Remittance flows into Nepal continue to rise despite decrease in number of its migrant workers, said Nepal Rastra Bank in its latest report published on November 25, 2018.
The report titled ‘Current Microeconomic and Financial Situation of the Country’ assessed the country’s remittance flows in the first three months of the current fiscal.
According to the report, remittance inflows into Nepal have grown by a record 37.3 percent to
Rs 242.17 billion over the first three months of FY 2018-19.
The remittance growth rate was only 2.6 percent during the corresponding period of the last year.
This growth continues to exist despite a significant decline in the rate of Nepali workers migrating abroad for jobs or any other purpose. This is majorly attributed to stopping of workers to Malaysia, says NRB.
According to the Central Bank, around 58,713 Nepalis left the country for foreign jobs during the three-month period, however, showing a 36.7 percent decline in the overall worker migration rate.
Rise in remittances was majorly attributed to the rise in USD value vis-à-vis Nepali Rupee besides money sent by migrant Nepalis to their local family members for festival celebrations, adds the report.
Despite this positive trend in remittances, the country’s Balance of Payment (BoP) continues to be high at NPR 35.42 billion in the review period compared to BoP surplus of NPR 4.27 billion year-on-year.
According to government reports, rise in imports has impacted key macroeconomic indicators.
On the other side, the current account also saw a deficit of NPR 81.96 billion in the review period, compared to NPR 25.52 billion, year-on-year.
The country has received a capital transfer of NPR 3.55 billion, down from NPR 4.96 billion in the review period, while its Foreign Direct Investment (FDI) has also declined to Rs 1.54 billion from
Rs 6.07 billion in the review period.
Total government expenditure during the review period stands at NPR 170.95 billion, more than from NPR 138.84 billion year-on-year. Capital expenditure went on to NPR 18.78 billion from NPR 11.64 billion, year-on-year.
The recurrent expenditure was at Rs 149.57 billion in the first three months of the FY 2018-19, down from Rs 126.35 billion, year-on-year.
Adding to the concerns, imports have also grown highly despite the government’s announcement to control. Goods and Services imports increased 43.6 percent to Rs 373.59 billion during the review period compared to the year-on-year rise of 17.9 percent. Whereas, the export growth remains low.
Surprisingly, the statistics remain in contrast to the Nepal Government’s claims over improvement in ‘ease of doing business’!