By Our Reporter
The indicators of the economy and the activities of the leaders in the government show that Nepal is sooner or later moving on the path of Sri Lanka. The latest report of the Nepal Rastra Bank also presents a bleak picture of the national economy.
According to the NRB report made public on Monday, consumer price inflation has doubled in the first 11 months of the current fiscal year as compared to the same period last fiscal year.
The y-o-y consumer price inflation stood at 8.56 per cent in the 11 months of the current fiscal year 2021/22 compared to 4.19 per cent a year ago, according to the current macroeconomic and financial report published by Nepal Rastra Bank (NRB) Monday.
Food and beverage inflation stood at 7.43 per cent whereas non-food and service sector inflation stood at 9.44 per cent in the review month. The average monthly y-o-y inflation for 11 months was 6.09 per cent.
Also, the growth rate of remittance has declined during the first 11 months.
Remittance inflows increased by 3.8 per cent to Rs. 904.18 billion in the review period compared to 12.6 per cent in the same period of the previous year.
In US dollar terms, remittance inflows increased by 1.5 per cent to 7.51 billion in the review period against an increase of 10.5 per cent in the same period of the previous year.
Balance of payments (BoP) also remained at a deficit of Rs. 269.81 billion in the review period against a deficit of Rs. 15.15 billion in the same period of the previous year.
In US dollar terms, the BoP remained at a deficit of 2.26 billion in the review period against a deficit of 140.8 million in the same period of the previous year.
Likewise, the current account remained at a deficit of Rs. 595.73 billion in the review period compared to a deficit of Rs.298.11 billion in the same period of the previous year.
In the meantime, gross foreign exchange reserves decreased by 15.9 per cent to Rs. 1,176.84 billion in mid-June 2022 from Rs. 1,399.03 billion in mid-July 2021.
In US dollar terms, the gross foreign exchange reserves decreased by 19.6 per cent to 9.45 billion in mid-June 2022 from 11.75 billion in mid-July 2021.
Of the total foreign exchange reserves, reserves held by NRB decreased by 17.1 per cent to Rs. 1,031.89 billion in mid-June 2022 from Rs. 1,244.63 billion in mid-July 2021.
Reserves held by banks and financial institutions (except NRB) decreased by 6.1 per cent to Rs. 144.95 billion in mid-June 2022 from Rs. 154.39 billion in mid-July 2021.
While the indicators are negative, the Nepal Oil Corporation is facing a huge loss, and it may not be able to import fuel if the present situation continues for a few weeks.
Moreover, growing corruption and the protection of the corrupt individuals by politicians, amassing of property by those close to power and wrong policies introduced for the benefit of the family members and businessmen close to Prime Minister Sher Bahadur Deuba’s spouse Arzoo Rana will not take more time for Nepal to become next Sri Lanka, where the all-powerful president fled the country after the people swarmed into his palace.
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