Nepal’s digital landscape demonstrates significant expansion in internet and social media adoption, primarily propelled by widespread mobile connectivity. While penetration rates continue to climb, notable disparities persist across geographical regions and various socioeconomic strata. The government has articulated an ambitious digitalization agenda, aiming to broaden access and cultivate a comprehensive digital economy.

Current data for 2024 and 2025 indicates a growing internet user base. At the beginning of 2024, Nepal recorded 15.40 million internet users, representing a penetration rate of 49.6 percent of the total population.1 This figure increased to 16.5 million users by January 2025, pushing the online penetration to 55.8 percent.2 It is important to acknowledge varying penetration figures from different sources, such as the Nepal Telecommunication Authority (NTA) reporting 99.38 percent internet penetration based on subscriptions 3 and the Nepal Living Standard Survey (NLSS) indicating 39.7 percent based on household access.4 These discrepancies are addressed and contextualized within the report.

Social media adoption mirrors this growth, with 13.50 million active social media user identities in January 2024 1, rising to 14.3 million by January 2025.2 Facebook remains the most dominant platform, followed by Instagram, while TikTok recently navigated a temporary ban in 2023-2024.1

Key trends underscore the continued expansion of mobile broadband, a heightened focus on digital literacy initiatives, and robust governmental emphasis on ICT infrastructure development and digital governance. Projections suggest a sustained increase in internet access, with penetration potentially reaching 79 percent by 2025 8, solidifying Nepal’s position as a “mobile-first” nation. However, addressing the enduring digital divide, ensuring internet affordability, and refining regulatory frameworks are crucial for achieving inclusive and sustainable digital growth across the country.

1. Introduction

1.1 Purpose and Scope of the Report

This report undertakes an extensive and data-driven analysis of the internet and social media landscape within Nepal. Its primary objective is to present current statistics, predominantly for the years 2024 and 2025, while also examining historical growth patterns, identifying pivotal factors influencing digital adoption, and exploring future projections for connectivity.

The scope of this analysis encompasses a detailed breakdown of the total number of internet users and their corresponding penetration rates. It further includes an examination of broadband connectivity types, distinguishing between mobile and fixed connections, and assessing their respective market shares. An overview of internet connection speeds and the underlying infrastructure is also provided. Beyond mere connectivity, the report delves into platform-specific user numbers for major social media services, offering demographic insights. A comprehensive exploration of the factors contributing to the digital divide, including socioeconomic and geographic disparities, is presented. Finally, the report addresses government initiatives, the evolving regulatory environment, and the broader economic and social implications stemming from Nepal’s increasing digital adoption.

1.2 Overview of Nepal’s Digital Transformation Journey

Nepal has embarked on a significant and ambitious digital transformation, recognizing Information and Communication Technologies (ICT) as a pivotal sector for driving economic growth, enhancing governance, and improving public service delivery.4 This profound commitment is formally articulated by the government’s declaration of 2024-25 to 2033-34 as the “IT Decade.” This strategic initiative is designed with far-reaching goals, aiming to position Nepal as a regional ICT hub. Specific targets include generating substantial ICT service exports, projected at Rs 3 trillion, and creating a significant number of direct (500,000) and indirect (1,000,000) jobs within the IT sector.4

Historically, internet adoption in Nepal has demonstrated substantial gains. From a modest 9 percent of the population using the internet in 2011, the penetration rate escalated to nearly 50 percent by 2022.8 This rapid increase in connectivity underscores the growing integration of digital technologies into various aspects of daily life for Nepalese citizens.8 The official declaration of the “IT Decade” and the substantial budgetary allocation of Rs 7.25 billion to ICT for FY 2081/82 4 indicate a deep governmental commitment that extends beyond merely increasing internet access. This comprehensive approach, which integrates ICT into national life, is designed to drive economic transformation and societal development, positioning digital advancement as a core national priority.

The breadth of initiatives, from infrastructure development to legal frameworks and human capital development, points to a strategic, long-term vision. The government’s plans encompass implementing automated systems for investment approval, integrating national information systems, establishing a market information system for agricultural data, launching campaigns for startups and innovation, expanding broadband to schools and health facilities, introducing satellite-based internet, drafting e-governance and data protection laws, enhancing digital literacy, and integrating IT into election management.4 This holistic strategy suggests a fundamental shift in how the government perceives and leverages digital technologies. It moves beyond viewing internet access as a standalone utility to recognizing it as a foundational element for a broader digital economy and modernized governance. This strong political will is a significant positive indicator for the future trajectory of digital growth and adoption in Nepal.

