October 23: Nepal's overall balance of payment (BOP) has recorded a deficit of Rs 3.50 billion in the two months period of the current FY 2073/74. The figure is shown by the current macroeconomic and financial situation published by Nepal Rastra Bank (NRB) based on two months data. During the first month of current FY, such deficit was Rs 2.13 billion. However, the BOP was in surplus of Rs 31.88 billion in the corresponding period of last FY 2072/73. According to NRB,on account of an increase in trade deficit and dividend payments on foreign investment accompanied with decrease in foreign grants, the current account slipped into a deficit of Rs. 11.12 billion in the review period from a surplus of Rs. 38.48 billion in the same period of the previous year. 

Similarly, the export-import ratio fell to 8.8 percent in the review period from 11.8 percent in the corresponding period of the previous FY. The total trade deficit in the review period expanded 48.1 percent to Rs 135.84 billion. In the corresponding period of last FY, such trade deficit was contracted to 17.8 percent. 

Likewise, in the first two months of the current FY, merchandise exports increased 7.7 percent to Rs 13.18 billion compared to a drop of 15.2 percent in the same period of last FY. In the review period, exports to India, China and other countries increased 9 percent, 24.5 percent and 5.5 percent respectively. Commodity wise exports of juice, jute materials, rosin, oil cake, noodles, pulses among other increased whereas export of zinc sheet, readymade garments, polyester yarn, cardamom, G.I. pipes, woolen carpet among others decreased in the review period.

Moreover, merchandise imports increased 43.4 percent to Rs. 149.02 billion in the review period compared to a drop of 17.5 percent in the same period of the last FY. In review period, imports from India, China and Other countries increased 49.8 percent, 26.2 percent and 36.5 percent respectively. Commodity wise imports of Vehicles & spare parts, MS billet, Petroleum products, edible oil, telecommunication equipment and parts, electrical goods among others increased whereas imports of Chemical fertilizer, silver, Coldrolled Sheet in Coil, Hotrolled Sheet in coil, readymade garments among others decreased in the review period.
In the review period, the remittances flow increased 6.6 percent to Rs. 114.74 billion compared to a growth of 27.5 percent in the corresponding period of the last FY.

Nevertheless, the gross foreign exchange reserves decreased 0.6 percent to Rs. 1032.70 billion as at mid-September 2016 from Rs. 1039.21 billion in mid-July 2016.