Nepal’s Export to India Surges Sharply in 2024/25 Despite Past Declines

Kathmandu, July 9 — Nepal’s exports to India have seen a dramatic turnaround in the first eleven months of the fiscal year 2024/25, reaching NPR 200.9 billion — a sharp 112.6% increase compared to the same period of the previous fiscal year, according to recent trade data.

This rebound comes after a year of sluggish trade, where Nepal’s total exports to India had dropped by 4.5% in 2023/24. The latest figures show a renewed momentum, especially in certain key commodities, indicating a robust demand from the Indian market and a recovery in Nepal’s production and export capacity.

Soyabean Oil Leads Turnaround

The standout performer is Soyabean Oil, which saw exports surge to NPR 93.5 billion in 2024/25, up massively from just NPR 901.8 million the previous year — a turnaround too sharp to ignore. This exponential rise played a dominant role in overall export growth, accounting for nearly 47% of total exports to India during this period.

Similarly, Polyster Yarn rose by 33.6% to reach NPR 11.1 billion, while Plastic Utensils jumped by 371.1%, albeit from a smaller base. Shoes and Sandals also did well, climbing 53% to NPR 1.73 billion.

Rebound in Traditional Items

Several traditional exports bounced back as well:

• Jute Goods - Hessian rose 41% to NPR 5.1 billion,

• Rosin rose 48.7% to NPR 1.88 billion,

• Tea saw a 36.9% increase to NPR 3.66 billion,

• Toothpaste maintained strong growth with stable NPR 688.8 million.

Pashmina and Textiles also registered growth of 20.3% and 20.3%, respectively, hinting at improved competitiveness in these sectors.

Decline in Key Agro and Industrial Products

However, not all commodities showed positive trends. Several major exports recorded heavy losses:

• Palm Oil, once a top export, plunged by 68.4% to just NPR 1.99 billion.

• Wire dropped by 81.8%, and Ginger declined by 64.9%.

• G.I. Pipe and Brans also saw sharp drops of 44.9% and 42% respectively.

Other declining categories included Thread (-34.7%), Juice (-8.6%), and Ayurvedic Medicine (-1.2%).

Sector-Wise Outlook

• The food and agro-processing sector remained mixed. While oilcakes and ayurvedic products held steady, exports of cinnamon, fruits, vegetables, and ginger declined.

• The industrial sector showed high volatility with steep losses in wire, G.I. pipe, and palm oil, counterbalanced by gains in textiles, polyster yarn, and jute hessian.

• The consumer goods sector, especially plastic items, toothpaste, and garments, recorded healthy gains.

Total Export Value and Implications

Overall, the total exports of major commodities (A) rose from NPR 75.1 billion in 2023/24 (eleven months) to NPR 166.9 billion in 2024/25, marking a 122.3% rise. "Others" (category B) also grew by 74.8%, pushing total exports (A+B) to NPR 200.9 billion.

This resurgence in export value signals a potential shift in Nepal’s export landscape, driven not just by traditional agri-products but also by diversified industrial and consumer goods. If this trend sustains, it could significantly narrow Nepal’s trade deficit with India.

Nepal’s export performance to India in 2024/25 reflects both opportunity and challenge. The spectacular rise in a few commodities, especially soyabean oil, has masked vulnerabilities in traditional sectors. Policymakers and exporters must now focus on sustaining gains while diversifying risks — to build a more resilient and balanced export portfolio.