Located between economic powerhouses China and India, the Federal Democratic Republic of Nepal shipped an estimated US$1.65 billion worth of goods around the globe in 2021.

That dollar amount reflects a 123.3% increase from $737 million in 2017 and a 92.4% year-over-year acceleration from $855.4 million during 2020.

Nepal’s 5 biggest exports are soya-bean oil, palm oil, synthetic staple fiber yarn, textile floor coverings including carpets, then nutmeg and cardamoms. Collectively, those 5 product categories generated over three-fifths (61.8%) of the Asian nation’s overall export sales in 2021.

Nepal’s Major Trading Partners

The latest available country-specific data shows that 94.6% of products exported from Nepal were bought by importers in: India (72.9% of Nepal’s global total), United States of America (10.2%), Germany (2.8%), United Kingdom (2%), Turkey (1.4%), France (1.1%), Japan (0.9%), Canada (0.75%), Australia (0.73%), mainland China (0.67%), Italy (0.65%) and Bangladesh (0.5%).

From a continental perspective, customers in Asia bought over three-quarters (78.2%) of Nepal’s total exports. In second place was North America at 10.9% trailed by importers in Europe at 9.3%.

Tinier percentages went to Oceania (0.8%) led by Australia, Africa (0.7%) and Latin America (0.1%) excluding Mexico but including the Caribbean.

Given Nepal’s population of 29.7 million people, its total $1.65 billion in 2021 exports translates to roughly $60 for every resident in the South Asian country. That dollar metric almost doubles the average $30 per capita one year earlier in 2020.

Nepal’s Top 10 Exports

At the 2-digit Harmonized Tariff System code level, the following export product groups represent the highest dollar value in Nepalese global shipments during 2021. Also shown is the percentage share each export category represents in terms of overall exports from Nepal.

1. Animal/vegetable fats, oils, waxes: US$867.5 million (52.7% of total exports)
2. Coffee, tea, spices: $82.9 million (5%)
3. Textile floor coverings: $82.9 million (5%)
4. Manmade staple fibers: $81.1 million (4.9%)
5. Paper yarn, woven fabric: $52.9 million (3.2%)
6. Food industry waste, animal fodder: $52.5 million (3.2%)
7. Beverages, spirits, vinegar: $45 million (2.7%)
8. Miscellaneous textiles, worn clothing: $42 million (2.6%)
9. Plastics, plastic articles: $38.1 million (2.3%)
10. Knit or crochet clothing, accessories: $32.7 million (2%)

Nepal’s top 10 exports accounted for 83.7% of the overall value of its global shipments.

Beverages, spirits and vinegar was the fastest grower among the top 10 export categories, up by 7,799% from 2020 to 2021.

In second place for improving export sales was plastics both as a material and items made from plastic via a 461.1% gain.

Nepal’s shipments of animal or vegetable fats, oils and waxes posted the third-fastest expansion in value up by 239.2%.

The lone decliner among Nepal’s top 10 export categories was coffee, tea and spices thanks to a -4.6% drop year over year. That drop was caused mainly by lower international revenues from exported Nepalese tea.

At the more granular four-digit Harmonized Tariff System code level, soya-bean oil represents Nepal’s most valuable exported product accounting for 36.1% of the country’s total. In second place was palm oil (14.4%) trailed by yarn made from synthetic staple fibers (4.2%), textile floor coverings including carpets (also 4.2%), nutmeg and cardamoms (3%), woven jute fabrics (also 3%), non-alcoholic drinks excluding water, juices or milk (2.7%), sunflower-seed or safflower oil (2.2%), miscellaneous plastic items (1.8%) and tea (1.4%).

Products Generating Nepal’s Largest Trade Surpluses

The following types of Nepalese product shipments represent positive net exports or a trade balance surplus. Investopedia defines net exports as the value of a country’s total exports minus the value of its total imports.

In a nutshell, net exports represent the amount by which foreign spending on a home country’s goods or services exceeds or lags the home country’s spending on foreign goods or services.

