KATHMANDU, Sept 24: The country faced trade deficit of Rs 63.76 billion in the first month of the current fiscal year, thanks to merchandise imports which has been on an upward trend.
The deficit widened by 13.6 percent in the review period compared to expansion of trade imbalance by 8.7 percent in the corresponding period of 2015/16, according to Current Macroeconomic and Financial Situation of Nepal based on first month's data of 2016/17.
Nepal had suffered trade deficit of Rs 56.12 billion in the first month of 2015/16.
The yawning trade imbalance is due to rapid rise in merchandise imports amid slow export growth. According to the central bank's periodic report, merchandise imports increased by 13 percent to Rs 70.72 billion in the review period. Export grew by only 7.7 percent to Rs 6.96 billion. The export-import ratio fell to 9.8 percent in the review period from 10.3 percent in the corresponding period of the previous year, according to the report.
In the review period, imports from India, China and other countries increased by 9.5 percent, 10.5 percent and 26.2 percent, respectively. Import of vehicles and spare parts, edible oil, telecommunication equipment and parts, electrical goods, MS billet, among others, increased, whereas import of cold rolled sheet in coil, hot rolled sheet in coil, M S wires, rods, coils, bars, crude soybean oil, among others, decreased, according to the report.
Nepal's export to China increased by 58.5 percent in the review period. The data shows that Nepal exported merchandise worth Rs 139 million to the northern neighbor.
However, export to India, the largest trading partner, inched up by a mere 0.8 percent to Rs 3.82 billion. Exports to other countries went up 16.1 percent to Rs 2.99 billion.
According to the report, export of jute materials, juice, Ayurvedic medicine, resin, and noodles, among others, increased in the review period while export of readymade garment, polyester yarn, pulses, G I pipes, among others, fell.