NADA Delegation Meets Finance Minister to Address Automobile Sector Challenges

Nepal Automobile Sector Challenges

17th September 2025, Kathmandu 

A high-level delegation from the Nepal Automobile Dealers’ Association (NADA), led by President Karan Chaudhary, recently held a crucial meeting with the newly appointed Finance Minister, Rameshwar Khanal, to deliberate on the current economic state and the specific challenges faced by the country’s automobile sector.

Nepal Automobile Sector Challenges

This meeting marks a significant step towards a collaborative effort between the private sector and the government to stabilize and stimulate the economy.

During the extensive discussion, President Chaudhary underscored the urgent need for government action to restore business confidence.

He highlighted that the current economic climate and a general sense of instability have deterred investors from committing to new ventures in Nepal.

Chaudhary pointed out that the automobile sector, a major contributor to the national economy, is particularly vulnerable. He noted that the sector contributes a staggering 27% to Nepal’s total customs revenue, making its health vital for the country’s financial stability.

Key Issues and Recommendations

The delegation’s primary objective was to present a 22-point set of recommendations aimed at revitalizing the sluggish automobile business.

A key proposal was to increase the Loan-to-Value (LTV) ratio for hire-purchase loans on petrol and diesel vehicles from the current 60% to 80%.

This adjustment, if implemented, would make it easier for consumers to purchase vehicles, thereby injecting much-needed liquidity and demand into the market.

Beyond financial policy, the discussion also touched upon other pressing issues. Chaudhary demanded swift disbursement of insurance claims for the damages caused to property and vehicles by recent vandalism and protests.

He also raised concerns about the implementation of the Nepal Vehicle Emission Standard 2082, which he warned would inevitably lead to an increase in vehicle prices, potentially stifling an already weak market.

The delegation also shared with the government NADA’s strengths and weaknesses, expressing a strong desire for continued cooperation to navigate the current economic complexities.

Government’s Response and Pledges

In a positive response, Finance Ministry Secretary Ghanshyam Upadhyay provided assurance that the Tatopani customs point, which had been non-operational due to road damage, would soon reopen for vehicle entry, a move that would ease the import process for many dealers.

He also mentioned that the government would soon introduce an incentive package for entrepreneurs. Regarding the new emission standards, he assured NADA that a consultation would be held with the Ministry of Forests and Environment to discuss its implications.

Concluding the meeting, Finance Minister Khanal acknowledged the severity of the situation. He pledged that the government would carefully consider the suggestions put forward by the entrepreneurs.

He specifically mentioned that the government would collect data on the losses caused by recent protests and take appropriate action. Minister Khanal also assured the delegation that banks and financial institutions would be directed to provide necessary facilities to the sector.

He further added that the government would explore possible tax concessions and that many of the tax-related suggestions would be taken to the cabinet for formal discussion.

Acknowledging the heavy losses suffered by the automobile sector, he committed to staying in direct contact with entrepreneurs.

The meeting was attended by a host of NADA officials, including Vice President Nirakar Shrestha, Secretary Bikram Singhania, Treasurer Milan Babu Malla, Joint Treasurer Pankaj Agrawal, and central executive committee members Akash Golchha, Prakash Kapuri, Meghraj Paudel, Yamuna Shrestha, and Abhik Jyoti.

The collective attendance signals a unified front from the association in advocating for the revival of the Nepal automobile industry.

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