KATHMANDU (REUTERS) - Nepal temporarily banned public and religious gatherings and most transportation in its capital Kathmandu and surrounding areas on Wednesday (Aug 19), asking residents to stay home to control the spread of the coronavirus as cases surge.

The curbs will apply to Kathmandu Valley from Wednesday for a week, but could be extended, the government said, one day after the country reported its biggest daily spike in coronavirus cases. Transgressors will be fined US$5 (S$7) but could face up to three months in jail.

Nepal began to partially ease a nationwide lockdown in June, allowing some local transport to resume, but kept a ban on international and domestic travel in place while the country's famed peaks have remained closed to climbers.

"The running of private and public vehicles is prohibited in the district (Kathmandu)", the government said in a statement.

"No one should organise public or religious gatherings, fairs, celebrations and festivals," it said, urging the valley's four million residents to observe cultural events at home.

Only transport carrying essentials such as food items, as well as security and health workers will be allowed on the streets, the government said.

On Tuesday, Health Ministry spokesman Jageswar Gautam said more than 1,000 people had tested positive for the coronavirus and seven had died from Covid-19 in the past 24 hours, the highest single-day spike in cases.

The numbers took Nepal's total cases to 28,257 and the death toll from Covid-19 to 114.

Kathmandu Valley, which comprises the capital city and surrounding areas, recorded 205 new cases, a jump of around 10 per cent jump from the previous day.

The restrictions come as the Hindu festival season begins this week, with hundreds traditionally participating in gatherings in the country.

Some critics say the measures were not enough.

"A public health emergency must be declared to fast track measures like taking private hospitals on lease to treat coronavirus patients," said former health minister and opposition lawmaker Gagan Thapa, amid concerns that hospitals could end up overwhelmed.

The health ministry spokesman told Reuters on Wednesday there was no shortage of hospital beds, intensive care units, ventilators or testing kits.