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Capacity Utilization of Industries Increases to 70.5 Percent: Study

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Capacity Utilization of Industries Increases to 70.5 Percent: Study
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January 2: The capacity utilization of industries is increasing significantly with the receding effects of COVID-19.  The Industrial Status Report released by the Confederation of Nepalese Industries (CNI) shows that the capacity utilization of the industries has significantly improved in the first quarter of the current fiscal year compared to the last quarter of the previous fiscal year.

According to the report, Nepali industries have utilized 70.5 percent of their total capacity till the first quarter of the current fiscal year, up from 64.8 percent in the last quarter of the last fiscal year.

The report titled 'Industrial Status Report' was released by Arjun Prasad Pokharel, secretary at Ministry of Industry, Commerce and Supplies. This is the second edition of the Industrial Status Report published by CNI. The report is based on survey of 62 industries of the country. 

The latest report shows the revenue of industries has also improved. The industries have witnessed the revenue growth of 41.15 percent in terms of income in the review period of the current fiscal year compared to the same period of the last fiscal year.

The report states that 61.8 percent of the industries still depend on generators for energy which has increased the cost of the industries by five percent on a monthly basis.

During the review period, agriculture industries have paid interest of 8.7  percent, energy  industry, manufacturing industry and service industry have paid interest of 7.7  percent, 8.7 percent , and 8.2 percent respectively which is higher compared to the last fiscal year. 

Similarly, manufacturing industries have borrowed 54.1 percent of their working capital from banks and financial institutions. Among the industries which participated in the study, 61.7 percent stated they were ready for new investment. In the review period of the last year, 83 percent of industries were looking for new investment. 

Meanwhile, 30.8 percent of the sampled manufacturing industries exported their goods in the first quarter of the current fiscal year, which mostly belonged to manufactured foods and textiles.

According to the report, 90 percent of the industries that applied for the Business Continuity Loan received it while 57.1 percent of industries received a refinance loan. The surveyed industries are generating employment to 22,343 people. In the review period, the service-oriented industry has generated 67.4 percent new employment opportunities followed by manufacturing industries with 25.3 percent. The share of Nepali workers in the industries surveyed stands at 94.8 percent, with the manufacturing sector having the lowest share of 90.1 percent. 

Speaking at the program, Pokharel said that research conducted by the private sector would help the government in formulating policies. He said that the government would move hand in hand  with the private sector for industrial development. He also expressed commitment to make necessary policy arrangements for the promotion of domestic industries.

Secretary Pokharel said that the government has emphasized on the promotion of innovative industries. Bishnu Kumar Agrawal, chairman of CNI, stressed on the need to formulate regional policies for industrialization and its implementation.

 

 

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