KATHMANDU, April 13: Nepal’s trade deficit that was on the path of correction mode in the past several months has started to worsen again with escalating imports following a decline in the negative impacts of the COVID-19.
According to the Current Macroeconomic Reports published by Nepal Rastra Bank (NRB), the country’s trade deficit increased by 1.6 percent to Rs 863.20 billion in the first eight months of the current fiscal year. As of the first seven months of the current fiscal year, it declined by 0.7 percent. It had gone down by 5.8 percent during the first six months.
The rising negative balance of trade has been resulted from the whooping increase in imports along with slow rise in the export earnings. According to NRB, import expenses in a month during mid-February and mid-March escalated by 17.46 percent to Rs 943.98 billion. But the export earnings crawled up 15.53 percent to Rs 80.77 billion during the period.
Compared to an increase of Rs 10.86 billion of exports with additional over Rs 140 billion of imports, the country’s expense stood almost 14 times of the earnings in just a single month.
During the eight months review period, Nepal’s import from India surged by 9.8 percent to Rs 622.30 billion. However, there was a decline in the import from the third countries.
Similarly, the country’s exports to India increased by meagre 11.3 percent during eight months of this fiscal year compared to a surge of 35.5 percent in the same period last year. Exports to China have come down to almost half during the review period.