Nepal has made one of the fastest leaps to electric mobility anywhere in the world. Customs data of fiscal year 2024-25 show that electric cars, jeeps and vans accounted for around 73 percent of all newly-imported four-wheeler passenger vehicles, placing Nepal among the global frontrunners in EV market share for new imports. More than 13,500 EVs got imported in the country that year alone, reflecting not a niche trend but a mainstream consumer shift. The momentum is driven as much by economics as by environmental goals: competitive pricing from international manufacturers, preferential tax structures and a national grid powered over 90 percent by domestic hydropower have combined to make going electric the logical and cost-efficient choice for many Nepali households.
Nepal’s advantage is structural. With roughly 90 percent of electricity coming from hydropower, most EV kilometers run on domestic renewable energy. Installed capacity reached more than 3,600 MW by mid-July 2025, almost all from clean sources. This alignment of energy and transport strengthens energy security, eases the import bill, and turns decarbonization into a practical development strategy.
Nepal’s EV journey has deep roots. The Kathmandu trolleybus launched in 1975, offering an early template for electric public transport. In the 1990s, battery-powered Safa Tempos entered the scene and by 1999 the government phased out diesel three-wheelers in the valley, accelerating the switch to cleaner electric three-wheelers. Today’s momentum stands on these foundations.
Across South Asia, progress is uneven. In India, EVs reached 4.1 percent of new passenger vehicle sales in May 2025, up from 2.6 percent a year earlier, strong growth but still below Nepal’s current pace. Bangladesh has only a small, registered EV car base, yet millions of electric rickshaws operate informally, revealing latent demand. Pakistan remains at an early stage for passenger EVs, with policy targets of 30 percent of new car sales by 2030 and 90 percent by 2040, while charging infrastructure expands from a low base. Sri Lanka’s adoption stalled during its 2020 to early 2025 vehicle import ban and is now easing. Bhutan’s push has focused on public fleets and taxis, in line with its carbon neutral policies.
Clean electricity is no longer a distant dream for Nepal; it is already moving across borders. The 25-year power trade agreement with India, signed in January 2024, set a target of 10,000 MW of exports within the next decade, giving long-term certainty to Nepal’s hydropower sector. That commitment was reinforced in June 2025 when Nepal exported its first 40 MW of electricity to Bangladesh through India’s transmission network, marking a historic tripartite breakthrough in regional energy trade.
The road ahead is clear. First, heavy transport: buses and trucks need targeted financing and dependable high-capacity charging to electrify at scale. Second, infrastructure depth: reliable public charging in cities and along highways will sustain consumer confidence beyond early adopters. Third, policy stability: clear, multi-year signals on tariffs, standards and incentives will de-risk private investment across vehicles, charging and grid upgrades. With a hydro-dominant grid and one of the world’s highest EV shares for new four-wheelers, Nepal is well-positioned to convert today’s momentum into durable economic, environmental and strategic dividends.
Looking ahead, Nepal should move from adoption to systems design. Set clear multiyear targets with public reporting, mobilize concessional finance for buses and freight, and build corridors charging on every major highway. Grow local assembly, components, battery second life and recycling to anchor jobs and cut import exposure, while smart charging and time of use tariffs keep the grid stable. Pilot vehicles to grid, electrify public transport in secondary cities, and green logistics. With disciplined execution and regional power trade, Nepal can set South Asia’s playbook for clean mobility.
Nepal has shown that clean mobility is possible today. The task now is to make it routine by setting clear yearly targets, supporting buses and trucks with affordable finance, expanding reliable charging, and encouraging local assembly and battery reuse. Through smart policies and consistent execution, Nepal can turn its early momentum into a lasting national advantage and a model for the region.