2. Internet User Landscape in Nepal

2.1 Total Internet Users and Penetration Rates (2024-2025)

At the commencement of 2024, Nepal’s total population was recorded at 31.07 million.1 Within this population, there were 15.40 million internet users, translating to an internet penetration rate of 49.6 percent.1 This figure suggests that approximately 15.67 million people, or 50.4 percent of the population, remained offline at the beginning of that year.1 Progress continued into 2025, with the number of internet users increasing to 16.5 million by January, and online penetration reaching 55.8 percent of the total population.2 However, Kepios analysis indicates a slight decrease of 26 thousand users, or -0.2 percent, between January 2024 and January 2025, while the overall internet adoption rate remained unchanged during this specific period.2 This minor fluctuation could represent a temporary statistical adjustment or a brief plateau in user acquisition within certain segments, despite the overarching upward trend in total users.

It is important to note the significant disparities in reported internet penetration rates across various authoritative sources, which highlight a critical challenge in precisely assessing Nepal’s digital landscape. For instance, the Nepal Telecommunication Authority (NTA) reported a substantially higher internet penetration rate of 99.38 percent in 2024.3 Conversely, the Nepal Living Standard Survey (NLSS) 2022/23 report, published in 2024, indicated an overall internet penetration of 39.7 percent based on household access.4 Another NTA report further stated that internet access had reached 81 percent of the total population (24.347 million people) in the first five months of a recent fiscal year, marking a 10 percent increase compared to the 72.42 percent recorded in the same period the previous year.12

These differences in reported figures are primarily attributable to varying methodologies and definitions of “internet user” or “penetration.” DataReportal, through Kepios, typically focuses on “active internet users” or “unique individuals,” providing a measure of actual individual engagement with the internet.1 In contrast, the NTA’s higher figures often represent “subscriptions” or “connections,” which can significantly exceed the total population because individuals frequently possess multiple SIM cards or broadband accounts.13 The NLSS figure, derived from “households with internet access,” naturally yields a lower percentage as it measures access points rather than individual users.4 Therefore, for a comprehensive and accurate understanding, it is crucial to recognize these definitional differences. The DataReportal figures are more indicative of individual internet usage, while NTA’s subscription-based data provides valuable insight into the total number of active connections and the market’s overall capacity. The NLSS data is particularly useful for understanding household-level access and the nuances of the digital divide within the country.

Table 1: Internet Users and Penetration in Nepal (2022-2025)

Note: Population figures vary slightly across sources. DataReportal figures are used for consistency where available. NTA and NLSS provide different penetration rates based on subscription counts or household access, as discussed in Section 2.1.

2.2 Historical Growth and Recent Trends (2022-2025 Analysis)

Nepal has exhibited a clear and consistent upward trajectory in internet adoption over the past decade. The number of internet users increased by 172 thousand, or 1.1 percent, between January 2023 and January 2024.1 Prior to this period, between January 2022 and January 2023, internet users saw a more substantial increase of 822 thousand, representing a 7.7 percent growth.8 This progression is significant, evolving from a mere 9 percent of the population using the internet in 2011 to 37.7 percent in 2022 8, and further reaching 49.56 percent in the same year.11

Despite this robust long-term growth, Kepios’s analysis indicates a slight decrease of 26 thousand internet users, or -0.2 percent, between January 2024 and January 2025.2 This minor dip, when contrasted with the International Telecommunication Union’s (ITU) ambitious projection of Nepal’s internet penetration reaching 79 percent by 2025 8, suggests a potential shift in the dynamics of internet growth. The ITU projection might be based on a broader definition of internet access, potentially including all forms of connectivity like public Wi-Fi or shared household access, or it may reflect a more optimistic outlook on future infrastructure rollout and digital literacy initiatives. The slight short-term decline observed could be a natural market adjustment following a period of rapid expansion, or a temporary effect of specific economic or regulatory conditions.

