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.
Similarly, in the non-food and service categories, the index of transportation and communication, housing goods and services, and tobacco and related products rose by 23.1 percent, 18.1 percent and 12.7 percent respectively compared to last year.
In the foreign trade sector, exports rose by 2.1 percent compared to the significant rise of 13.3 percent in the corresponding period of the previous year. However, exports to India plummeted by 20.7 percent during the period as compared to the same period last year mainly due to a decline in the export of vegetable ghee, thread and jute goods. Similarly, exports to other countries surged owing to the export of pulses, woollen carpets, pashmina, tanned skin and herbs, said the release.
The overall balance of payments (BOP) recorded a deficit of Rs. 2.97 billion during the period. Of the shortfall, the current account deficit amounted to Rs. 781 million. Although net transfers rose by 64.7 percent, an increase in the trade deficit as well as a decline in net services was responsible for the current account deficit, added the release.
“Under transfers, workers’ remittances increased by 43.2 percent compared to the 21.4 percent growth in the corresponding period of the previous year,” said the release.
Likewise, gross foreign exchange reserves stood at Rs. 205.6 billion in mid-August 2008, a decline of 3.3 percent compared to mid-July 2008. In terms of US dollars, gross foreign exchange reserves declined by 3.4 percent to US$ 3 billion during the period. The current level of reserves is sufficient to cover merchandise imports of 9.4 months and merchandise and service imports of 6.9 months.
As an initial indication of rising investor confidence, domestic credit increased by 1.8 percent during the period as compared to a decline of 0.1 percent last year mainly due to an increase in private sector credit, which grew by 2 percent.
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32 responses to “Bad Ass Economy: Inflation Soars to 13pc”
economists say inflation is due to the demand and supply. if there is more demand than supply then price rises………………….. i accept that theory in the case of agri. products……………………………………….. …..but in the case of non agro. product. (in nepal)…….. we are paying high price for non. agri. products and services because the production capacity is very high and the market is very small so the producers have started unofficial cartelling…………………………… they are trying to loot as much as possible from small market. those suppliers are trying to get as much as possible from their small buyers………………………………………. …………………… .the only way to stop this is start………. rule of the jungle………. where weaker has to die or be eaten by stronger………………………………. ……………….. to do this in human world we have to make a better laws…………… ……..the creditor- lenders, suppliers, unpaid labours etc- should have power to drag unhealthy companies,……….. those companies who do not pay their debt on time,…………… into bankrupty and charge their dues by sellign assets…….. ……………….. in this way unhealthy companies can not compete and healthy company would get bigger market and make good profit, they would be able to gain their market share by reducing price……. they would see a hope in business……………………………. ………………….. if unhealthy companies are sidlined…………… in the earley stages there may rise unemployment (we should not care much because even the employed are not getting deserved wages)…………………………… but in long run the employed would get better wages when their companies make better profit and the better paid labour would make bettere market and there will be more investment and thus the unemployemnt problem will be reduced……………………………………………………………………………
………………… if the govt. can not declear minimum wages 6000 then they should give opt. to the companies…….. to choose between 6000 wages or 1500 wages+7% of profit+.25% of turnover +.05% of production…………………………………………………………. …………. i think govt. should declear min. salary of educated and skilled labout ……………. like min. 8000 salary tfor above +12 educated and skilled labours.
why is it that those terrorist just dont have any sympathy for nepal, nepalese……………….. they have already killed thousands of lives of poor to get into power and its still not enough for them they want to kill more to stick to the power for every………………………………
why are they using poor nepalese for their benifit…………………… bythe way how many maoist leaders or their family member have died in war…………. ……..its only the poor nepalese…………… ……….now they want to sacrifice more lives for nothing………. ……… why are they talking about people’s republic when it is actually time to talk about developemnt,,,,,,,,,,,,,, peace…………… we have to start to do something to make them pay for thousands of souls
Let’s talk about the past war………………………… a few thousand untrained individuals(maoist) with rusted guns attacking barracks with hundreds of trained to kill soldiers with millions of bullets. what would happen next?????????????????????????????????????????????????????????????//
Even dumb can say thousands of maoist would die…
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But even their own commandor sent them to attack those barracks. Why? …………………………………… cause the cold blodded opportunist killer bahun prachanda wants propaganda for his dark speech that his org. sacrificed 13000 lives in the war so only he has right to lead this country…………………………………………
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We all have been hearing him regularly saying in his speech, they have sacrificed 13000 lives as if his own family is one of them.
