Kathmandu, Oct 16 — Nepal’s Foreign Minister Shishir Khanal said that trade facilitation, investment and industrial partnerships, energy, digital transformation and tourism were key priorities for Nepal-India economic cooperation.
Addressing the 32nd annual general meeting of the Nepal-India Chamber of Commerce and Industry, Khanal said Nepal’s hydropower potential should be linked with India’s expanding energy market to promote further investment, transmission infrastructure and regional energy integration.
India remains Nepal's primary destination for electricity exports, and Nepal also exports some of its power to Bangladesh through India’s transmission grid.
According to cross-border electricity import and export data released by the Nepal Electricity Authority (NEA), the state-owned power utility, Nepal earned NPR 29.32 billion from electricity exports to India and Bangladesh in fiscal year 2025-26 that ended in mid-July, representing a 67.96 per cent increase from the previous fiscal year. This was the highest annual revenue the NEA has ever generated from electricity exports.
Nepal earned NPR 17.46 billion from electricity exports in fiscal year 2024-25.
Several high-capacity cross-border transmission line projects between Nepal and India have advanced, enabling the two countries to transmit more electricity in the future. Besides purchasing electricity from Nepal, India is also expanding its investment in Nepal’s power sector, with the implementation of several major hydropower projects backed by Indian investment moving forward.
Khanal also said that expanding cooperation between the two countries in the areas of digital payments, artificial intelligence and financial technology would enable Nepali youth and entrepreneurs to benefit from the Indian market and technological advancements.
Nepal and India officially launched a real-time, peer-to-peer (P2P) cross-border remittance service in June this year. The service connects India’s Unified Payments Interface (UPI), managed by NPCI International Payments Limited (NIPL), with Nepal’s National Payments Interface (NPI). Fund transfers are executed digitally in real time through mobile banking apps and digital wallets.
Khanal also called for increased Indian investment in Nepal to boost domestic production, facilitate technology and knowledge transfer, and connect Nepali enterprises with regional value chains.
India remains the largest source of foreign direct investment (FDI) in Nepal. However, investment from China has also increased in recent years, according to data released by Nepal Rastra Bank (NRB), the country’s central bank.
India accounted for 32.8 per cent of Nepal’s total FDI stock as of mid-July 2025, followed by China at 9.3 per cent, Ireland at 7.3 per cent, Australia at 6.5 per cent and Singapore at 5.4 per cent, according to a report titled Foreign Direct Investment (FDI) in Nepal 2024/25.
Khanal emphasised the need to translate the potential of bilateral relations into tangible economic gains.
“Diplomacy is no longer confined to the Ministry of Foreign Affairs, formal negotiations, and treaties and agreements. Industry, trade, energy and digital payment systems have also become important areas of economic diplomacy,” Khanal said.