EV Adoption in Nepal | Growth & Future Trends

Nepal in Top of EV Adoption

September 16, 2025

Introduction

The current state of EV adoption is at full swing, as about 70% of cars being sold in Nepal are electric. The constant engine rumble and air pollution from carbon emission vehicles are being replaced by quiet and carbon-free electric vehicles (EV) in the form of cars, jeeps, motorcycles, etc.

With changes in government vehicle policy and people's interest, the automobile industry is pivoting towards electric, making it a smart policy for the economy and environment. Let's jump into why Nepal is adopting EV on an extensive scale.

History

Around 1995, the introduction of EVs in Nepal took place with three-wheelers (battery powered tempo) replacing diesel powered tempos. The government started to understand the benefits of EVs towards the environment, yet the policies hardly changed for electric vehicles.

Small-scale projects like electric Safa tempos took place. Nepal Electricity Authority (NEA) started diving into electric vehicles and EV charging options. The government introduced tax incentives on EVs so people can easily buy them, transitioning to EV adoption by making it cheap, with tax breaks, etc. When the NEA solved load-shedding issues, and with government tax breaks, people started to adopt electric vehicles at a great pace.

Fast forward to today, electric vehicles are being used in a lot of areas with massive adoption and imports, fuel engines are being replaced, and we are heading towards green cities.

Adoption of EV

Past Days:

Started as an experiment to become one of the top importers:Nepal’s transition was not a quick shift but the outcome of years of awareness, policy shifts, and technical advancement. The first introduction to the electric environment was through electric public transport, Safa Tempo, in Kathmandu Valley as a replacement for diesel tempos, which became an early environmental consciousness. The cost of electric vehicles was high with minimal options; less knowledge, awareness, and technology didn’t attract consumers. The government policies did not favor it as well.

Present (Turning Point):

The advancement of technologies and increasing awareness led to growing adoption of electric vehicles. The Nepal Electricity Authority (NEA) and the government played a critical part and are the main catalysts for this change. NEA started to deliver electricity at a stable rate as Nepal suffered extreme electricity shortages and loadshedding. This stability brought a sense of safety among consumers, as electric vehicles consist of batteries and need to be recharged before use, and this can be done at home. The recharge price with electricity is far cheaper than filling up with petroleum products as well; the extensive rise in petroleum products with no tax breaks started to be a pain point for consumers, making them ditch fuel emission vehicles.

The government played its role by changing policies for electric vehicles regarding import tax. They slashed the import duties for EVs but kept the fossil fuel high so people would switch to EVs. This decision led to hypergrowth in electric vehicle adaptation, like cars, jeeps, motorcycles, etc., which increased imports and sales domestically and lowered noise and air pollution to some extent. Since then the use and adaptation of EVs towards public transportation has shown exponential growth. Now NEA and private companies have introduced charging stations where electric vehicles can be recharged similarly to petroleum stations at different locations.

Future Condition and Growth:

Attractive factors

The mass EV adoption in Nepal is happening due to all of the positive aspects discussed below.

• The number one reason for the adoption of electric vehicles is financial incentives. Import taxes and duties are very low compared to petroleum vehicles. E.g., 200%+ total taxes for fossil fuel cars, but with EVs, taxes start from just 10% (EV taxes depend on vehicle type and its range).
• As over 90% of Nepal’s electricity comes from hydropower, EVs will run on clean, renewable energy and save money on petroleum imports with home charging.
• It contributes to the environment, as electric vehicles have no sound and carbon emissions, being a solution to noise and air pollution.
• Modern EVs provide fast charging, long ranges, and attractive features, making them a great replacement.
• It can be a practical option, as Kathmandu is well within the EV range. It saves money, as it can be refueled at home overnight.

Challenges

Though adaptation of electric vehicles is at an all-time high, there are things you need to be aware of, mentioned below:

• The upfront cost is very high despite significant tax breaks compared to petrol vehicles. This discourages a lot of buyers.
• The fear of getting stranded due to running out of charge without an EV charging station close by is common among people. The time required to fill up an electric car is very high.
• Despite doing lots of improvement, NEA still can't provide electricity equivalent to the requirement with stability.
• Electric vehicle batteries are expensive to replace with no recycling system. The range decreases over time, making travel uncertain. The resale value is also very low, making it a tough bargain.
• People are concerned about performance due to Nepal’s roadmap and condition.
• The policies do support and encourage EV adoption but can change in the future.

Future of EV

Nepal shows positive statistics on sales, imports, and usage towards electric vehicle adoption. This change is driven by strategic EV tax incentives, hydropower, and increasing health awareness but needs to fight challenges like expensive upfront costs and lack of charging infrastructure.

With further investment in grid updates and a circular economy of batteries, Nepal will achieve exponential growth in EV adoption and clean cities in the upcoming future.

This journey towards a cleaner, energy-independent future is rocky but achievable.

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