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The economic cost of the devastating Bhotekoshi-Trishuli flood is emerging as a far larger crisis than the destruction of roads, bridges, houses and power plants visible along the river corridor.

The devastating flash flood that swept through the Bhotekoshi-Trishuli River corridor on Aug 26 has escalated into one of the most economically damaging natural disasters in Nepal’s recent memory. Beyond a human toll exceeding 1,250 dead and nearly 4,000 missing, the floods destroyed important trade corridors, energy grid infrastructure, vibrant marketplaces, bank branches, government infrastructure, and private residences across Rasuwa, Nuwakot, and Dhading districts.

Insurance companies have received claims worth Rs 25.87bn, according to preliminary figures released by the Nepal Insurance Authority. It is expected to rise further once detailed assessments are made. However, they already exceed the Rs 23.20bn in insurance claims generated by the GenZ movement last year and are substantially higher than the Rs 16.09bn claimed following the 2015 earthquakes.

The insurance figure should not be mistaken for the flood’s economic cost. A large portion of damaged homes, public infrastructure, informal businesses and other assets were not insured. Nor do insurance claims capture lost income, interrupted trade, reduced electricity generation, disrupted tourism, additional government spending or the longer-term impact on investment.

The government has estimated that $4-5bn could be required for reconstruction and rehabilitation—equivalent to roughly 10 percent of Nepal’s annual economic output. 

The composition of the insurance claims provides an early indication of where the economic damage is concentrated.

Engineering and contractor-risk insurance accounts for Rs 20.5bn, or nearly four-fifths of the total claims. This largely came from operating or under-construction hydropower projects along the Bhotekoshi-Trishuli corridor. Property insurance accounts for another Rs 2.34bn, while motor insurance claims stand at Rs 1.55bn. Transport insurance claims amount to Rs 897.7m, while claims under other insurance categories total Rs 529.2m.

The Oriental Insurance has alone received claims worth Rs 13.04bn from eight insured parties. Shikhar Insurance has received the largest number of claims, with claims worth Rs 1.87bn from 127 insured parties.

Rs 50bn may be needed to rebuild roads, bridges

The Department of Roads (DoR) has estimated around Rs 30bn in damage to two strategic highways and said as much as Rs 50bn may be required to rebuild roads and bridges using more resilient technologies. 

Around 40 km of the Bidur-Rasuwagadhi section has been completely destroyed, while 31 bridges have been washed away, according to DoR’s preliminary study.  

Beyond the immediate cost of reconstruction, damaged road networks will have a long-term impact on the economy. Roads are the arteries through which fuel, food, construction materials and imported goods move. A sudden disruption in traffic movement can send prices soaring. 

The disruption of the Rasuwagadhi border point will also have a significant long-term impact on the economy. Nepal imported goods worth Rs 425.24bn from China in the last fiscal year, while imports through Rasuwagadhi alone amounted to Rs 45.74bn. In recent years, Rasuwadhi had emerged as the most viable customs point for imports of electric vehicles from China. With China also closing Tatopani border, the destruction of the border point means importers will have to route all imports through the Korala border in Mustang which is certain to put additional burden on end consumers.

The economic consequences of this can extend to Kathmandu’s supply chains and consumer prices, particularly ahead of the Dashain and Tihar shopping season.  

The flood has also struck one of the sectors Nepal regards as the foundation of its future economic growth. More than 12 percent of the country's installed electricity-generation capacity was estimated to have been affected, with projects including Upper Trishuli-1, Trishuli 3A, Trishuli 3B and Chilime suffering damage.

The damage has dealt a double blow to hydropower developers. In addition to the immediate cost of repairing generation infrastructure, they will lose revenue while the affected plants remain out of operation. Prolonged outages could make it more difficult for developers to service their debt, while banks that financed the projects could face increased credit risks.

For projects still under construction, the damage could be even more consequential. Reconstruction will require additional capital and may delay commercial operation, potentially weakening the investment cycle in a sector Nepal has been aggressively promoting.

The financial sector has not escaped the disaster. Banks operating in affected areas have reported direct losses of around Rs 600m. Fifteen of the 16 branches of 12 banks operating in the affected areas are completely damaged. Together, those branches had 78,204 depositors and Rs 4.50bn in deposits, while banks had extended Rs 2.43bn in loans, excluding lending to hydropower projects.

Tourism is another sector where the economic damage extends beyond destroyed assets. Minister for Culture, Tourism and Civil Aviation Khadak Raj Paudel has estimated preliminary losses of more than Rs 50bn when direct damage and potential future losses are considered. The floods damaged 142 hotels, 57 small restaurants and 141 tourism-related vehicles, along with 27 heritage sites and two mosques, monasteries, stupas and temples.

