Dependence on imported agricultural products is rising steadily, and the consequences for Nepal’s economy are deeply troubling. When even goods that can be produced domestically have to be imported, the economic fallout is inevitable. While vast tracts of farmland lie fallow, the very workforce needed to till them is migrating abroad. The shortage of active manpower has become a major constraint on boosting agricultural production. One key reason is the absence of a reliable market for farm produce. Despite year-long toil, farmers struggle to transport their goods to market. Even when they succeed, middlemen reap disproportionate benefits, often at the expense of both farmers and consumers. This persistent imbalance has further eroded the attraction of agriculture as a viable livelihood. The scale of the problem is evident in the numbers. In the first five months of the current fiscal year (FY 2025/26), Nepal imported agricultural and livestock products worth nearly Rs 150 billion. Successive governments have repeatedly pledged to raise domestic production, yet reality continues to move in the opposite direction. Growing dependence on agricultural imports—traditionally the backbone of the economy—should itself set alarm bells ringing. What is needed is a clear strategy: prioritise domestic consumption of locally produced goods and export any surplus. This, however, requires sustained state support and incentives, which remain largely absent. In principle, only goods that cannot be produced domestically should be imported, while those that can be produced at home should be encouraged for both local consumption and export. Only such a shift can deliver long-term economic benefits.
What is missing in budget for agriculture?
Nepal has long practised subsistence agriculture, with production sufficient to sustain households for only a few months each year. As agriculture increasingly fails to provide a dependable livelihood, young people have turned to foreign employment. The lack of industrial growth and the fragility of alternative business opportunities have left them with few choices. Farming no longer covers basic costs, let alone offers dignity or stability. Unsurprisingly, this has led to a decline in agricultural and livestock production. Ironically, remittances sent by migrant workers are then used by families back home to buy imported food. Had disposable income been scarce, households would have been compelled to produce more themselves. Compounding the problem, imported agricultural goods are often cheaper than domestic ones, largely because of economies of scale. High production costs prevent Nepali farmers from competing with imported products. Yet it is not beyond the government’s capacity to curb imports of goods that can be produced domestically. Protecting farmers and incentivising consumers would help revive domestic production. Policy must also move beyond fragmented, individual farming and actively promote large-scale commercial farms. At a time when food security has emerged as a global concern, strengthening domestic agriculture should be a national priority.
Between mid-July and mid-November alone, Nepal imported food grains, vegetables, fish, meat and related items worth Rs 154 billion. Alarmingly, Rs 22.72 billion was spent on staples such as rice, paddy, maize and wheat—crops that can be grown abundantly at home. While the government has declared pocket areas to boost paddy production, the enthusiasm seen in policy announcements is rarely reflected in actual output. Even household-level production could make a difference. Kitchen gardens can meet much of a family’s vegetable needs, yet this practice remains underutilised. During the period, Nepal spent Rs 14.89 billion on vegetables, Rs 11.89 billion on fruits, and Rs 63.14 billion on animal and vegetable fats and oils. Tea and coffee imports alone cost Rs 4.03 billion—despite Nepal’s clear potential to expand production of both. Supplying domestically produced tea and coffee even to local cafés could begin to change the picture. Nepal is equally well-positioned for poultry farming, livestock rearing and beekeeping. Expanding domestic production would not only reduce imports but also help narrow the trade deficit. Agriculture has the added advantage of generating relatively quick cash returns, improving farmers’ livelihoods within months. With fertile plains and with proper investment in irrigation, fertilisers, improved seeds and skills, scaling up production is entirely achievable. Agricultural products are indispensable to human survival. Continuing to rely overwhelmingly on imports for such essentials is neither sustainable nor wise. Those entrusted with shaping Nepal’s agricultural strategy must confront this reality—and act decisively.
