However, the latest statistics showed the official assesment of the three products that once formed the backbone of Nepali exports was completely wrong.[break]
Nepal Rastra Bank (NRB), which reported that Nepal´s overall exports expanded by nearly 14 percent or Rs 6 billion in the first eight months of 2011/12, acknowledged that Rs 3 billion of that additional Rs 6 billion export income came from these three products.
NRB data showed, exports of all these products expanded by around 50 percent and such robust growth came despite the fact that the US and Euro zone -- their major markets -- were not faring well in recent years.
Among these three major products, data showed Pashmina enjoyed 59 percent rise in its export and became the best performer in terms of growth. But in term of volume, hand knotted woolen carpet that grew by almost 50 percent and touched Rs 4.60 billion, remained the biggest export of Nepal.
Readymade garment industry, which expanded by 49 percent, too fetched additional earnings of over Rs 1 billion during the period.
“Though it is difficult to forecast the fate of garment industry, which is largely intertwined with global politics and shift in labor market outlook, pashmina and woolen carpet will continue to stay and make their mark in country´s overseas trade,” opined a NRB official.
If the government extended meager supports to farmers in raising mountain goats and sheep he even believed the country could kill three birds with a single stone.
“Local raising of these livestock will first enable the industry source raw materials locally which will make them more competitive and expand exports. Secondly, it will enable the country to be self sufficient on meat by curtailing meat import, and thirdly attain poverty reduction,” said the official.
As a result of expansion of these products export, Nepal´s third country exports expanded by 13.5 percent during the eight months of 2011/12, compared to net decline in exports by 1.7 percent in the same period last year.
That is not all. Nepal´s exports to India, the largest trading partner, also rose by higher rate during the same period. “Exports to India grew by 14.5 percent and touched Rs 32.59 billion during the first eight months of 2011/12,” says the latest NRB report.
As usual, Nepal´s exports to India grew on the back of 43 percent rise in export of textiles, almost 50 percent rise in growth of polyster yarn, 27 percent rise in juice, 175 percent rise in export of GI Pipe.
With exports totaling at Rs 3.11 billion, textiles became Nepal´s largest export to India. Zinc Sheet with exports valued at Rs 2.92 billion and jute goods at Rs 2.71 billion were the second and third largest export to India during the period.
Despite the sharp growth of major exports, the total export earning of the country remained less by some Rs 10 billion to finance the import of just one item - petroleum products.
Even though frequent scarcity prevented Nepalis from getting hold of enough fuel as they would have liked, imports of petroleum products expanded by over 31 percent and crossed Rs 58 billion in the first 8 months of 2011/12.
Likewise, import of gold also remained high at Rs 16.22 billion, becoming second largest import of the country. With imports valued at Rs 12.08 billion, vehicles and spare parts was the third largest import of Nepal.
Nepal also imported Rs 7.17 billion worth of crude soya bean oil and Rs 1.10 billion worth of edible oil, something the country has enough potential to produce locally, said the NRB official.
Unfortunately, in the absence of proper policy alignment, Nepal´s import soared by almost 17 percent and touched Rs 295.24 billion. That caused country´s trade deficit to widen to Rs 247 billion.
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