Trade deficit balloons to Rs 1.32 trillion

Published On: July 30, 2019 03:00 AM NPT By: Republica | @RepublicaNepal

Growth rate of export higher than that of import

KATHMANDU, July 30: Total trade deficit of the country jumped by 14.26% to Rs 1.32 trillion in the last fiscal year 2018/19.

According to data compiled by the Department of Customs, the country imported commodities worth Rs 1.42 trillion in the last fiscal year while its export earnings stood at Rs 97.11 billion.

While the growth rate of exports was higher than that of imports, ballooning trade deficit has been raising concern about external sector stability of the country. The data shows that imports grew by 13.93% in the last fiscal year compared to last fiscal year whereas exports grew by 19.36%.

Country's exports to imports ratio fell to 1:14.6 in the last fiscal year from 1:15.3% in the previous fiscal year. This means that the country imported Rs 14.6 worth of goods for every rupee worth of export earnings in the last fiscal year.

Out of 157 trading partners, Nepal registered trade deficit with 134 countries while the country maintained positive trade balance with 23 countries. Trade surplus with these countries is very nominal in value, according to the data. Some of the countries with whom Nepal logged trade surplus were Afghanistan (Rs 14.29 million), Central African Republic (Rs 275.85 million) and Maldives (Rs 6.2 million).

As always, the highest trade deficit was with India. According to the DoC, Nepal registered trade deficit of Rs 855.19 billion with the southern neighbor in the last fiscal year. Nepal exported goods and commodities worth Rs 62.73 billion to India while it imported goods and commodities worth Rs 917.92 billion with its largest trading partner. Similarly, trade deficit with China ballooned to Rs 203.4 billion. Nepal exported goods worth Rs 2.1 billion to China, while it imported goods worth Rs 205.52 billion from its northern neighbor.

Widening trade deficit has become a matter of serious concern for the government. It has been taking some measures, including restrictions on import of some commodities, in recent months to arrest swelling trade deficit of the country.