Education-Related Travel Deficit at USD −100M: Rising Student Outflow from Nepal

Nepal’s Balance of Payments (BoP) data for the first month of fiscal year 2025/26 reveals a massive education-related travel deficit of USD −100.9 million, underscoring the growing trend of Nepali students pursuing studies abroad.

According to the Nepal Rastra Bank, the country spent USD 102.8 million on overseas education payments, while earnings from foreign students studying in Nepal were negligible — just USD 1.8 million. As a result, the education deficit widened further from USD −110.4 million last year to USD −100.9 million this year, remaining a major drain on Nepal’s foreign reserves.

Economists say the increasing number of Nepali youths opting for foreign education reflects domestic policy weaknesses, including limited higher education opportunities, unemployment, and declining confidence in local universities.

While remittance inflows continue to offset the BoP gap, experts warn that the outflow of human capital could have long-term consequences. “Remittances may sustain the current account today, but we are exporting our future workforce,” one analyst remarked.

The Ministry of Education estimates that more than 130,000 students left the country for study permits in 2024/25 — a record high. With similar trends continuing into 2025/26, the education-related outflow is expected to cross USD 1 billion annually if unchecked.