Kathmandu, Mar 11: The Nepal Rastra Bank (NRB), the central bank of Nepal, has said that the remittance inflows have increased 7.3 percent to Rs.900.58 billion in the latest seven months period of the current fiscal year (2024/25) as compared to an increase of 18.8 percent in the same period of the previous year.
In the US Dollar terms, remittance inflows increased 5.3 percent to 6.65 billion in the review period compared to an increase of 16.4
percent in the same period of the previous year, the bank said.
According to a report “Current Macroeconomic and Financial Situation of Nepal (Based on Seven Months Data Ending Mid-February, 2024/25)” published on March 10, 2025 by NRB, net secondary income (net transfer) reached Rs.985.17 billion in the review period compared to Rs.910.77 billion in the same period of the previous year.
The number of Nepali workers, both institutional and individual, taking first-time approval for foreign employment stands at 274,622 and taking approval for renew entry stands at 190,886. In the previous year, such numbers were 245,432 and 157,045 respectively.
Current Account and Balance of Payments
The current account remained at a surplus of Rs.166.80 billion in the review period compared to a surplus of Rs.162.52 billion in the same period of the previous year. In the US Dollar terms, the current account registered a surplus of 1.24 billion in the review period against a surplus of 1.22 billion in the same period last year.
In the review period, net capital transfer amounted to Rs.5.83 billion. In the same period of the previous year, such transfer amounted to Rs.3.80 billion. Similarly, in the review period, Rs.7.45 billion foreign direct investment (equity only) was received. In the same period of the previous year, foreign direct investment inflow (equity only) amounted to Rs.5.19 billion.
Balance of Payments (BOP) remained at a surplus of Rs.284.41 billion in the review period compared to a surplus of Rs.297.72 billion in the same period of the previous year. In the US Dollar terms, the BOP remained at a surplus of 2.11 billion in the review period compared to a surplus of 2.24 billion in the same period of the previous year.
Foreign Exchange Reserves remains Rs. 2369 billion
Gross foreign exchange reserves increased 16.1 percent to Rs.2369.08 billion in mid-February 2025 from Rs.2041.10 billion in mid-July 2024. In the US dollar terms, the gross foreign exchange reserves increased 11.7 percent to 17.05 billion in mid-February 2025 from 15.27 billion in mid-July 2024.
Of the total foreign exchange reserves, the reserves held by NRB increased 13.9 percent to Rs.2105.14 billion in mid-February 2025 from Rs.1848.55 billion in mid-July 2024. Reserves held by banks and financial institutions (except NRB) increased 37.1 percent to Rs.263.93 billion in mid-February 2025 from Rs.192.55 billion in mid-July 2024. The share of Indian currency in total reserves stood at 22.0 percent in mid-February 2025.
Foreign Exchange Adequacy: enough to merchandise import for 17.2 months
According to NRB data, based on the imports of seven months of 2024/25, the foreign exchange reserves of the banking sector is sufficient to cover the prospective merchandise imports of 17.2 months, and merchandise and services imports of 14.4 months.
The ratio of reserves-to-GDP, reserves-to-imports and reserves-to-M2 stood at 41.5 percent, 120.3 percent and 32.5 percent respectively in mid-February 2025. Such ratios were 35.8 percent, 108.6 percent and 29.3 percent respectively in mid-July 2024.
Foreign Trade
During the seven months of 2024/25, merchandise exports increased 46.5 percent to Rs.127.20 billion against a decrease of 7.1 percent in the same period of the previous year.
Destination-wise, exports to India, China and other countries increased 66.9 percent, 8.6 percent and 3.5 percent respectively.
Exports of soyabean oil, polyster yarn and thread, tea, cardamom and particle board, among others increased whereas exports of palm oil,
zinc sheet, ginger, herbs, readymade garments, among others decreased in the review period.
During the seven months of 2024/25, merchandise imports increased 10.1 percent to Rs.988.59 billion against a decline of 2.3 percent a year ago. Destination-wise, imports from India, China and other countries increased 7.5 percent, 11.2 percent and 17.5 percent respectively.
Imports of crude soyabean oil, rice/paddy, transport equipment, vehicle and other vehicle spare parts, edible oil, sponge iron, among others increased whereas imports of petroleum products, crude palm oil, aircraft spareparts, peas, writing and printing paper, among others decreased in the review period.
During the seven months of 2024/25, merchandise imports from India against payment in convertible foreign currency amounted Rs.103.94 billion. Such amount was Rs.88.18 billion in the same period of the previous year.
The intermediate and final consumption goods accounted for 37.4 percent and 61.8 percent of the total exports respectively, whereas the ratio of capital goods in total exports remained 0.8 percent in the review period.
In the same period of the previous year, the ratio of intermediate, capital and final consumption goods remained 56.4 percent, 0.25 percent and 43.4 percent of total exports respectively.
On the imports side, the share of intermediate goods remained 51.2 percent, capital goods 8.9 percent and final consumption goods 39.9 percent in the review period. Such ratios were 49.2 percent, 8.9 percent and 41.8 percent respectively in the same period of the previous year.
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