The government has reiterated its priority to complete the Kathmandu–Terai/Madhesh Fast Track and its link roads, despite the project continuing to fall behind its initial timeline.

Eight years after construction began, the Fast Track had achieved 45.16 percent physical progress as of mid-February. The Nepali Army, which is executing the project, has maintained that although the project was formally initiated in 2017, it entered the contract phase only in 2021 after Cabinet approval. Officials say this delay in procurement and contracting has significantly slowed implementation, preventing the project from meeting expected milestones.

The policy document states that the government will adopt measures to expedite completion of the Fast Track and ensure faster progress on associated infrastructure links, positioning it again as a key national priority project.

Alongside the fast track, the government has also reaffirmed its commitment to the East-West Electric Railway, one of the country’s most politically recurrent infrastructure promises.

The policy document states that construction of the East-West Railway will continue, while investment models will be studied for two major international corridors: Kerung–Kathmandu and Raxaul–Kathmandu railways. These projects are expected to play a strategic role in regional connectivity, though they remain at the planning and early construction stage.

The East-West Railway has been included in election manifestos of nearly all major political parties for decades, including since the early 1990s. However, despite repeated commitments, progress on the project has remained limited. While the Rastriya Swatantra Party (RSP) had not included it in its own election commitment paper, the government has now placed it among its priority infrastructure projects in the policy framework.

Work funded through Indian grants has also slowed in recent years. Construction is ongoing in certain segments, including the Bardibas–Chocha section in Mahottari and Rautahat. According to official estimates, around Rs 28 billion has already been spent on the railway project. In addition, approximately Rs 24.5 billion is required for compensation to households affected along the alignment, which continues to be a major obstacle in advancing construction work.

The government has also announced plans to accelerate expansion and upgrading of the national road network, including the Postal Highway, Pushpalal Highway and North–South corridors. It has set an objective of ensuring all local levels are connected through all-weather road access.

“To accelerate infrastructure development, the Prime Minister’s Delivery Unit will be strengthened and implemented in a mission-based model,” the policy document states. “An improved contract system and effective engineering standards will be ensured to complete large projects on time.”

The government has also proposed preparing an integrated national transport master plan that will bring together road, rail, water, ropeway and air transport systems under a unified framework. It also introduces the concept of an “investment express” mechanism aimed at faster resolution of infrastructure-related disputes.

Large-scale infrastructure projects in Nepal have long been affected by delays linked to compensation disputes, land acquisition hurdles and tree-felling approvals. The policy document acknowledges these constraints and proposes that detailed project reports (DPR), environmental clearances and land acquisition processes must be completed before budget approval to reduce implementation delays.

A “zero-day procurement policy” will be introduced to ensure procurement processes begin from mid-July, immediately after the start of the fiscal year. This is aimed at addressing the longstanding issue of concentrated public spending in the final months of the fiscal year, particularly in June.

“An open public procurement policy will be applied to large-scale purchases,” the document states.

Although the fiscal year begins in mid-July, government spending patterns have historically shown that a majority of contracts are awarded only by October or November, contributing to delays in project implementation and expenditure efficiency.

In the energy sector, the government has reiterated its target of producing 30,000 MW of electricity over the next decade. This target aligns with commitments made in earlier policy documents and political manifestos.

To support this goal, the government has proposed establishing a one-door approval system by revising existing laws related to energy, forests, land and environment. Energy developers say they currently have to deal with more than 23 different government agencies to develop a single project, which significantly slows investment and execution.

The policy document also states that private sector participation will be expanded across electricity generation, transmission, distribution and trade. At present, private developers are largely limited to generation, while the Nepal Electricity Authority (NEA) maintains a monopoly over transmission, distribution and electricity trading.

According to NEA data, 4,200 MW of electricity is currently connected to the national grid. However, peak demand stands at around 2,600 MW, while average demand remains close to 1,800 MW. This indicates a surplus generation capacity, though transmission constraints and seasonal fluctuations continue to affect utilisation.

The government has also stated that cross-border electricity trade agreements will be used as a mechanism to attract long-term investment into the sector. Nepal has already received approval to export 40 MW of electricity to Bangladesh and 1,000 MW to India.

The policy also proposes offering equity participation to residents of project-affected areas instead of cash compensation, a model aimed at reducing disputes while promoting local ownership. It further plans expansion of off-grid renewable systems, including solar, wind and micro-hydro energy, particularly in areas not yet connected to the national grid.

The Nepal Electricity Authority states that national electrification has now reached over 99 percent through a combination of grid, solar, wind and micro-hydro systems.

Ganesh Karki, president of the Independent Power Producers’ Association, Nepal (IPPAN), said the government’s target depends heavily on implementation capacity. “To meet the government’s goal, execution is essential,” he said. “The modality for achieving 30,000 MW must be clearly defined.”

He added that private developers are capable of delivering projects if the government develops transmission infrastructure and road access. He also stressed the need to open power purchase agreements to encourage investment.

In the transport sector, the government has announced plans to develop an electric mass transit system to improve urban mobility. It also aims to strengthen road safety through GPS tracking systems, AI-based traffic cameras, digital fine systems and stricter speed control mechanisms.

The policy document also proposes infrastructure for pedestrians and cyclists and states that detailed design work for Bus Rapid Transit (BRT) in Kathmandu will begin.

Within the first 100 days of the governance reform agenda, the government plans to bring at least 25 “Blue Bus” services into operation.

In the industrial sector, the government plans to expand special economic zones and establish industrial villages across the country. Over the past six years, industrial villages were announced in 120 local units, but only four were operational by mid-April 2025, according to the Ministry of Industry.

The policy document now proposes developing manufacturing and innovation-based industrial areas, including green garment villages, IT parks and agricultural production centres, with linkages to industrial tourism.

In agriculture, the government plans to fix minimum support prices for major crops before planting seasons, a practice already applied to crops such as paddy, sugarcane and coffee. The policy also proposes digitising subsidy payments to ensure direct transfers to farmers’ bank accounts.

Subsidies will be provided to private companies and cooperatives purchasing agricultural produce at minimum support prices. The Food Management and Trading Company will be strengthened to improve procurement and distribution systems.

The government also plans to promote branded agricultural products for export through improved storage, certification, branding and marketing systems. It has also proposed stronger regulation of pesticide import and use, coordinated across all three tiers of government, along with expansion of accredited testing laboratories at markets and customs points.

A land bank system will be implemented to bring fallow land into productive use, allowing access for youth, women, landless and small-scale farmers. Although the provision exists in legislation, implementation has remained pending for years despite repeated commitments in earlier policy documents.

The policy also focuses on soil health improvement, promotion of organic fertilisers, protection of biodiversity and support for indigenous crops. It further includes preparation of a revised national industrial policy by updating the Industrial Policy, 2010.

In trade and investment, the government plans to expand investment areas and prepare a project pipeline through public-private partnerships, with clearer frameworks on risk sharing and agreements.

A women entrepreneurship development strategy will also be introduced, alongside policy and institutional reforms in the mining and minerals sector, which the government aims to develop as a foundation for broader economic growth.