Although Nepal has no substantial economic ties to either Russia or Ukraine, the war between the two countries has wreaked havoc on the Himalayan country’s already fragile economy. Nepal’s economy had already been undermined by a pandemic-induced loss of tourists, a drop in remittances, a rising trade imbalance, and depletion of foreign exchange reserves, as well as by skyrocketing gasoline and food prices brought on by the war between the two nations. The country’s financial situation was not so good even in the pre-war period, according to Roshee Lamichhane, Assistant Professor at Kathmandu University. Among other issues, Lamichhane mentions a decrease in tourist arrivals and foreign investment. “And the continuous fighting has worsened the issue even further,” she explained.
The Himalayan nation relies solely on imports to meet its fuel needs. With the rise in global crude prices following Russia’s Ukraine invasion, the state-owned oil monopoly, Nepal Oil Corporation, has been forced to hike prices of petroleum products. Prices of other commodities like food stuffs, soybeans and palm oil as well as iron, have also surged, making life much tougher for many Nepali people.