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The government has unveiled its policies and programmes for the upcoming fiscal year 2026/27, prioritising good governance, policy reforms, and qualitative improvements in public service delivery and accelerate economic recovery and promote social advancement.

President Ramchandra Paudel presented the government’s policies and programmes at a joint session of the Federal Parliament on Monday.

President Paudel said that the government had pledged to prioritise good governance as the foundation of a prosperous Nepal, adopting a zero-tolerance policy on corruption while launching nationwide campaigns to improve public service delivery, accelerate economic recovery, and promote social advancement.

Ensuring equal ownership and inclusion of all classes, regions, and communities, the government will engage in dialogue with political parties to identify common constitutional issues and prepare a “Constitutional Amendment Discussion Paper.”

The government will conclude the transitional justice process at the earliest possible time.

Through the policies and programmes, the government expressed its commitment to full implementation of the 100-point agenda for governance reforms.

The government has said that it will develop information technology-based service exports, hydropower, tourism, and high-value agriculture and green industrialisation as key pillars of economic transformation.

It is also mentioned that the economy dependent on labour exports will be transformed into a sector based on knowledge, services-oriented economy focused on digital trade, remote work and value-added services.

To upgrade Nepal to a respectable middle-income country, comprehensive legal and institutional reforms will be implemented under the "New Phase of Economic Reforms" to achieve an average real economic growth rate of 7 per cent over the next decade.

A fundamental restructuring of economic incentives will be undertaken to reduce production costs, simplify the business environment, remove policy and legal obstacles, and attract domestic, foreign, and diaspora investment.

An efficient institutional mechanism will be built to ensure continuity in national development priorities, project selection, and implementation, while ensuring a stable and predictable economic policy in the long term.

Tax and digital economy reforms

The tax structure will be reviewed to reduce the burden on entrepreneurs and middle-class families.

All financial transactions will be integrated into digital platforms, and the economy will be formalised into a cashless, transparent, and revenue-leakage-free system.

The tax system will be made business-friendly through voluntary tax compliance, technology-friendly revenue administration, and a fast tax dispute resolution system.

Double taxation avoidance agreements will be expanded with various countries.

The government has proposed that policies will be adopted to gradually convert fragmented charges such as pollution fees, infrastructure fees, and others into an integrated “green tax” system.

The government said that under-invoicing at customs points will be controlled.

The refund system for value-added tax and all other taxes will be made automatic and time-bound.

The policy and programmes said that that a “borderless economy” and “weightless trade” will be adopted as national economic strategies, and service exports based on information technology, hydropower, tourism, and high-value agriculture along with green industrialisation will be developed as key pillars for economic transformation.

Fully complying with international standards on anti-money laundering, a risk-based regulatory, supervisory, and prosecution system will be implemented.

The policies and programmes proposed that the capacity of the National Cooperative Regulatory Authority will be strengthened to regulate and effectively manage cooperative institutions.

An integrated Depositor Protection Fund will be established to return the savings of depositors in troubled cooperative institutions, and depositors’ funds will be returned through loan recovery processes.

The credit information system will be improved to control excessive borrowing, usurious lending (loan sharking), and financial crimes.

Public procurement, revenue and administrative processes will be made transparent, technology-friendly and competitive.

The government said that anti-corruption measures will be strengthened by identifying high-risk areas through the citizen trust and good governance perception index and digital audit system.

To make policy and planning based on facts and evidence, the National Planning Commission and the Policy Research Institute will be restructured and developed into competent and credible public think tanks and national policy institutes focused on research and monitoring.

Capital market, investment reforms

The capital market will be developed in a safe, competitive, and internationally compliant manner.

Reforms will be carried out in securities regulation, NEPSE, and the clearing system, while expanding the participation of institutional investors, pension funds, insurance companies, mutual funds, and Non-Resident Nepalis (NRNs).

A debt market, bond market, infrastructure bonds, and risk management instruments will be developed to build long-term capital formation.

The government said that an alternative development finance, diaspora capital, and private investment will be mobilised to implement a new model of infrastructure financing.

Foreign aid, loans, and private sector investments will be directed toward high-return projects.

Transformational projects will be implemented with clear objectives, fixed milestones, and strict timelines.

"Performance agreements will be signed with project heads, digital progress tracking will be introduced, and issues related to land acquisition and forest clearance will be resolved. A system will be established to ensure that key personnel responsible for projects are not transferred until the project is completed," said the policies and programmes.

The “Investment Express” policy will be implemented to complete processes from business registration to construction permits within 30 days.

The government has stated that laws related to foreign investment will be amended and an automatic approval route will be expanded.

The policies and programmes also mention that “Nepal Investment Visa” will be provided to foreign investors who invest above the threshold set by the government.

International payment gateways will be given legal recognition, and systems for bringing in foreign currency earnings and managing taxation will be simplified.