This is particularly important because tourism losses cannot be measured solely by the cost of rebuilding hotels or heritage structures. Damage to roads, trekking routes, cultural sites and perceptions of safety can affect visitor arrivals for months or even years.

The cost of rebuilding private homes, restoring highways and bridges, repairing hydropower projects, replacing public buildings, restoring border infrastructure and supporting affected households will be massive. Lost electricity revenues, interrupted trade, reduced tourism income, deterioration in bank loan portfolios and the fiscal cost of relief and rehabilitation is certain to have a long-term impact on the economy.

The death toll from the devastating Rasuwa flood has reached 1,331, according to the latest update from the National Disaster Risk Reduction and Management Authority (NDRRMA). The update, issued at 6 pm on Saturday, puts the number of missing people at around 5,000, including 589 foreign nationals.

The highest number of bodies have been recovered in Chitwan with 355, followed by Nawalparasi East with 218, Nawalparasi West with 212, Nuwakot with 177, Rasuwa with 127, Dhading with 60, Gorkha with 72 and Tanahun with 38. The figure includes unidentified human remains. So far, 95 bodies have been handed over to families.

Authorities say 12,038 people have been rescued. The Nepali Army has carried out 4,126 rescues, including 3,653 Nepalis and 273 foreigners by air, while 200 people were rescued by land. Nepal Police and the Armed Police Force have rescued 3,988 and 3,924 people, respectively.

A total of 21,402 security personnel have been mobilised for search, rescue and relief operations.

Meanwhile, 5,384 injured people have received medical treatment, including 3,206 treated by the Nepali Army and 1,874 by the Armed Police Force.

The government has provided Rs 160m in cash support—Rs 10m each to Rasuwa and Nuwakot, Rs 5m to Dhading, and Rs 135m to 15 affected local governments.

There are currently 3,844 people staying at holding centres in Rasuwa, Nuwakot and Dhading.

Relief operations are also continuing, with 69 trucks and 38 Boleros carrying food and relief materials dispatched to affected areas. The APF has transported relief supplies through 163 flights.

Fuel stocks in affected areas currently stand at 40,000 litres of diesel, 22,000 litres of petrol and 18,000 litres of aviation fuel.

Telecommunication services have also largely been restored, with all 110 damaged NTC towers back in operation, while 75 of 78 damaged Ncell towers have been restored.

The figures reflect the scale of the ongoing search, rescue and relief operation following the catastrophic flooding along the Rasuwa–Trishuli river system. Recent reporting has also highlighted continuing searches for people missing in hydropower tunnels and other heavily affected areas. 

Cleanup operations have begun in Belkhu Bazaar of Gajuri Rural Municipality-6, Dhading, where homes and sheds were buried in mud and debris following the floods.

The cleanup is being carried out under the leadership of Gajuri Rural Municipality Chairperson Ganesh Lal Shrestha, with the participation of municipal staff, personnel from the Nepali Army’s Shree Bhairav Gan stationed in Gajuri, and local youths.

Teams are removing accumulated soil, sludge and waste from inside homes and sheds affected by the floods. The rural municipality said the cleanup is being carried out at a rapid pace. Authorities have prioritised sanitation and rescue operations to ease the difficulties faced by local residents affected by the flooding.

An alternative road connecting Dhadingbesi, the district headquarters of Dhading, with the Prithvi Highway has been brought into operation after floods washed away the Furkhe Khola bridge at Malekhu. The Mashtar–Pipaltar–Parewatar alternative route, previously constructed by local authorities, was repaired and upgraded jointly by Siddhalek Rural Municipality and the Department of Roads under the federal government.

Badri Sharma, chief of the Nuwakot Road Division, said the road, which had been obstructed by heavy rainfall, was repaired and opened for vehicular movement. Jeeps, vans, Hiace vehicles, microbuses and Boleros can currently operate on the route. Further repairs and upgrades are underway to make the road suitable for larger passenger and freight vehicles, including buses, Sharma said.

Vehicles travelling from Dhadingbesi towards the Prithvi Highway can take the route from Parewatar through Pipaltar and Keureni to Mashtar. Vehicles travelling from the highway towards Dhadingbesi can cross the Trishuli River bridge at Mashtar and proceed through Keureni and Pipaltar to Parewatar.

Siddhalek Rural Municipality Chairperson Parshuram Khatiwada said the alternative route was opened after the main road was disrupted when the Furkhe Khola bridge was swept away by the flood. “For the time being, the road has been opened for smaller vehicles, while improvement work is being prioritised to make it suitable for larger vehicles,” Khatiwada said.

