Petroleum products account for 21% of Nepal's total imports

KATHMANDU, Aug 17:

Petroleum products accounted for more 21 percent of the country´s import bill in 2012/13.Rising petroleum imports is one of the major reasons behind Nepal´s widening trade deficit. Increasing petroleum imports, soaring international prices and weakening of Nepali rupee against US dollar jacked up Nepal´s fuel import bill during the period.

Nepal´s petroleum imports increased by 13 percent to Rs 109 billion in 2012/13.A provisional data compiled by Trade and Export Promotion Center (TEPC) shows exports to India increased only by around one percent to Rs 51.45 billion, while imports from the southern neighbor shot up by a whopping 23 percent to Rs 396.26 billion over the year.

According to officials, trade deficit jumped by 22 percent to Rs 518.52 billion, or Rs 1.41 billion a day, over 2012/13 thanks to significant rise in imports of petroleum products and industrial goods. During the review year, Nepal imported goods worth Rs 595.63 billion, while export was limited to Rs 77.11 billion. Overall imports increased by 19.6 percent while, exports went down by 4.1 percent during the review year.

The overall trade imbalance is mainly due to double-digit rise in trade deficit with India -- the largest trading partner of Nepal.
India is the supplier of Nepal´s top import items such as petroleum products, iron and steel, machineries, and vehicles. Imports of iron and steel, machineries, and vehicles surged by 15 percent, 24 percent and 33 percent, respectively, to Rs 57.35 billion, Rs 32.67 billion and Rs 31.88 billion. Similarly, import of gold increased marginally by 0.9 percent to Rs 26 billion.

Nepal´s iron and steel export increased by 2.8 percent to Rs 11.64 billion over the year. Export of textiles and cardamom also went up by 3.5 percent and 10 percent to Rs 5.4 billion and Rs 3.85 billion, respectively. However, yarns and woolen carpet exports declined by 7.6 percent and 5.9 percent to Rs 5.84 billion and Rs 5.65 billion, respectively.

Trade deficit with China, Nepal´s second largest trade partner, also jumped to Rs 65.32 billion during the review year compared to Rs 51 billion of 2011/12. Garments, electronics, machineries, vehicles, and electrical goods are among Nepal´s top imports from the northern neighbor.
Nepal has been exporting only agriculture goods, incense sticks, medicinal herbs, and hide and skin, among others to China, though the world´s second largest economy has offered duty free access to 7,831 Nepali goods.

Source: Republica