Budget puts AI, health reform and infrastructure expansion at centre of policy push

Nepal's Finance Minister Swarnim Wagle presented a budget for fiscal year 2026-27 designed to propel the nation toward graduating from the United Nations' least developed country category. This transition will be supported by an intensive national economic and social transformation campaign, even as Nepal has met the minimum criteria for graduation.

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Nepal had already met the minimum criteria required for graduation from the least developed country status. However, he said the government had decided to pursue the transition over the next two years through an intensive national economic and social transformation campaign.

The budget outlines a series of ambitious projects, including a special initiative to prepare Nepal for the artificial intelligence era and a new bill to reform the visa system for investment-friendly immigration. Significant investments are planned for drinking water and sanitation, with deep-boring programs in Tarai-Madhesh, completion of 280 water projects in the region, and new projects in Damak, Dharan, and Itahari. A nationwide water testing campaign and wastewater treatment programs are also slated for introduction.

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the government would bring a new bill to reform the visa system and establish investment-friendly immigration management.

In the financial sector, the government will facilitate the listing of Nepali companies on foreign securities markets and restructure the Nepal Stock Exchange to enhance credibility. To expand democratic participation, legal and technical infrastructure will be developed to grant voting rights to Nepali citizens living abroad. The budget also doubles the child nutrition allowance for Dalit children to Rs1,000 per month.

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the government said it would facilitate the listing of Nepali companies in foreign securities markets and move ahead with the restructuring of the Nepal Stock Exchange to make the capital market more credible.

The health sector will undergo major restructuring of its insurance program, aiming for 90% citizen coverage within three years. Nepal Drugs Limited will be strengthened to produce 25 types of medicines currently provided free by the state. Infrastructure development includes the construction of 1,000 kilometers of blacktopped roads and 275 permanent bridges, with Rs17.64 billion allocated for the Kathmandu-Tarai/Madhesh Fast Track project. The long-delayed restructuring of Nepal Electricity Authority will proceed, dividing it into generation, transmission, distribution, and trade entities.

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the government said it would prepare the legal, technical and administrative infrastructure required to ensure voting rights for Nepali citizens living abroad.