This scenario implies that future growth in Nepal’s internet landscape may not solely be driven by adding entirely new, unique individuals to the user base at the same rapid pace as before. Instead, the focus is likely to shift towards enhancing the quality and inclusivity of internet access and usage. This will involve efforts to upgrade existing users from basic mobile connections to higher-speed mobile broadband (3G/4G/5G) and fixed broadband. There will also be an emphasis on deepening digital engagement by promoting more diverse and productive online activities, such as e-commerce, e-governance, and online education, among the existing user base. Furthermore, targeted penetration strategies will be crucial to bridge the remaining digital divides in rural areas and among marginalized socioeconomic groups, where significant offline populations still exist.1 This strategic evolution aligns with the government’s broader “IT Decade” goals, moving beyond merely increasing raw user numbers to enhancing the overall digital experience and participation for all citizens.

2.3 Broadband Connectivity: Mobile vs. Fixed (Subscription and Penetration by Technology)

As of Ashadh 2081 (June 15, 2024), the total broadband service penetration in Nepal, measured by subscriptions, reached an impressive 149.23 percent.14 This figure, exceeding 100 percent of the total population, is a clear indicator of the common practice where individuals hold multiple subscriptions, such as possessing multiple SIM cards or separate connections for home and work.13

Mobile broadband stands as the predominant form of internet access in Nepal, accounting for the vast majority of connections. There were 31,211,074 mobile broadband subscriptions, achieving a population penetration of 107.02 percent.14 This represents an overwhelming 91.72 percent of the total broadband market share.14 Further reinforcing the mobile-first nature of Nepal’s digital landscape, a substantial 96 percent of internet users access the internet via smartphones.3 This overwhelming dominance of mobile broadband firmly establishes Nepal as a “mobile-first” nation, which has profound implications for digital service delivery, e-commerce, and content consumption. Future strategies for digital inclusion and economic growth must inherently prioritize mobile accessibility and optimization.

Fixed broadband, while experiencing growth, holds a significantly smaller share of the market. Fixed broadband (wired) accounted for 2,810,771 subscriptions, with a penetration rate of 42.12 percent.14 This segment constitutes 8.26 percent of the total broadband market share.14 Fiber-to-the-Home (FTTH) is the leading wired technology, with 2,804,928 users 14, and its user base grew to approximately 2.89 million by late 2024.13 Older ADSL services are in decline, with Nepal Telecom actively phasing them out in favor of fiber upgrades.13 Fixed broadband (wireless) remains a marginal category, with only 6,738 subscriptions and a penetration of 0.10 percent.14

The breakdown of mobile technology users as of Ashadh 2081 (June 15, 2024) further illustrates the landscape:

• 4G: This is the leading mobile technology, with 22,232,416 users, representing a 76.23 percent penetration rate.14 4G coverage had already reached approximately 88 percent of the population by 2023.13
• 3G: Still widely utilized, with 7,519,672 users and a 25.78 percent penetration rate.14 3G networks covered about 90 percent of the population by 2023.13 Nepal Telecom is reportedly preparing to phase out 3G services starting in 2025 to concentrate on expanding 4G and potentially 5G networks.16
• 2G: Remains in use for basic services, with 1,458,986 users and a 5.00 percent penetration rate.14
• 5G: This technology is in the early stages of deployment, with 8 percent mobile 5G coverage reported as of 2023.15

The major Internet Service Providers (ISPs) by market share in 2023/2024 include:

• WorldLink Communications Pvt Ltd: This is the nation’s largest fixed broadband ISP, holding approximately 32 percent of the overall ISP market share 15 and nearly 1 million fixed broadband subscribers.13 WorldLink alone accounts for roughly 30 percent of Nepal’s fixed broadband connections.13
• Nepal Telecommunications Corporation (NTC): NTC holds the largest market share for internet service overall, with 48.9 percent of all internet subscribers 8 and 13 percent of the top ISP market share.15
• Ncell Pvt. Ltd.: Accounts for 32.8 percent of internet subscribers 8 and 9 percent of the top ISP market share.15

The overwhelming dominance of mobile broadband, accounting for over 90 percent of total broadband subscriptions and with mobile connections significantly exceeding the total population, firmly establishes Nepal as a “mobile-first” nation. This paradigm has profound implications for digital service delivery, e-commerce, and content consumption, dictating that future strategies for digital inclusion and economic growth must prioritize mobile accessibility and optimization. This means that mobile devices are the primary, and often sole, means of internet access for the majority of the population. Any digital strategy, whether for e-governance, financial services, education, or business, must be inherently mobile-centric. Investment priorities should heavily lean towards mobile infrastructure, such as the ongoing 4G/5G rollout and NTC’s plan to phase out 3G 16, the development of mobile-friendly applications, and mobile-specific digital literacy programs. Despite high coverage, the “usage gap” in 3G/4G 13 indicates that while infrastructure is expanding, effective utilization remains a challenge, likely due to factors such as affordability, digital literacy, or device quality.

