As per the macroeconomic report of the country published by Nepal Rastra Bank up to Poush 2074, NRB hopes that financial imbalances ongoing in the market will be balanced in some time but deposit collection will be stagnant due to diminish in remittance.
Non-agricultural activities like electricity generation, supply situation and construction activities are anticipated to hike which will help to maintain pace in non-agricultural activities but the farm output is expected to decline but growth in maize and paddy production will somehow contribute for satisfactory economic growth.Inflation rate is to be affected by the price of agricultural items, construction materials and petroleum products.
The followings are the major macroeconomic situations of Nepal for the first six months Poush of the ongoing fiscal year 2074/75.
Inflation
Inflation has fallen to 4% in Poush 2074 as compared to highest inflation of 4.2% in Poush 2074. Pick up in prices of food items hike the inflation in the review period.However, such inflation is lower than the inflation of 3.2 percent recorded in the corresponding period of the previous year.
See Nepal’s full inflation scenario in ShareSansar’s new economy section
Government Revenue & Expenditure
The Government of Nepal has expected to earn revenue of Rs 730.05 billion and to spend Rs 1278.99 billion in the FY 2074/75.
At the end of Poush 2074 the government revenue collection increased by 20.7% to Rs 335.10 billion. Such revenue had increased by 68.9% to Rs 277.57 billion in the corresponding previous year. But the growth rate is as targeted of Rs 334.14 billion.
On the other hand, the total government expenditure on a cash basis decreased to Rs 364.95 billion. Such expenditure was just Rs 248.20 billion in the corresponding period of the previous year.
See Nepal’s Government full revenue and expenditure in ShareSansar’s new economy section
Capital Expenditure
These are the expenditure made on fixed assets. Capital expenditure is funds used to acquire physical assets to improve its value or increase its long-term productivity.
The government had targeted to spend Rs 335.17 billion as capital expenditure. At the end of Poush 2074 only 12.74% of the budgeted capital expenditure of Rs 42.72 billion was made which seems to be utilized ineffectively and it notifies slow growth of development activities. This shows that developmental works are not going as per the target made by the government pushing the country backward as well.
See Nepal’s Capital Expenditure in ShareSansar’s new Economy section
Remittance
Remittance is one of the major sources strengthening the Nepalese GDP since many years as money sent from abroad by Nepalese are comparatively higher than the income generated from production of goods in the country.
In the review year, Nepal’s workers’ remittance decreased by 0.5% to Rs 340.54 billion. The growth in the previous year was 5.7%. But the amount of remittances has declined due to fall in number of Nepalese going abroad foreign employment by 1.8%.
See Nepal’s Remittance outlook in ShareSansar’s new Economy section
BFIs Deposit & Lending
Deposits at Banks and Financial Institutions (BFIs) increased by 6.9% in the review year compared to an increase of 7.2% in the previous year.
Credit to the private sector from BFIs increased 11.9% in the review year compared to a rise of 12.9% in the previous year. In the review year, private sector credit from commercial banks and development banks increased 11.5 percent and 16.6 percent respectively, while that of finance companies increased 4.2 percent.
See Nepal’s BFIs Deposits &Lendings in Share Sansar’s new Economy section
Interest Rates
The weighted average 91-day Treasury Bill rate increased to 5.82% in sixth month of 2074/75 from 1.74% a year ago. Likewise, the weighted average inter-bank transaction rate among commercial banks, which was 2.71% a year ago, increased to 4.40% in the review month. The average base rate of commercial banks increased to 9.94%.
See Nepal’s Interest rates in Sharesansar’s new Economy section
Budget Deficit / Surplus
In the review year, the Government of Nepal (GoN) was at a deficit of Rs 35.47 billion in its budget which was Rs 40.22 billion in the corresponding period of the FY 2073/74.
See Nepal’s Budget Deficit / Surplus at Sharesansar’s new Economy section
Top 5 Imports and Exports
In the review period, as usual imports dominates exports. The summation of top 5 export from India and China amounts to Rs 9422.5 million (Rs 9.4 arba) and Rs 462.3 million (46.23 crore) respectively whereas top 5 import from India and China amounts to Rs 175,477.4 million (Rs 1.75 kharba) and Rs 33,004.1 million (Rs 33.004 arba) respectively. This signifies that Nepal is dependent on other countries production which outflows huge outflow of national currency.
