01 JULY 2026, WEDNESDAY
Ashwin Ravikumar, R Shwetha, Sreekanishkaa GK, and Sreemaya Nair

Nepal: Budget causes rifts within Nepali Congress and CPN-UML coalition
On 01 July, The Kathmandu Post reported that debates regarding the budget for the next fiscal year are yet to commence in the provincial assemblies of Lumbini, Karnali, and Koshi, with a more intense deadlock in Sudurpaschim, which is governed by the coalition led by the Nepali Congress and the CPN- UML as its partner. The parliament proceedings have been stalled as the UML plans to register amendment proposals, stating that it refuses to endorse the budget as it contains serious procedural and technical flaws. There have been contradictory statements made within the ruling coalition, with the Chief Minister of Sundarpaschim, Kamal Bahadur Shah, stating that discussions regarding the budget are underway, and UML's parliamentary party deputy leader, Santosh Kumari Thapa stating that no discussions had taken place about the assembly meeting or budget deliberations. The UML has also accused the Nepali Congress of taking over the budget preparation despite both parties ruling the coalition.
("Budget process stalls in four provinces as rifts emerge within ruling coalitions," The Kathmandu Post, 01 July 2026)

Bhutan Opinion:
KP Sharma, "Policy U-turns raise concerns over long-term planning
"The frequent reversal of policies, programmes and development priorities by successive governments is emerging as a growing governance concern, with analysts warning that disruptions in policy continuity risk delaying national goals, increasing fiscal pressures and weakening institutional stability. While policy change is an inherent feature of democratic governance, the pattern of discontinuing initiatives introduced by previous governments reflects structural challenges in maintaining long-term continuity beyond political cycles."

Bangladesh: Election Commission expands smart NID coverage across the country 
On 01 July, Dhaka Tribune reported that the Election Commission (EC) distributed 73․6 million smart National Identity (NID) cards to voters in different parts of Bangladesh․ The EC's National Identity Card Wing reported that 87.6 million smart cards were sent from the Printing Press to the regional offices as of May this year․ Of these‚ 73․6 million cards were distributed and 13․9 million cards are yet to be issued․ They further stated that distribution of smart NID cards was yet to start in 115 out of the country's 404 electoral police stations or upazilas and around 55 million registered citizens were yet to receive smart NID cards․
("EC distributes smart NID cards to 73․6 million‚" Dhaka Tribune‚ 01 July 2026)

Myanmar: Regime rejects ASEAN envoy meeting request 
On 01 July, The Irrawaddy reported that Myanmar authorities denied a request by ASEAN's special envoy to meet with detained democratic leader Daw Aung San Suu Kyi․ Myanmar presidential office spokeswoman Khaing Khaing Soe said Suu Kyi had been prosecuted under the law and was serving sentences, preventing meetings with international representatives. She went on to say that permission could only be considered after her sentence. However, the permit request came after the Philippines, the chair of ASEAN, sought brief access for its Myanmar special envoy. ASEAN had kept Myanmar excluded from high-level summits since the 2021 coup, while its five-point peace plan had made limited progress.
(“Myanmar Regime Denies ASEAN Request for Daw Aung San Suu Kyi Meeting,” The Irrawaddy, 01 July 2026)

Sri Lanka: IMF says economy remains resilient despite Middle East shock 
On 01 July, Daily Mirror reported that the International Monetary Fund (IMF) said Sri Lanka’s economic recovery has remained resilient despite the impact of the Middle East conflict. IMF Mission Chief for Sri Lanka Evan Papageorgiou said higher energy prices and slower tourism had created challenges but strong revenue collection and steady economic growth had helped mitigate the impact. Continued fiscal and structural reforms will be important to sustain the country’s economic recovery, the IMF said. It urged the government to enhance tax compliance, restructure state-owned enterprises, upgrade public financial management and retain exchange rate flexibility to ensure fiscal and external stability.
("Sri Lanka weathers Middle East shock better than expected: IMF," Daily Mirror, 01 July 2026)

Sri Lanka: Deputy environment minister reaffirms commitment to climate resilience at UNESCAP 
On 01 July, Daily Mirror reported that Deputy Minister of Environment Anton Jayakody reaffirmed Sri Lanka’s commitment to environmental sustainability and climate resilience at the Ninth Session of the Committee on Environment and Development at the Ministerial Level, organised by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) in Bangkok. Jayakody commended the UNESCAP Secretariat for its work in promoting sustainable development and implementing the Ministerial Declaration on regional environmental cooperation. He also stressed the importance of collective action and enhanced regional cooperation to address environmental challenges and achieve sustainable development goals.
("Sri Lanka reaffirms commitment to sustainable environment at UNESCAP ministerial session," Daily Mirror, 01 July 2026)

Pakistan: Islamabad joins International Olive Council as permanent member
On 30 June, Dawn reported that Pakistan became a permanent member of the International Olive Council for the first time during its 123rd session in Lisbon, attended by 27 olive-producing countries. A Pakistani delegation highlighted the country's expanding olive sector, including the cultivation of more than seven million olive trees, over 55,000 acres under olive farming, 51 operational olive oil extraction units, and the establishment of IOC-standard laboratories. Pakistan also reaffirmed its commitment to promoting sustainable olive production and strengthening its role in the global olive oil market.
(“Pakistan becomes permanent member of International Olive Council,” Dawn, 30 June 2026)

Pakistan: GDP growth hits 3.7 per cent in FY26 - highest in four years
On 01 July, The Express Tribune reported that Pakistan's real GDP growth accelerated to 3.7 percent in FY2025-26, the highest in four years, with the economy expanding to USD 452.1 billion, according to the finance ministry's June Economic Update. Growth was broad-based across agriculture, industry, and services, with large-scale manufacturing growing 6.4 percent during July-April, compared with a 1.5 percent contraction the previous year, while agriculture grew 2.9 percent despite flood damage. The fiscal deficit narrowed, with a primary surplus of 3.5 percent of GDP during July-April, supported by a 10.3 percent reduction in current expenditure driven by a 21.9 percent decline in mark-up payments. The current account recorded a surplus of USD 255 million during July-May, with remittances hitting a record USD 4.25 billion in May 2026 and IT exports continuing to grow. Pakistan re-entered international capital markets through a Eurobond issuance after four years and successfully launched Panda Bonds. Average CPI inflation stood at 6.7 percent during July-May FY26, with May year-on-year inflation at 11.7 percent, and June inflation projected to remain in the 11 to 12 percent range. ("GDP growth hits 3.7%, highest in four years," The Express Tribune, 01 July 2026)

Pakistan: India ignores letters on Chenab fluctuations, complains Pakistan’s Indus Commissioner
On 30 June, Dawn reported that Pakistan Commissioner for Indus Waters Syed Muhammad Mehar Ali Shah revealed that he had written to his Indian counterpart four times about significant fluctuations in the flow of the Chenab River since India placed the Indus Water Treaty (IWT) in abeyance last April, but had received no response. Speaking at the same Islamabad seminar on the IWT, he said the data blackout was not a technical inconvenience but a strategic hazard, since without hydrological data Pakistan could not tell whether it was facing a natural event or deliberate upstream manipulation. He called for an immediate Indus Waters Commission meeting, full restoration of data-sharing and resumption of inspections. ("Indus commissioner says he wrote to Indian counterpart 4 times over Chenab fluctuations, but no reply so far," Dawn, 30 June 2026)