Table 2: Broadband Subscriptions and Penetration by Technology (Ashadh 2081 / June 15, 2024)

Source: Nepal Telecommunications Authority (NTA) MIS Report, Ashadh 2081 (June 15, 2024) 14

2.4 Internet Connection Speeds and Infrastructure Overview

As of January 2024, Nepal has demonstrated significant improvements in internet connection speeds. The median mobile internet connection speed via cellular networks was 15.79 Mbps, reflecting a notable increase of 2.30 Mbps, or 17.0 percent, in the preceding twelve months.1 Similarly, the median fixed internet connection speed reached 57.82 Mbps, showing a substantial increase of 9.35 Mbps, or 19.3 percent, during the same period.1 Another source indicates an average of 58.17 Mbps for download and 16.08 Mbps for upload, likely referring to fixed broadband speeds.15

Nepal’s digital infrastructure includes 7 active data centers and 2 Internet Exchange Points (IXPs).15 A commendable achievement in infrastructure development is that 74 percent of the top 1000 most-visited websites can be accessed via a local server or cache within Nepal, surpassing the Internet Society’s target of 50 percent.15 This indicates a healthy level of local content hosting and efficient network routing, contributing to improved user experience and reduced latency. Nepal Telecom (NT) has also made significant strides in expanding its fiber internet service, which now reaches all 77 districts across the country.4 This expansion marks a major milestone in bringing faster internet connectivity to remote regions.

Despite these advancements, persistent challenges in infrastructure remain. Nearly half of Nepal’s population resides more than 10 km away from the existing fiber optics infrastructure, which is essential for high-speed internet access.17 The total fiber-optics backbone coverage extends only 4,932 km, which limits the overall capacity and speed of the country’s digital networks and their reach.17 Furthermore, as a landlocked country, Nepal is reliant on India and China for international bandwidth. This dependency introduces additional costs due to taxes, tariffs, and fluctuations in foreign currency exchange rates.17

While Nepal has made commendable progress in improving internet connection speeds and expanding fiber infrastructure to all districts, the underlying structural constraints imposed by its landlocked geography and the relatively limited fiber backbone length present persistent challenges. These factors create a fundamental dependency on external bandwidth providers and restrict the widespread availability of truly high-speed, affordable internet, particularly in remote areas. The high percentage of locally cached content is a positive sign of internal network optimization, but the external reliance remains a key vulnerability. The government’s continued focus on initiatives such as introducing satellite-based internet 4 and exploring alternative international bandwidth routes via China 19 are strategic responses designed to mitigate this dependency, enhance network resilience, and expand internet access beyond the limitations of traditional fiber infrastructure.

3. Social Media Landscape in Nepal

3.1 Total Social Media Users and Penetration

Social media usage in Nepal has shown consistent growth, reflecting the broader trend of increasing digital adoption. In January 2024, there were 13.50 million active social media user identities in Nepal, which equated to 43.5 percent of the total population at that time.1 By January 2025, this figure had risen to 14.3 million active social media user identities, representing 48.1 percent of the total population.2 This indicates an increase of 750 thousand users, or 5.6 percent, between early 2024 and the beginning of 2025.2

It is important to note that these figures represent “social media user identities” and may not correspond to unique individuals, as one person may manage multiple accounts.1 However, analysis suggests that the number of people using social media is likely not massively different from the total user identities.20 For a broader perspective, 87.7 percent of Nepal’s total internet user base, regardless of age, utilized at least one social media platform in January 2024.1 In January 2025, data from ad planning tools indicated that 14.3 million users aged 18 and above were using social media, equivalent to 72.8 percent of the total adult population.2

3.2 Platform-Specific User Statistics

Facebook: Facebook remains the most widely used social media platform in Nepal. Meta’s advertising resources reported 13.50 million Facebook users in Nepal in early 2024.1 This figure saw continued growth, with Facebook’s potential ad reach increasing by 750 thousand, or 5.6 percent, between January 2024 and January 2025.2 By April 2024, NapoleonCat reported 16,373,200 Facebook users, accounting for 51.3 percent of Nepal’s entire population.21 A slightly lower figure of 15,698,400 users was reported for February 2024, representing 49.2 percent of the population.22 This variation could be due to differences in reporting periods or data collection methodologies. In early 2025, Meta’s data indicated that 72.8 percent of adults aged 18 and above in Nepal used Facebook, and its ad reach was equivalent to 86.2 percent of the local internet user base.2 Facebook Messenger, a related platform, reached 10.85 million users in Nepal in early 2024.1

