Nepal’s GDP Growth Projected at 4% for FY 2024/25 – NRB Estimate

According to the latest Nepal Rastra Bank (NRB) Macroeconomic Update (Mid-September 2025/26), Nepal’s economy is projected to expand by 4.0% in FY 2024/25, reflecting a modest but steady recovery following years of subdued growth. The estimate indicates gradual improvement across key sectors — agriculture, services, and industry — supported by controlled inflation, a stable external position, and improved financial liquidity.

The NRB report shows that the real GDP at basic prices is expected to rise by 4.0%, while the real GDP at purchasers’ prices is forecasted to grow by 4.6%. This moderate pace of expansion follows growth rates of 3.4% in FY 2023/24 and 2.3% in FY 2022/23, signaling that Nepal’s economy is gradually rebounding from the pandemic-era slowdown and the subsequent credit crunch that affected private sector activity.

The nominal GDP is projected to reach Rs. 6,107 billion in FY 2024/25, representing a 7% year-on-year increase. NRB attributes this growth to the combination of macroeconomic stability, rising remittances, and steady public spending. The central bank’s data also indicate improvements in Gross National Income (GNI) and Gross National Disposable Income (GNDI), which grew by 6.7% and 7.4%, respectively — reflecting an overall rise in national earnings and purchasing capacity.

Sector-wise, the service sector continues to be the primary driver of growth, bolstered by tourism revival, digitalization, and remittance-driven consumption. The agriculture sector has maintained moderate progress due to favorable weather conditions and improved irrigation infrastructure. Meanwhile, the industrial sector is showing early signs of revival as manufacturing, construction, and hydropower projects regain momentum following policy reforms and increased capital expenditure.

From a macroeconomic standpoint, inflation remained low at 1.87%, helping sustain consumer purchasing power and reducing cost pressures for businesses. Similarly, interest rates have eased, with the base rate at 5.72% and lending rate at 7.66%, creating a more conducive environment for investment and credit expansion. The current account surplus of Rs. 130.7 billion and foreign exchange reserves exceeding Rs. 2.88 trillion (USD 20.41 billion) further reinforce the foundation for stable growth in FY 2025/26.

However, NRB cautions that Nepal’s growth momentum remains vulnerable to structural challenges, including sluggish capital spending, low private investment, and heavy reliance on remittances. To sustain growth above 5%, the country will need to accelerate infrastructure development, enhance the business climate, and diversify exports.