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Nepal Trade: Rs 56 Billion Oil Exports, 57% Surge, Rs 987B Deficit

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27th March 2025, Kathmandu

Nepal has recorded a massive 57.20% increase in exports, with cooking oil shipments alone worth Rs 56 billion in the first eight months of fiscal year 2024/25 (mid-July 2024 to mid-March 2025).

Nepal Trade 56 Billion Oil Exports

This growth comes as Nepal imports crude oil, refines it domestically, and re-exports processed edible oil—a business model boosting foreign trade.

Key Highlights from Nepal’s Trade Report

Total Exports (8 months): Rs 158.17 billion

Top Export Products:

Soya bean oil – Rs 47.94 billion

Sunflower oil – Rs 7.98 billion

Cardamom – Rs 5.83 billion

Carpets – Rs 4.32 billion

Trade Deficit Widens to Rs 987.39 billion

Total Imports: Rs 1,145.56 billion

Major Imports:

Diesel – Rs 78.86 billion

Petrol – Rs 42.80 billion

LPG – Rs 41 billion

Smartphones – 1.4 million units (Rs 21.91 billion)

Why is Nepal’s Cooking Oil Export Thriving?

1. Value Addition Strategy

Nepal imports crude edible oil, processes it locally, and exports refined oil, boosting export revenues.

Soya bean oil dominates (Rs 47.94B), followed by sunflower oil (Rs 7.98B).

2. Growing Demand in Regional Markets

Refined oil exports cater to neighboring markets, including India and China.

Competitive pricing and quality improvements drive demand.

3. Government & Private Sector Push

Policies supporting agro-processing industries.

Investments in refining capacity expansion.

Nepal’s Trade Deficit: A Major Concern

Despite export growth, Nepal’s trade deficit reached Rs 987.39 billion, with:

 India: Rs 563.67 billion deficit (Imports: Rs 688.68B | Exports: Rs 125B)

China: Rs 21.70 billion deficit (Imports: Rs 219.18B | Exports: Rs 2.12B)

Other High-Deficit Trade Partners: Argentina, UAE, Ukraine, Australia

Biggest Import Categories

Petroleum Products – Rs 162.66 billion (Diesel, Petrol, LPG)

Electronics – Rs 21.91 billion (Smartphones)

Vehicles – Rs 11.80 billion (EVs + others)

Silver Lining: Trade Surplus with 34 Countries

While deficits dominate, Nepal enjoys a trade surplus with:

Afghanistan, Denmark, Russia, Austria, Maldives

Mostly from cardamom, carpets, and niche agro-products.

The Way Forward: Can Nepal Reduce Its Trade Deficit?

1. Expand Value-Added Exports

More edible oil refining

Promote herbal & agricultural products

2. Reduce Reliance on Costly Imports

Boost domestic fuel production

Encourage local smartphone manufacturing

3. Strengthen Trade Agreements

Better terms with India & China

Diversify export markets

Final Verdict: A Mixed Trade Picture

Nepal’s processed cooking oil exports are booming (Rs 56B), showing potential in value-added industries. Challenge: Rs 987.39B trade deficit remains a hurdle, requiring policy reforms & industrial growth.

Key Takeaway:

Nepal must capitalize on its edible oil export success while tackling import dependency.

Smart investments in local production could help balance trade.

For more: Nepal Trade 56 Billion Oil Exports


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