ADB Projects Nepal’s Economy to Grow by 4.4% This Fiscal Year, 5.1% Next Year

The Asian Development Bank (ADB) has projected Nepal’s economy to grow by 4.4% in the current fiscal year, with an expected pickup to 5.1% in the next. This follows a 3.9% growth recorded last year. The bank attributes the improvement to gradual recovery across key sectors, especially energy, industry, and tourism.

According to ADB officials, credit flow to the construction and industrial sectors has improved, reflecting renewed activity. In the first six months alone, credit to the construction sector rose by 7.7%. With around 900 megawatts of new electricity expected to be added this year, the energy sector is likely to play a central role in driving growth. At the same time, rising tourist arrivals and a rebound in trade and transport are expected to boost the services sector.

Despite broader global uncertainties—driven in part by recent U.S. policy changes and rising trade tensions—ADB remains optimistic about South Asia’s prospects, forecasting regional growth to rise to 6%. For Nepal, inflation is expected to stay manageable at around 5.2% this year and ease further to 5% next year, supported by improved supply conditions and policy measures.