmission and battery storage, targeting over $200m in private investment. Capital Markets: NEPSE slipped below 2,600 amid broad selling pressure, with weekly turnover rising but daily trading intensity weakening. US Visa Policy: The US expanded a visa bond programme to 50 countries (India excluded), with Nepal among South Asian nations covered. UPI Growth (Regional Finance): India’s UPI hit 145 billion transactions in H1 FY27 (+27%) ahead of new MDR rules from Oct 15. Banking: Global IME Bank’s AGM approved a 10% dividend (4% bonus shares, 6% cash).

UNGA & Climate Finance: Nepal’s PM Balendra Shah’s historic UNGA address was highlighted in the House of Representatives, with FM Shisir Khanal saying it pushed for simplifying and unlocking climate finance and turning climate justice into concrete action for vulnerable countries like Nepal. Climate Justice in Practice: Khanal also urged Kathmandu Climate Week participants to move beyond slogans, calling for grant-based, easily accessible climate finance, adaptation support, and technology transfer. Public Finance Watch: Nepal’s public debt is nearing Rs 3 trillion (about 45.5% of GDP), with concerns raised over fast-rising borrowing and whether it is translating into growth and deliverable assets. Infrastructure Delivery & Cost Overruns: The Kathmandu–Tarai/Madhesh Fast Track deadline has been extended to April 2030, with progress still around halfway and land/environment approvals and the Khokana dispute cited as major bottlenecks. Digital Security: A warning is growing that Nepal is going digital faster than its cybersecurity capacity, after breaches disrupted capital-market systems and e-bidding. Internet Affordability: ISPAN says low-speed, low-cost internet packages will be discontinued from Ashoj 19 due to rising operating costs. Flood Risk & Regional Spillovers: Nepal plans a high-stakes mission to drain four glacial lakes after deadly flash floods, while in India’s Bihar, Gandak flooding worsened after embankment breaches, triggering an orange alert at 28 locations. Payments & Economy Link: India’s UPI hit 145 billion transactions in H1 FY27 (+27%), ahead of new merchant discount rules—an indicator of how digital payments keep reshaping regional commerce. Local Economy & Migration: Baitadi’s villages are rapidly emptying as people move to the Tarai and abroad, with student numbers reportedly down sharply over five years.

Glacial Risk Reduction: Nepal plans a large-scale project to drain four high-altitude glacial lakes this fiscal year to cut flood risk after the August disaster, with channels to divert water and studies that could take up to six years. Market Oversight & LPG Supply: The supplies minister says market monitoring is meant to protect consumers and ensure fair competition, not “terrorize” business, while the government is also preparing to let security agencies distribute LPG during shortages. Investment Climate & Legal Reform: Business leaders and ministers are pushing “legal stability” and simpler, clearer rules for infrastructure and investment, including talk of an infrastructure court to speed up disputes. NEPSE Watch: NEPSE fell 11.90 points to close at 2,587.25; turnover topped Rs 4.29 billion. Energy Skills: AEPC and GRIPS 2 trained 45 engineers on industrial solar PV and battery storage, aiming to strengthen grid resilience. Foreign Employment: Nepal asked Malaysia to remove 25 Nepali foreign employment firms from Malaysia’s recruitment system, rejecting the “principal/supporting” structure. Flood-Linked Climate Justice: Foreign Minister Shisir Khanal urged grant-based climate finance and practical climate justice, tying Nepal’s development and disaster risks to global commitments.