Instagram: Instagram also holds a significant presence in Nepal. Meta’s advertising tools indicated 3.60 million Instagram users in Nepal in early 2024.1 This translated to an ad reach equivalent to 11.6 percent of the total population at the start of the year.1 By February 2024, Instagram had 3,892,500 users, accounting for 12.2 percent of the total population.23 This number further increased to 4,160,900 users by April 2024, representing 13 percent of the population.24

TikTok: TikTok’s presence in Nepal has been dynamic due to regulatory actions. Nepal had over 2.2 million TikTok users prior to a nationwide ban imposed on November 13, 2023.5 The government cited concerns over the platform’s role in disrupting social harmony, propagating hatred, and disseminating inappropriate content.5 This ban followed directives requiring social media platforms to establish liaison offices in Nepal.7 The ban was subsequently lifted in August 2024, after TikTok’s parent company, ByteDance, agreed to register with the government and comply with specific conditions, including assistance in identifying misuse and cybercrimes.5 TikTok became the third social media company to register with Nepal’s Ministry of Communications and Information Technology, following Viber and WeChat.7 Despite the temporary ban, TikTok has a significant user base, as evidenced by the continued presence of top TikTok creators in Nepal in 2025.25

YouTube: While specific user numbers for YouTube in Nepal are less consistently reported in the provided data compared to Meta platforms, it is evident that YouTube is widely used. Global data from January 2025 indicates YouTube had at least 2.53 billion users worldwide, reaching 30.9 percent of the global population and 45.5 percent of global internet users.26 In Nepal, YouTube’s market share among social media platforms was 0.92 percent as of May 2025, according to StatCounter.27 The presence of numerous top YouTube channels in Nepal with millions of subscribers underscores its popularity as a content consumption platform.28

X (formerly Twitter): X has a smaller but notable user base in Nepal. As of August 2024, Nepal had 456.5 thousand X users.30 This figure was a decrease from 553.6 thousand users in 2023.30 In terms of market share among social media platforms in Nepal, X accounted for 5.15 percent as of May 2025.27 Globally, X had 102.1 million users in the United States and 69.5 million in Japan, with India having 25.1 million users 31, indicating that Nepal’s user base is comparatively smaller but still part of the global network.

3.3 Social Media Demographics

Social media user demographics in Nepal show a clear male majority. In January 2024, 43.6 percent of Nepal’s social media users were female, while 56.4 percent were male.1 This gender distribution remained largely consistent in January 2025, with 44.3 percent female and 55.7 percent male social media user identities.2

For Facebook users in April 2024, men constituted 56.3 percent of the user base.21 The largest age group on Facebook was 18 to 24 years old, accounting for 6,000,000 users.21 The most significant gender disparity was observed in the 25 to 34 age group, where men outnumbered women by 3,100,000.21 Similar trends are seen for Instagram, where men made up 57.4 percent of users in April 2024.24 The 18 to 24 age group was also the largest for Instagram, with 1,959,900 users.24 For Instagram, the highest difference between men and women occurred in the 25 to 34 age group, with men leading by 831,800.24 These demographic patterns highlight the importance of understanding target audiences for digital initiatives and content creation in Nepal.

4. Factors Influencing Internet and Social Media Adoption

4.1 Digital Divide: Urban-Rural and Socioeconomic Disparities

Despite significant advancements in internet and digital infrastructure in Nepal, persistent challenges related to internet adoption and the digital divide remain evident.4 While the Nepal Telecommunication Authority (NTA) reported a high internet penetration rate of 99.38 percent, the Nepal Living Standard Survey (NLSS) 2022/23, published in 2024, revealed stark disparities.4 The NLSS report indicated an overall internet penetration of 39.7 percent based on household access, a modest increase from 37.8 percent in 2021.4

