- Ashma Khanal, Uma Balampaki, and Shabda Kushal Ghimire
For decades, Nepal’s economy was told at the departure gates of Tribhuvan International Airport: young people leaving for the Gulf and Malaysia, doing hard physical work, and wiring their wages home. Those remittances still keep the country running, but they came at a heavy price — emptied villages, families divided for years, and talent spent far from home.
A quieter story is now being written in the office blocks of Kathmandu and Lalitpur. Rather than send its people abroad, Nepal has begun selling their skills — writing software, crunching data and building artificial-intelligence tools for clients in the United States, Australia and Europe. The work is done at a desk in Nepal; the payment arrives in dollars; the worker never leaves. Economists call this a “weightless” export: nothing to load into a container, only information travelling down a cable. Nepal’s IT services sold abroad were worth about 515 million dollars in 2022; by 2025, industry bodies put them near one billion — close to a doubling in three years, growing around 20 percent a year. An estimated 100,000 Nepalis now earn a living this way, up from about 70,000 in 2022, though the work stays concentrated in the Kathmandu Valley.
From typing jobs to a real industry
None of this appeared overnight. In the early 2000s the work was humble — typing data, checking website content, building simple web pages — but it taught a first generation to work with overseas clients and deliver on time. Through the 2010s, thousands of Nepali developers went freelance on global hiring sites, proving they could build apps and websites at prices businesses abroad found hard to refuse. The turning point came when individuals gave way to institutions — firms large enough to be trusted with serious, long-term work.
Cotiviti Nepal, a pioneer at work in Kathmandu since 2004, sifts vast volumes of American health-insurance data to catch billing errors and cut waste in the US medical system. Deerwalk, founded in 2010 by Rudra Raj Pandey — who came home to build it — took a similar path in healthcare data and grew successful enough to be bought by the American firm Cedar Gate Technologies, a rare “exit” for a Nepali company. And Fusemachines, founded by Dr Sameer Maskey, a Nepali computer scientist who teaches at Columbia University in New York, builds AI products and trains AI talent, with around 260 of its roughly 350 staff based in Nepal. In October 2025 it began trading on America’s NASDAQ under the ticker “FUSE” — the first company founded by a Nepali entrepreneur to list there. For an industry that began with data entry, a Wall Street listing is a startling distance travelled.
The factory with no machines:
CloudFactory If one company explains how Nepal learned to sell brainpower to the world, it is CloudFactory. Around 2010 a Canadian developer, Mark Sears, fell into conversation with three young programmers over pizza in Kathmandu and began teaching them to code; a two-week visit became six years of building a business on a simple idea — connecting ordinary people in developing countries to digital work anyone with a little training and an internet connection could do. That is the unglamorous labour behind modern technology, what the industry calls “human-in-the-loop”: transcribing audio, entering data, and labelling images and text so software can learn to recognise them. Today CloudFactory prepares data for more than 130 clients worldwide, including driverless-car startups, and processes millions of tasks a day.
The company has raised around 78 million dollars from international investors — including a 65-million-dollar round led by America’s FTV Capital in 2019 — and built a workforce of thousands of “cloud workers” from Nepal to Kenya, with the audacious aim of creating online work for one million people in the developing world and training them “as leaders to address poverty in their own communities.” For Nepal, the significance is less the dollars than the proof: that a serious, venture-backed technology business could be built from Kathmandu and sold to the world’s most demanding clients. Early cloud workers earned around 60 dollars a week for part-time hours, and the company trained a generation of engineers and team leaders who went on to seed other firms. “The future of AI and machine-learning innovation will be driven by people,” Sears has said, “and we believe our focus on people has been the biggest contributor to our growth.”
“Not just for mountains”:
Programiz The Weightless Export Not every success serves foreign clients; some serve the world directly. Programiz, run out of Jhamsikhel in Lalitpur, has taught millions of people to code. It began in 2011 as a blog by Ranjit Bhatta, later joined by Punit Jajodia and Aswin Shrestha; today its free tutorials draw more than 10 million learners a month — from India and the United States to the Philippines and Europe — served by a few dozen people working entirely inside Nepal. “We want the world to know Nepal not just for mountains, but as a powerhouse in coding and programming,” says Jajodia, who is candid about the catch: “Our biggest problem is that Nepal is not our market. If we were in India or the US, our revenue would have multiplied by ten times.” The internet lets a Nepali company reach the planet; turning that reach into income — and getting paid smoothly — is a problem the country has not fully cracked.