Electricity & Infrastructure: Nepal’s national transmission grid opens to private players as the ERC sets wheeling charges for medium/long-term and short-term open access, aiming to boost electricity trading. Telecom Regulation: NTA moves to recover over Rs 8.052 billion in dues from United Telecom Limited after its basic phone license was cancelled, including freezing assets and starting valuation. Consumer & State Firms: Salt Trading Corporation faces a Rs 300,000 fine for failing to share sugar stock details, while another STC fine is reported for unfair market practices. Capital Markets & Policy: HoR forwards three economic bills (Citizen Investment Trust, payment/allowance, and EPF amendments) to committees for clause-wise discussion. Climate & Resilience: Kathmandu Climate Week kicks off Friday with climate justice, loss-and-damage and resilience sessions, starting with remembrance of Bhotekoshi victims. Disaster Impact on Business: Floods and landslides disrupt power and trade—repairs begin on damaged transmission lines in Myagdi/Mustang, and over 150 containers are stuck at Korala customs due to road blockages. Aviation & Trade Links: Himalaya Airlines launches direct Kathmandu–Hangzhou flights, adding a new Nepal–China air corridor. Retail & Tech: Ncell bundles unlimited data/voice for iPhone 18 buyers, while HONOR Choice T10 is launched in Nepal with AI translation features. Agriculture & Festival Economy: Goat trading starts across Sarlahi ahead of Dashain, while the state-run Food Management and Trading Company skips goat sales this year due to transport disruptions and losses.

Disaster & Recovery: Nepal is still reeling after the August Bhotekoshi flash flood, with a month of recovery shifting toward resettlement and reconstruction; the government says deaths have crossed 1,400 and total economic loss is estimated at $883.3m, while reconstruction needs are put at $4.775bn. Flood Fallout for Jobs: The ILO estimates 21,400 workers’ livelihoods were disrupted within the Bhote Koshi–Trishuli flood footprint, hitting tourism, agriculture, transport and micro/small enterprises. New Landslide Wave: Fresh heavy rain and landslides have killed at least 30 people and forced trekkers off the Annapurna Circuit, with helicopters evacuating people from Manang and Mustang. Aviation Law: Nepal’s Domestic Airlines Liability Bill has cleared the National Assembly Legislation Management Committee and is set for Friday passage, proposing up to $100,000 compensation for serious injury, disability or death. Power & PPPs: ADB will back NEA power transmission and 100–150 MWh battery storage projects via PPPs, mobilising over $200m in private investment. Telecom Regulation: The communications minister has asked the Nepal Telecom Authority to explain telecom service quality and monitoring, as complaints about weak phone and internet services rise. Market Watch: NEPSE closed near-flat at 2,599.15 with turnover of Rs 4.89bn. Electricity Exports: NEA approved selling 86 MW to India during the monsoon via the Indian power exchange from Nov 1, 2026 to May 31, 2029. Connectivity Boost: Himalaya Airlines launched direct Kathmandu–Hangzhou flights, adding a new Nepal–China air corridor. Policy & Social: Parliament sent three economic bills to committees for clause-by-clause review, while a civil service bill proposes menstrual leave for female employees. Climate Risk Lens: UAE and IWMI hosted a Kathmandu dialogue warning of “water bankruptcy” risks in the Himalaya and linking water security to economic growth and food security.

Capital Markets: NEPSE slipped below 2,600 points, closing at 2,598.89, as turnover rose to Rs 4.765 billion; meanwhile, SEBON says reforms and investor-protection measures are underway, and the Finance Committee has directed a new securities bill to modernize trading and curb market manipulation. IPO Bottleneck: 112 companies are stuck waiting for Sebon approval for IPOs worth about Rs 71.29 billion, with no new IPO approvals for six months. Regulation & Consumer Protection: The Supreme Court ordered full nationwide enforcement of the 40-micron plastic bag ban, citing weak coordination and delays. Climate Policy Prep: MPs urged strong COP-31 preparations focused on climate justice, climate finance, early warning systems, and linking loss-and-damage funds to safe housing and livelihoods. Energy & Trade: NEA will sell up to 86 MW of surplus electricity to India; FNCCI pushed China to reopen the Tatopani border to ease supply-chain disruptions. Disaster & Infrastructure: Nepal Telecom reported Rs 88.51 million in flood damages and service disruptions; meanwhile, Larke Pass is blocked by heavy snowfall, disrupting Manaslu trekking routes and local supply lines. Social Media Governance: Government is drafting a separate law to regulate social media and introduce age-based restrictions for children. Relief & Education: Sewa International plans support for 10,000 flood-affected children, including skill centers in affected districts. Business & Tech: iPhone 18 Pro series launches in Nepal on Oct 1 with promotions and instalment options.

