Finance Minister Swarnim Wagle on Friday said the Nagdhunga-Sisnekhola tunnel project would come into operation from mid-July, with 98 percent of construction work already completed.

Presenting the budget for fiscal year 2026-27 in the federal parliament, Wagle announced plans to expand burn treatment services at Bir Hospital and Kirtipur Hospital. The government also pledged free treatment for childhood cancer at government hospitals.

The government allocated Rs1.46 billion to blacktop 25 kilometres of the Madan Bhandari Highway and construct bridges under the project in the next fiscal year.

Wagle said Nepalis working abroad would be allowed to study through the Open University system. The government also plans to allow reputed foreign universities to operate campuses in Nepal.

The budget announced that education from school to university level would be made more innovation-and skill-oriented, while teachers would undergo competency assessments.

The government said 670 megawatts from hydropower projects and 370 megawatts from solar projects would be connected to the national grid, raising the country’s total installed capacity to 5,535 megawatts.

The budget also said a study would be completed to bring drinking water to Kathmandu from the Yangri and Larke rivers in Helambu, Sindhupalchok, following the Melamchi Water Supply Project.

The government allocated Rs37.17 billion for the drinking water sector.

Wagle said construction of the Pushpalal Mid-Hill Highway would be completed within the next three years. The government allocated Rs2.16 billion to upgrade 65 kilometres of road and complete five bridges under the project.

The budget allocated Rs286.48 billion for roads and urban development.

The government also announced plans to operate “Blue Buses” equipped with CCTV cameras across the country to ensure safer travel for women.

Among key health sector measures, the government said 25 types of medicines currently distributed free of cost would be produced within Nepal. It also aims to bring 90 percent of citizens under health insurance coverage within three years.

The quota system in higher education, including medicine, nursing and information technology, will be reviewed in the next fiscal year. The government also pledged to strengthen Nepal Drugs Limited to improve and expand healthcare services.

Wagle said the Postal Highway would be completed in the next fiscal year, with Rs4.65 billion allocated for the project.

The government also announced a new policy to promote and regulate the financial technology sector. Wagle said a “Fintech Marketplace” would be established under the direct supervision of Nepal Rastra Bank.