NRB Former Governor Dipendra: $3,000 Per Capita Income Target is Highly Challenging
13th May 2026, Kathmandu
Dipendra Bahadur Kshetry, the former Governor of Nepal Rastra Bank, has characterized the government’s ambitious goal of doubling the per capita income within five years as a significant challenge.
NRB Former Governor Dipendra
Speaking on the fiscal roadmap set by Finance Minister Dr. Swarnim Wagle, Kshetry emphasized that achieving a per capita income of $3,000 and an economy nearing Rs 100 trillion requires more than just policy announcements it demands deep structural reforms.
A Paradox of Positive Indicators and Weak Production
While external economic indicators appear stable, the former Governor expressed concern over the hollow nature of this stability.
Foreign Exchange Reserves: Currently exceeding Rs 3.4 trillion, capable of covering roughly 18 months of imports.
Current Account & Balance of Payments: The current account remains in a surplus of Rs 638 billion, with the balance of payments also showing a surplus of over Rs 700 billion.
However, Kshetry warned that these “healthy” figures are almost entirely driven by remittances. In a single month (Chaitra), Nepal received approximately Rs 207 billion from workers abroad.
“The money coming in through remittances is immediately flowing back out to purchase foreign goods,” Kshetry noted. “This highlights the precarious state of our domestic production.”
The Crisis in Agriculture and Migration
Despite being an agrarian society, Nepal’s dependence on imported food has reached alarming levels. In the first nine months of the current fiscal year, the country imported:
Paddy and Rice: Rs 33 billion
Vegetables: Rs 16 billion
Fruits: Rs 31 billion
Kshetry pointed out a “vicious cycle” where the youth migrate for foreign employment, leaving village lands fallow, which in turn decreases local production and increases import reliance.
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He compared the current economy to a body that looks large but is actually swollen with “water and fat” rather than muscle.
Challenges to the “Decade of Prosperity”
The government has declared the upcoming decade as the “Decade of Prosperity and Employment.” To realize the goal of jumping from $1,500 to $3,000 per capita income, Kshetry identified several critical hurdles:
Capital Expenditure: Historically, capital spending hovers around 60%, but currently, it is struggling at approximately 26%.
Tax Burden: Nepal has one of the highest tax burdens in South Asia. While relief for the middle class is promised, expanding the tax net to the informal sector remains a task.
Bureaucratic Trust: Kshetry insisted that the government must mend its “harmonious relationship” with the bureaucracy.
“Bureaucracy is the final agency for policy implementation. Without winning their trust, programs for good governance and revenue reform will remain ineffective,” he stated.
Energy and Infrastructure: Beyond Production
While the government targets 30,000 MW of electricity production, the former Governor argued that the focus must shift to consumption.
Electric Transition: To reduce the pressure of fuel imports, electricity must be prioritized for everything from kitchen stoves to public transport.
Project Bank: Kshetry lauded the “Project Bank” concept, which prioritizes ready-to-go projects for budget allocation, as a positive step toward solving chronic delays.
Conclusion
According to Kshetry, a 7% economic growth rate is not impossible given Nepal’s low base, but it requires moving away from “Western imitation” and focusing on Nepalese realities.
He concluded that only through administrative reform, increased domestic production, and a transparent, investment-friendly environment can the ambitious targets of the “Decade of Prosperity” be met.
For more: NRB Former Governor Dipendra