Capital Market Overhaul: Nepal’s Finance Committee directed the government to draft a new Securities Bill and push reforms at SEBON, NEPSE and CDSC, including tighter IPO/promoter-share rules and stronger cyber security for trading systems. NEPSE Slips: The stock index fell below 2600, closing at 2,598.89 points, with Rs 4.765 billion turnover as investors stayed cautious. Civil Aviation Restructuring Debate: Nepal is moving to split the Civil Aviation Authority into separate regulator and service-provider institutions, with a key question being whether real capacity and independence will improve safety and governance. Flood Recovery & Connectivity: One month after the Bhote Koshi disaster, temporary tuins are being used to restore crossings and road links are gradually reopening, while hydropower damage and power-disruption pressures are forcing alternative electricity supply planning. Trade Disruptions with China: All three major overland routes—Tatopani, Rasuwagadhi and Korala—were hit by monsoon disruptions, stranding cargo and raising supply concerns ahead of Dashain/Tihar. Energy Budget Execution: The energy minister ordered faster budget and project implementation after low financial progress, urging tenders and agreements earlier in the fiscal year. AIIB Leadership: Finance Minister Dr. Swarnim Wagle returned from AIIB’s Doha annual meeting where Nepal was elected vice-chair for 2026–27. Migrant Workers Diplomacy: NRN Qatar submitted a 9-point memorandum to address problems faced by Nepali workers in Qatar, while Nepal also urged Malaysia to remove listed manpower agencies from its FWCMS system.

Breastfeeding Policy Push: Nepal’s latest surveys show only 55% of babies get mother’s milk within an hour of birth and just 70% are exclusively breastfed under six months, with bottle-feeding rising in some provinces; experts say weak breastfeeding costs Nepal about Rs 21 billion in 2024 and also drives spending on milk substitutes. Tourism & Local Economy: Hotel Association Nepal’s Kavrepalanchowk chapter proposes “Stay in Dhulikhel, Day Trips to Twelve Destinations,” linking Dhulikhel with 12 nearby attractions to extend visitor stays and boost local demand. Aviation Connectivity: Himalaya Airlines has resumed direct Kathmandu–Shanghai flights (two weekly services initially), aiming to revive an important trade-and-tourism air link. Disaster Finance & Insurance: Nepal Insurance Authority data says insurers have received about Rs 20.98 billion in Bhotekoshi–Trishuli flood claims; it has also eased claim procedures, allowing advance payments and relaxed documentation deadlines. Power Security: NEA plans to import up to 1,100 MW from India in the dry season after floods and monsoon damage cut hydropower output, targeting peak demand between February and May. Regional Trade/Policy: India recommends anti-subsidy duties on jute imports from Bangladesh (and Nepal covered in the probe), adding pressure to South Asian jute exporters. Business Climate Risk: Commentary links Nepal’s flood recovery challenge to how quickly tourism narratives and demand can shift, warning that information and preparedness shape economic rebound.

AIIB Leadership: Nepal’s Finance Minister Dr Swarnim Waglé was elected Vice-Chair of the AIIB Board of Governors for 2026-27 during the Doha annual meeting, and held talks with counterparts including India and Bangladesh on investment, trade and clean energy. Power Security: NEA plans to import up to 1,100 MW of electricity from India in the dry season (Dec–May 2027) after monsoon-linked damage cut hydropower output, with peak demand expected Feb–May. Market Watch: NEPSE fell for a second straight day, down 9.62 points to 2,603.71, as turnover dropped to Rs 4.65 billion. Disaster Oversight: Rastriya Swatantra Party deputy leader Ganesh Parajuli is set to chair a parliamentary special committee on the Bhotekoshi-Trishuli disaster, tasked with rehabilitation, reconstruction and climate-risk reforms. Trade & Connectivity: Nepal-China border bottlenecks are being discussed through on-site dialogue to ease movement of goods and people at Kodari. Tourism & Air Links: Himalaya Airlines resumed direct Kathmandu–Shanghai flights (two weekly services), while Hotel Association Nepal urges stronger India/China messaging that only the Bhote Koshi corridor was affected. Energy Policy: Government is reviving a plan to separate household and commercial LPG supplies using different cylinder sizes after shortages exposed distribution weaknesses. Environment Law: Nepal’s Supreme Court ordered strict nationwide enforcement of the plastic bag ban for items thinner than 40 microns.

