Highlight related to agriculture and access to food:

The agricultural sector in Nepal is projected to grow over the medium term, primarily due to increased paddy production.

A significant increase in the main season rice planted area from 94.6 percent in FY23 to 98.5 percent in FY24, thanks to favorable rainfall, is expected to boost output and drive growth to 3.3 percent in FY25. Assuming continued favorable monsoon conditions, growth is projected to reach 3.4 percent in FY26.

Consumer price inflation is expected to remain moderate, supported by declining global commodity prices and increased agricultural production. Lower expected inflation in India, combined with Nepal’s currency peg, could help mitigate imported inflation.

On remittances (special chapter on migration):

Remittances are projected to stabilize around 25 percent of GDP. The widening trade deficit, coupled with stable remittances, is anticipated to narrow the current account surplus from 3.9 percent of GDP in FY24 to an average of 2.2 percent of GDP over FY25-26.

International remittances play a significant role in Nepal’s economy, affecting household consumption, poverty reduction, and human capital development. However, migration also poses challenges, such as high costs, unequal opportunities, and poor working conditions for migrants.