Thursday, January 30, 2014

Bandhs cost Rs 1.79 billion everyday, fuels inflation

The country loses Rs 1.79 billion from a day's bandh, according to a study ‘The Economic Cost of General Strikes in Nepal’ by the head of Research Department at the central bank Dr Min Bahadur Shrestha and Shashi Kant Chaudhary.

Between January 2008 and August 2013, the bandh also cost 2.15 percentage points off the annual gross domestic product (GDP) growth rate, apart from pushing the price – especially food products – and disturbing the tourist arrivals, the study reported, revealing that the monthly inflation rates were above nine per cent, whenever two-day general strike was reported the previous month. Further, three or more days of general strikes led to inflation rate crossing 10 per cent except in 10th and 11th months of 2009-10.

"The country had to bear an accumulated output loss of Rs 27 billion per year at current prices, which is around 1.5 per cent of the country’s annual GDP," it added. "There were a total of 4,451 general strikes in 75 districts between 2008 and 2013. Solukhumbu recorded the highest number of bandhs at 207 days in the five-and-a-half-year period. But bandh hit the Kathmandu district hard with daily gross output loss at Rs 148.44 million, followed by Morang at Rs 87.80 million and Jhapa at Rs 69.67 million in 2012-13."

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