KATHMANDU: Economic Digest presents a brief yet comprehensive roundup of major business developments in Nepal, delivered in clear and accessible summaries.
Recent developments in Nepal highlight the country’s progress in climate adaptation, infrastructure recovery, food security and tourism, alongside persistent challenges in disaster management and public infrastructure. The Adaptation Fund’s approval of climate adaptation projects, with proposed funding of USD 44.9 million, offers opportunities to strengthen early warning systems, protect ecosystems and build resilient communities. However, effective implementation and timely access to climate finance will be essential to translate these commitments into tangible benefits.
Meanwhile, the estimated Rs 70 million reconstruction cost for the flood-damaged Beni–Darbang–Muna road underscores the economic and connectivity challenges posed by increasingly disruptive weather events. Restoring this vital route is important for local mobility, trade and access to public services.
Nepal’s planned tourism cooperation with India and the sharp increase in visitors to Mustang indicate opportunities to expand tourism markets and support local businesses. Nevertheless, seasonal road disruptions, traffic congestion and high-altitude mountaineering risks highlight the need for safer transport infrastructure, effective visitor management and stronger emergency response systems. The recovery of two Japanese climbers’ bodies from Mount Gangapurna also underscores the dangers associated with high-altitude expeditions.
In food security, Nepal’s improved Global Hunger Index score and declining child stunting rate indicate progress in nutrition. However, its moderate hunger classification signals that further efforts remain necessary. Overall, sustainable development will depend on coordinated investment in climate resilience, reliable infrastructure, tourism safety and long-term food security.
Adaptation Fund approves three climate adaptation projects for Nepal
The Adaptation Fund has approved three climate adaptation project proposals for Nepal aimed at strengthening vulnerable communities, protecting ecosystems through nature-based solutions and improving early warning systems for floods and landslides. The proposals were approved at the Fund’s 47th Board Meeting, which was also attended by Nepal’s representative on the Adaptation Fund Board, Naresh Sharma. Sharma said the projects would help communities exposed to climate change build resilience, conserve ecosystems and improve preparedness for climate-related disasters through stronger early warning systems. One of the approved proposals is the Green Koshi project, to be implemented by the National Trust for Nature Conservation (NTNC). According to Sharma, the Board approved the project’s concept note with a proposed budget of USD 9.92 million. The initiative aims to strengthen climate resilience and conserve ecosystems through nature-based solutions.
Reconstruction of Beni–Darbang–Muna road estimated to cost Rs 70 million
The reconstruction of the flood- and landslide-damaged Beni–Darbang–Muna road in Myagdi is estimated to cost around Rs 70 million. The road, which connects Mangala, Malika and Dhaulagiri rural municipalities in western Myagdi with the district headquarters, Beni, suffered extensive damage from floods, landslides and erosion along the Myagdi River following continuous rainfall from September 23 to 27. According to the Infrastructure Development Office in Myagdi, around 22 locations along the road from Beni to Muna, the administrative centre of Dhaulagiri Rural Municipality, have been damaged. Engineer Mohan Ruwali of the office said the disasters had washed away road surfaces and severely damaged gabion walls, retaining walls and paved sections.
Nepal–India tourism networking event scheduled for October 26–28
The Nepal–India Cross Border Tourism Connect 2026 will be held from October 26 to 28 through a joint initiative of the Non-Resident Nepali Association International Coordination Council and the Samriddha Chitwan Campaign. The event aims to strengthen tourism cooperation between Nepal and India, link Nepali destinations with international markets and establish direct business connections between tourism operators in both countries. Twenty-one tourism representatives from major Indian cities are expected to participate in business meetings, familiarisation tours and tourism package development. The initiative also seeks to develop an integrated regional tourism circuit connecting Lumbini, Ramgram, Devghat, Nawalpur and Chitwan, covering several local municipalities.
