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As the monsoon remains active nationwide, there is a possibility of rainfall across the country this afternoon due to the impacts of the monsoon winds. According to the Weather Forecast Division of the Department of Hydrology and Meteorology, most parts of Koshi, Madhesh, Bagmati, Gandaki and Lumbini Provinces and some parts of the remaining provinces are expected to receive light to moderate rain today. Likewise, there is the possibility of heavy rain along with thunderstorms in some parts of Koshi, Madhes, Bagmati, Gandaki and Lumbini Provinces. Light to moderate rain with thunder and lightning is likely at some places of Koshi, Madhes, Bagmati, Gandaki and Lumbini Provinces and few places of remaining provinces tonight, according to the Department. The Department has also cautioned one and all to apply precautions from the losses that could happen from the occurrence of heavy rain, lightning, storms, landslides and soil erosion.

The 20th National Paddy Day is being marked today across the country. The government in 2061 BS had decided to mark Ashad 15 of the Nepali calendar every year as National Paddy Day and Paddy Cultivation Festival. Rice plantation, eating delicacies like curd and beaten rice and participating in the traditional cultural programs like singing, throwing mud at each other and merriment are the major attractions of the day. Paddy is the major crop not only in Nepal but in entire South Asia. The government aims to attain self-sufficiency in rice production by conserving the land for paddy cultivation, promoting clean and healthy seeds, expanding irrigation facilities, and developing hybrid and disease-resistant varieties. Paddy is cultivated on 47 per cent of the total cultivable land in Nepal. Likewise, Prime Minister Pushpa Kamal Dahal has extended best wishes to all on this day stating that the government has been implementing different programs including expansion of irrigation supply, grants on chemical fertilizer and seeds, expansion of modern technology, research and development, among others to increase the production of paddy. The PM has also cautioned that the target of paddy production could be affected due to impacts of climate change--drought, heavy rain, scanty rain, natural disasters and spread of diseases--and pose challenges to our food security. Against this backdrop, the PM has underscored the need for development of climate-resilient species of paddy and development of new technology for the increment of paddy production to substitute import of rice and paddy in the country and remain self-reliant.  

Monsoon rains have begun. Water levels in rivers are rising, and so is power generation. The Nepal Electricity Authority (NEA) is instructing the private sector to reduce energy generation, citing low consumption. This indicates that there is adequate electricity in the system. However, households and industrial consumers have been experiencing intermittent power cuts for the past many months. Suresh Bhattarai, the spokesperson for the NEA and chief of the Load Dispatch Center, said intermittent power cuts are due to voltage issues and problems in several transmission lines. “Because of this, the energy generated in the country is going to waste,” he added. Nepal generates 800 MW of hydropower in the dry months. The country is currently generating 2,100 MW. The present demand is around 1,700 MW, which makes a surplus of 400 MW. Of that, NEA is exporting around 300 MW to India. NEA is allowed to export 452 MW to India. Citing the rise in energy generation, NEA verbally asked power producers to reduce generation about a week ago. The Independent Power Producers Association of Nepal (IPPAN), on the other hand, says that about 500 MW of hydropower generated by independent power producers is going to waste. “Some 500 MW generated by 29 plants of independent power producers is going to waste,” IPPAN President Ganesh Karki said. While the energy generated in the country is being wasted, the NEA hasn’t been able to provide sufficient electricity supply to industrial corridors in Banke and Birgunj. The sudden power cuts are affecting industrial productivity, says Anil Patwari, the president of the Birgunj Chamber of Commerce and Industries. “This has been the situation for the past many months. It would be easier for us if NEA cuts power supply by publishing a schedule,” he added. NEA has also not stopped electricity imports from India. According to NEA, it is importing a maximum of 87 MW from India at present. Mukesh Kafle, former executive director of NEA, said the utility has failed to synchronize its generation, transmission, and distribution system. “While making forecasts of electricity consumption, NEA needs to make investments to build transmission and distribution infrastructure,” he said. “We have already started to see problems.” NEA has already accepted that it was facing problems in distribution due to ‘structural issues'. Addressing an event recently, NEA Executive Director Kulman Ghising said although demand has increased, there have been problems in electricity distribution due to a low-capacity distribution system. “We can manage somehow this year, but our existing system cannot cope with the increased production and demand of the next year,” he added. According to Ghising, an investment of Rs 60m over five years is needed to improve the distribution system in the Kathmandu Valley. Similarly, Rs 500m would be needed to upgrade the distribution system all over the country. NEA needs around Rs 800bn over the next five years to upgrade distribution and transmission systems, according to Ghising. NEA has been saying that it has invested Rs 100bn to upgrade its distribution and transmission systems over the past three years. Despite this, the power supply hasn't been dependable. The cost of building a kilometer of a 400 kV transmission line comes to around Rs 100m. Similarly, it costs Rs 5bn to build a 400 kV substation and Rs 2bn to build a 125 kV substation. “Since we need to build infrastructure like these all over the country, a big investment is needed,” said Ghising. NEA has been signing power purchase agreements (PPAs) under the ‘take or pay’ system. But it has been signing ‘emergency’ PPAs with projects citing a lack of transmission lines. Under this arrangement, NEA pays for the power producer only if its alternative system supports the evacuation of power generated by hydropower projects. Such agreements have been signed for the purchase of a combined 500 MW. However, NEA is buying only around 250 MW at present. According to IPPAN Deputy General Secretary Prakash Dulal, power plants on the Dordi corridor are affected the most due to a lack of transmission. “NEA may not buy if its alternative transmission system doesn’t work,” he added. NEA has signed PPAs under ‘take or pay’ for 5,000 MW generated by independent power producers, while the process to sign PPAs for another 1,500 MW has begun. Plants having a combined capacity of 120 MW have been affected by floods and landslides. IPPAN has been saying that such ‘emergency’ PPAs won’t be acceptable to them. “NEA signed an emergency PPA two years ago, stating that it was for a few months only. But it is continuing the agreement for this year as well,” said IPPAN President Karki.

