KATHMANDU: The Asian Development Bank (ADB) has projected Nepal’s economic growth rate to remain at 2.7 percent in 2026.
According to the Asian Development Outlook April 2026 published by the ADB, this marks a decline compared to 4.6 percent growth recorded in the previous fiscal year.
ADB Country Director for Nepal Arnaud Cauchois said economic growth is expected to slow due to political uncertainty, the Gen Z movement of September, 2025,, and the ongoing conflict in the West Asia.
He noted that maintaining political stability would help advance reform initiatives and boost economic confidence, while also warning that the Middle East conflict continues to pose risks through potential impacts on oil prices, tourism, and remittance inflows.
The report estimates economic growth could reach 5 percent in the following fiscal year, as current constraints gradually ease. It states that improving domestic demand, expanding hydropower exports, and a recovery in tourism are expected to support the economy.
ADB projects inflation at 3.7 percent in fiscal year 2082/83 BS, rising to 4.5 percent in 2083/84, citing additional price pressures from expanding domestic economic activity.
The current account surplus is estimated at 7.2 percent of GDP in fiscal year 2082/83, up from 6.7 percent in the previous year. While remittances and exports are expected to grow moderately, the report notes possible pressures from a temporary decline in foreign employment, higher import costs due to elevated oil prices, and weaker tourism earnings. In the following fiscal year, the surplus is projected to fall to 5.3 percent.
The ADB report highlights high uncertainty in the overall economic outlook, citing prolonged Middle East tensions, weak capital budget execution, financial sector risks, and climate-related disasters as key challenges. It also warns that fluctuations in global oil prices and potential declines in remittances from Gulf countries could pose additional risks.
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