Nepal is a developing country with an agricultural economy. The country’s attempts to expand into manufacturing industries and other technical sectors have achieved much progress. Farming is the main economic activity, followed by manufacturing, trade and tourism, although, sadly these have been badly affected by the world events of the last two years, not to mention the massacre of the Royal family, and the Maoist/government confrontation.

As a rule, the chief sources of foreign currency earnings are merchandise export, services, tourism and Gurkha remittances.

Manufacturing :

Manufacturing is still at the developmental stage, representing less than 10% of the GDP. The chief industries include carpets, cement, garments, leather products, paper and textiles. Although there are many modern, large-scale factories, most of the production is from cottage or small-scale operations. Most of Nepal’s industry is based in the Kathmandu Valley and in some small towns in the Terai.

**Photo courtesy of Laurent Bollinger

Trade :

Trading is second nature to the Nepalese people, especially as the country is situated at the cross-roads of the ancient trans-Himalayan trade route. Foreign trade is characterized by import of manufactured products and export of agricultural raw materials. Petroleum products are a major import. Exports include carpets, garments, handicraft goods, pulses, hides and skins, jute and medicinal herbs.

Tourism :

Sadly, for the reasons mentioned earlier, the situation is now not so good and in 2003 tourism is said to be down by over 50%. This is a real tragedy for Nepal’s wellbeing and development, and it is hoped that potential tourists will not be put off by the present temporary problems. Nepal remains what it has always been – an exquisitely beautiful and excitingly adventure-filled country of kindly and gentle people who thrive on the chance to offer warmth and hospitality to all comers. They need you to visit them.