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This opportunist bahun doesnot care about human life, life of his own slaves. he doesnot think twice to sacrifice their life to creat propaganda that would lead him to power. He wanted as many dead as possible weather it is from his side or other. Actually, only himself is in his side.
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Does any other army commandoe wants his personnel dead? But opportunist prachanda bahun does.
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……………………..Opportunist prachanda bahun is a criminal to the maoist party maoist should punish him.
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Other opportunist bahuns shook hand with corrupts, crooks, royals to get power.
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But prachanda opportunist bahun turned out to be many times dangerious opportunist bahun, in the name of impowering backward casts, he gave backward cast guns and send them to kill or be killed so that one day he could rule nepal…………………………
Not only the economy and the unions all needs to be revised. But one can easily see how the steps from feudalism to capitalism to state protected regulations are not easy on no budget. From a farmers’economy with all remote areas de facto being remote and all the problems I do not envy this government….
We need education, jobs, we need all yesterday.
Criminilazation and looting may also be more due to the problems of unemployment which is the main reason of racism in Europe people are afraid the jobs go or the outcasts without homes and passports begin to steal.
I am confident this government does its utmost but they need so much TIME. My hopes are on the world bank and ngos cooperating in infrastructure and education. The problem with low salaries and private initiative is if you close down your factory you have even more unemployment, if you stop child labour you have to provide a solution for those families so they can survive….
Maybe that is why India is cruel they have the richest classes right next to dying people and it has always been like that and worse only now the rich became richer, this does not mean the poor are not poor anymore. Maybe the collective karma of a country that choose socialist is positive balance.
Hare bhagwan… k ho… should we not be going to the right direction… for how long should we face difficult times? shouldn’t the political parties be making the right decision so that inflation rate, atleast does not rise up this high or control it?
Yo ta jun jogi aayepani kani chireka jasto bhayena ra?
which are the right decisions? In Netherlands government took a fast undemocratical decision to save national bank and all happily shut up.
Humanly speaking all do what they can I suppose.
The expatriates and non resident nepalis dedicate their lives to help from their holiday inn lifestyle with good ideas, the real people sweat it out.
Big mouth from outside and chupla all together.
I think we dance there is democracy, electricity, water, tempoe. When all start teaching something maybe the poor uneducated learn at least whille learning they do not smash up someone or do other bad things.
Christmas and dassein should be all year through, as well as intelligence service.
I like to start this comment with a famous quote in United States these days, if the economy sneezes in USA then European economy catches the cold. This time around it looks like the American sneeze caught cold on entire world and as a matter of fact all the economic indices are currently showing that they did not just caught cold but they are having a serious case of pneumonia.
If I confused you so much with the cold talk then take a look around the world, Japan down 10 percent, Hong Kong down 8 percent and Australia down 8 percent as markets around the world are gripped by recession fears and our closest country India’s shares plummeted another 7 percent on Friday on global recession fears, but recouped almost a third from the day’s low after the Indian central bank cut bank reserve requirements, amid softening inflation. I think what we are seeing in Nepal is a direct effect of this world economic storms with added effects of our long running insurgencies, slower development and lack of investor’s confidence.
Hopefully when we return back from Dashain’s festival mood every thing will be fine and NEPSE will start to recuperate its lost along side with the world economy. Visit http://site.nayanepalnews.com/ for latest and up to date news and info on recent economic turmoil that’s engulfing the world.
The inflation is far more than 13%…
if you don’t believe it then find the price hike of petrol to vegetables…..I believe it is more than 25%…
and real sufferers are Janajati…
Just a reminder that when useless UML and pro India MJF joined hands with the terrorist outfit of the Maoists, they had signed on to a 50 point common minimum program which runs as following. We cna see that nearly two months down the line, very little out of the CMP has been achieved and paltry little has been done to meet other points in the CMP– just shows what these thugs can do to fool the people and cling on to powert:
The 50-point CMP is divided into: (i) Nationalism, (ii) Federal Democratic Republic, (iii) Peace and Security, (iv) Relief and Reconstruction, and (v) Socio-Economic Transformation. The excerpts of CPMs are:
(i) Nationalism concerning to unity and promotion
• Nepal’s sovereignty, national unity, independence and integrity shall be preserved, giving national importance to self-respect.
• National security, foreign policy, utilization of water resources, and mobilization of foreign assistance shall be based on Nepal’s sovereignty, independence, and welfare. Unequal treaties and agreements shall be reviewed.
