Nepal’s interim government has introduced a major relief and austerity package to address the destruction caused by youth-led “Gen Z” protests earlier this month, which left more than 70 people dead and inflicted damage worth nearly half of the country’s GDP, according to local media.
Approved by the Cabinet, the package is aimed at stabilizing fragile economic sectors, helping recovery efforts, and ensuring continuity of business activities following the protests that toppled the elected government of former Prime Minister KP Sharma Oli. Businesses alone are estimated to have lost around 80 billion Nepalese rupees ($563 million), with nearly 15,000 jobs affected, particularly in the tourism sector.
Key measures include a 50% exemption on customs and excise duties for affected businesses to import furniture, machinery, and equipment, simplified tax procedures for uninsured losses, and access to reconstruction loans with extended repayment timelines. A Payroll Protection Scheme has also been introduced to safeguard jobs and prevent mass layoffs. Alongside these relief steps, the government has rolled out austerity measures, scrapping all small-scale provincial and local projects and halting funding for new initiatives this fiscal year.
