KATHMANDU, Dec 24: Nepal’s trade deficit in the first five months of the current fiscal year declined by 10.91 percent compared to the same period last year, providing some cushion to the country’s foreign currency reserve being spent to settle the huge imports bills.
The records at the Department of Customs (DoC) show that Nepal’s trade deficit came down to Rs 475.44 billion from Rs 533.64 billion during mid-July and mid-December as a result of a fall in import expenses and a rise in export earnings.
According to the DoC, the country's export increased by 5.12 percent to Rs 50.05 billion whereas the imports declined by 9.59 percent to Rs 525.49 billion.
Despite a notable fall in the trade deficit figure in the review period, Nepal is less likely to benefit in a larger context due to low export earnings figure. Although the government had targeted to cross the export earnings to more than Rs 100 billion by 2020, it is far from realization till date.
As much as 70.65 percent of Nepal’s total international trade worth Rs 575.44 billion was with India in the review period. In terms of import, 65.78 percent of Nepal’s total import was with the southern neighbor. Nepal has a trade deficit with 112 of its 136 trading partner countries. The landlocked country had a favourable trade balance with the remaining 24 countries during the review period.