The disbursement of loans by banks and financial institutions (BFIs) to the country’s industrial sector has dipped in the first half of FY 2022/23. As industries across the country grappled with the prolonged liquidity crunch and interest rate volatility in the first six months, they took fewer loans from the BFIs. According to the Half Yearly Economic Activities Report (Integrated) 2022/23 Report made public by the central bank The BFIs’ loan disbursement to industries decreased by 6.9 percent to Rs 1343.37bn in the first half of the current fiscal year compared to the growth of 19.4 percent during the corresponding period of FY 2021/22. In the first six months of the last fiscal year, BFIs disbursed a total of Rs 1443.19bn to the industrial sector. According to the report, of the total loans, Bagmati Province has the highest share of 67.21 percent. The BFIs disbursed Rs 902.87bn in loans to the industries in Bagmati Province while Karnali Province has the lowest share of 0.39 percent (Rs 5.28bn). Of the total industrial loans disbursed during this period, 39.6 percent went to the non-food manufacturing industry, 20.1 percent to the agriculture and beverage industry, 20 percent to the electricity and gas industry, 13 percent to the construction industry, six percent to the metal industry and 1.3 percent to the mining industry. The disbursement of loans declined because industries’ overall capacity utilization took a beating in the first half of this fiscal. The interest rate volatility and surge in the prices of raw materials have hit the country’s industrial output in the first half of the current fiscal year. Industries in Nepal saw their average capacity utilization falling in the first six months of FY 2022/23 compared to the same period of FY 2021/22. According to the Half Yearly Economic Activities Report (Integrated) 2022/23 Report made public by the central bank, the average capacity utilization of industry in the first half of this fiscal stood at 43.07 percent compared to 48.3 percent in FY 2021/22. The central bank report shows the electricity, chocolate, and processed tea industries' capacity utilization was the highest during this period. The capacity utilization of the electricity industry stood at 93.19 percent, while that of the chocolate industry and processed tea industry stood at 85.59 percent and 85.39 percent respectively. The increase in the cost of doing business due to rising interest rates along with the decline in market demand has badly affected the operational efficiency of industries across all seven provinces. The report shows industrial production in three provinces housing the country’s major industrial corridors—Koshi, Madhes, and Lumbini -remained weak this year compared to last year. Except for Karnali Province, the capacity utilization of all six provinces remained below 50 percent while Bagmati and Sudurpaschim provinces' industries' efficiency increased marginally in this fiscal. The capacity utilization of industries producing vegetable ghee, mustard oil, soybean oil, rice, wheat flour, animal feed, biscuits, noodles, alcohol, soft drinks, synthetic fabrics, processed leather, paints, tablets, capsules, ointments, liquids, soaps, plastic goods has improved in the first half of FY 2022/23. Similarly, industries manufacturing cement, concrete, iron rods and sheets, aluminum products, electric wires and cables, tires and tubes, and leather shoes were better than the last fiscal. However, industries producing processed milk, sugar, chocolate, processed tea, beer, cigarettes, yarn, pashmina, garments, jute goods, raw leather, paper, rosin, dry syrup, bricks, steel products, GI wire, and GI pipe decreased during this period. Box 1 Industrial Loan Disbursement (First Six Months)

