Nepal’s public debt climbed to Rs 2.974 trillion (Rs 2,974.90 billion) at the end of the 2025/26 fiscal year, according to the latest figures released by the Public Debt Management Office (PDMO) under the Ministry of Finance.
The national debt stock grew by Rs 300.86 billion (an 11.25% annual increase) from Rs 2.674 trillion recorded at the start of the fiscal year. Crucially, over half of the new liabilities—roughly Rs 167 billion (55.5%)—stems directly from exchange-rate losses caused by the depreciation of the Nepali rupee against the U.S. dollar and other foreign currencies, rather than net new borrowing alone.
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│ Nepal Public Debt Breakdown (FY 2025/26) │
├────────────────────────────────┬───────────────────────────────────────┤
│ Total Outstanding Public Debt │ Rs 2.974 Trillion ($19.3 Billion USD) │
│ Debt-to-GDP Ratio │ 45.07% │
│ External Debt Share │ Rs 1.599 Trillion (53.77%) │
│ Domestic Debt Share │ Rs 1.375 Trillion (46.23%) │
│ Total Annual Debt Increase │ Rs 300.86 Billion (+11.25%) │
│ Currency Loss Contribution │ Rs 167 Billion (55.51% of increase) │
└────────────────────────────────┴───────────────────────────────────────┘
Key Highlights from the PDMO Report
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Debt-to-GDP Ratio Rises: Total public debt now stands at 45.07% of Gross Domestic Product (GDP), up from 43.79% in the previous fiscal year.
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Composition of Liabilities: External liabilities account for Rs 1.599 trillion (53.77%) of the total debt burden, while internal domestic borrowing makes up Rs 1.375 trillion (46.23%).
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Borrowing vs. Targets: During the fiscal year, the government mobilized Rs 447.16 billion in total public debt, achieving 75% of its annual target. Domestic borrowing hit 99% of its operational target (Rs 358.66 billion), whereas external loan mobilization lagged significantly at Rs 88.50 billion due to slow project execution and disbursement bottlenecks.
The PDMO highlighted that while Nepal’s risk of debt distress remains within manageable thresholds according to international frameworks, growing foreign exchange exposure poses an increasing risk to future debt-servicing allocations.