Disaster Finance: Nepal has asked the UN Loss-and-Damage Fund for US$20m after the 26 Aug Bhotekoshi floods, saying total losses are about $2.7bn plus $4.8bn in recovery costs—so the request is small versus needs. Power & Industry: NEA says dry-season supply (mid-Dec 2026 to mid-May 2027) will rely on up to 1,154MW imports from India to cover a domestic shortfall after flood damage; separately, FNCCI urges rollback of electricity VAT, warning it raises production costs and hits cash flow. Floods, Landslides & Trade Disruptions: 272 disaster incidents in 24 hours killed 21 and injured 26; heavy rain and snowfall have disrupted Nepal-China trade via Korala and blocked key routes. Himalayan Safety: Avalanche at Himlung base camp in Manang has killed at least four, with more missing as rescue teams battle weather. Policy & Governance: NA members pressed for accountability and faster relief, while debate continues over the Federal Civil Service Bill’s “55–30” compulsory retirement rule. Regional Security & Crime: UNODC reports synthetic-drug markets in South Asia are evolving differently across countries, urging better detection and cooperation. Business Community: PATA Nepal elected a new executive committee, with Narendra Deo Bhatta as chairman.

Avalanche Update: Nepal’s Himlung Himal disaster response continues after four bodies were recovered and 12 remain missing following an avalanche at the base camp in Manang; improved weather is helping helicopter-assisted rescue operations. Floods & Power: Continuous monsoon rains have damaged NEA transmission and distribution lines, disrupting about 1,000 MW of hydropower generation and affecting multiple corridors and projects, with restoration teams deployed. Public Finance: Nepal’s public debt reached 45.05% of GDP (Rs 2.97 trillion) by mid-September, while debt servicing costs in the first two months of FY 2026/27 totaled Rs 85.01 billion. Market Watch: NEPSE fell 16.47 points to close at 2,613.33, with turnover at Rs 5.38 billion. Energy Policy: FNCCI and the Federation of Nepalese Chambers of Commerce and Industry urged the government to withdraw VAT on electricity tariffs, saying it raises production costs and strains working capital. Hydropower Standards: An NSP MP called for revising hydropower tunnel construction criteria to better handle disaster and improve emergency safety design. Transport Safety: The Infrastructure Development Committee directed safer, orderly public transport during festivals, including vehicle checks, anti-overloading controls, and tighter ticketing rules. Court & Cyber: Kathmandu District Court granted three days’ custody to medical entrepreneur Durga Prasai for investigation after a complaint linked to social media remarks. Business & Investment: Finance Minister Dr. Swarnim Wagle met AIIB President Zou Jiayi in Doha, urging more concessional financing and support for post-flood reconstruction.

Himalayan Weather Disaster: Torrential rain and landslides across Nepal have killed at least 21 people, with 5 missing and 5 injured, damaging 260 homes and forcing about 3,000 residents from high-risk areas. Power Shock: Floods and damaged transmission lines have disrupted electricity generation and supply by around 900–1,303 MW, halting output from multiple hydropower projects and affecting the Kaligandaki corridor. Avalanche at Himlung Himal: An avalanche hit the Himlung Himal base camp in Manang, with two bodies recovered and around a dozen to 14 Nepali guides and kitchen staff still missing; rescue is slowed by bad weather. Hydropower Policy Debate: The August flood’s impact is reigniting scrutiny of Nepal’s hydropower push and climate risk, while an energy minister’s plan to reserve 2% IPO shares for security personnel has sparked controversy. Trade & Transport Disruption: The Jomsom–Korala road is completely blocked by landslides and heavy snowfall, disrupting cross-border movement. Finance & Diplomacy: Nepal’s foreign minister met Serbia in New York, and India’s FM Nirmala Sitharaman is set to attend AIIB’s Doha meeting, with bilateral talks including Nepal. Business & Consumer: TVS launched the NTORQ 150 scooter in Nepal at NPR 3,69,900, targeting young riders. Local Economy Hit: Taplejung’s Dobhan Bazaar suffered a second major fire in six years, gutting 10 houses and 17 shops.