This figure represents an 8.35% decline compared to the previous fiscal year, which saw remittances of 6.16 billion rupees. In the fiscal year 2078-79, the amount of remittances sent out was even higher at 7.67 billion rupees. The decline is attributed to a recent economic slowdown affecting remittance flows.

The reduction in legal remittances is partly due to the constraints faced by foreign workers who come to Nepal with labour permits. These workers are allowed to send up to 75% of their earnings back to their home countries, while the remaining 25% is used for local expenses. Despite this, there is a significant amount of informal remittance, estimated at around 3 billion rupees, largely driven by Indian citizens working in Nepal without proper labour permits. Various studies suggest that a substantial portion of this informal money is sent through unofficial channels.

Nepal continues to experience a high influx of remittances, with inflows amounting to 14.45 trillion rupees last year, representing 23% of the country’s Gross Domestic Product (GDP). However, the outflow of remittances has increased due to the growing number of foreign technical workers in infrastructure and industrial projects, such as the construction of hydropower projects and major infrastructure developments. Companies like Coca-Cola, Unilever Nepal, and various banks employ foreign workers, further contributing to the remittance outflow. Economists highlight the need to ensure that foreign workers are only brought in for roles where local expertise is lacking and emphasize the impact of informal remittance channels on official statistics.