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The banking sector is witnessing a steady rebound in credit growth, buoyed by rising foreign trade and increased loan demand across key sectors. According to a recent report from the Nepal Rastra Bank (NRB), private sector credit from banks and financial institutions grew by seven percent, reaching Rs 5,534.77bn, during the first nine months of the current fiscal year 2024-25. This reflects a credit disbursement of Rs 361.3bn between mid-July 2024 and mid-April 2025.

Credit growth had stood at 5.1 percent in the same period of the previous fiscal year, pushing the total credit portfolio to Rs 5,167.17bn in mid-April last year. On a year-on-year basis, credit disbursement grew by 8.3 percent in mid-April.

This uptick marks a turnaround from the sluggish loan expansion seen in recent years, which had eroded bank profitability. Amid a deposit surge and subdued credit growth, the banking system was left with excess liquidity, pushing interest rates to historic lows. In mid-April, the average interest rate on loans from commercial banks fell to 8.22 percent, down from 10.55 percent a year earlier. Development banks and finance companies saw similar declines, with average lending rates dropping to 9.59 percent and 10.40 percent, respectively.

Slow credit expansion in previous fiscal years was largely attributed to the phased rollback of covid-era relief measures, including loan moratoriums and subsidized interest rates, by the central bank. As the economy stabilized, these supports were withdrawn, leading to cautious lending practices and tepid credit demand from businesses.

However, the latest data signals renewed momentum in credit expansion. Foreign trade has surged, with merchandise exports rising by 65.5 percent to Rs 188.2bn, and imports increasing by 12.2 percent to Rs 1.309trn in the nine-month period. This has triggered a spike in demand for import loans, which grew by a robust 60.6 percent by mid-April. Working capital loans and margin-based loans also recorded strong growth of 17 percent and 37.8 percent, respectively. In addition, credit expansion was driven by increased borrowing in real estate, stock market investments, and vehicle purchases.

Credit flow to the production sector rose by 9.6 percent, construction by 11.4 percent, transportation, communication and public services by 10.2 percent, and service industries by 8.6 percent. During the review period, term loans increased by 4.9 percent, margin nature loans by 37.8 percent, trust receipt (import) loans by 60.6 percent, hire purchase loans by 4.1 percent, cash credit loans by 5.2 percent and real estate loans (including residential personal home loans) by 4.9 percent.

Despite the rebound in credit activity, banks continue to grapple with excess liquidity. The banking system recorded a 5.7 percent increase in deposits, totaling Rs 368.47bn, while remittance inflows rose by 10 percent to Rs 1,191bn during the same period. This has left banks and financial institutions with a stockpile of loanable funds.

The NRB absorbed a total of Rs 17,186.15bn from the market, comprising Rs 2,212.05bn through deposit collection auctions, Rs 14,974.1bn via the Standing Deposit Facility (SDF) and Rs 2.7bn utilized under the Overnight Liquidity Facility, over the first nine months of the current fiscal year. In contrast, the central bank had absorbed Rs 766.19bn in net liquidity through various monetary operations in the same period of the previous fiscal year.

The UN Support Mission in Libya (UNSMIL) has urged all parties to de-escalate tensions in Tripoli following reports of armed mobilization.

In a statement on X, UNSMIL called for restraint and dialogue, stressing the need to protect civilians and support local peace efforts, according to Xinhua.

Local media reported seeing military vehicles and fighters throughout the city. There have been no official statements made.

Since Muammar Gaddafi's fall in 2011, Libya has been divided between opposing regimes in the east and west, Xinhua reported.

UK and European foreign ministers met in London on Monday, reaffirming support for Ukraine but reaching no major breakthroughs.

They promised a coalition for air, land, and sea help, as well as ongoing security guarantees. The European Commission, France, Germany, Italy, and Spain emphasized the importance of a ceasefire for diplomatic advancement, according to Xinhua.

UK Foreign Secretary David Lammy declined to address the sequencing of any potential ceasefire.

The gathering is a part of the planning for the UK-EU Summit in London on Monday, Xinhua reported.

An executive order signed by US President Donald Trump on Monday mandates that pharmaceutical companies match the prices of prescription drugs in the US with those in other industrialized nations, according to Xinhua.

The directive instructs Robert F. Kennedy Jr., secretary of health and human services, to establish a system that would enable Americans to buy drugs directly from producers at the best price available abroad, avoiding intermediaries.

