Europe Beckons, Nepal Lags Behind

Nepal’s foreign employment story has long been told through familiar geographies. For decades, the Gulf Cooperation Council (GCC) countries have served as the backbone of labor migration for Nepal, absorbing hundreds of thousands of workers into construction sites, factories, households, and service sectors. East and Southeast Asia, especially Malaysia, Japan, and South Korea, have formed a second pillar, shaped by government-to-government arrangements, skill tests, and regimented recruitment systems. These corridors have defined not only where Nepalis work abroad, but how the Nepali state governs migration, structures policy, deploys diplomatic labor capacity, and imagines the migrant worker.

Over the past four fiscal years, however, a quieter but far more structurally disruptive shift has been unfolding  beyond this familiar map. Europe—once seen as peripheral, niche, or aspirational rather than a mass labor destination—has emerged as the most transformative new frontier of Nepali labor migration. The transformation is not just about numbers. It marks a structural change. Old recruitment models are weakening, worker-initiated migration is rising, and women are becoming more central to migration flows. These all have exposed Nepal’s labor governance to risks it is not equipped to manage.

Between 2021/22 and 2024/25, labor approvals for European destinations nearly tripled, rising from 25,697 to 72,953. Europe’s share of Nepal’s total foreign employment approvals has more than doubled over the period, from just over 4% to nearly 9%. In absolute terms, Europe still trails far behind the Gulf. But structurally, its role is far more significant than raw numbers suggest. Europe has become the anchor of individual labor migration, the most gender-inclusive major destination, and the clearest indicator that Nepal’s foreign employment system is shifting away from agency-driven mass recruitment toward worker-led, contract-based mobility.

What makes this transition striking is not its speed, but the lack of a matching policy response. Europe’s rise has occurred largely without bilateral labor agreements, without government-to-government deployment systems, and with limited consular and labor attaché coverage. The gap between migration realities and institutional preparedness is widening.

Rajendra Bhandari, former president of Nepal Association of Foreign Employment Agencies (NAFEA), says the trend of Nepalis going to Europe, either directly or via the Gulf countries, is clearly rising. Except for Cyprus, he says, institutional recruitment for Europe has largely shut down. In its place, middlemen have stepped in, charging  Rs 1 million to Rs 1.5 million per worker.

From the margins to an emerging corridor

Out of 630,090 labor approvals issued in 2021/22, only 25,697 were for European countries. Europe accounted for just over 4% of total labor approvals, dwarfed by the Gulf’s overwhelming dominance and East and Southeast Asia’s steady presence.

Even then, Europe displayed characteristics that set it apart from Nepal’s traditional labor corridors. Unlike the Gulf, which relies heavily on recruiting agencies, or East Asia, which depends on structured government-to-government mechanisms and employer-driven quotas, Europe functioned largely as an individual migration market.

Nearly half of all Europe-bound workers that year migrated through individual labor approvals. Recruiting agencies had some role, but not a dominant one. Government-to-government deployment was entirely absent. This was not incidental. Nepal has no formal G-to-G labor arrangements with European countries, and European employers rarely work through Nepali recruiting agencies. Instead, migration took place through direct employer sponsorship, personal networks, online platforms, and informal intermediaries.

This structure shaped who migrated. Women made up 28.4% of all Europe-bound workers during the year, far higher than in the Gulf, where women accounted for just 6.6%, or East and Southeast Asia, where the share was around 5%. Europe absorbed more than 7,200 Nepali women that year, reflecting labor demand in caregiving, hospitality, domestic work, and health support services, among other sectors Even at this early stage, Europe pointed to a different migration logic. It was smaller and less visible than the Gulf corridor, but more individualized, diverse, and more gender-inclusive. What looked peripheral in volume was already central in terms of transformation.

Rapid growth without institutionalization  The shift became unmistakable in 2022/23. Labor approvals for Europe  surged to 45,302, marking a dramatic year-on-year increase. Europe’s share rose to nearly 6%, even as global labor markets were still stabilizing after the pandemic.

Growth was driven almost entirely by migration through individual channels. Nearly 27,800 Nepalis received individual labor approvals for European destinations  that year, more than double the previous year. Recruiting agencies increased their activity, but remained secondary. Government-to-government deployment remained nonexistent during the period.

