IMF Projects Nepal’s Economic Growth at 3.6% in 2026, Lags Behind Asian Average

The International Monetary Fund (IMF) has projected Nepal’s real GDP growth at 3.6% in 2026, down from an estimated 4.4% in 2025, according to its latest World Economic Outlook report, titled Resilience Under Strain, Urgent Choices. The country’s economic growth is expected to improve slightly to 3.7% in 2027, indicating a gradual recovery in domestic economic activity. Meanwhile, consumer inflation is projected to decline from 4.1% in 2025 to 3.1% in 2026 before rising to 5.8% in 2027. Nepal’s current account surplus is forecast to increase significantly from 6.6% of GDP in 2025 to 13.9% in 2026, although it is expected to narrow to 2.0% in 2027. Despite the stronger external position and lower projected inflation, Nepal’s economic growth is expected to remain below the Asian average of 4.8% and the emerging and developing Asia average of 5.1% in 2026. Compared with regional economies, Nepal is projected to grow more slowly than India and Bhutan, both forecast to expand by 7.0%, while its growth rate is expected to match Bangladesh. The projections highlight the challenges facing Nepal’s economy and the need to strengthen domestic production, encourage investment, expand productive activities, and create employment opportunities to support sustainable economic growth.