Towards Sustainable Export Growth

Adam Smith, the father of Economics, in his book The Wealth of Nations (1776), mentioned that trade is the only way to make a country rich.  Since the era of Mercaantilism, foreign trade has long been recognised as a cornerstone of economic development and prosperity.  Countries that have attained the pinnacle of prosperity today are only because of trade.  For a small, landlocked country like Nepal, trade is predominantly important because it is the main catalyst to provide access to global markets, stimulate employment, and support poverty alleviation.  However, despite its rich cultural heritage, indigenous traditions, and natural resources, Nepal has been struggling to establish a significant footprint in the global marketplace.  

On the one hand, Nepal’s export portfolio is modest and concentrated in a handful of items. Major exports include refined palm oil, soybean oil, synthetic yarn, woollen carpets, cardamom, fruit juice, jamdani fabric, jute products, and iron plates. These products demonstrate some level of diversity; they often represent either raw materials or low-value-added goods. On the other hand, the volume of imports is much higher than that of exports, triggering a high trade deficit. Imports remain largely dominated by petroleum products, gold, mobile phones, machinery, and raw materials. The persistently high trade gap largely indicates the structural weakness of Nepal’s trade sector. Lack of branding, inadequate digital integration, weak marketing strategies, and insufficient value addition constrain the competitive edge of Nepali products. 

Comparative advantages

Despite possessing high-quality cultural goods, Nepal has yet to capitalize on its comparative advantages. Most of the Nepali products, to a large extent, represent cultural identity, craftsmanship, and sustainability. A hand-woven scarf, for instance, is not simply a textile, but a symbol of community, tradition, and resilience. Dhaka topis, copper vessels, and pashmina shawls represent more than functional goods—they reflect heritage and identity. These unique qualities, if properly marketed, can capitalize on niche markets abroad. Nepali products can contribute to global diversity while supporting local livelihoods. 

International consumers are increasingly motivated by emotional and experiential factors rather than price alone. In global markets, branding often assures success as much as quality. Products that communicate values—such as sustainability, fairness, and authenticity—tend to capture consumer loyalty. For Nepal, this means selling stories alongside products. Fundamentally, this is a unique way of selling products in international market. Campaigns emphasising “Crafted in the Himalayas,” or “Organic Tea from Community Forests” can differentiate Nepali goods from mass-production.  

In marketing a product, storytelling enhances value perception. A copper vessel marketed as “a tradition that carries a family’s legacy” or pashmina presented as “sustainably woven luxury from the Himalayas” can transform consumer experience. This approach largely coincides with global trends in ethical consumption and cultural tourism. One of the major constraints of Nepal’s exports is overdependence on raw or semi-processed goods. To overcome this, Nepal must move towards value addition. For example, exporting essential oils, herbal cosmetics, and wellness kits would be more profitable than raw herbs. Similarly, branded pashmina and designer woollen products could yield higher returns than raw wool. This strategy requires innovation, investment in technology, and capacity-building for local entrepreneurs.

Moreover, promoting sustainable production and eco-friendly packaging could further provide additional advantages, especially in the European and North American markets, where consumers are sensitive to environmental standards. Global acceptance of Nepali products begins with its originality. A sense of national identity, “Made in Nepal” tags must be entrenched. Government campaigns, public procurement policies prioritising domestic products, and consumer awareness programmes can create an enabling environment where local products are respected and preferred. This internal validation is a prerequisite for building external credibility. 

In this regard, the development of entrepreneurship and creativity is important. Policies that reduce bureaucratic hurdles, provide tax incentives for exporters, and facilitate logistics are essential. To make this happen, simplifying customs procedures, ensuring better transport connectivity, and strengthening trade diplomacy are crucial.  Moreover, Nepal must pursue bilateral and multilateral trade agreements that provide preferential access to major markets. Equally important is securing international certifications such as ISO, Fair Trade, and Organic labels, which are prerequisites for entering premium markets.

Above all, the digital economy presents immense opportunities for Nepali exporters. Growing online platforms such as Amazon, and Alibaba have enabled small producers worldwide to access international consumers directly. However, Nepali producers remain underrepresented in these spaces due to limited digital literacy, poor logistics, and lack of institutional support. By investing in digital marketing skills, logistics infrastructure, and e-commerce platforms, Nepal can connect rural artisans to global buyers without intermediaries.

Digital transformation

On top of that the global Nepali diaspora represents an underutilised asset in promoting Nepali products. Embassies, Non-Resident Nepali (NRN) associations, and cultural organisations can organise exhibitions, trade fairs, and “Nepali Product Weeks” in host countries. These initiatives not only expand visibility but also create trust and demand within international communities. Moreover, collaborations between embassies and private enterprises can strengthen brand recognition. For example, cultural diplomacy initiatives linking Nepali cuisine, handicrafts, and music with trade exhibitions could enhance the overall image of Nepal as a source of unique and authentic products.

Youths play a pivotal role in developing new ideas.  Nepal’s young entrepreneurs have been experimenting with sustainable fashion, organic cosmetics, and technology-driven solutions. In this regard, skill development programmes recently organised by the Kathmandu Metropolitan City can be taken as an example. Its products, blended with cultural richness and artisanal excellence, can compete internationally if supported by effective branding, value addition, digital transformation. To achieve this, collaboration between government, private sector, diaspora, and youths is essential.  Above all, enhancing Nepal’s export competitiveness is not just an economic imperative, but also a cultural mission—one that allows the country to share its heritage, creativity, and identity with the world.

(The authors are research scholors.)