Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU – The Government of Nepal has announced a major reform agenda for the country’s capital market, including the phased introduction of intraday trading, short selling, and derivative instruments, while advancing the restructuring of the Nepal Stock Exchange (NEPSE).
Presenting the national budget for fiscal year 2083/84 at a joint session of the Federal Parliament on Friday, Finance Minister Dr. Swarnim Wagle said the government will strengthen the regulatory framework of Nepal’s stock market and make the capital market more investor-friendly, transparent, and technology-driven.
“The capacity of the regulator will be enhanced to make the capital market disciplined and investment-friendly. We will strengthen technology-based trading systems and investor protection mechanisms. The restructuring of Nepal Stock Exchange will be advanced, and instruments such as intraday trading, short selling, and derivatives will be introduced in phases,” Wagle said during his budget speech.
The announcement marks one of the most significant structural reforms proposed for Nepal’s capital market in recent years, potentially bringing the country’s stock market closer to international trading practices.
Under the plan, the government intends to modernize market infrastructure and expand financial products available to investors. Intraday trading will allow investors to buy and sell shares within the same trading session, while short selling will enable traders to profit from declining stock prices under regulated mechanisms. Similarly, derivative instruments are expected to provide risk management and hedging opportunities for investors.
The Finance Minister also announced a zero-tolerance policy against undesirable activities in the stock market, including share cornering and insider trading, which have frequently raised concerns among market participants and regulators.
In another significant policy shift, the government said it will create arrangements for companies listed in Nepal’s stock market to access foreign capital markets by issuing Global Depository Receipts (GDRs) after completing prescribed procedures.
The move is expected to improve access to international investment, strengthen corporate financing opportunities, and increase the global visibility of Nepali listed companies.
The budget announcement comes at a time when Nepal’s capital market has been demanding structural reforms, regulatory clarity, and modern financial instruments to improve liquidity, investor participation, and overall market depth. Analysts believe the successful implementation of intraday trading, derivatives, and short selling could significantly reshape Nepal’s stock market ecosystem and attract greater domestic and foreign investor interest.
For Nepal’s growing investor community, the reforms signal a broader effort by the government to modernize the financial system and position the country’s capital market for long-term growth.
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