You may have to move the file to a server location. I would think that the ASPNET account would need to be able to access it. You have some options:
1. Load the data into an ADO.NET Data set, then update the data to the database via the SQLDataAdapter.Update method.
2. Use DTS to do it. You can use the SQL DTS COM objects to do that. If you look on the web, you can find more about it.