Nepal's 21-point capital market reform plan, and what each deadline means.

What is Nepal's 21-point capital market reform plan?

The 21-point plan is an action plan the Finance Ministry published on 15 September 2026, setting dated deadlines for reforms to Nepal's capital market. It covers margin lending, intraday trading, securities borrowing and lending, short selling, a second benchmark index, exchange-traded funds, easier entry to the primary market, secondary-market access for non-resident Nepalis, and a cut to capital gains tax, which is already in force.

Two pressures sit behind it. The NEPSE index had fallen roughly 375 points since March, and the floods on the Bhotekoshi and Trishuli in late August damaged hydropower infrastructure belonging to listed companies, in a market where hydropower is the single largest group of scrips by count.

Every deadline in the plan

The dates below are the ones the plan states. It works in the Nepali calendar, where the end of Ashoj 2083 is mid-October 2026 and the end of Mangsir 2083 is mid-December 2026.

1. ImmediatelyUnderway
   • SEBON issues basic eligibility requirements for companies seeking to go public
   • SEBON publishes a bond market policy
2. Mid-October 2026Next
   • Finance Ministry approves the rules for margin lending, intraday trading, securities borrowing and lending, and short selling
   • Framework for green, disaster, social and environmental bonds
   • Policy for a secondary market in treasury bills
   • Amendments to the Foreign Investment Act and the Foreign Exchange Act submitted, for non-resident Nepali access
3. Mid-December 2026
   • A second benchmark index from SEBON, alongside the existing NEPSE index
   • Guidelines and infrastructure for corporate bonds, money-market instruments and exchange-traded funds
   • Rules for institutional investors aligned
   • Mutual funds repositioned as professional, diversified and transparent vehicles
4. Mid-January 2027
   • Margin trading launches through brokers
   • Sector-specific IPO eligibility rules for hydropower, manufacturing, hotels, agriculture and pharmaceuticals
5. Mid-March 2027
   • A study of institutional capacity at CDS and Clearing
6. No date givenUndated
   • The restructuring of NEPSE itself, which follows a task force's recommendations

Who has to act

The 21 points are spread across three bodies, which is part of why the dates slip. Nothing reaches a trading screen until all three have moved.

• Finance Ministry

  Owns the legal framework: the Securities Act amendments behind margin lending, intraday trading, securities lending and short selling, plus the tax proposals.

• SEBON

  Writes and issues the directives: IPO eligibility, the second benchmark index, bond and ETF guidelines, and the rules for institutional investors.

• NEPSE and CDSC

  Build and run the plumbing. A rule is only real once the trading system, the broker back office and the depository can carry it.

When will intraday trading and short selling start in Nepal?

The plan gives the Finance Ministry until mid-October 2026 to approve the rules for margin lending, intraday trading, securities borrowing and lending, and short selling, with the legal basis coming through an updated Securities Act. Margin trading through brokers is to launch by mid-January 2027. A deadline to approve a rule is not the day the feature appears in your broker's terminal.

These four together are the largest change in the plan for how a share is actually traded. Nepal's market is long-only and cash-settled today: you buy with money you have, and you cannot profit from a fall. Short selling and securities lending change both halves of that, and intraday trading removes the wait for settlement before a position can be closed. If those three words are new to you, start with what margin, intraday and short selling actually mean, which covers each one from the beginning and says which you can legally use today. Margin lending already has its own rulebook, the Margin Lending Directive 2082 that took effect in February 2026, and its classes and collateral rules are in the guide to that directive.

Is capital gains tax on shares in Nepal going down?

Yes, and it already has. The plan cut capital gains tax to 5% on shares held 365 days or less and 3.75% on shares held longer. Cabinet approved it and it took effect on 22 September 2026, when it was published in the Nepal Gazette. Your broker deducts the new rates at source on any sale from that date.

Note the direction of travel. The 10% and 7.5% rates were themselves an increase that took effect on 17 July 2026, when short-term went from 7.5% to 10% and long-term from 5% to 7.5%. The cut takes both below where they stood before that rise. The plan also mentioned working out gains net of losses; how that will apply had not been set out when this page was updated. The rise and the cut are covered in the page on the current rates, and any sale you model today should use the rate for its sale date.

What is the new NEPSE benchmark index?

SEBON is to introduce a second benchmark index by mid-December 2026, weighted by tradable shares, market capitalisation, the financial health of the companies in it, trading liquidity, corporate governance and the quality of disclosure. The existing NEPSE index continues as the all-equity measure, so the market will have two headline numbers rather than a replacement.

For an investor this matters mostly when comparing a portfolio against the market. An all-equity index counts every listed company at its full market capitalisation, including the promoter shares that never trade, which is why a handful of large scrips can move it in a session. A benchmark weighted by tradable shares tracks the part of the market you can actually buy.

Will ETFs be available in Nepal?

The plan targets guidelines and supporting infrastructure for corporate bonds, money-market instruments and exchange-traded funds by mid-December 2026. Mutual funds are to be made more professional, diversified and transparent over the same period.

Can non-resident Nepalis buy NEPSE shares under this plan?

The plan commits to submitting amendments to the Foreign Investment Act and the Foreign Exchange Act by mid-October 2026, so that non-resident Nepalis can take part in the secondary market. Until those amendments pass, secondary-market participation stays closed to them.

Is any of the 21-point plan law yet?

One point is: the capital gains tax cut took effect on 22 September 2026. The other 20 are government commitments with deadlines attached, not rules in force yet. Nepal has a recent example of the gap: the order-placement amendment was approved in April 2026 and only reached traders on 13 August 2026, as an after-market session rather than the round-the-clock ordering the announcement suggested. What that session actually is, is covered in the page on after-market orders.

The practical reading: treat each point as a date to check rather than a change to plan around. A rule approved in Kathmandu still has to reach the trading system, the broker back office and the depository before it changes what you can do with a share. Punji updates its calculators and screens when a rule takes effect in the market, not when it is announced.

Sources

• Government rolls out sweeping capital market reform plan The Kathmandu Post, 15 Sep 2026
• Govt revokes increased CGT on share transactions after NEPSE slump Republica, Sep 2026
• Capital gains tax rates reduced: decision published in the Gazette ShareHub (from Sharesansar), Sep 2026
• Nepse allows round-the-clock order placement as trading rules revised The Kathmandu Post, 16 Apr 2026
• NEPSE introduces After Market Order feature in TMS ShareHub (from Merolagani), Aug 2026