The death toll from the devastating floods in the Bhotekoshi River in Rasuwa has reached 626, while 2,426 people remain missing, according to the National Disaster Risk Reduction and Management Authority (NDRRMA). NDRRMA released the latest figures on Saturday morning, reporting that 626 people have died in the floods. In some cases, only partial human remains have been recovered.

The deaths have been reported from several districts: 13 in Rasuwa, 51 in Nuwakot, 45 in Dhading, 48 in Gorkha, 158 in Nawalparasi East, 47 in Nawalparasi West, 31 in Tanahun and 233 in Chitwan. Among those reported missing are 933 people associated with hydropower projects, 562 from Rasuwa, 115 from Nuwakot and 65 from Makwanpur.

The missing also include 517 foreign nationals, 27 police personnel, 45 Nepal Army personnel, 13 Armed Police Force personnel, 15 customs officials and four immigration officials. NDRRMA said 127 Nepali citizens residing abroad who had been visiting Nepal are also missing, along with three people associated with Langtang National Park. A total of 15,234 security personnel have been mobilised for search and rescue operations, while 4,451 people have been rescued so far, according to the authority.

Authorities in Chitwan are set to bury 229 unidentified bodies and human remains recovered from various locations following the devastating floods in the district.

The District Administration Office, Chitwan, said in a notice issued on Saturday that 233 bodies have been recovered so far, of which only four have been identified. The remaining 229 bodies and remains have deteriorated significantly and will be collectively buried.

The administration said the bodies were recovered from hospitals, holding centres and riverbanks and have deteriorated to the point that identification is no longer possible. Health experts have warned that the decomposition and spreading odour could increase the risk of disease outbreaks, leaving authorities with little option but to proceed with the burial.

Chief District Officer Ganesh Aryal said the decision was taken in accordance with the Unidentified and Unclaimed Bodies Management (First Amendment) Directive, 2083, following a decision by the District Security Committee on Friday. Aryal said DNA samples would be collected from all the bodies and detailed records maintained using identification numbers before the remains are buried. 

The bodies will be respectfully and securely buried at an open site in Devghat, located in Bharatpur Metropolitan City-1, he said.

The decision has, however, triggered anger among some bereaved families who have been searching for their missing relatives. Families have expressed concern that they may be unable to perform funeral rites if the bodies of their loved ones cannot be located and identified.

The administration acknowledged the difficulties caused to affected families and apologized for the inconvenience, saying the decision had been taken under unavoidable circumstances due to the condition of the recovered remains.

The Nepali Army rescued 208 people, including 43 foreign nationals, from flood-affected areas of Rasuwa on Saturday. According to the Army, its helicopter had rescued 208 people, including 38 Chinese and five Indian nationals, by 2:30 pm during rescue operations following floods in the district.

A joint team temporarily stationed in the area has also been working to rescue a group of people who have been trapped inside the tunnel of the Trishuli-3 hydropower project since Friday. The Army said the team is using equipment including a drilling machine in an attempt to locate the exterior section of the tunnel and facilitate the rescue operation.

More than 7,000 Nepali Army personnel have been deployed across the affected districts, where they are carrying out search and rescue operations, providing emergency medical treatment and managing recovered bodies, the Army said.

The government has sought specialised technical assistance from neighbouring countries for forensic examinations and the management of bodies recovered from disaster-affected areas, Foreign Minister Shishir Khanal said on Saturday.

Speaking at a press conference organised at the Ministry of Foreign Affairs, Khanal said Nepal had requested technical support from friendly neighbouring countries for rescuing people trapped inside disaster-hit tunnels, locating survivors, conducting forensic examinations and managing recovered bodies.

He said an 11-member tunnel rescue technical team from India has already been deployed, while a rescue team from China is expected to arrive soon. According to Khanal, Nepal has already received more than 57 tonnes of relief materials from India. Additional essential supplies are being sent by China, Japan, Australia and other countries, he said.

The government is also coordinating with foreign embassies to provide information to the families of tourists affected by the disaster and to facilitate the identification and repatriation of bodies, Khanal said. He added that authorities are continuously monitoring a lake formed by water accumulation downstream of the flood-affected area and assessing the potential risks it could pose through technical coordination between Nepal and the two neighbouring countries.

Khanal said the impact of the floods remained confined to certain areas and that most of Nepal’s major tourist destinations were safe and fully operational. “We are closely monitoring the situation and coordinating with concerned countries and agencies to ensure rescue, relief and recovery efforts,” Khanal said.