With the introduction of new arrangements for investment companies, especially targeting foreign investors, whether investment companies will be the new popular vehicle for investing in Nepal is a matter of curiosity. We have discussed briefly the previous and new arrangements for investment companies and what the new arrangement has to offer. Retracing back, it is equally important to understand what precipitated the government to introduce an arrangement like this in Nepal in the first place, how the arrangements have been introduced so far, along with their implications, and what is so advantageous about establishing investment companies as a vehicle for investing in Nepal. So, let's retrace our steps, shall we?

Here is our weekly economic bulletin highlighting the major economic updates of the week. The Asian Development Bank (ADB) has approved a $300 million loan to improve transport connectivity of the Kakarbhitta–Laukahi road in Nepal, enhancing trade routes with India and Bangladesh. Additionally, the International Finance Corporation (IFC) has invested $55 million in Siddhartha Bank to support small and medium-sized enterprises (SMEs). Also the central bank of Nepal has issued a treasury bill of NPR. 24.74 Billion. Nepal has also signed an agreement with Bangladesh to export 40 MW electricity. Economic growth seems to be a major concern as the economic growth rate is projected to decline in all seven provinces, with Bagmati experiencing the lowest growth rate at 1.04% and Gandaki the highest at 3.3%.

This weekly economic bulletin by Nepal Invests highlights various developments in the country's economic landscape throughout last week. The commitment of EU ambassadors to promote trade relations brings promising prospects for Nepal-EU trade ties. The waiver of custom duty on smartphones imported by Nepali migrant workers aims to facilitate communication and reduce financial burden while the Government is aiming to fully implement the MDMS. Then, there are concerns about inflation and the cost of living. To counter this and the economic recession, Nepal Rastra Bank has shown a bit of flexibility in its third quarter review of the monetary policy. Additionally, Nepal's remittance earnings have surged to a record high!

Inappropriate lending or loan sharking, known as “meter byaj” in Nepal, is an issue causing widespread financial devastation. It is not just about inappropriately charging higher rates of interest; loan sharks lend money at interest rates normally higher than the legal cap of 10%. One of the many inappropriate practices includes the loan sharks' refusal to accept principal and forcing borrowers to pay accumulating interest, leading to insurmountable debts. The newly enacted Ordinance has listed several acts that can constitute as inappropriate lending, such as preparing a deed with more money than actually lent, adding interest to the principal, charging higher interest than the principal amount, and threatening or assaulting the debtor to receive the disbursed loan amount. Inappropriate lending has complex origins, including the lack of access to financial solutions, lack of financial literacy, and vulnerability due to poor economic backgrounds. And in this article we discuss these issues in the light of the newly issued Ordinance by the Nepal Government.

Nepal is facing significant economic challenges after the data show that it has slipped into recession in nearly 60 years. But the government is clueless and seems to lack a clear strategy to tackle the issue and take strategic steps to address the situation and promote sustainable economic growth. Check out these recent developments from Nepal's economy during the last week.

Government of Nepal first introduced the concept of investment company, as a new vehicle for investing in Nepal a long way back. Shortly afterwards, the arrangement was repealed before it could bear any fruit. After a few years of void, in 2078 B.S., government introduced the arrangement of investment company in a rather systematic manner. But the arrangement was again repealed after a year in 2079 B.S and a new set of arrangement was brought for the registration of investment company in Nepal. Now, what is the arrangement? Why all of these fluctuations for an arrangement? Why was the arrangement brought in the first place? And what are the possible implications of this arrangement?

This economic bulletin highlights various issues and developments in Nepal's economy over the last week. The country is likely to face a number of economic challenges amidst political instability. A lack of investment in critical sectors is hindering its economic growth. However, there are also positive developments. Read our weekly updates of the major headline from Nepal's business and economy with our own analysis and comments.

But is it really so? For a country that is always on a run to attract foreign investors, Nepal endeavors to bring alluring enough arrangements every now and then to cajole foreign investors. But do all the endeavors translate into proposed action? Well, let us look into this very recent development on Nepal’s foreign investment front to get the idea.

As expected, the NEPSE index indeed plummeted! But why? To know more on this and other updates from Nepal, share market, read our weekly stock market news picks of the week.

We bring you all the top headlines from Nepal's economy last week with a twist of our insights and analysis.