KATHMANDU, JANUARY 21, 2026 – Nepal’s automotive industry has reached a historic milestone as the latest data from the Department of Customs reveals that Electric Vehicles (EVs) now make up a staggering 60% to 70% of all four-wheeler imports. This surge marks a definitive shift in consumer preference, moving away from traditional Internal Combustion Engine (ICE) vehicles toward sustainable, battery-powered transportation. The Himalayan nation, once heavily reliant on fossil fuel imports, is now being recognized globally as a leader in green mobility adoption.
The unprecedented rise in EV imports is primarily driven by the government’s aggressive tax incentives and the increasing availability of affordable Chinese and Indian models. While petrol and diesel vehicles face import duties and taxes exceeding 200%, EVs benefit from significantly lower customs and excise duties, ranging between 10% and 50% depending on their motor capacity. This price advantage, combined with the rising cost of fuel and the expansion of the national charging infrastructure, has made electric cars the first choice for both middle-class families and commercial taxi operators.
According to the customs report for the first half of the fiscal year 2025/26, major players like BYD, Tata, MG, and Hyundai have dominated the market share. China remains the leading supplier, contributing nearly 70% of the electric passenger vehicles entering the country. The trend is not limited to private cars; the import of electric microbuses and vans for public transport has also seen a sharp increase, aligning with the government’s “Net Zero” emission targets for 2045.
Financial institutions have also played a crucial role in this “EV boom.” Banks in Nepal currently offer easier financing options for electric vehicles, with loan-to-value ratios often more favorable than those for petrol-driven cars. Despite a recent central bank directive that slightly tightened the financing limit to 60%, the demand remains robust. Experts believe that the shift is also motivated by Nepal’s surplus hydroelectricity, which provides a cheap and domestic energy source, reducing the country’s massive trade deficit caused by petroleum imports.
However, the rapid transition has brought new challenges. Urban centers like Kathmandu are struggling to keep up with the demand for fast-charging stations, and the national grid is facing pressure to upgrade local transformers to handle the increased load from home charging. Despite these hurdles, the 2026 import data confirms one thing: the era of the petrol engine in Nepal is rapidly fading, replaced by a quieter, cleaner, and more economical electric future.