On May 18, 2025 (Jestha 4, 2082, Sunday), Nepal witnessed major developments across its economic, political, environmental, and social sectors. From fiscal concerns and foreign investment to corruption cases and climate-related disasters, here are the top stories shaping the nation’s narrative.
Economic Concerns as LDC Graduation Nears
As Nepal prepares for its graduation from the Least Developed Country (LDC) status by 2026, significant concerns have been raised about the adequacy of the current budget. Industry, Commerce, and Supplies Minister Damodar Bhandari cautioned that the nation’s debt levels are mounting. In the past ten months, the government borrowed 390 billion rupees, while only 308 billion rupees were repaid, pushing the total outstanding debt to 26.22 trillion rupees.
Despite fiscal pressures, Nepal’s financial system remains liquid, with deposit interest rates declining. Credit growth showed a positive trend, with banks disbursing 367.60 billion rupees in new credit—marking a 7.1% increase for the fiscal year 2081/82.
Foreign Investment Shows Promise, Focus on Climate Finance
Nepal attracted 57 billion rupees in foreign direct investment (FDI) commitments over the past ten months, largely in services and tourism. FNCCI President Chandra Prasad Dhakal stressed the importance of facilitating private sector access to climate finance through global mechanisms like the Green Climate Fund.
Dhakal highlighted that legal reforms—over 30 amended laws and a proposed bilateral investment framework—aim to boost investor confidence. The country’s foreign exchange reserves now stand at 17.63 billion USD, signaling a stable macroeconomic environment.
Capital Market Slumps Despite Trading Uptick
The Nepal Stock Exchange (NEPSE) index declined for the sixth consecutive trading session, despite rising trade volume. Investors are pushing for policy changes, including making capital gains tax final and allowing stockbrokers to offer retail loans—moves expected to reinvigorate the capital market.
High-Profile Corruption Cases Surface
Anti-corruption efforts intensified with the filing of charges against eight individuals, including former Madhesh Province minister Vijay Kumar and former Bagmati Municipality mayor Bharat Kumar Thapa. The Sagarnath Forest Development Project is at the center of allegations involving the embezzlement of over 567 million rupees through illegal forest excavation and unauthorized fish pond construction.
In a related probe, the government is moving to nationalize 164 ropani of land associated with Shera Palace in Nuwakot. The CIB recommended that 163 of the 184 ropani be brought under state ownership, citing illegal exemptions and questionable transactions during the tenure of CPN Maoist Centre Chair Pushpa Kamal Dahal.
Meanwhile, the Supreme Court rejected bail for Ichcharaj Tamang, ex-MP and Civil Cooperative director, keeping him in detention amid a major financial fraud case. Authorities also seized significant quantities of gold at the Rasuwagadhi border.
Governance and Political Landscape
Nepal’s seven-party coalition government, led by Nepali Congress and CPN UML, faces criticism over slow development expenditure and a 211 billion rupee fiscal deficit. NC lawmaker Sanjay Gautam noted inefficiencies, while CPN Maoist Chair Dahal stated that party unification talks are progressing.
In Sudurpaschim Province, Nagarik Unmukti Party MP Rameshwar Chaudhary was sworn in as minister. Meanwhile, in Kathmandu, three ward chairpersons rejected mayoral committee roles assigned by Mayor Balen Shah, citing procedural disputes.
Climate Change and Environmental Disasters
The Sagarmatha Dialogue, focused on climate change and the Himalayas, concluded with a 25-point ‘Sagarmatha Call to Action’. The conference underscored Nepal’s vulnerability to climate impacts—despite its minuscule 0.027% contribution to global carbon emissions.
A Glacial Lake Outburst Flood (GLOF) in Humla’s Namkha Rural Municipality displaced 19 families, following the bursting of glacial lakes in the Thakara region. Lawmakers called for urgent disaster response and climate-resilient infrastructure.
Health Sector Demands and Reforms
MPs demanded improvements in organ transplant accessibility, particularly for kidney patients. Although laws permit organ donation from brain-dead individuals, implementation remains limited.
Hypertension was labeled a “silent killer”, raising alarms over public health awareness. The Shahid Dashrath Chand University of Health Sciences Bill, 2081 was unanimously passed, aiming to expand medical education. Meanwhile, cuts in foreign health aid are affecting maternal and child healthcare services, according to the Health Minister.
Slow Progress in Infrastructure Projects
The upgrade of Tribhuvan International Airport is underway, with an estimated cost of 15 billion rupees and a projected completion timeline of 1.5 years. However, the Kakarbhitta-Gaddachauki electric railway project faces delays, with costs escalating from 950 billion to 1.5 trillion rupees.
For the latest updates on Nepal’s economy, governance, climate action, health policy, and infrastructure projects, follow our ongoing coverage.
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