To enhance export competitiveness, market diversification, integrated trade strategy, and an industrial logistics master plan will be implemented.

According to the policies and programmes, public expenditure will be made result-oriented, with priority given to reforming public institutions, reducing costs, and ensuring efficient service delivery.

Public institutions will be classified, and a clear policy will be implemented to merge them, engage in partnerships with the private sector, bring in strategic partners.

The investment sector will be expanded, and project pipelines will be prepared through public-private partnerships, with clear frameworks for investment risk-sharing and agreements.

A “Women Entrepreneurship Development Strategy” will be formulated to make women-led enterprises more market-oriented.

To expand labour-intensive and export-potential industries such as agro-processing, tourism services, light manufacturing, and technology-based industries, “Employment-Oriented Production Zones” will be established.

Revival of rural economy, agriculture

The policies and programme said that Special Economic Zones will be expanded and “industrial villages” will be established with shared infrastructure.

The government has said that green garment villages, information technology parks, and agricultural production centres, along with other production-oriented and innovation-based industrial zones, will be developed, and such areas will be linked with industrial tourism.

Similarly, through the “Startup Nepal Portal,” services such as company registration, tax exemptions, and seed capital support will be provided within a single day.

Multi-sectoral investment will be promoted to revive the rural economy and to establish agriculture as a respectable and entrepreneurial profession.

The rural economy will be revitalised, and agriculture will be established as a respectable and entrepreneurial profession through multi-sectoral investment.

For increasing production, reducing costs, import substitution, and achieving food self-sufficiency, policy reforms, package-based production systems, mechanisation, digital technology, and agri-tech will be used to accelerate the modernisation of agriculture.

Integrated production zones will be developed, linking agricultural production with industry, processing, and marketing, and returnee migrant workers will be encouraged to engage in agricultural enterprises.

Through public-private partnerships, agricultural companies and collection centres will be established to reduce post-harvest losses and strengthen the supply chain.

The trend of leaving cultivable land barren will be discouraged, and access for youth, women, landless people and small and marginal farmers will be ensured through a land bank system to utilise unused land for productive purposes.

Access to concessional finance and technology will be expanded through farmer registration, identity cards, and credit cards.

Contract farming, cooperative farming, and agroforestry systems will be promoted.

Transform Nepal into a tech hub

The government has proposed that the information technology sector will be declared a national strategic industry, and exports of software, digital services, cloud services, cybersecurity, green computing, and AI computation will be promoted.

Digital parks, high-capacity data centres, and public digital infrastructure will be developed to advance Nepal as a tech hub.

The information technology export industry will be provided with financial concessions, investment facilitation, government co-investment, and tax incentives for research, development, and innovation expenditures.

The policies and programmes proposed that the Industrial Policy, 2067 will be revised and a new “National Industrial Policy” will be formulated.

To provide startups, micro, small, and medium enterprises (MSMEs) with integrated access to finance, technology, markets, and capacity development, a “National Enterprise Promotion Facility” will be established.

The Nepal Trade Integrated Strategy and the Trade Deficit Reduction Action Plan will be effectively implemented.

In the policies and programmes, issues such as the classification of public enterprises, collaboration with the private sector, capacity enhancement, and mergers have been mentioned.

Announce to celebrate Visit Nepal 2085

The government has announced that it will celebrate “Visit Nepal 2085" and the upcoming fiscal year will be used as a preparatory phase for the campaign.

The government has also announced structural reforms in the civil aviation sector.

The private sector participation in the sector would be improved and international safety standards implemented.

Tourist visas will be made fully online.

The government announced the installation of an e-gate system at international airports.

The government will also undertake diplomatic initiatives to enhance operations at Pokhara International Airport and Gautam Buddha International Airport.

The government has stated that at least 5,000 homestays will be connected to booking platforms in the upcoming fiscal year.

Infrastructure development

The upgradation and expansion of the national road network, including the Postal Highway, Mid-Hill Highway, and North–South corridors, will be accelerated.

The Kathmandu–Tarai/Madhes Expressway and its link roads will be completed soon.

All local levels will be connected to an all-weather road network.

To accelerate infrastructure development, the Prime Minister’s delivery unit will be strengthened and implemented in mission mode.

The government has proposed reviving public transport and road-related laws.

To ensure the timely completion of large projects, an improved tendering system and engineering standards will be effectively implemented.

The construction of the East–West electrified railway will be continued, and studies on investment modalities for the Kerung–Kathmandu and Raxaul–Kathmandu railway lines will be advanced.

In the long term, a transport system that is favourable, sustainable, and competitive will be developed.

The Integrated Urban Development Programme will be implemented, giving priority to municipalities with weak urban infrastructure indicators.

The government has set a target of producing 30,000 megawatts of electricity in the upcoming decade. The policies and programme said that environmental and forest laws will be amended to achieve this target.

Author: Laxman Kafle