After the Gen-Z protests, the RSP won 122 of 165 constituency seats in the March 2026 election and Balen Shah became PM. The Rs2.12tn FY2026/27 budget targets 7% growth and exit from the AML grey list.
What a Korean company can do now
Government · leader
Prime Minister Balendra (Balen) Shah (head of government, Rastriya Swatantra Party, sworn in 27 Mar 2026)
Key national agenda
- Early exit from the FATF grey list and financial reform
- 7% GDP growth with inflation under 6%
- Connect 670 MW hydro and 370 MW solar, lifting capacity to 5,535 MW
- Sovereign wealth fund and a 'Motherland Fund' for strategic projects (3-month fuel reserves, AI factories)
- Tech hub push, digital public infrastructure and centralised government software procurement
- 90% health insurance coverage within three years
Government programmes
FY2026/27 federal budgetRs2.12tn (allocated)
Recurrent Rs1.27tn (59.8%), capital Rs431.1bn (20.3%), financial management Rs422.6bn. Revenue target Rs1.4tn; financing gap Rs657.3bn (foreign loans 247.3bn, domestic 410bn)
Roads and urban developmentRs286.48bn (allocated)
Largest allocation, Rs286.48bn; Postal Highway Rs4.65bn, Pushpalal Mid-Hill Highway 65 km Rs2.16bn, Madan Bhandari Highway 25 km Rs1.46bn
Nagdhunga-Sisnekhola tunnelNot disclosed
98% complete, operations expected from mid-July 2026 (single source)
Grid connection expansionNot disclosed
Connect 670 MW hydro and 370 MW solar to reach 5,535 MW installed capacity
East-West Highway Hetauda-Narayanghat upgrade (ADB SASEC)Not disclosed
International bidding for three ADB-financed contracts (SHINER/OCB/PHN/01-03), closed 12 Oct 2026
Janakpur drainage and road improvement (ADB URLIP)Not disclosed
Drainage, road and footpath works under the Urban Resilience and Livability Improvement Project, bids closed 7 Jul 2026
Business opportunities
Consulting on centralised government software procurement and DPI
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Open this week
AML/KYC regtech solutions
Exiting the grey list is the government's top financial reform.
Nepal Rastra Bank, FIU, commercial banks
Joining the fintech marketplace
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Remote-work and IT outsourcing hub links
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PMO and scheduling for ADB road projects
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Korean support schemes
- KOICA grant aid (priority partner) · KOICA — Nepal is a priority partner country for Korean ODA; no new individual project was confirmed in this review.
- EDCF concessional loans · Export-Import Bank of Korea — Infrastructure loan programme; no new Nepal EDCF project was confirmed in this review.
Official notices
Office of the Prime Minister and Council of Ministers, Nepal
- 2026-05-29 Finance Minister Wagle presents the Rs2.12tn FY2026/27 budget
- 2026-03-27 Balendra Shah sworn in as PM and forms cabinet
- 2026-03-09 Election results: RSP wins 122 of 165 constituency seats
Disaster · conflict · epidemic
Stable 2026-11-07
Trekking permits to high areas suspended for 3 days over rain and blizzard risk from Cyclone Arnab (from 10/28)
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Agencies
Earth & space
Credit rating · FX
S&P not confirmed / Moody's not confirmed / Fitch not confirmed · K-SURE Not confirmed · NPR -2.8%
Sanctions
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No country-level UN, US, EU, UK or Korean sanctions programme was found.
