KATHMANDU, MAY 12
In the first nine months of the current fiscal year (mid-July, 2020 to mid-April, 2021), the country's current account deficit surged by 64.49 per cent.
The 'Current Macroeconomic and Financial Situation of Nepal' report of the Nepal Rastra Bank (NRB) unveiled today reveals that the current account remained at a deficit of Rs 207.41 billion in the review period compared to a deficit of Rs 126.09 billion in the same period of the previous year.
During the nine months of fiscal year 2020-21, merchandise exports increased 20.2 per cent to Rs 94.77 billion compared to an increase of 12.9 per cent in the same period of the previous year. Meanwhile, merchandise imports during the review period increased by 13.1 per cent to Rs 1,111.40 billion against a decrease of 7.5 per cent in the corresponding period a year ago.
The mismatch between the country's exports and imports resulted in the total trade deficit to rise by 12.5 per cent to Rs 1,016.63 billion in the nine months of fiscal 2020-21. Such deficit had decreased by 8.9 per cent in the same period of the previous year.
The export-import ratio increased to 8.5 per cent in the review period from eight per cent in the same period of the previous year, as per the central bank's report.
The balance of payments (BoP) registered a surplus of Rs 42.54 billion in the review period as compared to a surplus of Rs 36.61 billion in the same period of the previous year.
The number of Nepali workers (institutional and individual-new and legalised) taking approval for foreign employment slumped by 66.7 per cent in the review period. It had increased by 10.2 per cent in the same period of the previous year. The number of Nepali workers (renew entry) taking approval for foreign employment decreased by 55.7 per cent in the review period. It had decreased 15 per cent in the same period of the previous year.
Nevertheless, remittance inflows increased 16.5 per cent to Rs 729.02 billion in the review period against a decrease of 4.2 per cent in the same period of the previous year.
Meanwhile, the gross foreign exchange reserves increased 2.7 per cent to $11.96 billion in mid-April, 2021 from $11.65 billion in mid-July, 2020. Based on the imports during the nine months of fiscal 2020-21, the foreign exchange reserves of the banking sector is sufficient to cover the prospective merchandise imports of 11.9 months, and merchandise and services imports of 10.8 months, reveals the NRB report.
A version of this article appears in the print on May 13, 2021, of The Himalayan Times.