A borderless boom — and its risks
Nepal’s rise rides a much larger wave. In 2023, “digitally deliverable” services — software, design, analysis, support — made up 4.5 trillion dollars of global exports, more than half of all services traded, according to UNCTAD; developing economies alone crossed the one-trillion-dollar mark, up 43 percent since 2015. The market for outsourced IT work was worth about 623 billion dollars in 2025 and is forecast to keep climbing, driven by remote-first working, cloud computing, cybersecurity and the global hunger for anything involving AI. But the same UN figures carry a warning: the world’s least-developed countries, Nepal among them, saw their slice shrink from 0.24 to 0.19 percent even as the pie grew. “Without targeted interventions, the digital economy risks entrenching existing inequalities rather than alleviating them,” warns UNCTAD’s Torbjörn Fredriksson. The money is there for the taking — but only for countries that organise themselves to take it.
There is also a supply question. Nepal’s universities — Tribhuvan, Kathmandu, Pokhara and Purbanchal among them — produce an estimated 15,000 to 16,000 IT graduates a year, but the stream leaks at both ends. More than 6,000 head abroad annually, mostly to the United States and Australia — the very brain drain the digital economy was meant to reverse — and employers say too few who stay are job-ready; one industry figure claims “90 percent of IT graduates are unqualified or semi-qualified.” Starting pay for a junior developer, roughly 20,000 to 35,000 rupees a month, is decent locally but no match for what a good engineer earns overseas. The raw talent is abundant; the challenge is turning enough of it into world-class, well-paid work that stays in Nepal.
What the industry wants — and what the budget promises
Those who run these firms warn that a handful of practical problems, most of them the government’s to fix, could slow everything down. IT earnings often enter Nepal disguised as ordinary remittances, so the industry’s true size is underestimated; slow foreign-currency approvals make it hard to pay overseas suppliers for cloud and AI tools or to bring earnings home; owners want tax rates that stay stable for a decade rather than changing yearly; education lags the tools employers actually use, forcing firms to retrain graduates from scratch; and many want treaties to stop the same income being taxed twice. Their lobby, the Nepal Association for Software and IT Services Companies (NAS-IT), which speaks for around 80 firms, has set an ambitious roadmap: roughly 500,000 digital jobs and exports toward 30 billion dollars over the coming decade.
Policy is beginning to catch up. The 2025/26 budget cut the effective income-tax rate on IT-export earnings to about 5 percent through a 75-percent waiver and gave new startups — turnover up to 100 million rupees — a five-year tax holiday; the 2026/27 budget made “sweat equity” tax-free, put real money behind the sector (about 5.9 billion rupees for information and communication and 4 billion for science, technology and innovation, plus a “Startup Nepal” platform), and promised a state-backed “sovereign” AI computing centre in Kathmandu, stocked with thousands of specialised chips and offered to local startups at subsidised rates. A wider plan, Digital Nepal Framework 2.0, prioritises software, cloud, cybersecurity and AI, promises a legal framework for Nepalis to work from home for foreign employers, and proposes a “digital skills passport” and a national “learn while you earn” apprenticeship scheme. The gap, as ever, is delivery: there is still no modern data-protection law, no national cybersecurity strategy and no clear rulebook for data centres — and whether the enthusiasm survives Nepal’s slow bureaucracy is the question on which the whole experiment may turn.
The export that never leaves
Nepal has spent a generation exporting its muscle and importing wages. The weightless economy offers what the labour-migration model never could: the chance for young Nepalis to earn the world’s money while living, spending and building at home. Cotiviti, Deerwalk, Fusemachines and Programiz have already proved it can be done, and global demand for exactly this kind of work has never been larger. Whether it becomes Nepal’s future — rather than a bright exception — now depends on whether the country can clear the ordinary, unglamorous hurdles in its own path, and finally recognise that its most valuable export may be the one that never leaves.
Publish Date: August 31, 2026
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