Agricultural Land Area Declines in Karnali Province: NRB Report

Agricultural land coverage in Karnali Province declined by the end of the last fiscal year (FY 2024/25), according to a recent study by Nepal Rastra Bank. The central bank’s report shows that the area under cultivation had fallen by 0.08 percent as of mid-July 2025 compared to the previous year.

Among major food crops, the area covered by paddy, maize, wheat, millet and barley decreased by 5.11 percent, 4.16 percent, 4.86 percent, 11.52 percent and 1.39 percent, respectively.

Similarly, the area under vegetable crops fell by 14.91 percent, while the area under fruit cultivation increased by 2.40 percent. Overall agricultural production in the review year declined by 5.01 percent. During the same period, the production of cash and other crops decreased by 3.95 percent.

During the review period, production of key food crops such as paddy, wheat, millet and barley fell by 10.25 percent, 17.31 percent, 22.92 percent and 8.55 percent, respectively, while maize production increased by 4.24 percent. By the end of FY 2024/25, vegetable production and fruit production had decreased by 0.88 percent and 36.41 percent, respectively.

Bank and financial institutions (BFIs) supplied 8.02 percent of their total credit to the agricultural sector in Karnali Province. This represents a 7.70 percent decline from the previous year.

The average capacity utilization of industries sampled in the province stood at 46.52 percent. Capacity utilization was highest in the wire and cable industries at 90 percent, while carpet industries had the lowest utilization at 23.08 percent. Industrial lending in the province decreased by 1.94 percent, accounting for 6.50 percent of the total credit flow.

The number of tourists entering the province increased by 1.72 percent during the review year. Tourist arrivals from India and China dropped by 23.85 percent and 25.77 percent, respectively, whereas arrivals from other countries increased by 9.13 percent.

Meanwhile, 85.47 percent of the total credit issued by BFIs in Karnali Province went to the service sector. The number of branches of banks and financial institutions in Karnali Province in the review year stood at 475 while there were 18 branchless banking units. The credit-to-deposit ratio stood at 66.85 percent.

According to the Karnali Provincial Office of the Nepal Electricity Authority, the total length of transmission lines in the province reached 3,575.74 circuit kilometers in FY 2024/25. Construction of the Pushpalal Mid-Hill Highway, Karnali Corridor, Madan Bhandari Highway and the Bheri-Babai Diversion Multipurpose Project has been progressing steadily, the report added.

Read Full Report: Karnali-Yearly-EAR-2081.82-v08.02.docx.pdf