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Senior representatives of Nepal’s private sector and government have called for greater priority to the automobile and mobility sector, higher capital expenditure, stable investment policies and stronger infrastructure as key measures to revive economic activity and create jobs.

Speaking at the inauguration of the NAIMA Nepal Mobility Expo 2026, which began in Kathmandu on Tuesday, President of the Confederation of Nepalese Industries (CNI) Birendra Raj Pandey said the government should accord high priority to the automobile and mobility sector because of its extensive contribution to revenue, employment, technology adoption and economic activity.

Pandey said the automobile sector serves as an important link connecting industry, business, technology and consumers. He said exhibitions such as the mobility expo not only provide consumers with information about new technologies but also highlight future opportunities and possibilities in the automobile and mobility industries.

Referring to Nepal’s economic performance over the past several years, Pandey said the economy had failed to progress as expected and that the effects of the slowdown had been felt across the private sector, government revenue, employment, production, trade and overall economic activity. He, however, welcomed signs of improvement emerging in the economy in recent months.

According to Pandey, the automobile sector has the capacity to make a significant contribution to government revenue while generating a large number of jobs. The sector is also directly connected with construction, infrastructure, energy, financial services, insurance, tourism and transportation, making it an important driver of wider economic activity.

“The automobile and mobility sector is capable of making a significant contribution to government revenue and creating a large number of jobs. It is directly connected with sectors such as construction, infrastructure, energy, financial services, insurance, tourism and transportation,” Pandey said.

He said the government must substantially increase capital expenditure if it is to achieve its 7 percent economic growth target for the current fiscal year. Higher capital spending, he said, would accelerate the construction and development of roads, bridges, energy projects, transportation systems and urban infrastructure, generating positive spillover effects across other sectors of the economy.

“To achieve the 7 percent economic growth target set by the government for the current fiscal year, it is necessary to significantly increase capital expenditure,” he said.

Pandey said the CNI has a clear position that the automobile and mobility sector should be given high priority by the government. He described automobile expos as more than platforms for promoting trade, saying they can help increase consumer confidence, introduce new technologies and promote electric and green mobility.

He also stressed the need to create employment opportunities within Nepal to prevent the country’s young workforce from leaving abroad. Describing the youth population as Nepal’s greatest strength, Pandey said increased investment in industries, infrastructure, information technology, green energy, tourism, agro-processing and mobility could create large numbers of quality jobs at home.

“Thousands of young people are compelled to go abroad every year. If investment is expanded in industries, infrastructure, information technology, green energy, tourism, agro-processing and mobility, a large number of quality jobs can be created within the country,” he said.

Pandey said the private sector has been calling for a stable government, policy stability, legal reforms and an investment-friendly environment. He emphasized the need to increase sustainable investment in infrastructure and productive sectors while promoting private-sector expansion and industrialization, saying such measures would strengthen the foundation for long-term economic transformation, employment generation and prosperity.

He also expressed confidence that the mobility expo would contribute not only to trade promotion but also to strengthening consumer confidence and encouraging the adoption of green and electric mobility.

Meanwhile, President of the Nepal Federation of Nepalese Transport Entrepreneurs, Punya Prasad Sitoula, called for a stable policy framework for electric vehicles (EVs), saying investors should be assured that major policies would not change for at least five to 10 years.

Speaking at the same inauguration ceremony, Sitoula said frequent changes in government policies whenever governments or officials change have placed businesses under considerable pressure. He stressed the need for a long-term, predictable and fair legal framework for the EV sector.

“We are asking the government for a clear, stable and fair policy for electric vehicles. Businesses investing in EVs should have a stable policy environment and investment protection for at least five to 10 years,” he said.

Sitoula also called for scientific studies of routes and passenger numbers before permits are issued for public transportation services. Public transport fares, he said, should not be determined on the basis of political decisions but through a scientific mechanism based on actual operating costs and reasonable returns.

He said the private sector has been facing difficulties because of a lack of coordination between the federal and provincial governments over fare determination and called for a clear policy and a one-window system for transport-related matters.

To accelerate EV adoption, Sitoula urged the government to introduce a policy requiring every petrol station across the country to install charging stations. He also called for substantial government subsidies and incentives to expand the charging network, particularly in rural areas.

“The government should provide subsidies and incentives to expand a safe and adequate charging network across the country,” he said.

Sitoula said the government should focus not merely on expanding the tax base but also on creating an investment-friendly environment for charging infrastructure to reach rural parts of the country.

He further drew the government’s attention to the high cost and limited availability of EV batteries and spare parts. He warned that fake and substandard spare parts were entering Nepal through the open border, increasing the risk of accidents, and called for stricter controls on their import.

“There should be arrangements to make batteries and essential spare parts easily available at affordable prices. The import of counterfeit and substandard spare parts must be controlled immediately,” he said.

