Nepal records Rs18.76 billion electricity trade surplus in fiscal 2025-26

Nepal has solidified its position as a net electricity exporter, recording an impressive trade surplus of Rs18.76 billion in the fiscal year 2025-26. The nation's electricity exports surged to Rs29.32 billion, a substantial increase from the previous year's Rs17.45 billion, while imports saw a decline to Rs10.55 billion.

This positive trade balance is largely attributed to Nepal's abundant hydropower generation during the monsoon season, when domestic consumption is lower than production. The Nepal Electricity Authority has been actively participating in India's power market through competitive bidding on the Indian Energy Exchange and supplying power to India's NTPC Vidyut Vyapar Nigam (NVVN) under a medium-term agreement. Additionally, Nepal began exporting electricity to Bangladesh in 2024 following a tripartite agreement.

While Nepal benefits from increased exports during the wet season, it still relies on imports during drier months when hydropower output diminishes. However, the overall trend shows a steady decline in import costs as export revenues climb. The country exports electricity to India in Indian rupees and to Bangladesh in US dollars, with a specific agreement to supply 40 megawatts to Bangladesh annually.

Despite the overall success, challenges remain. India has not yet approved an increase in electricity exports to Bangladesh, citing limited transmission capacity. Nevertheless, Nepal has secured approval to export up to 1,200 megawatts to India and Bangladesh, signaling a promising future for its energy sector.