Trade deficit balloons

The country has witnessed a trade deficit of Rs 11.86 billion in the first six months of the current fiscal year.
"The country has imported Rs 145.43 billion — worth of key 50 products — whereas its export stood at only Rs 33.57 billion by mid-December," according to the data of the central bank.
The ballooning trade deficit is alarming, said finance minister and coordinator of the High Level Financial Sector Coordination Committee Barsha Man Pun during the meeting of the committee organised at his office in Singh Durbar today.
The government has mobilised Rs 111.3 billion revenue — Rs 95.93 billion tax revenue and Rs 15.53 billion non-tax revenue — whereas spent Rs 98.64 billion under recurrent expenditure and Rs 9.56 billion under capital expenditure by the end of six months. The recurrent expenditure is 33.62 per cent whereas capital expenditure is 13.17 per cent, according to the Finance Ministry.
"Similarly, by the end of Pous, the inflation stood at 7.5 per cent, which has moderated to seven per cent in Magh — the seventh month — and foreign exchange reserve stood at Rs 368 billion."
Though the overall macroeconomic indicators are good in the first six months of the current fiscal year, the balloning trade deficit and low capital expenditure have to be taken seriously, he said, adding that the government will focus on increasing capital expenditure, bridging trade deficit, and cracking whip on price hike.
The meeting discussed on possible merger of NIDC Development Bank and Rastriya Banijya Bank, apart from current liquidity situation of the financial sector, which is comfortable, interest rates and the investment on productive sector.
The meeting — participated by the National Planning Commission (NPC) vice chair, secretary at the Prime Minister's Office, central bank governor and finance secretray — also discussed on current short supply situation of petroleum products, problems of paddy and sugarcane farmers and planned to study on the problems and report soon.