KATHMANDU, July 24: Nepal’s trade deficit widened sharply by 16.63 percent in fiscal year (FY) 2025/26, reaching Rs 1.781 trillion, as import expenses surged far ahead of export earnings, according to the annual report of the Department of Customs (DoC).
The deficit stood at Rs 1.527 trillion in FY 2024/25. The import-to-export ratio climbed to 6.65, meaning Nepal imported goods worth Rs 6.65 for every rupee earned from exports. The ratio was 6.51 in the previous year, underscoring the country’s deepening trade imbalance.
Nepal’s foreign trade declines, trade deficit reaches over Rs 1...
Foreign trade expanded by 15.88 percent overall, but the growth was heavily skewed toward imports. Nepal imported goods worth Rs 2.096 trillion in FY 2025/26, up 16.20 percent from Rs 1.841 trillion a year earlier. Imports ranged from luxury items to daily consumer goods, reflecting the country’s rising dependence on foreign production.
Exports rose by 13.81 percent to Rs 315.29 billion, compared to Rs 277.03 billion in the previous year. However, exports accounted for only 13.07 percent of total trade, down from 13.31 percent, highlighting Nepal’s weak competitiveness in global markets. Imports dominated with an 86.93 percent share.
Trade experts warn that the structural imbalance persists despite repeated government pledges and strategies aimed at self-sufficiency and import substitution. Just days ago, the government unveiled a five-year strategic plan to reduce the deficit, targeting exports at 20 percent of GDP within five years.
Nepal recorded trade deficits with 134 countries in FY 2025/26. India remained the largest trade partner, with a deficit of Rs 1.210 trillion, followed by China at Rs 423 billion
