Following the Nepal Oil Corporation’s reduction of fuel prices effective from midnight, the government is preparing to adjust fares for public transportation accordingly. According to Maniram Bhusal, Director of the Department of Transport Management, fare rates will be adjusted automatically based on changes in fuel prices. “We are calculating based on these factors and expect to issue a notification by evening,” Bhusal stated. He further explained that fare adjustments will be determined using 13 key indicators.
“These indicators include investment in vehicle procurement, expenses for drivers and conductors, maintenance costs, insurance fees, fuel expenditures, profit margins, and others. The fare adjustment corresponding to the share of these components will be determined,” Bhusal clarified. “For instance, a 5 percent decrease in fuel prices leads to a proportional adjustment in total costs. Since the price has dropped by more than 5 percent recently, we are moving ahead with the fare revision.”
The department manages fare adjustments for inter-provincial public transport and freight vehicles. Previously, on Baishakh 16 (around late April), the department increased fares by 5 percent. This hike was influenced by rising fuel prices caused by heightened conflict in the Middle East, following attacks on Iran by the United States and Israel, which impacted various regions of Nepal. Director Bhusal noted that, at that time, fares should have increased by 9.8 percent. “Considering difficult circumstances and public livelihoods, the Ministry agreed to limit the fare increase to 5 percent,” he said. “As a result, fare adjustments now may not reflect a decrease larger than this threshold. We are finalizing calculations and expect to issue the official notification by evening.”
Bhusal also indicated that decisions will be aligned with signs of fuel price stabilization. “The Middle East conflict continues to affect fuel prices; uncertainty remains,” he remarked. “Therefore, significant fluctuations are unlikely, and prices are expected to remain relatively stable. Fare adjustments will be made correspondingly over time.”
Some stakeholders have expressed dissatisfaction that Nepal Oil Corporation has not adjusted fuel prices according to international market trends. However, Sudan Prasad Dhungana, Deputy Director and Information Officer at the corporation, stated that price reductions were made solely based on the procurement cost.
Reductions in airfare are also anticipated. Due to a 40-rupee per liter decline in aviation fuel prices, fare cuts are expected. Nevertheless, Murali Dhar Joshi, General Secretary of the Airlines Operators’ Association, noted that fare adjustments have already been implemented. “Total airfare is determined based on fuel prices and fare components, and the adjustment process is automated,” he explained.
