Nepal Rastra Bank has released the Nepal economy report for the first three months of the current fiscal year 2082/083. The report shows strong savings in both the current account and the capital account. Foreign exchange reserves have also grown significantly. However, direct foreign investment has seen a sharp drop.
According to the central bank, the current account saved Rs 2,37,59 crore in the first three months of this fiscal year. This is more than double last year’s Rs 1,15,36 crore for the same period. In US dollars, savings increased from $86 million last year to $169 million this year.
What about the capital account?
The total capital account showed a savings of Rs 2,64,03 crore, compared to Rs 1,84,99 crore last year. In US dollars, this rose from $138 million to $188 million.
Foreign exchange reserves rise, but by how much?
Nepal’s total foreign exchange reserves also saw healthy growth. By the end of Ashad 2082, reserves were Rs 26,77,68 crore. By the end of Asoj, they had increased 11.3% to Rs 29,79,81 crore.
In US dollars, reserves grew from $1.95 billion in Ashad to $2.12 billion by Asoj, an increase of 8.7%.
Of the total reserves, the share held by Nepal Rastra Bank rose from Rs 24,14,64 crore in Ashad to Rs 26,67,70 crore in Asoj, a 10.5% rise. Reserves held by banks and financial institutions (excluding the central bank) grew 18.7%, from Rs 26,304 crore to Rs 31,210 crore. About 24% of total foreign reserves are in Indian currency.
During this period, net capital transfers increased to Rs 5.55 crore, up from Rs 2 crore last year. However, direct foreign investment dropped sharply. Only Rs 1.74 crore came in, compared to Rs 4.81 crore in the same period last year.
