21-Point Action Plan: Big Reforms Set to Revive Nepal’s Capital Market

Nepal’s Ministry of Finance has introduced a 21-point action plan aimed at revitalizing the country’s sluggish capital market and boosting investment and liquidity. The plan includes reviewing banks’ share-investment limits and risk-weighting rules, reducing the minimum holding period for institutional investments to 45 days, and introducing capital gains tax relief and loss adjustment mechanisms. It also proposes reforms in IPOs, brokers and mutual funds, along with advancing tools such as margin lending, short selling and intraday trading. Legal measures to bring institutional funds and NRN investment into the secondary market are also planned, raising expectations of stronger market participation and liquidity.