A significant economic barrier to adoption is evident in internet access for households below the poverty line, where only 9.5 percent have internet access.4 This highlights a substantial affordability challenge for a considerable segment of the population. Urban-rural disparities are particularly pronounced: urban areas, especially Kathmandu Valley, exhibit much higher connectivity with 79.3 percent internet penetration, while rural areas lag significantly with only 17.4 percent internet penetration.4 Regional gaps further exacerbate this divide, with Bagmati province showing 59.8 percent of households having internet access, compared to a mere 14 percent in Karnali province.4 Natural disasters, such as floods and landslides, have also severely disrupted connectivity in several regions, including Solukhumbu and Surkhet, further widening the digital divide.4

Beyond geography and income, socioeconomic factors such as education level and caste significantly influence internet connectivity.32 For instance, only 23 percent of individuals with SLC/SEE or lower education have internet access, compared to 90 percent of those holding a master’s degree or higher.32 Similarly, 37 percent of “Other” castes have connectivity, while only 21 percent of Dalits do.32 Infrastructure quality, such as cement-bonded homes (46 percent connectivity) and electricity access (18.9 percent boost), also correlates with higher adoption rates.32 Economic factors like remittances and urban residency (47 percent connectivity in urban areas versus 16 percent in rural) further enhance access.32 These findings underscore the complex and multifaceted nature of the digital divide in Nepal, necessitating targeted interventions to bridge these gaps.

4.2 Digital Literacy and Awareness

A significant barrier to widespread and effective internet adoption in Nepal is the prevailing low digital literacy rate and skill gaps within the workforce.17 A World Bank report identified that only 0.16 percent of the population has completed education in ICT, and merely 2 percent in STEM fields.17 This lack of foundational digital skills severely limits the ability of many Nepalese to engage meaningfully with modern technology. For example, 91 percent of Nepali adults (aged 15 and above) are unable to complete basic digital tasks such as copying and pasting text within documents.17 Wiley’s Digital Skill Gap Index ranks Nepal 124th out of 134 economies, indicating poor performance in critical areas like information literacy, communication, and digital content creation.17

In response to these challenges, several initiatives are underway to enhance digital literacy across the country. The government’s Digital Nepal Framework aims to foster a digitally empowered society by equipping citizens with necessary digital competencies.33 A notable program is ‘ICT Gyan,’ launched by ICT Foundation Nepal in collaboration with Ncell Foundation. This comprehensive digital literacy campaign aims to bridge the digital divide by empowering communities across all seven provinces with essential digital skills.33 The ‘ICT Gyan’ program targets diverse groups, including school teachers, women’s collectives, farmers, youth entrepreneurs, and local government representatives, providing training on topics such as basic digital skills, cybersecurity, mobile banking, and online payment systems.33 Successful implementation has already occurred in Koshi and Madhesh provinces, with plans for expansion to other regions with tailored modules, focusing on areas like social media management, data privacy, cloud services, and digital entrepreneurship.33

Furthermore, Nepal is actively addressing the digital gender gap, where despite 92 percent of women using mobile phones, only 41 percent have internet access.34 This disparity is influenced by socio-cultural, educational, and economic factors.34 Initiatives like the Digital Financial Literacy for Women Farmers Program and the Women Digital Champions Initiative are empowering rural women to use mobile banking, e-commerce, and promote digital literacy within their communities, demonstrating that digital inclusion is about transforming lives, not just connectivity.34

4.3 Affordability and Accessibility Challenges

The affordability of internet services remains a significant concern in Nepal, particularly given the average Nepali’s low economic status.18 The government’s decision to levy a Telecommunication Service Charge (TSC) of 13 percent on internet use, in addition to the existing 13 percent Value Added Tax (VAT), effective from the start of the current fiscal year, has been met with severe criticism from users and stakeholders.19 While the government stated that this increased cost would not apply to fixed broadband, it notably applies to mobile internet, which is used by approximately 90 percent of all internet users.19

The internet market in Nepal operates largely on a business-to-business (B2B) model, with private Internet Service Providers (ISPs) driven by profit.19 A key issue is the limited number of parties involved in bringing international internet bandwidth to Nepal from India, which raises concerns about potential cartels or syndicates that could lead to profiteering.19 This situation contributes to the high cost of internet for end-users, even as global prices for internet services are decreasing.19

To address these affordability and accessibility challenges, the government has a crucial role to play. A government-to-government (G2G) initiative could facilitate access to faster and more affordable internet services for citizens.19 Specific arrangements could include direct access to submarine cable landing points in Mumbai or Chennai, or establishing connections with the Hong Kong data center via China.19 The Nepal Telecom’s initiative to bring internet to Kathmandu from China via Kerung-Rasuwagadhi represents a positive step towards creating alternative international routes.19

