Weekly Economic Updates (6th September 2024–12th September 2024)
3 min readSep 13, 2024
- 77 Project Proposals for Start-up Enterprise Loans
The Industrial Enterprise Development Institute received 77 proposals for startup enterprise loans under the Startup Enterprise Loan Operation Procedure, 2081 B.S., which offers loans from NPR 500,000 to NPR 2.5 million at 3% interest with a five-year term, focusing on startups with less than 10 years in business.
(Source: https://english.aarthiknews.com/news/detail/17118/) - Banks Struggling to Expand Loans for SMEs
Despite Nepal Rastra Bank’s directive for banks to allocate 40% of total loans to priority sectors like agriculture, SMEs, and energy by mid-2084, many banks are struggling, particularly in the SME sector. The deadline has been extended with penalties for non-compliance.(Source:https://www.abhiyandaily.com/article/saanaa-tthaa-mjhaulaa-udyogmaa-tokieko-krjaa-vistaar-grn-bainklaaii-hmme) - NRB to Mop NPR 100 billion from Banking System
Due to excess liquidity, Nepal Rastra Bank (NRB) plans to mop additional NPR 100 billion through a bidding instrument on Sunday. This follows Rs 246.4 billion already mopped since the fiscal year began, with NPR 158.6 billion outstanding. The NRB aims to manage liquidity effectively with today’s operation.(Source:https://myrepublica.nagariknetwork.com/news/nrb-to-mop-rs-100-billion-from-banking-system/) - IRD Offers 10% VAT Refund for Electronic Payments at Restaurants and Bars
Customers will receive a 10% VAT refund for payments made electronically at bars, restaurants, and various hospitality businesses. The Inland Revenue Department (IRD) has introduced this incentive to promote electronic transactions, offering refunds on services provided by these establishments.(Source:https://myrepublica.nagariknetwork.com/news/ird-to-refund-10-percent-of-vat-for-payments-through-electronic-means-at-restaurants-and-bars/) - Nepal’s Tourism Sector Struggles with low Bookings and Uncertainty Ahead of Peak Season
As Nepal’s peak tourist season approaches, hotel bookings are alarmingly low. Traditionally high from mid-September to November, bookings are only at 25%. Rising travel costs, including VAT on airfares, and Nepal Airlines’ limited operations contribute to a bleak outlook for the season.(Source:https://myrepublica.nagariknetwork.com/news/tourism-sector-in-nepal-struggles-with-low-bookings-and-uncertainty-ahead-of-peak-season/ ) - IFC to Expand Investment in Nepal
The International Finance Corporation (IFC) plans to expand its investment in Nepal, as announced by Regional Director Imad Fakhoury during a meeting with Deputy Prime Minister Bishnu Poudel. Following a USD 100 million investment last year, IFC will focus on green energy, job creation, and economic growth.(Source:https://www.onlinekhabar.com/2024/09/1537292/ifc-to-expand-investment-in-nepal) - Joshi Pledges to Support the Government’s Target of Welcoming 1.6 Million Tourists
Deepak Raj Joshi, reappointed as CEO of the Nepal Tourism Board, aims to attract 1.6 million foreign tourists this fiscal year. Joshi plans to promote Nepal internationally and support the “Visit Decade” initiative (2023–2031). His previous term ended with 1.2 million tourists before COVID-19.
(Source: https://english.aarthiknews.com/news/detail/17150/) - Government Introduces Internal Revenue Mobilization Strategy 2081
The Government of Nepal has issued the Internal Revenue Mobilization Strategy 2081, covering fiscal years 2081/82 to 2085/86. The strategy aims to balance revenue collection with private sector goals, increasing the tax-to-GDP ratio to 23.5% and reducing the budget deficit to 6.5%.(Source:https://nagariknews.nagariknetwork.com/economy/1448298-1726031561.html) - KOICA Pledges USD 8 Million for Inclusive Rural Development in Bardiya, Nepal
The Korea International Cooperation Agency (KOICA) has pledged USD 8 million (NPR 1.07 billion) for inclusive rural development in Bardiya, Nepal. The project aims to enhance agricultural capacity, establish market linkages, and promote ecotourism for sustainable livelihoods.(Source:https://nagariknews.nagariknetwork.com/economy/1448260-1726015363.html) - International Agency for Nepal’s ‘Credit Rating’ in Kathmandu
Fitch Credit Rating’s team arrived in Nepal on September 11 to assess the sovereign credit rating, stalled by COVID-19. This rating is crucial for evaluating financial stability, attracting foreign investment, and influencing borrowing costs.(Source:https://ekantipur.com/business/2024/09/11/international-agency-for-nepals-credit-rating-in-kathmandu-21-33.html )
