Nepal Rastra Bank proposes phased plan for capital account liberalization

A new report by Nepal Rastra Bank outlines a five-stage roadmap toward capital account convertibility, building on full current account convertibility achieved in 1993/94. The plan prioritizes foreign direct investment in its initial phase, followed by opening share markets and government bonds to non-residents, and eventually moving toward a more flexible exchange rate regime beyond the current peg with the Indian rupee. The central bank has stressed the need for strong fiscal discipline and low inflation to ensure a smooth transition.