Nepal Rastra Bank (NRB), the central bank, in its latest macroeconomic report, states that trade deficit with India, Nepal´s largest trading partner, increased by a whopping 26.2 percent during the review period. Trade deficit with India had gone up by 14.4 percent in the same period last fiscal year. Similarly, trade deficit with other countries rose by 16.5 percent in the ten-month period this fiscal year. [break]
Nepal´s merchandise exports went up by four percent to touch Rs 63.33 billion in the review period. Such exports had increased by 16.4 percent to Rs 60.9 billion in the same period last year. “The growth of total exports remained low in the review period due to slowdown in exports to both India and other countries,” the NRB report says.
Exports to India rose marginally by 1.9 percent, down from a hike of 17.6 percent reported in the same period last year. Similarly, Nepal´s exports to overseas countries also increased moderately by 8.5 percent during the review period, as against increment of 13.8 percent recorded in the same period last year.
Total imports during the review period increased by 19.7 percent to Rs 458.56 billion mainly due to surge in imports from India. In the corresponding period last year, total imports had gone up by 19.2 percent to Rs 383.01 billion.
NRB states that imports from the southern neighbor went up by 22.1 percent during the review period. Likewise, imports from other countries rose by 15.3 percent.
“Imports from India increased primarily owing to an increase in imports of petroleum products, vehicles and spare parts, cement, rice and other machinery and parts, among others,” the NRB report says. Likewise, imports from other countries increased due to increase in flow of silver, readymade garments, pipe and pipe fittings, telecommunication equipment parts, shoes and sandals, among others.
During the review period, the overall balance of payments (BoP) recorded a surplus of Rs 38.59 billion, down from a surplus of Rs 102.64 billion recorded in the same period last year. Similarly, the current account surplus shrunk to Rs 28.99 billion in the review period from Rs 44.75 billion recorded in the corresponding period last year.
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