The timing of this expansion was not coincidental. Across Eastern, Southern, and parts of Central Europe, labor shortages intensified as economies reopened and demographic pressures became more acute. Ageing populations, declining birth rates, and outward migration within the European Union (EU) created chronic labor gaps in construction, manufacturing, agriculture, logistics, caregiving, and hospitality sectors. Employers increasingly turned to third-country workers to sustain operations.

Romania emerged as the single largest European destination in 2022/23, absorbing more than 14,000 Nepali workers. Croatia and Malta followed, with Poland and Cyprus also seeking significant inflows. These were not traditional destinations within Nepal’s migration imagination, nor were they supported by formal bilateral labor frameworks. Yet demand grew rapidly, driven by employer need rather than state-to-state negotiation.

Gender dynamics remained distinct. Women accounted for more than a quarter of Europe-bound workers in 2022/23, a proportion far exceeding the global average. Among re-entry workers—those returning to the same destination—the share of female workers exceeded 40%. This suggested continuity, not only entry, with women sustaining employment relationships over time. Despite this deepening engagement, Nepal’s institutional response did not change. No new labor agreements were signed. Labor attaché coverage in Europe  remained limited. Migration expanded, but governance structures remained frozen in an older model.

Europe enters the mainstream

By 2023/24, the European labor market was no longer marginal or experimental. Labor approvals rose to 57,146, accounting for more than 7.7% of Nepal’s total migration In proportional terms, Europe began to rival East and Southeast Asia. This phase was marked by consolidation. Individual-new approvals surged past 39,500, accounting for nearly 70% of all Europe-bound workers.

Placements through recruiting agencies declined further. G-to-G migration remained negligible, with only 41 cases recorded.

Women continued to play a central role, accounting for over 26% of Europe-bound workers. Although Europe represented less than 8% of total migration that year, it absorbed nearly one-fifth of all female labor approvals. No other major region had exhibited such a high concentration of women.

Romania and Croatia together accounted for nearly half of all Europe-bound labor migration, confirming Eastern Europe as a structural corridor. Cyprus and Malta continued to attract female-heavy flows, while the United Kingdom maintained a steady but comparatively smaller intake.

Record volumes amid growing risks The most recent data from 2024/25 confirmed that Europe’s rise is structural, not temporary. Labor approvals reached a record 72,953, pushing Europe’s share to 8.69% of total approvals. In just four years, Europe had more than doubled its proportional importance within Nepal’s migration economy. Once again, growth was driven by individual migration. More than 50,000 new workers left for European job destinations with individual approvals. Recruiting agencies accounted for fewer than 9,000 workers, while government-to-government deployment was entirely absent. Female participation stood at nearly 24%, far above the Gulf’s 9.3 percent and comparable to East and Southeast Asia. Europe absorbed almost one-fifth of all Nepali female migrant workers that year.

Romania strengthened its dominance, receiving nearly 28,000 Nepali workers in a single year—more than any other European country across the four-year period. Croatia followed, while Cyprus, Malta, Serbia, Bulgaria, Portugal, and Austria rounded out the list. Many of these countries still lack formal labor agreements with Nepal.

An Individual migration market One pattern clearly stands out in the past four fiscal years. Europe is an individual-migration market. Individual-new permits rose from 44% of Europe-bound migration in 2021/22 to nearly 70% by 2024/25.

This reflects broader global shifts in labor recruitment. European employers increasingly rely on direct hiring, contract-based sponsorship, and skill-specific recruitment rather than mass agency placement. Digital platforms,  employer networks, and diaspora connections also play a growing role in linking workers to jobs.

For Nepali workers, individual migration  can also offer tangible benefits. Recruitment costs are often lower, and processing times are faster. Workers may have more choice and autonomy in choosing employers and negotiating contracts. But there are also risks involved.

Individual migrants operate largely outside Nepal’s regulatory oversight. They are more vulnerable to contract substitution, visa irregularities, and wage  theft. Grievance mechanisms are weak, especially in countries where Nepal lacks labor attachés or enforceable agreements. When disputes arise, workers often  have little institutional support beyond overstretched embassies.

