Nepal’s Costly Drift from Agriculture

Dependence on imported agricultural products is rising steadily, and the consequences for Nepal’s economy are deeply troubling. When even goods that can be produced domestically have to be imported, the economic fallout is inevitable. While vast tracts of farmland lie fallow, the very workforce needed to till them is migrating abroad. The shortage of active manpower has become a major constraint on boosting agricultural production. One key reason is the absence of a reliable market for farm produce. Despite year-long toil, farmers struggle to transport their goods to market. Even when they succeed, middlemen reap disproportionate benefits, often at the expense of both farmers and consumers. This persistent imbalance has further eroded the attraction of agriculture as a viable livelihood. The scale of the problem is evident in the numbers. In the first five months of the current fiscal year (FY 2025/26), Nepal imported agricultural and livestock products worth nearly Rs 150 billion. Successive governments have repeatedly pledged to raise domestic production, yet reality continues to move in the opposite direction. Growing dependence on agricultural imports—traditionally the backbone of the economy—should itself set alarm bells ringing. What is needed is a clear strategy: prioritise domestic consumption of locally produced goods and export any surplus. This, however, requires sustained state support and incentives, which remain largely absent. In principle, only goods that cannot be produced domestically should be imported, while those that can be produced at home should be encouraged for both local consumption and export. Only such a shift can deliver long-term economic benefits.