Export Share in Total Trade Climbs to 14.3% as Import Dependence Falls to 85.7%

Nepal’s foreign trade structure in FY 2025/26 shows signs of gradual rebalancing, as the export share in total trade climbed to 14.3 percent, up from 8.7 percent two years ago and 13.3 percent in 2024/25. At the same time, the import share fell to 85.7 percent, compared to 91.3 percent two years earlier. This shift reflects the sharp rise in exports, which surged by nearly 95.7 percent in FY 2025/26, outpacing import growth of 11.4 percent.

The improvement is largely driven by record-high exports to India, which now absorb over 81 percent of Nepal’s total exports, especially electricity, agricultural goods, and some manufactured items. Meanwhile, exports to China and other countries remain subdued, limiting broader diversification. Imports are still dominant, led by machinery, industrial inputs, petroleum, and consumer goods, but their relative share in total trade is shrinking as Nepal’s export earnings grow.

While the overall trade deficit remains huge at Rs. 1.19 trillion, the rising export share is a positive signal for economic resilience. If sustained, this trend could reduce Nepal’s extreme reliance on imports and improve foreign exchange stability. However, Nepal must expand beyond India and strengthen domestic production to ensure long-term balance.