KATHMANDU, Sept 26: The government's aspirations for the fiscal year 2023/24 that hinge on boosting economic activity and fostering business growth, face formidable challenges, as recent statistics from the months of Shrawan to Bhadra (mid-July to mid-September) do not bode well for their realization.
According to the Department of Customs (DoC), the first two months of the current fiscal year have seen a decline in imports by 5.06 percent, exports by 7.79 percent, and total foreign trade by 5.32 percent when compared to the previous fiscal year. While a reduction in the trade deficit by 4.47 percent may seem positive, the drop in exports of Nepali products is a concerning sign.
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Economists suggest that this decline in both imports and exports can be attributed to reduced production and consumption in the market, indicating economic stagnation. Former finance secretary Shishir Kumar Dhungana expressed his concern, stating that the decrease in foreign trade indicates broader economic challenges.
"It appears that the economy has been adversely affected by this contraction in foreign trade," Dhungana told Republica.
Comparing the months of Shrawan and Bhadra from last year to the current fiscal year, imports have dipped by 5.06 percent, with goods and merchandise worth Rs 259.74 billion being imported in contrast to the previous year's Rs 273.59 billion. This has contributed to a decrease in the foreign trade deficit, which has fallen by 4.74 percent to Rs 233.3 billion, down from Rs 244.91 billion during the same period last year.
Dhungana further emphasized that the impact of reduced import and export activity would extend to affect revenue generation and several sectors of the economy, underscoring the need for swift measures to revitalize foreign trade.