Sitoula identified battery cost, safety and lifespan as some of the biggest challenges facing the EV sector and called for clear standards and long-term policies to address them.

“The government should establish clear standards regarding battery safety and lifespan and create an environment that increases the confidence of investors and consumers,” he said.

He also said he had discussed providing concessions on the import of spare parts for public transportation with the finance minister. According to Sitoula, battery lifespan and cost have become major challenges for businesses investing in the EV sector, making clear provisions on battery safety, quality and standards essential.

At the event, Department of Transport Management Director General Rajiv Pokharel said the government was preparing to introduce a new Transport Management Act aimed at making the transportation sector more organized, dignified and technology-friendly.

Pokharel said the draft of the new law had already been prepared. The existing legal framework, he said, is no longer adequate to address the requirements of federalism and the new technologies entering the transportation sector.

He also said the government had recently implemented the National Transport Policy 2083, which prioritizes an integrated transportation system, digitalization of transport services and digital mobility.

According to Pokharel, the government is preparing to make technologies such as GPS tracking, CCTV cameras and emergency bells mandatory in vehicles. The Department of Transport Management is also planning to introduce a public-private partnership (PPP) model for services including vehicle fitness testing and the distribution of pollution stickers.

The government expects the PPP approach to make transport-related services more accessible, efficient and effective.

Pokharel said the department was also studying the development of standards that would allow old diesel- and petrol-powered vehicles to be converted into electric or hydrogen-powered vehicles. Preparations are likewise underway to establish new national standards governing vehicle imports.

“Through the National Transport Policy 2083, the Department of Transport Management has prioritized integrated transportation, digital mobility, road safety and research,” Pokharel said. “Work is also progressing to make transport services more accessible through a PPP model with the private sector.”

He said the new Transport Management Act would regulate GPS, CCTV, emergency systems, ride-sharing and digital mobility in line with new technologies and Nepal’s federal structure.

“Standards for converting old diesel and petrol vehicles into electric or hydrogen vehicles, as well as national standards for vehicle imports, are also being prepared,” he said. “Overall, the government is moving toward making the transportation sector technology-friendly, safe, environmentally friendly and well organized.”

Pokharel said cooperation between the government and private sector would continue in the coming days, stressing that both sides must work together to stimulate economic activity and create employment opportunities.

Similarly, President of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), Anjan Shrestha, urged the government to provide incentives and concessions to the private sector to support industrial development and create a favorable environment for investment.

Speaking at the expo’s inauguration, Shrestha said the government must establish conditions conducive to investment, particularly at a time when businesses are facing financial pressures.

He expressed concern over the growing import of counterfeit and substandard automobile spare parts and batteries and called on the Department of Customs, Department of Transport Management and other relevant government agencies to strengthen monitoring and enforcement.

“Even when businesses want to invest in the current situation, they have to borrow money to do so. Therefore, the government should create an environment for private-sector investment and provide concessions and incentives,” Shrestha said.

He warned that Nepal should not be turned into a dumping ground for low-quality goods in the name of collecting government revenue.

“The problem of counterfeit and substandard spare parts and batteries entering the country is serious. Customs, the Department of Transport Management and other concerned agencies must strictly monitor this,” he said.

Shrestha emphasized the critical role of the private sector in employment generation. He said the private sector accounts for 86 percent of total employment in Nepal, while around 500,000 to 600,000 young people enter the labor market every year.

The government, he said, can provide employment to only a limited number of people, leaving the private sector to absorb the vast majority of new entrants into the labor market. He therefore stressed the need to create an environment that enables the private sector to generate jobs domestically and helps curb youth migration.

Shrestha also said Nepal currently depends on imports for around 70 percent of its goods, while only about 30 percent are produced domestically, highlighting the need for a new strategy to accelerate industrial expansion.

He called for greater promotion of assembly and contract manufacturing industries as a means of reducing import dependence. Nepal’s geographic position between India and China, he said, should be leveraged to establish domestic production of automobiles as well as other imported goods.

Shrestha argued that the government should focus on creating a competitive environment for private businesses rather than directly operating industries itself.

“The government’s job is not to do business but to facilitate business,” he said. “There should not be a dual policy in which government industries receive subsidies while private industries are forced to compete without similar support. Government and private-sector businesses should be given a level playing field.”

He welcomed the government’s efforts to revive closed state-owned industries such as the Hetauda Textile Industry, but said equal attention should be given to sick and struggling industries in the private sector.

According to Shrestha, a policy of reviving only government-owned industries while ignoring troubled private businesses would not be acceptable to the private sector.

“The government should also facilitate the reopening of closed and distressed private industries. The effort to operate government industries is welcome, but alongside that, a policy to revive private-sector industries that have remained closed for years should also move forward equally,” he said.

Such a policy, he argued, would make an important contribution to industrialization, employment generation and the creation of a more self-reliant economy.