Despite slow growth in Gross Domestic Product (GDP), per capita income is expected to record a 16 percent growth to Rs 41,600 from last year´s Rs 35,865. CBS estimates that the overall size of the economy will touch Rs 1,176.5 billion by the end of the current fiscal year ending in mid-July, according to a preliminary draft circulated by the CBS among top technocrats, a copy of which was obtained by myrepublica.com. Nepal´s total GDP at market price was Rs 991.3 billion last year. [break]
Among the major sectors of Nepal´s economy, the agriculture sector is estimated to grow by a minimal 1.12 percent against the initial target of 3.3 percent. Last year, the sector grew by 3 percent.
Adverse weather conditions that dragged down the output of prime agriculture products like paddy and maize are the major reason behind the pessimistic performance of the agriculture sector, according to CBS. The Ministry of Agriculture recently estimated that the production of paddy and maize will decline by 11.05 percent and 3.91 percent respectively during the current fiscal year. Paddy and maize together contribute to one-fourth of the agriculture GDP.
Similarly, the non-agriculture sector has been estimated to increase by 3.6 percent whereas the budgetary expectation was 6.6 percent. Of the two major sectors of this group, the industrial sector is estimated to increase by 3.88 percent -- the highest since fiscal year 2006/07, as manufacturing and construction are expected to perform better than last year.
- Per capita GDP to touch Rs 41,600
- Total GDP at current prices to be Rs 1,175.5 billion
- Contribution of manufacturing to shrink to 6.25 percent
- Hotels and restaurants record highest growth of 8.5 percent
After two consecutive years of contraction, the CBS expects the manufacturing sector to expand by 2.65 percent while the construction sector that has witnessed a remarkable boom in recent years is estimated to grow by 6.62 percent.
Likewise, the service sector that constitutes almost half the national GDP is estimated to grow by 5.34 percent, thanks to healthy growth rates achieved in the hotel and restaurant and transport and communication sectors which grew by 8.54 percent and 6.45 percent respectively. The health and social sector that had expanded by 13 percent last year increased further by 6.06 percent this year.
However, the financial intermediation sector that represents the booming banking sector and financial institutions grew by just 4.87 percent, though this is much better that last year´s growth of 1.75 percent.
According to CBS data, the contribution of the agriculture sector to GDP has increased slightly to 33.03 percent from last year´s 32.10 percent. However, worrisomely, the contribution of the manufacturing sector, the largest employment generator after agriculture, continued to shrink, to 6.25 percent from last year´s 6.83 percent.
prem@myrepublica.com
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