Weekly Economic Update (8th April 2022 to 13th April 2022)
1. Advised to Increase Formal Remittances — The Minister for Labor, Employment and Social Security, Kumar Shrestha, has recommended the state cut remittance cost and provide additional 2% interest rate to depositors that directly remit money in Nepal’s bank account. (Source: https://myrepublica.nagariknetwork.com/news/labor-ministry-makes-a-slew-recommendations-to-increase-remittance-inflow-through-formal-channel/)
2. Nepal to Export Addition 325 MW Electricity — Nepal Electricity Authority is now set to export an additional 325 MW of electricity to the Indian energy market, after getting an approval from the Central Electricity Authority of India. This is expected to help Nepal’s trade deficit. (Source: https://myrepublica.nagariknetwork.com/news/india-allows-nepal-to-export-additional-325-mw-electricity/)
3. NRB Governor Suspended — The Government of Nepal has suspended the Governor of NRB Mahaprasad Adhikari. Deputy Governor Dr Neelam Dhungana Timalsina has been appointed as the Acting Governor of the central bank. (Source: https://myrepublica.nagariknetwork.com/news/nrb-governor-adhikari-suspended/
4. 1,565 Foreigners Received Work Permit — During the first eight months of the current fiscal year, 15,65 foreigners received permits to work in Nepal. Out of the total, the highest number of individuals are Chinese citizens, totaling 1,116 workers. (Source: https://myrepublica.nagariknetwork.com/news/over-1-500-foreigners-received-permits-to-work-in-nepal-in-8-month-of-current-fy/
5. NRB’s Instruction on Opening Letter of Credit — In line with NRB’s recommendation, the commercial banks of Nepal have agreed to not open letter of credit for the import of non-essential goods. The recommendation is made with an expectation to balance the country’s decreasing foreign currency reserve. (Source: https://myrepublica.nagariknetwork.com/news/commercial-banks-unite-to-implement-nrb-s-instruction-to-stop-opening-lc-accounts-to-import-non-essentials/)
6. Increase in Balance of Payment Deficit — According to the Current Macroeconomic and Financial Situation based on eight months data reported by NRB, Nepal’s Balance of Payments deficit increased from NPR 247.03 billion to NPR 258.64 billion in one month. (Source: https://www.nrb.org.np/contents/uploads/2022/04/Current-Macroeconomic-and-Financial-Situation-English-Based-on-Eight-Months-data-of-2021.22.pdf)
7. Increase in Remittance Inflow — According to the eight-month report on Current Macroeconomic and Financial Situation, the remittance inflow increased from NPR 540.12 billion in mid-February of the current fiscal year to NPR 631.19 billion. Number of Nepali workers taking approval for foreign employment increased to 227,900. (Source: https://www.nrb.org.np/contents/uploads/2022/04/Current-Macroeconomic-and-Financial-Situation-English-Based-on-Eight-Months-data-of-2021.22.pdf)
8. Review of FDI Threshold — The Government of Nepal is considering reviewing the current threshold amount for foreign direct investment (FDI) of NPR 50 million. This initiative is taken to attract more foreign currency as the country’s forex reserve continues to deplete. (Source:https://myrepublica.nagariknetwork.com/news/nepal-mulls-over-reducing-fdi-threshold-from-existing-rs-50-million/)
9. NEPSE Closes Below 2,400 Mark — On April 12, 2022, the Nepal Stock Exchange (NEPSE) lost 34.79 points and closed at 2,385.01 points. The market index fell below the 2,400 points mark for the first time in about the past four months. (Source: https://myrepublica.nagariknetwork.com/news/nepse-loses-34-79-points-to-close-below-2-400-mark-in-four-months/)
10. Consumer Inflation Increases — The consumer price inflation of Nepal has increased to 7.14% as of mid-March, as compared to 3.03% the same period previous year. According to NRB, in the eight-month of the current fiscal year, food and beverage inflation stood at 7.51% and service inflation stood at 6.84%. (Source: https://www.nrb.org.np/contents/uploads/2022/04/Current-Macroeconomic-and-Financial-Situation-English-Based-on-Eight-Months-data-of-2021.22.pdf)
