Coal Imports Surge 53%: What It Means for Nepal’s Power and Cement Industry

Nepal’s coal imports surged by 53.2% in the first month of 2025/26, reaching Rs. 2.29 billion compared to Rs. 1.50 billion in the same period last year. Coal now accounts for 1.6% of total imports, showing its continued importance for Nepal’s industrial sector despite the country’s growing focus on hydropower and renewable energy.

Experts say the surge is largely tied to the cement and brick industries, which are among the largest consumers of coal in Nepal. With cement demand rising due to ongoing infrastructure projects, housing construction, and hydropower development, cement factories are importing more coal to fuel their kilns. Similarly, the brick industry, which still heavily relies on coal-fired kilns, has seen higher consumption during the peak construction season.

Another factor is Nepal’s slow transition to alternative fuels. While hydropower is gradually replacing petroleum in transport and households, industries like cement and bricks still lack large-scale alternatives to coal. This dependence exposes Nepal to global coal price fluctuations, rising import bills, and environmental challenges.

Economists warn that while coal is vital for sustaining current industrial output, heavy reliance could worsen Nepal’s trade deficit and environmental footprint. Policymakers face the dual challenge of supporting industrial growth while encouraging investment in cleaner technologies such as electric kilns, biomass, or waste-to-energy solutions.