August 27: The average consumer price inflation stood at 3.60 percent in Fiscal Year 2020/21 compared to 6.15 percent a year ago, according to Nepal Rastra Bank (NRB).

Unveiling the annual report on Current Macroeconomic and Financial Situation of last fiscal year on Thursday (August 26), the central bank said that the average consumer price of ghee and oil; pulses and legumes; tobacco products; and transportation sub-groups rose 17.54 percent, 10.65 percent, 9.83 percent and 6.41 percent respectively on annual basis.

Export

During 2020/ 21, merchandise exports increased 44.4 percent to Rs 141.12 billion compared to an increase of 0.6 percent in the previous year, the report further states.

Destination-wise, exports to India and other countries increased 51.7 percent and 27.7 percent respectively whereas exports to China decreased 14.7 percent. Exports of soybean oil, cardamom, polyester yarn and threads, jute products, woolen carpet, among others, increased whereas exports of palm oil, pulses, zinc sheet, wire, cattle feed, among others, decreased in the review period.

Import

Likewise, in FY 2020/21, merchandise imports increased 28.7 percent to Rs 1539.84 billion against a decrease of 15.6 percent a year ago.

Destination-wise, imports from India, China and other countries increased 32.1 percent, 28.6 percent and 19.6 percent respectively.

Imports of transport equipment and parts, crude soybean oil, MS billet, rice, gold, among others, increased whereas imports of aircraft spare parts, crude palm oil, video television and parts, cold-rolled sheet in coil, betel-nut, among others, decreased in the review period.

Trade Deficit

According to the report, the total trade deficit increased 27.3 percent to Rs 1398.71 billion during 2020/21. Such a deficit had decreased 16.8 percent in the previous year. The export-import ratio increased to 9.2 percent in the review period from 8.2 percent in the previous year.

Remittance

Meanwhile, inflow of remittance increased 9.8 percent to Rs 961.05 billion in the review year against a decrease of 0.5 percent in the previous year. In terms of US Dollar, remittance inflow increased 8.2 percent to 8.15 billion in the review year against a decrease of 3.3 percent in the previous year.

Foreign Employment

The number of Nepali workers taking approval for foreign employment decreased 62.8 percent in the review year. It had decreased 20.5 percent in the previous year. The number of Nepali workers (renew entry) taking approval for foreign employment decreased 46.8 percent in the review year. It had decreased 34.7 percent in the previous year.

Current Account

Meanwhile, the current account remained at a deficit of Rs 333.67 billion in the review year compared to a deficit of Rs 33.76 billion in the previous year. In the US Dollar terms, the current account registered a deficit of 2.84 billion in the review year compared to a deficit of 339.8 million in the previous year.

Capital Transfer

In the review year, capital transfer increased 7.4 percent to Rs 15.26 billion and net foreign direct investment (FDI) increased 0.2 percent to Rs 19.51 billion. In the previous year, capital transfer and net FDI amounted to Rs 14.21 billion and Rs 19.48 billion respectively.

Balance of Payments

On the other hand, Balance of Payments (BOP) registered a surplus of Rs 1.23 billion in the review year compared to a surplus of Rs 282.41 billion in the previous year.

Refinancing

The report further states that NRB approved Rs 148.75 billion refinance in 2020/21. The outstanding amount of refinance provided by NRB remained Rs 122.70 billion in mid-July 2021.

Concessional Loan

As of mid-July 2021, the outstanding concessional loan is Rs 161.44 billion extended to 104,109 borrowers. Of which, Rs 106.98 billion has been extended to 46,057 borrowers for commercial agriculture and livestock businesses.

Likewise, Rs 50.98 billion loan has been extended to 55,551 women entrepreneurs. Remaining Rs 3.48 billion loan has been extended to 2,501 borrowers of other categories of concessional loans.

Business Continuity Loan

Business continuity loan has been extended to the Covid-19 affected tourism, cottage, small and medium industries for payment of salaries to workers and employees in line with 'Business Continuity Loan Procedure, 2077'. Under this provision, Rs 956.7 million loan has been approved as of mid-July 2021.

Branch Extension

Of the total 753 local levels, commercial banks extended their branches at 750 levels as of mid-July 2021.

Gross Domestic Product Growth

The Central Bureau of Statistics has estimated the Gross Domestic Product growth of 4.01 percent for 2020/21. Agriculture, industry and service sectors are estimated to grow 2.64 percent, 5.05 percent and 4.43 percent respectively.

The share of agriculture, industry and service sectors in GDP stands 25.83 percent, 13.11 percent and 61.06 percent respectively in 2020/21.

Gross domestic saving to GDP stands 6.6 percent in 2020/21. Ratio of gross fixed capital formation and gross national saving to GDP stands 27.26 percent and 32.30 percent respectively.

Hydro Electricity Capacity and Reconstruction

The installed capacity of hydro electricity increased to 1458 Megawatt in 2020/21. According to National Reconstruction Authority, reconstruction of 74.2 percent and 93.5 percent of private houses and government buildings, respectively, have been completed by the end of 2020/21.

Tourist Arrival

The total number of tourist arrivals decreased 90.9 percent to 70,123 in 2020/21.