The conflict in West Asia might appear remote from Nepal, but its economic repercussions are now felt in every Nepali household. Fuel prices have skyrocketed to levels that threaten the very survival of the middle class and the urban poor. Petrol now stands at Rs217 per litre while diesel has reached an unprecedented Rs225. This price hike threatens to sabotage the economic stability of the average citizen who depends on two-wheelers and public transport to earn a living. It signals a shift in the economic reality of the nation.

The human cost of this energy shock is profound and far-reaching. According to the United Nations Development Programme, the ongoing conflict could reverse significant gains in human development. Projections suggest that up to a month of human development progress could be erased in a short period. Furthermore, the possibility of a prolonged conflict risks pushing between 25 and 33 percent of the population into poverty. This is a staggering statistic that should alarm every policymaker. Economic growth is also at risk of falling to a mere 3 percent which is well below the long-term historical average of 4 percent. In addition, Sulphur shipments for phosphate fertiliser have been interrupted, leading to higher costs for farmers.

Amid this gloom, there is a glimmer of hope in the transition to electric vehicles, though it remains dangerously incomplete. Nepal has become a global leader in the adoption of electric four-wheelers, with over 70 percent of new car sales being electric. However, a majority of citizens are squeezed by the prices of fossil fuels. The current reliance on petroleum is a choice that the state can and must reverse through better infrastructure.

Public transport users are also suffering as fares have risen by an average of 16.71 percent. Students and daily wage workers are finding it increasingly difficult to afford basic mobility. Ride-sharing drivers are trapped between rising fuel costs and static fares. The government’s decision to implement an additional Sunday holiday to curb consumption is a minor palliative that does not solve the underlying problem.

A comprehensive and solution-oriented strategy is required to protect the nation from these external shocks. The state must prioritise the massive expansion of charging infrastructure across both urban and rural areas. This will directly address range anxiety surrounding EVs and encourage the middle class to switch to electric two-wheelers. Secondly, the government should provide targeted subsidies or low-interest loans for electric motorcycles to make them affordable for daily wage earners. The transition must be inclusive and not just a privilege for the wealthy owners of four-wheelers.

Beyond transport, the state must diversify the sources of national income. Relying on the Gulf for nearly half of all remittances is a gamble that the country can no longer afford to take. Policy makers must actively seek new labour markets and invest in domestic job creation to reduce this extreme exposure to West Asian volatility. Additionally, the agricultural sector requires a secure and independent supply of fertiliser to ensure food security.

Nepal has the resources to be energy independent, but remains shackled to global oil markets. It produces clean energy and has shown a capacity for rapid technological adoption. The challenge now is to extend this revolution to every segment of society. By investing in electric mobility for the masses and diversifying the economic base, the country can build a cushion against future shocks. The time for half-measures has passed, and that for radical structural change in energy consumption must begin today.