According to Bhandari, Nepali embassies in Europe have stopped verifying demand letters for recruitment agencies to send the workers. This, he says, has created a fertile ground for middlemen and traffickers to charge a hefty amount from workers. “Somehow the visa gets issued and the middleman, after taking a lot of money, manages to send the individual to Europe,” Bhandari added. “That’s why we are seeing more people going through individual channels rather than institutional ones. When people go individually, the risk is very high.” He describes this as a form of policy corruption where embassy inaction pushes workers toward illegal channels. “Embassies are not verifying demand from even the countries with which Nepal has labor agreements, citing a lack of resources,” he alleged.

Although many Nepalis are currently working in Europe, observers say nobody knows who sent them. “It is generally understood that people are applying on their own to get such visas, but can ordinary individuals get such visas on their own?,” they question, emphasizing that middlemen and traffickers are playing a significant role in bringing such visas.

“Except for Cyprus, institutional recruitment of workers for European jobs has been shut down,” Bhandari said. “But middlemen are attracting workers by charging them Rs 1-1.5 million per person.” To address the issue, recruitment agencies argue that authorities concerned and the government should first make embassies verify demand letters so that workers could be sent through institutional channels. This would also prevent middlemen from duping workers, they say.

Institutional paralysis

The absence of government-to-government arrangements in Europe is striking. Over four years, Europe absorbed tens of thousands of Nepali workers without a single structured deployment system. This stands in sharp contrast to East Asia, where G-to-G mechanisms remain central, and even to the Gulf, where bilateral agreements underpin agency recruitment.

Chandra Bahadur Shiwakoti, Spokesperson at the Department of Foreign Employment (DoFE), the government agency under the Ministry of Labor, Employment and Social Security, overseeing labor permits among other foreign employment related issues, says issues regarding the institutional work permits for European jobs fall largely with the Ministry of Foreign Affairs. “Our role here is to give approvals,” he said. “We have our embassies there. What is the role of those embassies, and why is that role not being fulfilled? It would be good to ask the Ministry of Foreign Affairs.” More people want to go to Europe. But Shiwakoti raises a basic question: is the demand real?

“Is there genuine business demand, or not? In such cases, should demand be verified? Should the state look into it?” he asked. “There is no presence of our department or ministry there. Only embassies are present. So what is the Ministry of Foreign Affairs doing to protect workers and move migration  towards an institutional route? Why are safe and formal channels not being developed? That is the real question.”

Shiwakoti also said there is no formal inter-ministerial coordination mechanism. “When problems arise, we write to the Ministry of Foreign Affairs. They communicate through embassies. There is also a labor attaché, but even the attaché is an employee of the Foreign Ministry,” he said.

“Our role is limited,” he added. “If someone brings a demand and submits documents, we verify them and issue approvals. That is our responsibility. All external engagement is handled by the Ministry of Foreign Affairs. Many embassies and consulates were opened specifically for labor diplomacy. What exactly are they doing?”

DoFE officials say they also handle cases  and complaints, and monitor institutional compliance. “But once workers have gone abroad, responsibility shifts to the Ministry of Foreign Affairs,” they said.

Attempts to obtain comments from MoFA officials were unsuccessful.

Jeevan Baniya, deputy director at Social Science Baha, said that even when people claim otherwise, manpower-related actors are involved in European migration in one way or another. The core problem, he says, is the absence of bilateral labor agreements and the lack of approval for manpower agencies to formally bring European demand and send workers.

“In recent years, people have gone from Nepal to Croatia and Romania, then to Bulgaria to some extent, and more recently to Greece,” Baniya said. “Even so, some manpower agents and individuals manage to bring demand from these countries. They collect money here—usually between Rs 1 million and Rs 1.5 million—through intermediaries. In one case in Greece, I found a worker who had paid Rs 1.7 million.”

Amid the narrative that Europe has opened up new opportunities, Baniya stressed the need to look closely at labor dynamics in countries such as Croatia, Romania, and Bulgaria. Free mobility within the European Union allows workers to move onward to Italy and Spain, and then in large numbers to Germany. Earlier, many moved towards the UK.

This happens because of wage differences and better living conditions in richer countries. As people leave, labor shortages emerge in the sending EU states. “Those shortages are then filled by workers from countries like China, India, Sri Lanka and Nepal,” Baniya said. “In some countries, hundreds of thousands—sometimes even a million—people leave every year. Even smaller countries see 30,000 to 40,000 people leaving annually.”

