By Our Reporter
The indicators of the economy’s external sector have been highly positive but the domestic economy is also in bad shape. It is what the report of the first four months of the current fiscal year released by the Nepal Rastra Bank showed.
According to the report, the gross foreign exchange reserve has increased by 10.2 per cent to Rs, 1696.78 billion in mid -November from Rs. 1539.36 billion recorded in mid-July.
Of the total foreign exchange reserves, reserves held by the NRB have increased to Rs. 1490.83 billion in mid-November from Rs 1345.78 billion in mid-July 2023.
Such reserves in the US dollar increased by 8.9 per cent and reached USD 12.75 billion in mid-November from USD 11.71 billion in mid-July.
Similarly, reserves held by banks and financial institutions (except NRB) increased by 6.4 per cent to Rs.205.95 billion in mid-November 2023 from Rs.193.59 billion in mid-July 2023, reads the report. The share of Indian currency in total reserves stood at 21.8 per cent in mid-November 2023.
Based on the imports of four months of 2023/24, the foreign exchange reserves of the banking sector is sufficient to cover the prospective merchandise imports of 13.6 months and merchandise and services imports of 11.3 months, according to the report.
Likewise, the country recorded the remittance inflow worth Rs. 477.96 billion in a period of four months.
According to the NRB report, remittance inflows increased by 26.4 per cent to Rs. 477.96 billion. There was an increase of 20.4 per cent in the remittances flows compared to the corresponding period of the previous year.
In the US Dollar terms, remittance inflows increased 23.1 per cent against 10.8 per cent in the corresponding last year to touch 3.60 billion in the review period.
Likewise, the country’s balance of payments has remained at a surplus of Rs.147.11 billion
The BOP remained at a surplus of Rs.147.11 billion in the review period against a surplus of Rs.20.03 billion in the same period of the previous year.
In US Dollar terms, the BOP remained at a surplus of 1.11 billion in the review period against a surplus of 149.6 million in the same period last fiscal year.
However, on the domestic front, the indicators are still poor. The government has collected only 25.55 per cent of the total revenue target of the fiscal year in the first four months. According to a daily report of the Financial Comptroller General Office under the Ministry of Finance, the government collected Rs. 363.42 billion in four months. The annual target is Rs. 1422.54 billion. Of the collected revenue, tax revenue is Rs. 337.1 billion and non-tax revenue Rs. 26. 24 billion.
Of the total revenue target of Rs. 1422,54 billion, Rs. 1305.4 billion is targeted to collect as tax revenue.
Likewise, the government managed to receive grants of Rs. 2.75 billion which is a mere 5.5 per cent of the annual target of Rs. 49.4 billion. Moreover, the government budget is in deficit in the first four months. The report said that the government faced a deficit if Rs. 69 billion because of higher expenses than the income. Similarly, the caital expenditure stands just at 11.94 per cent during the review period.
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