Economic Recovery Overview:
The Nepal Rastra Bank has indicated that the economic damage caused during the Janajiya (GENJI) movement is gradually improving. In its Bagmati Province Economic Activity Study Report, the central bank highlighted that the newly formed government’s focus on peace and security, good governance, and reconstruction after the movement had a positive impact on the economy.

Agriculture and Early Impact:
Although the late monsoon affected agricultural production, and economic losses were observed during the month of Bhadra due to the Janajiya movement, subsequent months have shown signs of improvement. The central bank noted that relief programs and incentives for affected businesses, along with an emphasis on reconstruction and governance, have helped revive economic activity.

Inflation Outlook:
The Rastra Bank reported that current inflation is low, and with falling prices of imported goods, consumer inflation is expected to remain within the target range.

Sectoral Growth Projections:

• Construction and Hydropower: The first quarter of the fiscal year is expected to see increased contributions from the construction and hydropower subsectors.
• Nagdhunga–Naubise Tunnel: Once operational, improved transportation is expected to enhance productivity.
• Hydropower Expansion: Upcoming projects in the national grid are projected to further support economic growth.

Potential Challenges:

• Industrial Supply Issues: Floods and landslides at the Rasuwa–Kerung border could negatively affect industrial supply chains.
• Infrastructure Damage: Floods and landslides at Bhote Koshi may cause short-term disruptions to infrastructure projects, including roads, bridges, hydropower, transmission lines, and tunnels.

Other Economic Indicators:

• Foreign Employment: The number of people going abroad for work is increasing, boosting remittance inflows.
• Tourism: Post-movement recovery has been observed in the tourism sector, with foreign tourist arrivals rising again.
• Infrastructure Progress: Overall, infrastructure projects are progressing rapidly, despite some localized setbacks.

Economic Growth Forecast:
According to preliminary estimates by the Rastra Bank:

• GDP Growth Rate for FY 2081/82: 4.6% (up from 3.7% last year)
• Sector Contributions: Agriculture 25.2%, Industry 12.8%, Services 62%

The report reflects a positive trajectory for Nepal’s economy, driven by government initiatives, infrastructure development, and sectoral improvements, despite some lingering challenges.