Nepal Remittances: 25% of GDP, 2 Million Workers Abroad — The Economy That Lives Overseas

Nepal is one of the world's most remittance-dependent economies. In fiscal year 2024/25, remittances reached NPR 1.37 trillion — equivalent to approximately 25-26% of GDP. Over 2 million Nepalis are currently in foreign employment: an estimated 800,000 in India (not fully counted in official statistics), 600,000 in Malaysia, 450,000 in the Gulf Cooperation Council states (primarily Qatar, UAE, Saudi Arabia), and the remainder in South Korea, Japan, Europe, and the United States.

This dependency shapes Nepal's politics in ways that are rarely discussed directly. When families receive NPR 20,000-40,000 per month from a family member working in Doha or Kuala Lumpur, the incentive to demand accountable domestic governance is both weakened (the income gap is filled) and strengthened (the comparison standard rises — workers see functional governments elsewhere).

The RSP government has placed labour diplomacy at the centre of its foreign policy. Specific commitments include: renegotiating labour agreements with Malaysia and Qatar to improve worker protections, establishing a government-backed insurance scheme for migrant workers, and creating a diaspora investment fund to channel remittances into productive domestic investment rather than consumption.

Nepal Next will track these commitments against delivery. Sources: Nepal Rastra Bank Remittance data, ILO Nepal, Ministry of Labour statistics.