Nepal Trade Deficit 2025/26 (Mid-March): Latest Data Analysis
Nepal's foreign trade data for the first eight months of fiscal year 2025/26 (mid-July 2025 to mid-March 2026) shows a trade deficit of Rs. 1,098,138.20 million — an increase of 11.22% over the same period of the previous year. This analysis is based on Nepal Rastra Bank (NRB) customs data.
Trade Overview: Eight Months 2025/26
| Indicator | 8M 2024/25 (Rs. M) | 8M 2025/26 (Rs. M) | % Change |
|---|---|---|---|
| Total Exports | 158,172.40 | 191,112.03 | +20.83% |
| Total Imports | 1,145,566.24 | 1,289,250.23 | +12.54% |
| Trade Deficit | 987,393.84 | 1,098,138.20 | +11.22% |
| Total Trade | 1,303,738.64 | 1,480,362.26 | +13.55% |
| Export/Import Ratio | 13.81% | 14.82% | +1.01 pp |
Key Findings
1. Trade Deficit Exceeds Rs. 1 Trillion: Nepal's merchandise trade deficit crossed the Rs. 1 trillion mark for the eight-month period, standing at Rs. 1,098,138.20 million. While this is an increase from the previous year's Rs. 987,393.84 million, the rate of growth has moderated as exports grew faster (+20.83%) than imports (+12.54%).
2. Export Coverage Improving: The export-to-import ratio improved from 13.81% to 14.82%, meaning Nepal now exports Rs. 14.82 for every Rs. 100 it imports — a modest but positive trend. However, the structural trade deficit remains deeply embedded.
3. Export Growth Driven by Soyabean Oil: Nepal's total exports surged 20.83% largely due to an extraordinary increase in soyabean oil exports (Rs. 75,774.15M — 39.65% of total exports, up from Rs. 47,946.69M). This single commodity accounts for nearly 40% of total export value.
Trade Balance by Country
| Partner | Deficit 8M 2024/25 | Deficit 8M 2025/26 | % Change | Share of Total Deficit |
|---|---|---|---|---|
| India | Rs. 563,676.14M | Rs. 567,396.74M | +0.66% | 51.67% |
| China | Rs. 217,063.59M | Rs. 264,683.68M | +21.94% | 24.10% |
| Other Countries | Rs. 206,654.12M | Rs. 266,057.78M | +28.75% | 24.23% |
India remains the dominant source of Nepal's trade deficit at 51.67%, but its share is declining as the China deficit grows (+21.94%) and the rest-of-world deficit expands (+28.75%).
Top Imported Commodities (8M 2025/26)
- Petroleum Products: Rs. 185,208.81M (14.37% share)
- Crude Soyabean Oil: Rs. 77,665.62M (6.02% share)
- Transport Equipment & Vehicles: Rs. 76,114.08M (5.90% share)
- Other Machinery & Parts: Rs. 58,601.44M (4.55% share)
- Chemical Fertilizer: Rs. 45,816.03M (3.55% share, +126.52%)
Top Exported Commodities (8M 2025/26)
- Soyabean Oil: Rs. 75,774.15M (39.65% share, +58.00%)
- Cardamom: Rs. 9,496.15M (4.97%, +62.68%)
- Polyster Yarn & Thread: Rs. 8,977.13M (4.70%, +3.00%)
- Woolen Carpet: Rs. 6,538.13M (3.42%, -9.31%)
- Jute Goods: Rs. 6,315.95M (3.30%, +27.22%)
Outlook
Nepal's trade deficit is structurally persistent and driven by heavy reliance on imported petroleum, machinery, and consumer goods. The good news is that export growth is outpacing import growth in 2025/26, providing a slight improvement in the trade balance ratio. However, Nepal's export base remains narrow and dominated by a few commodities — particularly re-exported soyabean oil — which makes export performance volatile from year to year.