Nepal’s income from the export of information technology (IT) services grew by 20.28% in the first four months of the current fiscal year (2024/25) compared to the same period in the previous fiscal year.
According to data from Nepal Rastra Bank (NRB) up to mid-November, earnings from IT service exports reached Rs 6.69 billion, up from Rs 5.56 billion in the same period last year. This includes Rs 1.72 billion from telecommunication services, Rs 4.96 billion from computer services, and Rs 9.3 million from information services.
During this period, Nepal imported IT services worth Rs 1.19 billion, resulting in a net surplus of Rs 5.50 billion in IT service trade. Imports included Rs 456.8 million in telecommunication services, Rs 684.1 million in computer services, and Rs 52.1 million in information services.
Nepal’s IT exports primarily consist of software products, mobile applications, and related services, with increasing global demand. However, the actual earnings from IT exports are believed to be significantly higher than the figures reported, as many service providers receive payments through informal channels.
Reports indicate that some individuals retain earnings abroad or transfer funds into Nepal through informal methods such as hundi. Compliance issues, tax burdens, and bureaucratic challenges discourage formal reporting of these earnings. Additionally, many exports stem from personal or freelance activities, further complicating their inclusion in official records.
Despite these challenges, NRB data shows consistent growth in IT service income. A study by the Institute for Integrated Development Studies (IIDS) revealed that Nepal earns approximately USD 515 million annually from IT service exports, with an equal split between formal and informal channels.
The study also highlighted that 66,500 IT professionals in Nepal are engaged in exporting IT services. Stakeholders noted that formalizing informal earnings could significantly enhance Nepal’s economy by increasing tax revenues and boosting foreign exchange reserves.
