Nepal’s roads may be filling up with electric vehicles (EVs), but the country’s fuel consumption habits remain stubbornly old-school. Despite a surge in EV imports and government incentives to go electric, petroleum imports - including petrol, diesel, and cooking gas - are not slowing down.

Data maintained by the Department of Customs (DoC) for the first eight months (mid-July 2024 to mid-March 2025) of the current Fiscal Year 2024/25 shows that Nepal’s petroleum imports have not only remained high but have increased marginally compared to the same period last FY.

The government has made EV imports attractive by offering tax breaks. As a result, urban centers in the country have seen a clear rise in electric cars and bikes. But this shift has yet to reduce the country’s overall fuel consumption.

In fact, diesel imports reached a staggering 871,399 kiloliters by mid-March. This marks an increase of 3.3 percent from 843,170 kiloliters imported during the corresponding period of last FY. Nepal spent Rs 78.86 billion on diesel this year, slightly less than last year’s Rs 88.89 billion, thanks to falling global oil prices. However, higher import volumes meant the government still collected over Rs 34.78 billion in revenue, up from Rs 34.24 billion last year.

The import of petrol has also increased during the review period compared to the same period during the last FY. By mid-March, Nepal had imported 489,842 kiloliters of petrol, up by 8.8 percent from 450,051 kiloliters imported in the same period of last FY. The government collected nearly Rs 27.81 billion in taxes from the total Rs 42.80 billion spent for the import of petrol in the first eight months of the current FY.

Nepal has experienced a significant increase in electric vehicle (EV) imports in recent years. According to the data maintained by the DoC, in the first eight months of the current FY, the country imported a total of 8,766 electric four-wheelers, marking a 24.3% rise compared to the same period in the previous FY, which saw 7,052 units imported. Of these recent imports, 6,883 vehicles originated from China, while 1,856 were sourced from India.

Additionally, during this eight-month period, Nepal imported 12,895 electric three-wheelers and 6,975 electric two-wheelers. In the previous FY, Nepal imported a total of 11,701 electric four-wheelers, up from the 4,050 units imported in the FY 2022/23.

Experts suggest multiple factors behind the rise of the volume of petroleum import despite growing uptake of EVs in the country. While urban EV use is growing, Nepal’s public transportation, freight movement and rural mobility still depend heavily on fossil-fuel based vehicles. They also argue that the increase in the import of petroleum products could also be caused by the momentum seen in the economic activities and power rationing in industrial sectors during peak hours as power generation has come down significantly due to reduced level of water in major rivers that supply water to power plants.

It’s not just the fuel for vehicles; the reliance of Nepal on cooking gas also seems to be climbing. Imports of Liquefied Petroleum Gas (LPG) rose from 3.47 billion kilograms in the first eight months of last year to 3.62 billion kilograms in the corresponding period of this year, costing Nepal Rs 41 billion. Revenue collection from LPG hit Rs 7.64 billion, an increase from Rs 6.69 billion during the same period last FY.

Experts suggest that the rise in the import of LPG could be largely due to the fact that cooking gas continues to remain the preferred option for most households as electric stoves require stable electricity — something not available everywhere.

Similarly, aviation fuel (ATF) imports jumped to 139,153 kiloliters, up from 127,478 kiloliters last year, reflecting the rebound in air travel. Kerosene imports also saw a slight rise from 7,112 kiloliters to 8,284 kiloliters.

While urban EV use is growing, Nepal’s public transportation, freight movement, and rural mobility still depend heavily on diesel-powered vehicles. Similarly, cooking gas remains the preferred option for most households, as electric stoves require stable electricity — a luxury not available everywhere.