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NARENDRA ADHIKARI runs a grocery shop in Lokanthali, on the eastern edge of the Kathmandu valley. Over the past several seasons, he has watched the price of a sack of Sona Mansuli rice climb from Rs1,700 to over Rs2,000, while Jeera Masino, a more popular premium variety, commonly flirts with Rs2,600 or so. None of this rice was grown abroad out of necessity. Nepal has some 1.37m hectares currently under paddy cultivation—more land devoted to rice than to any other crop—in a country where 65% of the workforce depends on agriculture. Yet the rice on Adhikari’s shelves, like an increasing share of what Nepalis eat, arrived from somewhere else.
Nepal’s annual agricultural import bill hovers around Rs360bn, fueled heavily by the domestic demand for fine, aromatic rice varieties that local farms do not widely produce. According to recent Department of Customs data, even during windows where domestic production fluctuates, imports of paddy and rice alone frequently surpass Rs28bn in a mere eight-month span, alongside tens of billions spent on vegetables, food grains and edible oils. The total food and livestock import bill has expanded drastically over the last decade, fundamentally exposing the country’s vulnerability to global supply chains and regional export curbs.
This was not always the arrangement. Nepal was a net rice exporter for most of the twentieth century. The reversal began gradually after 1990 and has accelerated since. Whereas Nepal’s population grew rapidly over six decades to nearly 30m, the productivity of its land struggled to keep pace. Though paddy yields advanced over the decades to peak at 4.19 tonnes per hectare before climate-induced fluctuations brought them to 4.14 tonnes per hectare, overall output continues to leave a massive deficit.
To meet a domestic baseline demand of 4m or so tonnes of clean milled rice, Nepal consistently faces a systemic shortfall of around 500,000 tonnes a year. A country whose population grew geometrically tried to feed itself off yields that grew arithmetically.
The most direct cause is the same one reshaping every other corner of Nepal’s economy: out-migration. Vast tracts of farmland now lie fallow because the people who would work it have left. Estimates place the share of cultivated land left idle or underutilised at some 32%. The workers most capable of modernising agriculture—educated, willing to adopt new tech and financially able to invest in localised irrigation—are the ones most likely to take a job in the Gulf or Malaysia instead. Remittances sent home end up financing foreign rice imports at neighbourhood grocery counters, a transaction that makes sense for any individual household but steadily hollows out the primary sector for the country as a whole.
What remains of Nepali farming is incapable of competing even when workers stay. The average landholding remains minuscule at just 0.6 hectares, heavily fragmented across generations of inheritance and too small for substantial economies of scale or modern mechanisation.
Barely a third of agricultural land has year-round irrigation, leaving the country heavily exposed to weather anomalies like the acute droughts that crippled plantings in Madhes Province, Nepal’s historic breadbasket. Post-harvest losses in fruits and vegetables run between 30-40% due to a missing cold-chain infrastructure. National Statistics Office analyses place the comparison starkly: agriculture contributes just 25.16% to Nepal’s GDP while anchoring 65% of its labour force—a ratio that signals chronic underproductivity rather than rural prosperity. Imported produce, grown at massive scale and heavily subsidised in India or China, frequently undercuts local farmers on price.
Government intervention, where it has existed, has tended to miss the target. Large-scale funding packages and agricultural commercialisation projects intended to raise rural incomes and boost localised infrastructure have historically faced extreme institutional leakages. Post-investigation data has repeatedly shown that big portions of development budgets are captured by intermediaries and “paper farmers”—urban middlemen who possess the administrative literacy to extract grants and subsidised soft loans while genuine cultivators remain isolated from state support.
The forecast offers little reprieve. Total paddy production dipped by 4.2% to around 5.7m tonnes following severe rainfall deficits during prime planting seasons. Nepal possesses everything a thriving agricultural economy needs in theory: extraordinary topographical diversity as well as fertile plains and a massive captive domestic market.
What Nepal lacks is a rural workforce willing to stay on the land; rules that allow farming at scale; and a state capable of getting seeds, fertiliser and irrigation to the people who need them. Until those problems are fixed, the sacks on Adhikari’s shelves will keep coming from across the border, even though Nepal devotes more land to rice than to almost any other crop. ■
