01Key Takeaways
- Nepal exported $1.30 billion worth of goods in 2022, down 21.93% from $1.67 billion in 2021, after nearly doubling from $855 million in 2020.
- Animal and vegetable fats and oils, mostly refined edible oil re-exported to India, made up 30.16% of exports ($392 million), more than any other category.
- That single category's rise and fall traces largely to a tariff loophole under the South Asian Free Trade Area, which India moved to close in September 2021.
- India bought 71.93% of everything Nepal exported in 2022, worth $935 million, one of the most concentrated single-country shares in this entire dataset.
024-Year Trend
| Year | 2019 | 2020 | 2021 | 2022 |
|---|---|---|---|---|
| Value | $959.6M | $855.4M | $1.7B | $1.3B |
03Top Export Markets (2022)
| Rank | Partner | Value | Share |
|---|---|---|---|
| 1 | India | $935.4M | 71.9% |
| 2 | United States | $147.2M | 11.3% |
| 3 | Germany | $32.6M | 2.5% |
| 4 | Turkey | $26.1M | 2.0% |
| 5 | United Kingdom | $23.8M | 1.8% |
| 6 | France | $13.3M | 1.0% |
| 7 | Australia | $10.8M | 0.8% |
| 8 | Japan | $10.4M | 0.8% |
| 9 | Canada | $10.2M | 0.8% |
| 10 | Italy | $9.9M | 0.8% |
04Top Export Categories (2022)
| Rank | Category | Value | Share |
|---|---|---|---|
| 1 | Animal or Vegetable Fats and Oils and their Cleavage Products; Prepared Edible Fats; Animal or Vegetable Waxes | $392.2M | 30.2% |
| 2 | Man-made Staple Fibres | $102.7M | 7.9% |
| 3 | Coffee, Tea, Mate and Spices | $90.5M | 7.0% |
| 4 | Carpets and other Textile Floor Coverings | $89.1M | 6.8% |
| 5 | Articles of Apparel and Clothing Accessories, not Knitted or Crocheted | $57.8M | 4.4% |
| 6 | Iron and Steel | $54.3M | 4.2% |
| 7 | Residues and Waste from the Food Industries; Prepared Animal Fodder | $51.2M | 3.9% |
| 8 | Preparations of Vegetables, Fruit, Nuts or other parts of Plants | $48.6M | 3.7% |
| 9 | Other Vegetable Textile Fibres; Paper Yarn and Woven Fabrics of Paper Yarn | $45.6M | 3.5% |
| 10 | Wadding, Felt and Nonwovens; Special Yarns; Twine, Cordage, Ropes and Cables and Articles thereof | $39.8M | 3.1% |
05Trade Partner Map
06Analysis
A Tariff Loophole in Edible Oil Explains Nepal's Top Export
Nepal exported $1.30 billion worth of goods in 2022, down 21.93% from $1.67 billion in 2021. Animal, vegetable and microbial fats and oils led every category by a wide margin, at 30.16% of the total, worth $392 million. Edible oils made up 65% of India's imports from Nepal in 2021, worth $865 million. India then cut its crude edible oil import tariff to zero in September 2021, a change that triggered a 62% collapse in Nepal's edible oil exports to $327 million in 2022. That single policy shift explains much of the swing visible in this data.
Nepal's refiners had spent recent years importing crude palm and soybean oil from countries like Argentina, Brazil and Indonesia, processing it minimally, and re-exporting the refined product to India duty-free under South Asian Free Trade Area rules of origin. That re-export mechanism relied entirely on the tariff gap between crude and refined oil rates. Once India's own tariff on crude oil imports dropped to zero in 2021, the price advantage that made Nepali refining profitable largely disappeared.
Carpets and Cardamom Are the Genuine Nepali Exports
Man-made staple fibres added 7.90% of exports ($103 million), and coffee, tea, mate and spices contributed 6.96% ($90 million). Large cardamom, grown mainly in eastern Nepal, is a major genuine cash crop making up 17% to 25% of the country's agricultural export income. Unlike the edible oil trade, cardamom reflects Nepal's own farming output rather than a re-export loophole.
Carpets and other textile floor coverings supplied 6.85% of exports ($89 million). Nepal's hand-knotted wool carpet industry has historically sent close to half its output to Germany, with the USA emerging as its largest single importer in some years. That carpet trade helps explain why Germany and the USA both appear among Nepal's top export destinations despite neither country buying much else from Nepal. Apparel added 4.45% ($58 million), and iron and steel contributed 4.17% ($54 million). Food industry residues and prepared animal fodder supplied 3.94% ($51 million), and vegetable preparations added 3.74% ($49 million). Vegetable textile fibres contributed 3.50% ($46 million), and wadding, felt and nonwovens closed out the top ten at 3.06% ($40 million).
India Buys Nearly Three-Quarters of Everything Nepal Sells
India bought 71.93% of Nepal's exports in 2022, worth $935 million, by far the largest share held by any single country in this entire dataset. That concentration reflects Nepal's landlocked geography, its long open border with India, and decades of close bilateral trade ties. The USA followed at a distant second with 11.32% ($147 million), driven substantially by the carpet trade covered above. Germany added 2.51% ($33 million), and Türkiye contributed 2.01% ($26 million). The United Kingdom supplied 1.83% ($24 million), and France added 1.02% ($13 million). Australia, Japan, Canada and Italy rounded out the top ten, each holding less than 1% of the total. Together, India, the USA and Germany made up 85.76% of total export value.
Export values swung sharply across the years covered by this data. The total stood at $960 million in 2019, dropped to $855 million in 2020 as the pandemic disrupted global trade, then nearly doubled to $1.67 billion in 2021 as the edible oil trade boomed. It pulled back to $1.30 billion in 2022 once India's tariff change took effect, still well above where Nepal's exports stood before the boom began.