BOP posts a deficit of Rs 1.6b: Nepalis spent more on foreign education, travel and transportation

BOP posts a deficit of Rs 1.6b
Nepalis spent more on foreign education, travel and transportation
eKantipur.com, 10-Oct-07

The country registered a deficit of Rs 1.60 billion in balance of payment (BOP) in the first month of this fiscal year, indicating

that Nepalis spent more money on foreign education, travel and transportation during the period.

The BOP had a surplus of Rs. 2.83 billion in the corresponding month last year.

“More money went for financing education, travel and transportation outside the country while what we received from foreign tourists, however, did not go up,” said Nar Bahadur Thapa, director of the Research Department of Nepal Rastra Bank (NRB), explaining the reason behind the BoP deficit.

Exports and imports, however, showed some improvements during the period, says a central bank's report on the latest macro-economic situation of the country.

According to NRB, total exports rose by 10 percent during the period - thanks to upsurge in the export of zinc sheets, chemicals, jute products, polyester ion, pulses, silverware and jewelries, among others.

Likewise, the import grew by 13.8 percent as the country consumed more vehicles and spare parts, cold-rolled sheets, gold, crude soybean oil, telecommunication equipments and other parts.

During the month, Nepal received remittance totaling Rs 9.36 billion, which is a rise of 21.4 percent compared to the same period last year.

"Inflation slightly eased down to 6.3 percent from 7.3 percent," says the report, adding that strengthening of Nepali currency vis-à-vis US dollar made imports cheaper and impact of previous rise in prices of petroleum product also withered away during the period.

During the month, total government spending increased by 25.3 percent to Rs.3.64 billion. The spending soared due mainly to whopping growth in the recurrent expenditure resulting from the rise in salary of civil servants and compensation given to conflict-affected people.

On the revenue front, NRB report portrays a remarkable good picture. According to the report, the government recorded a 41.2 percent rise in revenue collection to Rs.7.13 billion.