• From handloom artisans in Bhaktapur, to formally contracted delivery riders operating across Bharatpur, Biratnagar, and beyond, to agricultural and floriculture workers in Surkhet — ESP-supported ventures are creating meaningful jobs across Nepal.
• Through ESP, over 1,900 students and graduates received entrepreneurship training, and 62 ventures received collateral-free, interest-free seed financing averaging NPR 2 million each — helping young Nepalis turn ideas into income-generating businesses.
• With 500,000 young people entering Nepal’s workforce every year, ESP is helping higher education institutions go beyond traditional academics by partnering with the private sector, establishing business incubation centers at six universities, and equipping graduates with the practical skills the labor market demands.

As a graduate student of business management, Nistha Kayastha from Bhaktapur, Nepal, took a part-time job as an accountant at a textile company. It was there that she first saw the beauty of handloom weaving, a traditional and labor-intensive craft used to produce Nepali fabrics such as Pashmina and Dhaka.

What stayed with her most, however, was not only the craft itself but the women behind it. Nistha admired their talent but was saddened by how much they had come to undervalue their own skills. “They thought weaving was just something they did because they lack formal education,” she recalls. That realization inspired her to start Handmade Wonders, a handloom enterprise, to promote local crafts and create income opportunities for local artisans.

With training, mentorship, and seed funding from the Entrepreneurship Support Program (ESP), Nistha formally registered her business enterprise in 2024.

ESP is implemented by the University Grants Commission (UGC)with support from the World Bank-financed Nurturing Excellence in Higher Education Program (NEHEP). Launched in 2021, NEHEP aims to make Nepal’s higher education more relevant to the labor market and to help graduates move from education to employment.

Through ESP, selected institutions affiliated with the UGC provided entrepreneurship training to more than 1,900 students and graduates, including Nistha, equipping them with practical skills beyond academics to turn local ideas into income-generating ventures.

Nistha Kayastha with her master tailor Shova Suwal (left) and her mother Sangita Joshi (right)

Photo: Anuj Adhikary/World Bank

Today, Handmade Wonders exports Nepali textile products to the United States and France and employs 20 local women artisans, seven on a full-time basis and the rest as part-time and home-based workers. For many, the job has been a first step into the formal economy.

“Many of my employees’ first bank account was their salary account,” says Nistha. “I am glad the home-based workers can do paid work while managing caregiving responsibilities at home.”

Addressing the education to employment gap

In Nepal, the education sector has made significant progress in building human capital. The literacy rate climbed from 49 percent in 2001 to 76.2 percent in 2021, reflecting broader gains in access to learning. Higher education has expanded as well, encompassing over 1,400 institutions and enrolling 633,000students nationwide in 2025.

Yet this growth has not translated into labor market readiness: with approximately 500,000 young people entering the workforce annually and the youth labor force projected to reach 22 million by 2030, higher education institutions are falling short in equipping graduates with the technical and soft skills needed for the labor market. This skills gap, compounded by low labor productivity continues to constrain job creation and economic opportunities.

In this context, NEHEP’s ESP initiative is supporting higher education institutions in promoting innovation and entrepreneurship skills, empowering students to transform ideas into market solutions and transition seamlessly into jobs and enterprises.

Prabina Shah, founder of ArtSpace in Chitwan, Bharatpur

Photo: Anuj Adhikary/World Bank

Turning ideas into workable businesses

Across three cohorts, ESP supported 62 promising student and alumni ventures through a month-long training program led by private sector experts and mentors, followed by collateral-free, interest-free seed financing. Each venture received an average of NPR 2 million from a revolving fund. The funding is to be repaid by the ventures over an agreed period, allowing the funds to be recycled and support future entrepreneurs.

By July 2026, many ESP-supported ventures had moved from ideas to operating businesses. In Chitwan, Prabina Shah built ArtSpace Nepal, turning her passion for art into a profession while tapping into Nepal’s creative economy.

Prabina Shah, Founder of Artspace, Chitwan, Nepal

Anuj Adhikary/World Bank

• “ArtSpace is the first art studio in Chitwan to offer workshops, training, and other art services, reaching more than 500 students in just two years. It has also helped create jobs for 5 full-time and 4 part-time staff.”

ESP has supported not only start-ups, but also existing enterprises ready to expand. In Surkhet, AG Ventures used the support to scale its agriculture business and enter floriculture. The enterprise employs four staff on a regular basis and up to 10 workers during peak season.

Sanjina Giri and Prisila Giri, Co-founders of AG Ventures, Surkhet, Nepal

Photo: AG Ventures

• “ESP support enabled us to expand our small biofertilizer company into floriculture business. We also provide seasonal internships to high school students through which more than 500 students have gained practical knowledge in sustainable farming practices in the past three years.”

Mero Kinmel, a food and commodity delivery service that began in Bharatpur, also used ESP support to strengthen and grow its business to other parts of the country. It has created jobs for 65 people, including 55 riders, all of whom are formally contracted.

Santosh Kandel, Co-Founder of Mero Kinmel, Chitwan, Nepal

Photo: Santosh Kandel

• “As an alumni, the entrepreneurship support training helped me gain practical business management skills, and the seed funding helped us upgrade our website and apps, strengthen customer service, and open branches in two cities.”

Connecting higher education with opportunity

These stories show how higher education institutions can help students and graduates move closer to real employment and enterprise opportunities when they work with the private sector. With mentors from the private sector providing hands-on training for starting and operating businesses, students gain practical insights into navigating Nepal’s private sector, which employs over 85 percent of the total workforce.

ESP also shows how higher education can move beyond traditional academic pathways toward job creation and innovation. In addition to training and seed funding, ESP has helped establish business incubation centers at six major universities, helping students and institutions connect learning with enterprise development.

A broader push for job-ready higher education

While ESP is the focus of these stories, it is only one part of NEHEP’s broader effort to make Nepal’s higher education more responsive to the labor market. To strengthen the link between higher education, employment, and entrepreneurship, the project has supported labor market-driven academic programs, curriculum reforms aligned with workforce needs, faculty development, digital learning, and scholarships for students from lower-income families in underserved areas. Together, these efforts are helping make Nepal’s higher education system more relevant to the labor market and better able to contribute to economic growth.

These broader reforms matter because entrepreneurship support works best when students and graduates are connected to skills, institutions, mentors, and opportunities. By supporting young people like Nistha, Prabina, Sanjina, Prisila, and Santosh, ESP is helping Nepal’s youth move from education to entrepreneurship, and from ideas to enterprises that create jobs and drive growth.

“Credit: World Bank Group. All rights reserved”