Nepal’s GDP Growth Shows Steady Recovery Post-COVID

Nepal’s Gross Domestic Product (GDP) at current prices has demonstrated a steady upward trajectory over the past six fiscal years, reflecting a gradual economic recovery following the pandemic-induced downturn. According to the latest data released by Nepal Rastra Bank, the GDP has grown from Rs. 3,888.7 billion in FY 2019/20 to a projected Rs. 6,107.2 billion in FY 2024/25, marking a cumulative nominal growth of over 57% within six years.

In FY 2019/20, Nepal’s GDP stood at Rs. 3,888.7 billion. The economy faced significant challenges in the following year due to the COVID-19 pandemic, but it still managed to expand to Rs. 4,352.6 billion in FY 2020/21—an increase of Rs. 463.9 billion. This was indicative of the government's monetary support and a rebound in certain economic activities post-lockdown.

The real momentum, however, picked up from FY 2021/22 onward. That year, the GDP rose to Rs. 4,976.6 billion, followed by Rs. 5,367.0 billion in FY 2022/23. These years reflect the resumption of large-scale industrial activity, a rise in remittance inflow, and gradual improvement in domestic consumption and exports.

By FY 2023/24, the GDP reached Rs. 5,709.1 billion, further signaling economic resilience amid global inflationary pressures and internal structural challenges. The central bank’s projection for FY 2024/25 places the GDP at Rs. 6,107.2 billion, reinforcing optimism about Nepal’s economic direction.

Economists note that this growth is primarily driven by sectors such as remittances, tourism recovery, government capital expenditure, and agricultural modernization. However, they also caution that the figures represent nominal growth, which includes the effects of inflation and exchange rate fluctuations.

With an average annual GDP increase of roughly Rs. 443 billion, the data paints a picture of consistent nominal expansion. Yet, questions remain about the quality of this growth, particularly in terms of employment generation, industrial output, and sustainable development.

As Nepal heads into the next fiscal year, policy focus will likely center on improving public investment efficiency, supporting small and medium enterprises (SMEs), managing debt levels, and expanding the digital economy to maintain this upward momentum.