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Key Insights
Nepal has experienced a dramatic surge in electric vehicle adoption, with EVs now comprising over 70% of new four-wheeler private vehicle imports.
Government policies, including reduced taxes and ambitious targets, are key drivers, aiming for 90% EV sales for private vehicles by 2030.
The shift to EVs is crucial for combating severe air pollution in Kathmandu and leveraging Nepal's abundant hydropower resources for clean energy.
Despite challenges like import standards and skilled labor, international partnerships are supporting infrastructure and technical training for sustained growth.
Kathmandu, Nepal – Electric vehicle (EV) adoption in Nepal has surged dramatically, with over 70% of four-wheeler private vehicles imported last year being electric, marking a significant shift in the nation’s transport landscape. This rapid transition, particularly evident in the capital, is driven by strategic government policies, economic incentives for consumers, and a pressing need to combat severe air pollution.
Sabin Kumar Chettri, a cab driver in Kathmandu, exemplifies this shift. After a decade of operating a gasoline-powered vehicle, Chettri switched to an EV in 2024, citing substantial savings on fuel, maintenance, and taxes. “I drive about 130 kilometers daily and charging costs me just 500 rupees,” Chettri stated, highlighting the economic viability. “EV companies provide free servicing up to 160,000 kilometers, which saves us a lot of money.” This personal experience reflects a broader trend; Nepal’s EV fleet expanded from a mere 250 units in 2020 to over 13,000 by 2024.
The Nepali government has implemented an ambitious EV agenda, aiming for 90% of new private and 60% of new public four-wheeler vehicles sold from 2030 onward to be electric. Suresh Shrestha, Senior Divisional Engineer and Chief of the Vehicle Fitness Test Center at Nepal’s Ministry of Physical Infrastructure and Transport, attributes this success to reduced tariffs and a growing consumer willingness. “EVs are taxed less than internal combustion engine vehicles, and today, EVs offer similar range and features,” Shrestha explained.
This transition is critical for Kathmandu, which consistently ranks among the world’s most polluted cities. Emissions from approximately 1.75 million vehicles are a major contributor to air quality that can be 20 to 35 times higher than WHO-recommended PM2.5 levels. EVs are seen as a vital solution to this public health crisis, which causes an estimated 26,000 deaths annually in Nepal. Suman Maharjan, an EV dealer in Kathmandu, noted, “Customers are more aware of environmental issues these days, and they also want to save on fuel and maintenance costs. We’ve already sold 125 units and 250 more are booked within just six months.”
While Nepal currently relies on imports from China and India for nearly all its EVs, the government is actively collaborating with international partners to sustain this growth. Challenges include establishing import standards and addressing a shortage of skilled technicians. The World Bank is studying the feasibility of converting existing ICE vehicles to EVs, while organizations like the Mitigation Action Facility, Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), and the Global Green Growth Institute (GGGI) are supporting skill development and financing access. Shrestha emphasized Nepal’s strategic advantage: “With abundant clean hydropower, Nepal is in a perfect position to drive the shift to sustainable transport.” This abundant domestic clean energy source is poised to power the expanding EV fleet, further reducing reliance on imported fossil fuels and enhancing national energy security.