Himal Press 
KATHMANDU: The World Bank has projected Nepal’s economic growth to slow to 3.7% in fiscal year 2026/27, citing disruptions to industry and services caused by the August 26 Bhotekoshi floods.
The World Bank, however, has projected growth to reach 5.2% in 2027/28, saying that reconstruction and rehabilitation activities will support the growth.
In its latest Nepal Development Update: Building Back Differently for the Future, the World Bank says that industry is expected to be the primary drag on growth, reflecting extensive damage to hydropower, solar energy, electricity transmission, and transport infrastructure, which will constrain electricity generation, production and the movement of goods. “Services are expected to be affected through disruptions to trade, transport, tourism, and financial activity. Agricultural losses, while limited in the effects on aggregate output, are expected to have significant impacts on livelihoods in affected areas,” it added.
The government has estimated repair, rebuild and recovery costs at Rs 723.31 billion (approximately $4.77 billion).
World Bank Country Director for Nepal, David Sislen, said the flood has caused devastating human and economic losses. “This is a moment of opportunity for Nepal to think about its infrastructure — connectivity, energy, and basic services like water and sanitation and health and education — and ensure that resilience and redundancy are central to its planning and investment, especially in the context of a changing climate and an evolving set of risks,” he said. “The World Bank stands ready to assist the authorities in investing in systems and implementing the right policies to help put Nepal on a more resilient and sustainable development path.”
The World Bank has recommended recovery efforts that go beyond restoring damaged assets and towards incorporating updated multi-hazard risk assessments, careful
consideration of infrastructure location and design, and greater redundancy in critical transport, energy, and communications networks.
Strengthening early warning systems will be equally vital, alongside building an Integrated Social Protection System as a foundation for rapidly delivering disaster assistance to vulnerable households, it said.