 “We are going to pay the lowest price there is in the world,” Trump said. “Whoever is paying the lowest price, that’s the price that we’re going to get ”, Xinhua reported.

Targeting the significant pricing differential between the United States and other members of the Organization for Economic Co-operation and Development (OECD), a group of primarily wealthy countries, is the goal of the action. Brand-name medications cost more than three times as much in the US as in those other nations.

India's Prime Minister Narendra Modi has firmly asserted that the country will not be intimidated by Pakistan's nuclear weapons. In a resolute address to the nation on Monday, he emphasized that Operation Sindoor is still ongoing, describing the current pause in hostilities as only a temporary halt, according to The Hindu.

Speaking on May 12 in his first public statement since the commencement of the operation on May 7, Modi warned that India is closely monitoring Pakistan’s actions and will assess developments in the coming days before considering further military or strategic responses.

“We will not succumb to nuclear blackmail,” Modi declared, reinforcing India’s commitment to national security and regional stability, The Hindu reported.

Modi's words came amid rising tensions between the two nuclear-armed neighbors, with both sides exchanging harsh rhetoric following recent escalation.

Operation Sindoor is not just a name but it's a reflection of the feelings of millions of people of the country. Operation ‘Sindoor’ is our unwavering commitment to justice, PM Modi said.

Late night of 6th May and in the early morning of 7th May, the whole world saw this pledge turn into reality, he said.  He further said:  “Indian forces attacked terror hideouts in Pakistan and their training centers with precision. The terrorists had never imagined that India could take such a big decision. But when the country is united, endowed with the spirit of Nation First and national interest is paramount, then strong decisions are taken and results are achieved.”

“First, if there is a terrorist attack on India, a fitting reply will be given. We will give a befitting response on our terms only. We will take strict action at every place from where the roots of terrorism emerge.”

“Secondly, India will not tolerate any nuclear blackmail. India will strike precisely and decisively at the terrorist hideouts developing under the cover of nuclear blackmail.”

“Thirdly, we will not differentiate between the government sponsoring terrorism and the masterminds of terrorism. During Operation Sindoor the world has again seen the ugly face of Pakistan, when top Pakistani army officers came to bid farewell to the slain terrorists. This is strong evidence of state-sponsored terrorism. We will continue to take decisive steps to protect India and our citizens from any threat.”

Thirteen people were killed in a blast during the disposal of expired military ammunition in West Java on Monday, according to army officials. The victims included nine civilians and four military personnel, Reuters reported.

According to military spokespersons, the explosion occurred when the disposal was being completed, and an investigation is ongoing. Officials are also investigating why civilians were permitted near the site, which is frequently used for such operations.

Locals regularly assemble nearby to gather scrap materials left over from detonations. To reduce future risk, the area has been evacuated, according to Reuters.

This is the second such occurrence in less than a year; a similar explosion occurred in March 2024 at a military depot outside Jakarta.

Prime Minister Anthony Albanese was sworn in for a second term on Tuesday, following Labor's overwhelming election victory, which gave the party its highest majority since Australia's formation in 1901.

Labor secured at least 92 seats in the 150-seat House of Representatives, but the Liberal Party suffered significant losses. Former Liberal leader Peter Dutton lost his seat, and Sussan Ley was elected as the party's first female leader, as reported by Reuters.

Key cabinet roles remain unchanged, with Michelle Rowland appointed Attorney-General, Murray Watt as Environment Minister, and Tanya Plibersek as Social Services Minister.

Reuters claimed Albanese will travel to Indonesia and later to Rome for Pope Leo XIV’s inauguration, where he will also meet EU leaders to discuss trade.

President Donald Trump indicated on Monday that he may attend the next peace talks between Russia and Ukraine, which is scheduled to take place in Turkey on Thursday.

Speaking to reporters at the White House, Trump said he was hopeful about the outcome of the meeting. “I think you may have a good result out of the Thursday meeting in Turkey between Russia and Ukraine,” he stated, according to Reuters.

The president is scheduled to visit Saudi Arabia, the United Arab Emirates, and Qatar later this week. However, he indicated that he might change his travel arrangements. "I thought about flying over. I don't know where I'll be on Thursday. "I have so many meetings, but I was thinking about flying over there," Trump stated.