EDITORIAL: Alarming scenario
The doubling of the trade deficit in the review period should be taken with
seriousness and attempts should be made to take immediate remedial measures
The trade deficit in the first four months of this fiscal year almost doubled as compared to the same period last fiscal year.
The deficit stood at a staggering Rs. 277.2 billion as the imports rose in the beginning of the year.
According to figures made available by the Department of Customs (DoC) the country then had imported goods amounting to Rs. 301.78 billion, and it was able to export goods totaling Rs. 24.99 billion only which is a deficit in trade amounting to Rs. 277.2 billion.
During this period, the trade deficit rose by Rs. 99.52 billion while the imports in the review period were 87.85 per cent but the exports were only 13.01 per cent. The imports are seen to be growing with the passage of every month in this fiscal.
It can be noted that the country imported merchandise amounting to Rs. 86.16 billion in the last month from mid-October to mid-November.
The imports have risen dramatically during the review period because of the import of construction materials that were required to carry out reconstruction works after the devastating earthquakes of last year which is now slowly getting momentum.
Moreover, due to the trade blockade suffered by Nepal for about five months from the last week of September last year the supply of goods from India to Nepal were disrupted leading to the growth of imports as high as 88 per cent.
The blockade had had an adverse effect on the country’s economy. The loss incurred during the blockade was calculated to be much higher than the damage caused by the big earthquake that had hit Nepal then.
The goods imported then constituted 65.26 per cent or Rs. 196.93 billion during the first four months of this fiscal. The top five import items were vehicles, petroleum products, iron and steel, electrical and machinery equipment.
At the same time the country’s major exports were identified as carpets as in most previous years and also tea and coffee, garments and clothing, as well as vegetables, nuts and parts of plants and herbs.
Nepal should consider doing its utmost to increase its exports which it can do if it manufactured more goods on which it has a competitive edge like garment, carpets and agro-products.
The importing countries are also providing tax rebates for some commodities and we should be able to make the most out of it.
At one time garments and carpets were the top export items but some countries discontinued buying them after it was found that children were used to manufacture them. We should make the most of the opportunity made available to the country.
In the meantime we should strive to export goods up to the international standard and be competitive in price which is possible if we become serious about it.
The doubling of the trade deficit in the review period should be taken with seriousness and attempts should be made to take immediate remedial measures, including creating a congenial environment for investment, which includes a number of requisites.
It would be in order to revive the economy that is showing little sign of growth by taking innovative measures to deal with the alarming trade deficit that the country has been facing for years.
Beating the cold
Every year several people are reported to die from severe cold in the midst of winter in the Terai.
Preventive measures were suggested to minimize the number of such deaths. Of course, the victims have been poor people who could not provide for themselves a safe shelter, warm clothes and fire, apart from enough food.
This year, as the winter has set in, the government has taken note of the danger, and has directed the concerned ministries, departments and district disaster relief committees, its district offices and other agencies to be on alert, for prevention as well as for relief and rescue.
Prevention would make the task easier than preparing to come to rescue when the severe cold starts taking its toll.
Safety tips include providing warm clothes, staying indoors during the cold waves, providing warm quilts and blankets, lighting bonfires, and taking special care of vulnerable people such as children, the elderly, pregnant women and patients, ensuring proper ventilation while lighting kerosene heaters or fires, and keeping watch over symptoms of hypothermia like excessive shivering, disorientation and drowsiness.
How effective the government will become in this task, however, remains to be seen.