Nepal's Import Bill Just Crossed Rs 2 Trillion : Here's Where All That Money Is Going

Nepal's Import Bill Just Crossed Rs 2 Trillion : Here's Where All That Money Is Going

Every time you fill your bike's petrol tank, cook with soybean oil, or scroll on your smartphone, you're touching a tiny piece of a much bigger story Nepal's ballooning import bill. In the fiscal year 2025/26 alone, Nepal imported goods worth a staggering Rs 2.096 trillion. That's not a typo. Two trillion, ninety-six billion rupees, in twelve months, spent buying things from the rest of the world.

If that number feels abstract, here's a simpler way to see it: for every Rs 1 Nepal earns from exports, it spends roughly Rs 6.65 on imports. That single ratio explains almost everything about Nepal's trade story and why understanding it matters if you follow NEPSE, remittances, or the exchange rate.

The Big Picture: FY 2025/26 at a Glance

According to the Department of Customs and Nepal Rastra Bank (NRB), here's how the year closed out:

Total imports: Rs 2,096.38 billion (up 16.2% year-on-year)

Total exports: Rs 315.29 billion (up 13.8% year-on-year)

Trade deficit: Rs 1,781.09 billion (up 16.6% from last year)

Total foreign trade: roughly Rs 2.41 trillion

Export-import ratio: just 15.0%

In plain language Nepal's economy remains deeply import-dependent, and the gap between what we buy and what we sell abroad keeps widening even in years when exports grow strongly.

What Exactly Is Nepal Buying?

The single biggest item on Nepal's shopping list is, unsurprisingly, fuel. Here's how the top imports for FY 2025/26 stacked up:

Petroleum products (mainly diesel): ~Rs 172.43 billion over 1.39 million kiloliters of diesel alone crossed the border, powering everything from motorbikes to backup generators.

Soybean oil and raw materials: ~Rs 132.77 billion much of this is later refined and re-exported, which is why Nepal's "export boom" in recent years has an asterisk attached to it.

Silver, transport equipment, vehicles and spare parts, chemical fertilizer, and machinery also posted strong growth during the year.

Meanwhile, imports of edible oil (finished), hot-rolled steel coils, garlic, bitumen, and M.S. billet actually declined a small silver lining suggesting some import substitution is happening in specific categories.

Geographically, the picture is lopsided: India and China together supply close to 78% of everything Nepal imports, with India alone accounting for the majority through land routes like Birgunj, which alone handled nearly 47% of the country's total import value this year.

Where Does the Money Come From?

If Nepal imports six-and-a-half times what it exports, how does the country avoid running out of foreign currency? Two words: remittances and reserves.

Remittance inflows jumped 37.1% to Rs 2,363.13 billion in FY 2025/26 money sent home by Nepali workers abroad and this single inflow effectively bankrolls the trade deficit. On top of that, gross foreign exchange reserves rose 45.6% to Rs 3,897.67 billion (about USD 25.31 billion), enough to cover nearly 23 months of prospective merchandise imports. So while the trade numbers look alarming in isolation, the broader balance-of-payments position actually remains comfortable for now.

The 10-Year Trend: 

How We Got Here

Zooming out reveals just how fast Nepal's import bill has grown. Below is the year-wise total import value over the last decade, based on Department of Customs and NRB data (figures in Rs billion):

Fiscal Year Total Imports (Rs Billion) YoY Change

2016/17 990.11 —

2017/18 1,245.10 +25.8%

2018/19 1,418.54 +13.9%

2019/20 1,196.80 −15.6%

2020/21 1,539.84 +28.7%

2021/22 1,920.45 +24.7%

2022/23 1,611.73 −16.1%

2023/24 1,592.98 −1.2%

2024/25 1,804.12 +13.3%

2025/26 2,096.38 +16.2%

A few patterns jump out immediately:

2019/20 was the only sharp dip in a decade the COVID-19 lockdowns froze cross-border trade and crushed demand.

2021/22 saw an explosive 24.7% rebound as pent-up demand, post-pandemic reopening, and rising global fuel and commodity prices pushed the bill to an all-time high at the time.

2022/23 and 2023/24 brought two consecutive years of decline largely the result of the government's import-restriction measures, tighter margin lending rules for vehicles, and a genuine liquidity crunch in the banking sector that curbed consumer demand.

2024/25 and 2025/26 mark a strong return to growth, with imports rising back-to-back by double digits as liquidity eased and consumption picked up again.

In just ten years, Nepal's annual import bill has more than doubled from under Rs 1 trillion in 2016/17 to over Rs 2 trillion in 2025/26.

Why This Matters for You

Whether you're an investor tracking NEPSE, a business owner pricing imported inputs, or simply someone budgeting for daily expenses, Nepal's import trend has real consequences:

Currency pressure: Nepal's rupee is pegged to the Indian rupee, but a widening trade gap still pressures reserves over the long run and shapes NRB's monetary policy stance.

Inflation linkage: With CPI-based inflation at 5.14% in mid-July 2026 and the import price index up 15.1% year-on-year, a chunk of domestic price pressure is quite literally imported.

Sector signals: Rising vehicle, machinery, and fertilizer imports often hint at credit expansion and construction/agriculture activity useful leading indicators for banking-sector stocks on NEPSE.

Policy watch: Every time imports spike sharply, expect NRB to respond with tighter margin lending or LC (Letter of Credit) rules, which directly affects bank stocks, auto dealers, and importer-heavy businesses.

The Bottom Line

Nepal's story remains one of a small, landlocked, remittance-fueled economy plugged tightly into its two giant neighbors. The Rs 2 trillion import milestone in FY 2025/26 isn't just a statistic.it's a mirror reflecting how much of daily Nepali life, from the fuel in vehicles to the oil in the kitchen, is quietly imported from across the border. As long as remittances keep flowing in strong enough to cover the gap, the system holds. The real question worth watching over the next few years is whether Nepal can grow its own exports and domestic production fast enough to close that gap rather than simply riding on the resilience of its migrant workers abroad.

Data sources: Department of Customs (Government of Nepal), Nepal Rastra Bank (NRB) Current Macroeconomic and Financial Situation reports.