Five items amount to nearly half of total import

Kathmandu, September 30

Five major commodities that the country imports constitute nearly half of the share in total imports in the first two months of this fiscal, according to the Department of Customs (DoC). Import of fuel, iron and steel, mill machinery, vehicles and aircraft and spare parts covered 47.05 per cent of the import bill in the first two months of the current fiscal 2018-19. Out of the total import worth Rs 232.35 billion the import bill of the aforementioned five commodities stood at Rs 109.33 billion in the review period.

As per data, import of fuel is skyrocketing each passing year. As per DoC, country imported fuel worth Rs 35.71 billion compared to Rs 20.18 billion of the corresponding period of the previous fiscal. There has been nominal impact on the import bill due to price rise of petroleum products in the international market and depreciation of Nepali currency vis-à-vis the US dollar and consumption of fuel has been increasing every year.

Likewise, iron and steel is another major import of the country. Total import bill of iron and steel increased by 53.07 per cent in this fiscal compared to same period of previous fiscal. Total import bill of iron and steel stood at Rs 25.67 billion this fiscal.

Import of iron and steel, mill machinery and aircraft are considered as import of capital goods, which will support in rejuvenating production, value addition and addressing supply side constraints and back economic growth. Import of aircraft by the national flag carrier — Nepal Airlines Corporation (NAC) — pulled the aircraft and spare parts category in the top five import list.

As per DoC, import of mill machinery rose by Rs 2.27 billion in the review period to Rs 17.34 billion compared to Rs 15.07 billion in the same period of last fiscal. The country imported vehicles worth Rs 17.11 billion in first two months of this fiscal compared to Rs 13.52 billion of the corresponding period of previous fiscal.

Nepal Airlines’ new Airbus 330-200 aircraft, which arrived in this fiscal, has raised the import bill of aircraft and spare parts significantly to Rs 13.50 billion compared to Rs 3.22 billion of same period of previous fiscal.

Due to the import of the aircraft by NAC, the country’s import seems to have slightly diversified from the over concentration with India. Though the import of aircraft from Europe contributed significantly to the import bill, the country’s imports were concentrated with India as imports from India constituted 63 per cent of the import bill compared to 64.6 per cent of same period of previous fiscal. Due to the currency depreciation with currencies of countries where Nepal imports from, country’s import is highly concentrated in India due to fixed exchange rate regime as Nepali currency is pegged with the Indian currency.

Similarly, country’s export is also concentrated with the southern neighbour as share of exports to India in total exports stood at 56.6 per cent compared to 53.9 per cent of previous fiscal. The country exported goods worth Rs 14.7 billion in the review period.

Source: DoC

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