Trade deficit has increased by 11.3 per cent – compared to the same quarter of the last fiscal year – to Rs 128.79 billion in the first quarter of the current fiscal year 2013-14, according to the central bank report.
The trade deficit with India – with which the country has above 65 per cent trade – surged by 14.2 per cent, whereas with third countries increased by 5.9 per cent only, the data revealed, adding that the country exported only Rs 23.07 billion worth merchandise, but imported Rs 151.86 billion worth in the first three months of the current fiscal year.
Though, Nepal's export to India increased by 18 per cent – compared to the same period of last fiscal year – export to third countries went up by a marginal 1.2 per cent only.
Despite consecutive governments promise to boost exports and substitute imports, the petroleum products is the largest import, which can only be substituted by the development of hydropower, apart from the agriculture produces that the country has competitive edge, provided the government encourages people for commercial agriculture.
However, the central bank has reported Rs 52.74 billion surplus Balance of Payment (BoP) in the first quarter against the surplus of Rs 2.05 billion in the period last fiscal year.
The macroeconomic indicator has also revealed that the foreign exchange reserve has increased by 13.8 per cent to Rs 606.82 billion in mid-October up from Rs 533.3 billion from mid-July.Likewise, the remittances – that has become a lifeline of the economy – inflow has also posted an increment by 38.2 per cent to Rs 135.03 billion in the first quarter.