Tag Archives: nepali economy

By Bhupendra Khanal

Many aggressive companies are staying away from Nepal, thanks to poor security situation. The power majors are considering of huge investment in Hydropower sector to export power to the power hungry states of India and China, and this is good news for Nepal. A country with very high hydro-power potential has one of the costliest energy, which simply is not acceptable. Nepal needs to reform the energy sector and prepare the base for development.

While the companies like Samsung, Kodak, LG, Kia etc have entered Nepal, their performance has not been very good in the past. The things are likely to change when Maoist are in the government. Many more companies are likely to follow the investment in this Himalayan country provided the early movers succeed. There are multiple reasons why companies would like to invest in Nepal:

1. Favorable Location: Nepal is a country between India and China, two fastest growing economies globally.

2. Power Sufficiency: Nepal is power rich (hydropower potential is more than enough for any future growth in economy).

3. Pleasant Climate: Nepal has one of the best climate on the world. The valley cities of Kathmandu, Pokhara, Surkhet and Dang are the front runners for this. Eastern city Dharan and western city Butwal are other places with comfortably moderate climate in the likes of Indian Silicon Valley, Bangalore. Continue reading →

A press statement issued by Nepal Rastra Bank said that food and beverage prices shot up by 13.4 percent while non-food and service rates were up 12.7 percent.

Propelled by a remarkable rise in the prices of food and non-food commodities, the rate of inflation during the first month of the current fiscal year climbed to an alarming 13.1 percent from 6.3 percent recorded during the same period last year. A press statement issued by Nepal Rastra Bank said that food and beverage prices shot up by 13.4 percent while non-food and service rates were up 12.7 percent. Of the items showing a double-digit price rise, the price indices of oil and ghee increased by a whopping 36 percent in mid-August 2008 compared to an increase of 11.4 percent a year ago, said the release. Likewise, the sub-group of grains and cereal products witnessed a rise of 23.5 percent in mid-August 2008 while the prices of rice and rice products increased by 27.8 percent compared to an increase of 7 percent a year ago. Continue reading →

Agriculture growth 14 yr high
By Prem Khanal

Propelled by the a strong growth in both the agriculture and non-agriculture sectors, the long-ailing economy has bounced back to record 5.56 percent growth in the current fiscal year, highest economic expansion in last the seven years. With the growth, the total size of Nepali economy in producers’ price has scaled up to Rs 828.8 billion (US$12.80 billion) while the per capita income has also increased by around 11 percent to Rs 30,361 per year (470 US$). However, with the creeping inflation, which is around 9 percent, the real purchasing capacity of Nepali consumers is estimated to grow marginally in the year. According to a preliminary estimate of national accounts prepared by the Central Bureau of Statistics (CBS), agriculture sector, which contributes 32 percent to national economy, grew by 5.65 percent while the growth of non-agriculture sector was around 5.52 percent. Continue reading →