Nepal's economy is projected to expand to 4.4% in 2025, compared to the estimated 3.9% growth in the previous year, according to the Asian Development Outlook April 2025, published by the Asian Development Bank (ADB). 

ADB estimates the growth will be supported by improved private investment, expanded electricity generation, higher tourist arrivals, and better capital budget execution.

Furthermore, according to the Asian Development Bank (ADB), Nepal’s agriculture sector is expected to grow at a rate of 2.8% in 2025, slightly lower than the 3.0% rate estimated for 2024, mainly due to reduced winter rainfall. The industrial sector is forecast to expand to 3.9%, supported by a recovery in construction and increased hydropower production. The service sector is projected to grow to 4.8%, driven by improvements in transport, tourism, and communication services.

Inflation is expected to ease to 5.2% in 2025, down from 5.4% in 2024, thanks to lower oil prices and declining non-food prices. The current account is anticipated to post a small surplus of 0.1% of GDP in 2025, supported by robust remittance inflows. However, this is projected to shift to a 2.4% deficit in 2026 as imports increase.

Challenges to growth include rising global trade barriers, lower foreign aid, delays in government spending, and natural disasters. Still, ongoing policy changes and more investment in energy and infrastructure are expected to support Nepal’s economic progress.