Nepal Urged to Boost Infrastructure Spending with Stronger Private Sector Support
Infrastructure development is essential for Nepal’s economic growth and improved living standards, covering sectors like transportation, energy, water, health, education, and urban development. Nepal’s economy relies heavily on agriculture (24.1% GDP) and services (62.9% GDP), but weak market infrastructure, poor transportation networks, and slow industrialization are limiting progress. While hydropower production has reached around 3,000 MW and tourism is expanding, sustainable development requires stronger investment in productive sectors. The private sector already contributes 81% of GDP and over 85% of employment, yet infrastructure projects remain limited due to low government capital expenditure. Institutions like NIFRA can support funding, but Nepal must accelerate Public-Private Partnerships (PPP), ensure stable policies, and attract foreign investment. Clear planning and stakeholder coordination are key to closing Nepal’s infrastructure gap.