NADA Slams NRB Monetary Policy 2082/83: Automobile Sector’s Expectations Unmet On Vehicle Loans, Imports
11th July 2025, Kathmandu
On Ashadh 27, 2082 BS, Governor of Nepal Rastra Bank, Mr. Biswo Nath Paudel, unveiled the monetary policy for the fiscal year 2082/83. However, the automobile industry association has expressed serious concerns over the policy’s lack of focus on the sector’s needs.
NADA Slams NRB Monetary Policy
The automobile sector feels the new monetary policy falls far short of their expectations. Despite repeated suggestions from industry stakeholders, the policy neither seriously considers nor addresses key issues impacting the automobile business in Nepal. Existing policies that require urgent reform remain unchanged. Crucially, no facilitation measures have been introduced to simplify vehicle imports. The policy continues to uphold outdated regulations related to luxury vehicles, heavy segment automobiles, and high-technology models.
While customs and tax exemptions for electric vehicles have been maintained as in previous years, the policy falls short in improving vital areas such as vehicle loan provisions, import procedures, and industrial recognition for the sector. Although the monetary policy promotes the adoption of electric vehicles and supports the development of green finance and sustainable transportation infrastructure, direct prioritization of credit flow for electric vehicles is absent. Instead, electric vehicle financing is treated merely as part of broader green initiatives.
On a positive note, the policy promises necessary amendments in the regulatory framework governing hire purchase loan companies. This includes the incorporation of the Fit and Proper Test, revised interest rate calculations, and service charge adjustments—steps welcomed by the automobile financing industry.
However, strict Loan-to-Value (LTV) provisions remain for vehicle loans, especially those for fuel-operated and luxury vehicles. Loan provisions for personal vehicle financing remain unchanged, signaling the continuation of restrictive lending policies. Though the policy acknowledges recent floods and border disruptions as challenges, it does not introduce new measures to ease vehicle import procedures. Nepal Rastra Bank has expressed willingness to coordinate with ministries and customs authorities, but concrete implementation actions are yet to be seen.
The monetary policy also lacks a clear roadmap or targeted reform programs aimed at the growth and upliftment of the automobile sector. While production-oriented industries have been given general priority, the automobile industry has not been explicitly recognized as a policy priority.
The automobile sector stresses the critical role it plays in promoting the electric ecosystem, creating jobs, and advancing Nepal’s industrialization. The industry calls on the government to urgently recognize the sector’s economic importance and provide clear, supportive policies to foster its sustainable growth.
Keywords: Nepal Rastra Bank monetary policy, automobile sector Nepal, vehicle import facilitation, electric vehicle finance Nepal, Loan-to-Value policy, hire purchase loans Nepal, green finance, sustainable transport Nepal, vehicle loan regulations, automobile industry policy Nepal
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