As long as these labor shortages persist, demand will continue to come, observers say. Another major driver is the care economy. Europe’s ageing population requires a steady supply of workers of productive age. “Countries like Germany, Italy and Spain are the final destinations,” Baniya said. “But intermediate countries help meet that labor demand. Countries like Nepal supply labor into this chain. Demand from Nepal will continue, depending on European labor dynamics.”

Baniya also pointed to underreported exploitation. “Beyond the high recruitment fees, people are paying around Rs 150,000 just to secure a visa appointment date in some cases,” he said. “This happens because there is no proper institutional mechanism for sending  workers.”

From the European side as well, the absence of Memorandums of Understanding (MoUs) has been creating confusion. There is no clarity on which manpower agencies should be allowed to send, or what types of jobs should be approved. This lack of clarity has placed a heavy burden on embassies.

“Diplomatic missions then become reluctant to verify demand letters,” Baniya said. “That reluctance mainly stems from the absence of MoUs and clear frameworks. We do not have development missions everywhere, and reviewing demand without proper research creates serious overload.”

The latest labor migration report mentions arrangements with Romania and Germany. But Baniya says those are not labor agreements, only expressions of intent.  Countries like Germany do face labor shortages, but their current focus is on highly skilled workers.

“You can see this in policies like the EU Blue Card,” he said. “It allows skilled workers to work for up to five years and bring family members. There have been attempts to see whether Nepal can supply such workers, but this will be possible with clear bilateral agreements. There must be clarity on whether recruitment is done by manpower agencies or directly by the state.”

The same issue applies to Romania. In wealthier European countries, hiring local or EU workers requires higher wages and benefits. Workers from Nepal, Sri Lanka or India are relatively cheaper, which also shapes demand.

Gender, care work, and Europe’s labor demand Europe’s higher female participation is not accidental. It reflects growing labor demand in ageing societies facing chronic care shortages. Caregiving, domestic work, hospitality, health support services and social care roles make up a growing share of demand. Cyprus and Malta consistently show female-heavy migration flows. The UK and parts of Southern Europe have more balanced gender ratios. Even in Eastern Europe, where construction and manufacturing dominate, women’s participation remains  significantly higher than in the Gulf.

Re-entry data reinforces this pattern. Female re-entry rates are consistently higher than male rates, suggesting better job continuity and employer retention. For many Nepali women, Europe offers not only higher wages but greater legal protection and social legitimacy than traditional destinations.

However, Baniya cautions against generalization. “In many European destinations, labor shortages are mainly in agriculture, which tends to attract more men,” he said. “Cyprus is different. Demand there is high in care and household services, which is why more women go. Some also go as dependents. Outside Cyprus, women’s numbers are not very high in most European countries.”

Baniya says Europe should now be considered an important labor destination for Nepal. “There is demand, driven by labor dynamics, ageing populations and internal mobility. But it will not reach the scale of traditional destinations like the Gulf or Malaysia,” he said.

Policy inertia in a changing migration economy

Despite Europe’s growing importance, Nepal’s labor diplomacy is still focused on older corridors. Institutional capacity, staffing and negotiation efforts are still concentrated on the Gulf and East Asia, even as tens of thousands of Nepali workers enter European labor markets each year. Nepali workers are integrating into Europe at scale—without labor agreements, without government-to-government safeguards, and often without adequate consular  support.

This raises urgent questions about sustainability, protection, and state responsibility. How long can Nepal rely on a system that places most of the risk on individual workers? What happens when disputes arise in countries without formal labor frameworks? And why has policy failed to adjust to Europe’s rise?

Europe may not yet rival the Gulf in volume. But it represents the future shape of Nepali labor migration—more individualized, more gender-balanced, more circular, and more diverse.

The trend is unmistakable. Nepalis are building new labor corridors ahead of policy. Whether the state responds by strengthening agreements, expanding labor diplomacy and formalizing channels—or continues to lag—will shape  the next phase of Nepal’s migration economy. Europe is no longer a footnote. It is a test of Nepal’s ability to govern migration in a rapidly changing global labor order.

(This report was originally publihsed in January 2026 issue of New Business Age magazine.)