Nepal Rastra Bank has warned that rising geopolitical tensions around the world could negatively impact Nepal’s economic growth.
According to its latest Microeconomic Report 2026, ongoing conflicts involving United States, Israel, and Iran are already affecting Nepal’s remittance inflows. The report notes that global market uncertainty may also drive up inflation and increase import costs.
NRB highlighted that for an import-dependent economy like Nepal, conflicts in the Middle East could disrupt supply chains and raise price levels. It estimates that around 41% of remittance inflows could be affected.
The report also cautions that internal political instability, natural disasters such as floods and landslides, and upcoming parliamentary elections could further strain the economy. While economic growth is projected to remain around 3–4% under normal conditions, instability could even push growth into negative territory.
Although the government has set a 6% growth target for the fiscal year 2082/83, NRB emphasized that achieving this will be challenging. Key priorities for the new government include maintaining political stability, encouraging investment, and sustaining remittance inflows.
The central bank further stated that reaching a 6% growth rate would require substantial improvements in tourism, government capital expenditure, and remittance flows, rather than just moderate reforms.
NRB has advised the incoming government to prioritize a stable political environment and effectively manage global uncertainties to support economic growth.
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