The much-talked-about electricity export from Nepal to Bangladesh could start from the third week of July. With the preparation for signing a tripartite agreement among Nepal, India, and Bangladesh reaching the final stage, government officials are hopeful for a milestone electricity trade deal. The top officials of the Energy Ministry and Nepal Electricity Authority (NEA) said preparations are being made to export Nepali electricity to Bangladesh from the start of the new fiscal year through a tripartite agreement within a week or two. India had finally given its nod for the use of an Indian transmission line for exporting Nepali electricity to Bangladesh during Prime Minister Pushpa Kamal Dahal’s recent India visit. Nepal and Bangladesh had agreed for a tripartite agreement with India for the export of 40 MW of electricity from Nepal to Bangladesh during the fifth meeting of the secretary-level Joint Steering Committee (JSC) on energy cooperation held in Dhaka in the third week of May. As Indian transmission lines had to be used to materialize the power export, both countries had decided to bring the Indian agency on board. As per the understanding, NEA, Bangladesh Power Development Board (BPDB), and NTPC Vidyut Vyapar Nigam Limited (NVVN) of India will finalize a tripartite deal. Energy Ministry Spokesperson Madhu Bhetuwal said that preparation for the tripartite deal has reached the final stage. “It will be signed soon,” said Bhetwal. Similarly, a senior NEA official said that the final draft of the power purchase agreement (PPA) has been prepared and sent to Bangladesh. “Once Bangladesh gives its nod on the PPA, the tripartite agreement will be signed,” he said. Nepal's quest for finding a market for its electricity beyond India was further emboldened after Bangladesh expressed readiness to import 40-50 MW of power from Nepal during the energy secretary-level JSC meeting of the two countries held in Kathmandu in the last week of August. Nepal and Bangladesh last year agreed to request India for the passage of 40-50 MW of electricity from Nepal to Bangladesh through the existing transmission infrastructure of India.   Final agreement on long-term power deal in Indian cabinet The draft of the final agreement on long-term electricity trade between Nepal and India has also reached the Indian cabinet. Once the agreement is endorsed by the Indian cabinet, the final agreement on long-term electricity trade between India and Nepal will be signed. Nepal and India had signed an initial agreement between Nepal and India at the energy secretary level on June 2 in New Delhi. During Prime Minister Pushpa Kamal Dahal's India visit, the southern neighbor agreed to buy 10,000 MW of electricity from Nepal in the next 10 years. Nepal has been requesting the southern neighbor for a long-term power trade deal arguing that an inter-government agreement would lock in the market and end the unpredictability of the Indian market’s availability for electricity from Nepal in the long run. As Nepal faces the risk of spillage of electricity in this monsoon season, it is also all set to export 200 MW of electricity to India under a medium-term five-year deal. The 200 MW deal is outside the existing quota of 452.6MW which Nepal is selling in the Indian energy exchange. The NEA has forwarded the list of five projects -Solukhhola (Dudhkoshi), Super Madi, Upper Balephi ‘A’, Dordi Khola, and Upper Chaku ‘A’—under this deal to India. The export of 200 MW will begin once the Indian authorities approve these projects, according to NEA.

The price of gold has dropped by Rs 600 per tola in the domestic market on Thursday. According to the Federation of Nepal Gold and Silver Dealers’ Association, the yellow metal is being traded at Rs 109, 400 per tola today. It was traded at Rs 110, 000 per tola on Wednesday. Meanwhile, tejabi gold is being traded at Rs 108, 900 per tola. It was traded at Rs 109, 500 per tola. Similarly, the silver is being traded at Rs 1,370 per tola today.

The Chitwan National Park (CNP) has banned commercial jungle drive (safari) inside the park from July 1 until further notice. The park banned the jungle drive, in view of forest tracks inside the park might be damaged, small streams inside the jungle might be flooded, roads might be obstructed due to fallen trees and there might be human casualty during the monsoon, the rainy season. A notice issued by the CNP Administration mentioned that operation of other tourism activities including boating has also been restricted. Information Officer of CNP, Ganesh Prasad Tiwari, said 65 jeeps have taken permission from CNP to operate jungle drive in the park. A total of 32 jeeps have taken permission to conduct jungle drive in the park from Sauraha, 15 from Kasara, nine from Meghauli, two from Ujauli, five from Amaltari and one from Madi, he said. With the beginning of monsoon, tourism activities conducted inside the park and in the river have been stopped. Tiwari said that the buffer zone management committee would decide about the activities to be carried out towards the buffer zone community forest.

Prime Minister Pushpa Kamal Dahal and National Assembly Chairman Ganesh Prasad Timilsina held a meeting at the former’s official residence in Baluwatar on Thursday. During the meeting, NA Chair Timilsina briefed the Prime Minister about his recent China visit and conversations held over there, NA Chair's secretariat said.