July 28: Nepal’s foreign trade witnessed a sharp decline in the fiscal year 2019/20 due to the effects of coronavirus pandemic. Although the reduction in import has improved Nepal’s trade deficit, it has also reduced revenue collection from customs duty significantly.

In fiscal year 2018/19, the Department of Customs had collected revenue of Rs 354 billion. The department had set a target of collecting 30 percent more revenue in the last fiscal year. The department was expecting import to rise and thereby an increase in revenue collection. However, the government’s restriction in import on top of coronavirus pandemic and the subsequent lockdown dented the customs department from achieving its target.

Revenue collection from customs duty, which was increasing every year, saw a decline  during the last fiscal year. The revenue collection from customs duty last year was much lower than the previous year. According to the department, revenue collection during last fiscal year was less that the preceding year by Rs 56 billion. The department was able to collect revenue of Rs 298 billion in FY 2019/20.

Data provided by the department shows that the overall foreign trade of Nepal shrunk by Rs 222 billion last year.

Nepal imported goods worth Rs 1196 billion during the review period against Rs 1498 billion during FY 2018/19.

According to the Department of Customs, Nepal’s import reduced by 15.63 billion while export of goods was down by 0.98 percent during the last fiscal year.