By Our Reporter 
The health of the national economy is not in good shape although indicators of the external sector of the economy have improved.
According to the latest current macroeconomic and financial situation report of the Nepal Rastra Bank (NRB), foreign currency reserves, balance of payment, current account and remittance inflows have grown increasingly positive in the first seven months of the current fiscal year 2023/24. However, the general people including the businessmen and contractors have not felt any relief.
The current macroeconomic and financial situation report of the first seven months of the current fiscal year made public by the NRB on Sunday, has shown that a significant increase in the remittance inflows has led to an increase in foreign exchange reserves.
Remittances sent by the workers who went abroad for employment have contributed significantly to increasing the foreign currency reserves and to making the balance of payments and current account positive.
According to the report, remittance inflows increased by 21.6 per cent to Rs. 839 billion in the review period compared to an increase of 27.1 per cent in the same period of the previous year.
The report showed that a remittance of Rs. 106 billion has been received in a single month from mid-January to mid-February 2024 of the current fiscal year.
The country received a remittance of Rs. 120 billion from mid-December 2023 to mid-January 2024.
Likewise, the foreign currency reserves reached an all-time high of Rs. 1,844.94 billion during the first seven months of the current fiscal year.
Foreign currency reserves increased by about Rs. 28.37 billion during a single month (mid-January to mid-February 2024). The foreign currency reserves amounted to Rs. 1,816.57 billion in mid-January 2023.
Based on the imports of seven months of 2023/24, the foreign exchange reserves of the banking sector are sufficient to cover the prospective merchandise imports of 14.7 months and merchandise and services imports of 12.3 months.
Meanwhile, there has also been an improvement in the current account and Balance of Payments (BOP) during the review period.
The Balance of Payments (BOP) remained at a surplus of Rs. 297.72 billion in the review period against a surplus of Rs. 128.55 billion in the same period of the previous year.
The sad part is that the government is unable to meet the revenue target, the nation’s exports have declined to the surface widening the trade deficit gap.
Domestic indicators are negative as the recession in the domestic market continues.
The government is managing the general sector expenditure by raising debts from domestic as well as international donors.
An increase in the general sector expenditure is due to the adoption of expensive federalism along with a large federal parliament and provincial structures.
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