Nepal’s Foreign Trade Rises 18.8% to Rs. 1.66 Trillion in 2025

Nepal’s total foreign trade reached Rs. 1.66 trillion in FY 2025/26, marking a strong 18.8 percent year-on-year growth. This expansion reflects both rising imports and a significant boost in exports, showing how external trade continues to shape Nepal’s economy. Imports remained the dominant component, totaling Rs. 1.43 trillion, up 11.4 percent from the previous year. However, exports showed the most dramatic change, nearly doubling to Rs. 239.32 billion, a 95.7 percent jump, making it the strongest export performance in a decade.

India remained Nepal’s largest trading partner, accounting for 61.7 percent of total trade, followed by China with 16.8 percent and other countries with 21.5 percent. The sharp rise in electricity exports to India, combined with steady flows of agricultural and manufactured goods, significantly improved Nepal’s trade earnings. At the same time, higher imports of machinery, raw materials, and consumer goods fueled industrial activity and domestic demand.

Despite the growth, Nepal still faces a large trade deficit of Rs. 1.19 trillion, although the gap narrowed slightly due to strong export growth. This trend highlights the dual challenge: while Nepal is diversifying and scaling up exports, its dependence on imports—especially from India and China—remains high. Sustained reforms in logistics, market access, and domestic production capacity will be essential to reduce structural imbalances in trade.