Beyond international bandwidth costs, other factors influencing internet prices include management, manpower, operating costs, local internet exchange points, and local content.19 Significant investments in infrastructure are also required to deliver internet to end-users, with most ISPs expanding their own infrastructure individually.19 A potential solution to reduce costs and increase presence across the country could involve government initiatives to build shared infrastructure, or to mandate that infrastructure built by individual ISPs be shared with others at a rational cost.19 This would allow other ISPs to expand their services into unreached areas more efficiently. Addressing these multifaceted issues is essential to make internet truly affordable and accessible for the general population across Nepal.

5. Economic and Social Impact of Digital Adoption

5.1 Economic Contributions and Opportunities

The digital economy is rapidly becoming an increasingly vital component of Nepal’s economic landscape. The widespread adoption of digital technologies and the increasing availability of high-speed internet have spurred the growth of numerous digital products and services.35 This growth is evident in the rise of cashless transactions facilitated by apps like e-Sewa and Khalti, and the transformation of shopping experiences through platforms like Daraz.18 The convenience of services like ride-hailing apps further exemplifies the integration of digital solutions into daily life.18

The government’s declaration of an “IT Decade” (2024-25 to 2033-34) underscores its commitment to transforming Nepal into an ICT hub, with ambitious targets for exporting Rs 3 trillion worth of ICT services and creating 500,000 direct and 1,000,000 indirect jobs in the IT sector.4 This strategic focus aims to leverage the “weightless and borderless” nature of IT service exports, which provides Nepal with a more level playing field in global competition compared to traditional goods.10 The shift from labor exports to service exports is seen as a viable path for economic growth and a means to address brain drain.10 The rise in entrepreneurial ventures and startups in Nepal is directly linked to increasing internet penetration, showcasing the potential for innovation and economic diversification.9

Furthermore, digital services are contributing significant tax revenue to the government. In FY 2080/81 BS (2023/24 AD) alone, 18 registered firms paid NPR 358.44 million in VAT and NPR 58.18 million in electronic service tax, totaling NPR 416.71 million in digital tax revenue from global technology companies.36 This highlights the growing economic significance of the digital sector.

5.2 Social Implications and Regulatory Environment

The increasing use of internet and social media platforms in Nepal has brought about significant social implications, affecting the lifestyle of youth in both positive and negative ways.37 On the positive side, social media enables individuals to express opinions, share expertise, and engage in debates.37 It facilitates connections between friends and allows individuals in Nepal to communicate with peers globally, strengthening ties across distances.37 Young people can also form online communities based on careers, religious beliefs, and other aspects of their lives, fostering new relationships and expanding opportunities.37 For many, these platforms have become an integral part of their daily lives, making interactions more pleasurable, effective, and simpler.37

However, there are also notable negative consequences. Social media can reduce face-to-face contact, as young people often spend extensive time on online platforms, potentially leading to social isolation.37 The constant availability of personal information online raises privacy concerns.37 Addiction to social media can hinder focus on work or studies, as users frequently check updates and hop between sites.37 Moreover, social media has the potential to amplify anxieties and rites of passage by making previously private exchanges visible to a wider audience.37

The regulatory environment for social media in Nepal has been fragmented and largely ineffective, with existing legislation not specifically designed for the unique challenges of social media.36 In response, the government has proposed a Social Media Bill (2081 BS / 2025 AD) that mandates all social media platforms operating in Nepal to register and obtain government approval.36 While proponents view this as necessary to combat cybercrime, misinformation, and hate speech, critics argue that the bill’s vague terminology and stringent provisions pose a serious threat to freedom of expression and digital rights.36 Civil rights groups, political parties, and media organizations have called for its withdrawal, warning that it could undermine democracy.36 The government faces a dilemma, as banning major platforms could trigger public backlash, while inaction would raise questions about the consistency of its regulatory intent, particularly after the temporary TikTok ban.7 Ensuring that the bill does not impede the operations of global platforms or deter their presence in Nepal, while also safeguarding freedom of speech, will be crucial in shaping the country’s digital landscape.36

6. Future Trends and Projections

6.1 Continued Growth and “Mobile-First” Evolution

Nepal’s internet landscape is poised for continued expansion, with projections indicating significant growth in penetration rates. The International Telecommunication Union (ITU) forecasts that Nepal’s internet penetration will reach 79 percent by 2025, a figure that could potentially surpass China’s projected 75 percent.8 This projection solidifies Nepal’s trajectory towards becoming a “mobile-first” country by 2025, where mobile devices serve as the primary means of internet access for the majority of the population.9 This evolution implies that strategies for digital services, content, and e-governance must increasingly prioritize mobile accessibility and optimization.

