KATHMANDU, Feb 7: Nepal received Rs 763.08 billion in remittances during the first six months of the current fiscal year. The Ministry of Finance reported a 4.1 percent increase in remittance inflow (in Nepali currency) in its mid-term budget review report.
Remittance inflow had surged by 22.2 percent during the same period last year. Meanwhile, net transfers rose by 4.2 percent to Rs 832.76 billion. Last year, net transfers had grown by 21.1 percent during the same review period.
The Ministry of Finance noted an 11.7 percent rise in Nepalis obtaining final labor permits (both institutional and individual) for foreign employment, bringing the total to 230,439. Similarly, the number of Nepalis renewing their labor permits increased by 21.4 percent to 162,628. In contrast, this figure had declined by 6 percent in the same period last year. Overall, the number of Nepalis leaving for foreign jobs grew by 15.5 percent compared to the previous year.
Remittance inflow increases 27.1 percent in six months
The balance of payments (BoP) maintained a surplus of Rs 249.26 billion during this period, compared to Rs 273.52 billion in the same period last year. As of mid-January, Nepal’s total foreign exchange reserves rose by 13.5 percent to Rs 2.316 trillion from Rs 2.041 trillion in mid-July 2024.
Foreign exchange reserves in US dollars climbed by 10.3 percent, reaching $16.84 billion from $15.27 billion in mid-July. These reserves can cover 17.3 months of merchandise imports and 14.4 months of goods and services imports. As of mid-January, Indian currency accounted for 24.3 percent of Nepal’s foreign exchange reserves.
Total merchandise exports jumped by 31.8 percent to Rs 98.79 billion. In the same period last year, exports had declined by 7.2 percent. Exports of soybean oil, tea, polyester yarn and thread, particle board, and cardamom increased, while exports of palm oil, zinc sheets, ginger, ready-made garments, and medicinal herbs declined.
On the import side, total merchandise imports rose by 7.1 percent to Rs 822.37 billion. Last year, imports had decreased by 3.1 percent during the same period. Imports of raw soybean oil, rice, paddy, transportation equipment, vehicle spare parts, sponge iron, and edible oil increased, while imports of petroleum products, crude palm oil, gold, chemical fertilizers, and peas declined.
As a result, Nepal’s trade deficit expanded by 4.4 percent to Rs 723.58 billion. In contrast, the trade deficit had decreased by 2.6 percent during the same period last year.
