The World Bank (WB) projects Nepal's economy to grow by 3.3 percent in 2024, propelled by a resurgence in tourism and an uptick in hydropower exports. Private consumption is anticipated to be the main driver of growth, buoyed by a significant rise in remittance inflows, according to the World Bank's semiannual country development update. In its latest Nepal Development Update, the WB notes the country's economic recovery trajectory, albeit with lingering challenges such as low private investment. The forecast anticipates a further rebound in growth to 4.6 percent in 2025. However, these projections are contingent upon several risks, including a potential slowdown in growth among partner countries, particularly India, Gulf nations, and Malaysia, which could lead to reduced remittances and tourism. To sustain medium-term growth, additional reforms to enhance the business environment and attract more private investment are deemed necessary.

"Strengthening the execution of capital expenditure, fostering business confidence, and enhancing Nepal's global competitiveness are crucial for fostering economic growth and alleviating poverty," remarked Faris Hadad-Zervos, World Bank Country Director for the Maldives, Nepal, and Sri Lanka.