Kathmandu, Apr. 27

Merchandise exports of the government increased by 14.1 per cent to Rs. 48.56 billion during the first eight months of the current fiscal year 2011/12.

According to a recent report made public by the Nepal Rastra Bank (NRB), such export had increased by 5.9 per cent to Rs. 42.54 billion compared to the corresponding period last year.

However, on monthly basis, merchandise exports declined by 10.4 per cent in February/March this fiscal year.

Exports to India went up by 14.5 per cent during the eight months compared to an increase of 10.1 per cent in the corresponding period the previous year.

Exports to other countries also went up by 13.5 per cent. In the corresponding period last year they had fallen by 1.7 per cent.

The increase in the exports to India was mainly ascribed to the increase in the exports of textiles, polyster yarn, G.I. pipe, stone and sand and cardamom, among others.

Export of woolen carpets, readymade garments, pashmina, Nepalese paper and paper products and tanned skin, among others, increased to other countries.

During the eight months of the FY 2011/12, merchandise imports increased by 16.6 per cent to Rs. 295.24 billion. Such imports had increased by 1.2 per cent to Rs. 253.13 billion in the corresponding period last year.

On monthly basis, the imports increased by 5.3 per cent in February/March of the current fiscal year.

Imports from India increased by 12.0 per cent during the review period compared to a growth of 24.7 per cent in the corresponding period last year.

Likewise, imports from other countries increased by 26.3 per cent compared to a decline by 27.2 per cent in the corresponding period last year.

During the review period, import of petroleum products, coal, chemical fertiliser, readymade garments and agricultural equipments and parts, among others, from India and of gold, crude soybean oil, silver, edible oil and other machinery and parts, among others, from other countries went up.

Trade deficit during the eight months went up by 17.1 per cent to Rs. 246.68 billion. Trade deficit had increased by 0.3 per cent in the corresponding period the previous year.

Trade deficit with India increased by 11.5 per cent during the review period compared to a growth of 28.2 per cent in the corresponding period last year.

Trade deficit with other countries increased by 28.9 per cent compared to a drop by 30.9 per cent in the corresponding period last year.

The increase in the import led to a reduction in the export/import ratio to 16.4 per cent during the review period from 16.8 per cent a year ago.

Whopping BoP surplus continues

The overall Balance of Payments (BOP) registered its highest ever surplus of Rs. 79.90 billion during the eight months of the FY 2011/12 compared to a deficit of Rs. 11.29 billion in the corresponding period last year.

The current account registered a surplus of Rs. 37.51 billion compared to a deficit of Rs. 8.79 billion in the corresponding period the previous year.

The growth both in the remittances and grants along with the improvement in the service account were the responsible for the substantial surplus in the current account.

FOB-based merchandise trade deficit increased by 16.9 per cent to Rs.237.55 billion during the eight months.

Such deficit had increased by 0.1 per cent in the corresponding period the previous year.

Net service account witnessed a surplus of Rs. 11.07 billion during the review period compared to a deficit of Rs. 7.56 billion in the corresponding period last year.

Under services, tourism income rose by 29.9 per cent during the period compared to a decline by 20.7 per cent in the corresponding period last year.

The net transfer account registered a growth of 29.7 per cent to Rs. 256.88 billion during the review period.

While pension receipts declined by 8.6 per cent to Rs. 17.77 billion, workers’ remittances increased by 34.7 per cent to Rs.217.77 billion compared to a growth of 12.3 per cent in the corresponding period the previous year.

On a monthly basis, the remittance inflows increased by 14.5 per cent in February/March compared to the value of the previous month of this fiscal year.

Likewise, under the financial account, foreign direct investment of Rs 6.02 billion was recorded during the review period compared to Rs 5.47 billion in the same period a year ago.

FOREX reserves up by 35.3 pc

The gross foreign exchange reserves went up by 35.3 per cent to Rs. 368.10 billion in mid-March 2012 from a level of Rs. 272.15 billion as at mid-July 2011.

Such reserves had declined by 4.2 per cent to Rs. 257.48 billion in the corresponding period last year.

Out of total reserve, NRB’s reserves increased by 43.1 per cent to Rs. 305.02 billion during the review period from a level of Rs. 213.10 billion as at mid-July 2011.

Such reserves had increased by 5.7 per cent during the corresponding period last year.

The reserves in terms of inconvertible foreign exchange, increased by 64.6 per cent to Indian Rs. 52.88 billion during the review period.

Such reserves had decreased by 37.6 per cent during the corresponding period previous year.

Based on the trend of import during the eight months of the current fiscal year, the current level of reserves is sufficient for financing merchandise imports for 10.1 months and merchandise and service imports for 9.0 months.