Nepal’s FY 2082/83 Federal Budget: Digital Governance and Infrastructure
In the budget speech for Fiscal Year 2082/83 (2025/26), delivered on May 29, 2025, Finance Minister Bishnu Paudel allocated NPR 7.72 billion to the Ministry of Communication and Information Technology—a modest increase from the current fiscal year’s NPR 7.25 billion. This allocation aims to advance digital rights, governance, and infrastructure, addressing the lag in Nepal’s digital economy, which the Minister attributed to insufficient innovation and underutilization of technology.
The budget outlines several initiatives to ensure citizens’ access to digital spaces, development of digital public infrastructure, robust cybersecurity mechanisms and frameworks. Notably, it proposes the formulation of the second edition of the Digital Nepal Framework, supported by NPR 740 million for developing digital infrastructure and ecosystems. This includes digital literacy programs to bridge the digital divide, with 85.43% of community schools already connected to the internet and 29.58% equipped with ICT labs.
Infrastructure enhancement plans include establishing an Information Technology Park in Kathmandu, upgrading the Integrated Data Management Center, expanding the Hetauda Disaster Recovery Center, and operationalizing the Kohalpur Data Center. Public-private partnerships will construct and secure data centers with land and electricity provisions and a feasibility study in the Mid-Hill region to attract foreign investment. Enhanced cloud systems and preparations for launching Nepal’s own geostationary satellite will improve national digital connectivity.
The Nepal Telecommunications Authority will be restructured to boost efficiency. A nationwide 4G expansion, phased 5G rollout (starting in Kathmandu and major cities), mandatory IMEI registration, and standardized hardware/software protocols—favoring domestic software—will streamline public IT systems.
To promote IT service exports, the budget offers a 75% income tax exemption and a final 5% tax for individuals in the sector. IT startups earning up to NPR 100 million annually will receive a five-year income tax holiday. The government will incentivize Industry 4.0 adoption and support innovation-driven startups to create youth employment. An incubation center, in collaboration with universities and the private sector, will nurture Gen-Z entrepreneurs.
Cybersecurity measures include quarterly advisories, completing a security printing center, and regulating social media and digital platforms. An AI Center, developed with private sector collaboration, will focus on AI and machine learning research and commercialization. Legal provisions will allow Nepali citizens to earn sweat equity for contributing specialized or technological services to foreign firms.
Banking and cooperative transactions will link to the national ID system, which will require family detail updates every five years. Telemedicine and digital health services will be expanded using AI and robotics, with the AI Center contributing to healthcare innovation. A child helpline will be integrated into the Nagarik App. The Make in Nepal, Made in Nepal campaign will boost domestic production. To enhance public ownership and transparency, 30% of Nepal Telecom’s shares will be opened to the public. NPR 211 billion is allocated to the Ministry of Education, Science and Technology, with a focus on virtual teaching, a digital learning portal, and technical training for 26,900 youths. Model technical schools will be established in all provinces. Financial reforms include mandatory annual KYC updates linked to national IDs, expansion of digital banking, introduction of cybersecurity insurance, and seizure of illicit cryptocurrencies. Public services will be digitized through the Nagarik App, offering free national ID services, digital citizenship distribution, and voter ID linkage beginning in Kathmandu.
Together, these initiatives—spanning infrastructure, AI, cybersecurity, innovation, and digital public services—aim to transform Nepal into a digitally empowered society. Their success will depend on political will, effective execution, sustained monitoring, and transparent governance. | | | Cabinet Approves IT and Cyber Security Bill to Present Before Parliament The government has approved a bill to regulate Information Technology and cyber security to be presented before parliament. In a cabinet meeting held on May 26, 2025, Minister for Communication and Information Technology Prithivi Subba Gurung was authorized to introduce the bill in the federal parliament. The bill will be registered soon and, once passed by both houses and authenticated by the President, will become law. Nepal’s Tech Leap: Economic Reform Implementation Action Plan 2082 The Government of Nepal’s Economic Reform Implementation Action Plan 2082 introduced this week outlines a comprehensive digital transformation strategy centered on local innovation, digital governance, and the development of a robust tech ecosystem. Key provisions include a mandate for government agencies to purchase software exclusively from Nepali IT firms within two years, a requirement for all ministries to retain data ownership within the state, and an update to the National IT Policy to incorporate emerging technologies such as AI, robotics, and the Internet of Things (IoT). The plan also prioritizes enhanced cybersecurity measures and the provision of stable power supply for data centers, among other initiatives. Press Council Nepal Urges Legal Compliance from Foreign Media
The Press Council of Nepal has urged all journalists, especially foreign ones, to obtain official permission before reporting in Nepal. It warned that unlicensed reporting violates laws and professional ethics. The Council raised concerns about recent cases of foreign journalists covering protests without permits and publishing biased or exaggerated reports. While reaffirming its support for press freedom, it called for responsible journalism that does not harm Nepal’s sovereignty, social harmony, or international relations. Supreme Court Urges Dignified Expression on Social Media Regarding Judicial Decisions
The Supreme Court has cautioned against defamatory and indecent remarks targeting judges and court decisions on social media, emphasizing that such conduct may hinder justice delivery. This warning came while upholding the High Court Tulsipur, Butwal bench’s order to remand Rastriya Swatantra Party Chair Ravi Lamichhane and Chhabilal Banjade. The joint bench of Justices Nahakul Subedi and Balakrishna Dhakal stressed the need for respectful commentary, noting growing trends of organized online defamation against judges. While constructive criticism is welcome, the court urged all to maintain sensitivity and dignity in public discourse. US President Trump Signs TAKE IT DOWN Act into Law
On May 19, 2025, President Trump signed the Take It Down Act into law to combat nonconsensual intimate images (NCII), including AI-generated deepfakes. The law criminalizes the knowing publication or threat of such content and requires platforms to implement a takedown system within a year. Victims can report NCII, and platforms must remove it within 48 hours. The FTC will oversee enforcement, and platforms are protected if they act in good faith. Though bipartisan support is strong, some privacy advocates express concerns about potential misuse and risks to encryption. The law complements Section 230, adding new responsibilities while maintaining certain platform protections. | | | Digital Rights Weekly is a week-based update on Digital Rights and ICT issues, that happened throughout the week, compiled and analyzed from the digital rights perspective by Digital Rights Nepal (DRN). DRN is a not-for-profit initiative dedicated to the protection and promotion of digital rights, including the right to online freedom of expression and association, online privacy, access to information, and related issues such as internet governance, cyber laws/policies, and cyber securities in Nepal. | | | |
