Nepal’s National Statistics Office projects a 3.85% economic growth for the current fiscal year 2025-26, slightly higher than the government’s revised projection of 3.5%. The country has been experiencing low and unstable economic growth since the fiscal year 2019-20 when the economy contracted by 2.37% due to the impact of Covid-19.
The average growth rate of Nepal’s economy over the last decade stands at 4.2%, according to the Finance Ministry’s white paper on the national economy. However, the projected growth for the current year is expected to remain below this average growth rate. Compared to neighboring countries, Nepal’s economic growth is notably slow.
The agriculture sector’s low growth rate is anticipated to impact the overall economic growth in the current fiscal year. While the agriculture, forestry, and fisheries sector is estimated to contribute 24.03% to the economy, it is projected to grow by only 1.58%. Paddy production is expected to decline, while other crops are forecasted to see modest growth.
The non-agriculture sector, on the other hand, is projected to grow by 4.54% in the current fiscal year. The electricity and gas sector is expected to have the highest growth rate in gross value added at 20.93%, followed by the financial and insurance sector at 9.16%. Sectors like public administration and defense, as well as education, are likely to experience lower growth rates.