Minister Chaudhary announces approval of three climate projects worth $44.9 million
Minister for Agriculture, Forestry and Environment Gita Chaudhary has highlighted the approval of three climate adaptation projects for Nepal by the Adaptation Fund at its 47th Board Meeting. The projects have a combined proposed value of USD 44.9 million and are intended to strengthen climate resilience and reduce disaster risks. The allocations include USD 9.9 million for the Green Koshi project, implemented by the National Trust for Nature Conservation; USD 30 million for regional flood and landslide early warning systems through the International Centre for Integrated Mountain Development (ICIMOD); and USD 4.9 million for community resilience initiatives in Lumbini Province through the United Nations Human Settlements Programme (UN-Habitat). Chaudhary described the approvals as an important achievement that could help Nepal address the growing economic burden of climate change and strengthen disaster preparedness.
Nepal ranks 72nd in Global Hunger Index 2026, showing improvement
Nepal has ranked 72nd among 122 countries in the Global Hunger Index 2026, scoring 14.5 points and falling into the moderate hunger category. The score marks an improvement from 18.4 in 2018, indicating progress in reducing hunger. In South Asia, Sri Lanka ranks 53rd with 10.2 points, ahead of Nepal, while Bangladesh stands at 84th, India at 100th, Pakistan at 106th and Afghanistan at 108th. The regional average score of 23.5 remains above the global average of 18.1. Nepal’s child stunting rate among children under five declined from 55.9 percent in 2000 to 26.2 percent in 2026. Despite this progress, further efforts are needed to improve nutrition and food security. The index evaluates hunger through four indicators: inadequate calorie intake, child stunting, child wasting and under-five mortality. Lower scores indicate better outcomes.
More than 7,800 tourists visit Mustang in two days after Dashain Tika
Tourist arrivals in Mustang have increased sharply following the Dashain festival and the reopening of the Beni–Jomsom highway, which had been obstructed by monsoon-related landslides on September 27. According to police records, 5,663 tourists visited the district between Ghatasthapana and Vijaya Dashami, including 3,738 men and 1,925 women. Foreign nationals accounted for 4,409 visitors, or 77.85 percent of the total. Arrivals rose further in the two days following Dashain Tika, when 7,846 domestic and international tourists entered Mustang. Of these, 3,033 arrived on Thursday and 4,813 on Friday. Previous monthly figures recorded 30,534 visitors from mid-July to mid-August, at least 20,268 from mid-August to mid-September, and 18,601 from mid-September to mid-October. Local tourism businesses expect visitor numbers to continue rising at major destinations, including Muktinath Temple and Lo Manthang.
Heavy traffic congestion reported at Kathmandu Valley entry points
Major entry points into the Kathmandu Valley are experiencing heavy traffic as people return to the capital following the annual festive holidays. Traffic monitoring reports indicate long queues along key routes, including Nagdhunga–Kalanki, Jadibuti–Koteshwor, Jagati and Dakshinkali–Farping. Official transport records show that more than 576,000 passengers left the capital between Ghatasthapana and October 20 to celebrate the festivals with their families in their home districts. With holidaymakers returning, traffic police have increased monitoring and deployed personnel to manage congestion at major checkpoints. Under normal conditions, approximately 1,000 vehicles pass through the main checkpoints each day, but the continuing return of travellers is putting additional pressure on major roads and entry corridors.
Bodies of two missing Japanese climbers recovered from Mount Gangapurna
Rescue teams have recovered the bodies of two Japanese mountaineers from the southern slopes of Mount Gangapurna at an altitude of approximately 6,300 metres. The climbers went missing while attempting to ascend the 7,455-metre peak in Nyeshyang Rural Municipality-6. Helicopters and high-altitude rescue teams were mobilised after contact with the climbers was lost above 7,050 metres on October 15. Search teams initially found climbing equipment and backpacks along the route towards the summit. Local officials said preparations were underway to transport the bodies to Kathmandu for post-mortem examinations. Authorities will then coordinate with the Japanese Embassy in Kathmandu to facilitate the handover of the remains to the climbers’ families.