The trend of mobile broadband dominance is expected to persist. While Nepal Telecom is preparing to phase out 3G services starting in 2025, this move is aimed at focusing on the expansion of 4G and potentially 5G networks, which could help the company regain competitive ground and further enhance mobile internet speeds and capacity.16 The continued growth in mobile connections, which reached 132 percent of the total population in early 2025 2, indicates an environment where multiple mobile connections per individual are common, driving overall connectivity.

6.2 Government Initiatives and Policy Direction

The Government of Nepal has articulated a clear and ambitious policy direction for digital transformation, encapsulated by the declaration of 2024-25 to 2033-34 as the “IT Decade”.4 This initiative aims to transform the country into an ICT hub, with significant targets for ICT service exports and job creation.4 The annual budget allocation of Rs 7.25 billion to ICT for FY 2081/82 underscores this commitment.4

Key government priorities include expanding broadband access to schools and health facilities, introducing satellite-based internet to reach remote and difficult terrains, drafting comprehensive e-governance and data protection laws, enhancing digital literacy nationwide, and integrating IT into election management.4 The push for digitalization extends to local levels, with municipalities implementing innovative digital services.4 The government’s emphasis on mandatory national ID cards for accessing public services and promoting digital payments further signals a move towards a more integrated digital society.4 These multi-pronged strategies are designed to bridge the digital divide, foster innovation, and ensure inclusive ICT access, although effective execution and transparent governance remain critical for realizing these ambitious goals.4

6.3 Emerging Technologies (AI)

The global landscape of digital technology is rapidly evolving, with Artificial Intelligence (AI) emerging as a transformative force across various sectors. Developing nations like Nepal are increasingly recognizing the imperative to align with these advancements to harness economic benefits and avoid being left behind in the technological race.10 The IT sector is now viewed as a critical economic frontier for Nepal, alongside hydropower and tourism.10

AI holds significant potential for revolutionizing digital marketing in Nepal, offering opportunities to enhance customer engagement, optimize marketing campaigns, and achieve competitive advantages.38 The global AI market is projected for substantial growth, with estimates suggesting it could reach USD 267 billion by 2027 and an impressive USD 15.7 trillion by 2030.10 While there is existing research on AI’s influence on various marketing functions globally, dedicated examination into AI’s role in transforming digital marketing specifically within the Nepalese context is an area for further exploration.38 As Nepal continues its digital journey, the strategic adoption and integration of emerging technologies like AI will be crucial for fostering innovation and driving economic growth.

7. Conclusions

Nepal’s digital landscape is characterized by dynamic growth in internet and social media adoption, predominantly driven by mobile connectivity. While the number of internet users continues to rise, reaching 16.5 million by January 2025 with a 55.8 percent penetration rate, the existence of disparate penetration figures from various sources necessitates a nuanced understanding of “connectivity” versus “usage.” The overwhelming dominance of mobile broadband firmly establishes Nepal as a “mobile-first” nation, underscoring the critical need for mobile-centric strategies in all digital initiatives.

Despite commendable progress in improving internet speeds and expanding fiber infrastructure, structural constraints such as Nepal’s landlocked geography and limited fiber backbone length present ongoing challenges to equitable and affordable high-speed internet access, particularly in remote areas. The government’s ambitious “IT Decade” initiative, coupled with significant budgetary allocations and comprehensive policy frameworks, signals a strong commitment to building a holistic digital ecosystem beyond mere connectivity, aiming for economic transformation and enhanced governance.

However, significant digital divides persist, influenced by socioeconomic factors, education levels, and urban-rural disparities. The high cost of internet, exacerbated by taxation and market structures, remains a barrier to broader adoption. Addressing these challenges through targeted digital literacy programs, strategic infrastructure investments (including satellite internet and alternative international routes), and regulatory reforms that promote affordability and fair competition will be paramount. As Nepal looks towards a digitally empowered future, leveraging emerging technologies like AI and ensuring inclusive access will be key to realizing its full digital potential and achieving sustainable socio-economic development.

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