The Asian Development Bank (ADB) anticipates that Nepal’s economy will expand by 4.4% in the ongoing fiscal year, with a projected increase to 5.1% in the following year. This comes after a recorded growth of 3.9% last year. The bank links this enhancement to a gradual resurgence across vital sectors, particularly in energy, manufacturing, and tourism.
ADB representatives indicate that the flow of credit to the construction and manufacturing sectors has improved, showcasing a revitalized activity. In just the first half of the year, credit extended to the construction sector surged by 7.7%. With around 900 megawatts of new energy anticipated to be introduced this year, the energy sector is set to play a pivotal role in propelling growth. Concurrently, increasing tourist numbers and a recovery in trade and transportation are likely to elevate the services sector.
Despite overarching global uncertainties—partly fueled by recent shifts in U.S. policies and escalating trade frictions—ADB holds a positive outlook on the prospects for South Asia, predicting regional growth to climb to 6%. For Nepal, inflation is forecasted to remain manageable at about 5.2% this year, easing further to 5% next year, aided by improved supply dynamics and strategic policy measures.