1. Animal/vegetable fats, oils, waxes: US$822.4 million (Reversing a -$185.3 million deficit in 2020)
2. Textile floor coverings: $78.5 million (Up by 56.2% from 2020)
3. Paper yarn, woven fabric: $19.9 million (Up by 1,972%)
4. Beverages, spirits, vinegar: $19.8 million (Reversing an -$18.4 million deficit)
5. Coffee, tea, spices: $13.8 million (Reversing an -$8.1 million deficit)
6. Vegetable plaiting materials: $13.6 million (Down by -0.5%)
7. Lead: $3.9 million (Up by 514.5%)
8. Collector items, art, antiques: $3.2 million (Down by -12.8%)
9. Musical instruments: $2.3 million (Down by -32.2%)
10. Raw hides, skins not furskins, leather: $1.9 million (Up by 249.7%)

Nepal has highly positive net exports in the international trade of animal or vegetable fats, oils and waxes as well as carpets and other textile floor coverings. In turn, these cashflows indicate Nepal’s strong competitive advantages under both product categories.

Products Causing Nepal’s Worst Trade Deficits

Overall, Nepal incurred an estimated -$10.9 billion trade deficit for 2021, up by 22.3% from -$8.9 billion in red ink one year earlier.

Below are exports from Nepal that result in negative net exports or product trade balance deficits. These negative net exports reveal product categories where foreign spending on home country Nepal’s goods trail Nepalese importer spending on foreign products.

1. Mineral fuels including oil: -US$2.2 billion (Up by 52.6% since 2020)
2. Iron, steel: -$1.4 billion (Up by 57.7%)
3. Machinery including computers: -$1 billion (Up by 32.7%)
4. Vehicles: -$909.6 million (Up by 77.4%)
5. Electrical machinery, equipment: -$863.9 million (Up by 25.6%)
6. Cereals: -$641 million (Up by 7.2%)
7. Pharmaceuticals: -$522.8 million (Up by 157.4%)
8. Plastics, plastic articles: -$394.5 million (Up by 8.5%)
9. Optical, technical, medical apparatus: -$235.2 million (Up by 60.1%)
10. Vegetables: -$231.3 million (Down by -23.4%)

Nepal has highly negative net exports and therefore deep international trade deficits under the mineral fuels-related category. Notable loss leaders among these energy products are refined petroleum oils and petroleum gases.

Nepal’s Export Companies

Not one Nepalese corporation ranks among the Forbes Global 2000.

Wikipedia lists exports-related companies from Nepal. Selected examples are shown below.

• Chaudhary Group (conglomerate)
• Citizens Bank International (commercial bank)
• Deurali-Janta Pharmaceuticals (drugs and medicines)
• Giribandhu Tea Estate (beverages)
• Hulas Motors (vehicles)
• IME Group (conglomerate)
• Krishna Pauroti (bakery)
• Nepal Oil Corporation (oil, gas)

 
From a macroeconomic perspective, Nepal’s exported goods in 2021 represent 1.3% of the country’s Gross Domestic Product on a Purchasing Power Parity basis, up from 0.8% for 2020. Those percentages suggest Nepal is depending more on international trade compared to other economic activities, albeit based on a very short timeframe.

Another key indicator of a country’s economic performance is its unemployment rate. Nepal’s average unemployment rate averaged 3.6% for 2021, down from an average 4.44% one year earlier in 2020 according to Trading Economics.

Nepal’s capital city is Kathmandu.

See also Nepal’s Top 10 Imports, Nepal’s Top Trading Partners, India’s Top Trading Partners, Palm Oil Exports by Country and Top Cardamoms Exports & Imports by Country Plus Average Prices

Research Sources:
Central Intelligence Agency, The World Factbook Country Profiles. Accessed on June 29, 2022

Forbes, Global 2000 rankings, The World’s Biggest Public Companies. Accessed on June 29, 2022

International Monetary Fund, World Economic Outlook Databases (GDP based on Purchasing Power Parity)

. Accessed on June 29, 2022

International Trade Centre, Trade Map. Accessed on June 29, 2022

Investopedia, Net Exports Definition. Accessed on June 29, 2022

Wikipedia, List of Companies of Nepal. Accessed on June 29, 2022

Wikipedia, Nepal. Accessed on June 29, 2022