• The foreign policy regarding neighbors shall be based on national interest, the UN Charter, non-alignment and the theory of Panchasheel.
• Financial assistance shall be taken from friendly forces, the UN and donor communities in the course of Nepal’s economic and livelihood development.
• National integrity and balance foreign policy shall be mobilized to internationalize and resolve the Bhutanese refugee situation.
(ii) State restructuring concerning implementation of democratic republic
• A New Constitution shall be framed within two years by forging consensus among political parties in the CA.
• All acts, rules and regulations that contradict with the declaration of republic on May 28, 2008 shall be scrapped.
• All efforts shall be utilized to trace the property of the former king and royalty.
• Special attention shall be paid to constitutional supremacy, independence of judiciary, fundamental human rights, press freedom and rule of law.
• The agreements signed with MJF on August 29, 2007 and United Democratic Madhesi Front (UDMF) on March 1, 2008 shall be implemented, but constitutional issues shall be decided by the CA.
• All women, Dalits, Muslims, Janajatis, Madhesis and backward people shall be included in all state mechanisms constituting and reforming necessary acts.
• Justifiable tax and resources shall be distributed to the backward areas, restructuring the country’s economic policy.
• Autonomous local government shall be established based on consensus of political parties till next local government is elected.
• Bureaucracy, Nepal Army, Nepal Police and Armed Police shall be mobilized independently forming a Monitory Task Force under the existing legal parameters.
(iii) Sustainable peace in realization for security
• The Peace process shall be ended at a logical conclusion through talks.
• The Maoists PLA combatants and arms shall be adjusted/managed within six months.
• A High Level Security Commission shall be formed to develop new National Security Policy. Nepal Army to be mobilized on development activities during the transition to peace.
• As per the Comprehensive Peace Accord (CPA), the National Peace and Rehabilitation Commission, High- Level Truth and Reconciliation Commission, High Level State Restructuring Commission, Commission of the Disappeared, and Land Reforms Commission shall be set up.
• Crime, anarchy and the culture of impunity shall be ended, consolidating law and order. To make independent and accountable administration and security organs, the Code of Conduct (CoC) shall be developed for the people’s realization of security.
(iv) Immediate relief concerning reconstruction
• Relief to families of martyrs and disappearances, rehabilitation of armed conflict effected families and internally displaced people, and compensation to the conflict victims who lost property shall be provided. A special Fund shall be established to manage rescue, relief, rehabilitation and assistance to the conflict victims.
• Medical treatment shall be provided to the people injured during the course of the People’s War, popular movement and Madhes violence.
• Top priority to reconstruction of infrastructure damaged during armed conflict shall be given.
• Price hikes shall be controlled; supply of fuel shall be smoothed; fair price shops shall be opened; and relief shall be provided to landslide, flood victims, etc.
• Debts of those who are below the poverty line shall be waived.
(v) Socio-economic transformation
• A National Independent Economy shall be set up based on the theory of people-oriented democracy and public-private partnership.
• Coordinating the State, cooperative, and private sectors; economic, social policy and programs shall be developed for social justice, economic growth and just distribution to address poverty, unemployment, backwardness, inequality and dependency.
• Immediate, short-term, mid-term and long-term development plans shall be established based on balanced development, people’s spirit and necessity of the country, restructuring the traditional National Planning Commission.
• Top priority shall be given to agriculture, hydroelectricity, tourism, human resources and physical infrastructure development.
• Land to the tillers shall be established in the course of scientific land reform.
• Top priority shall be given to national industries; special reform policy shall be adopted to revive sick industries; and special emphasis shall be given to small and cottage industries.
• Cheap, easy and effective services shall be provided, strengthening people’s service providers’ institutions. Both domestic and international investment shall be attracted.
• Rural electrification shall be given special attention to end load-shedding. Internal investment shall be encouraged for small and medium scale hydro-power.
• Loans shall be returned from big defaulters as per rules and regulations.
• Professional skill and commitment towards neutrality of the civil servants shall be enhanced. Culture of impunity shall be ended, pursuing transparency and governance.
• Effective corruption control shall be established. For this cause, concerned authorities, including the Commission for Investigation of Abuses of the Authority (CIAA), shall be strengthened.
• The participation of women including Janajatis, Madhesi, Dalit and disadvantaged groups at government mechanism shall be increased. Special package programs, such as education, health and employment shall be brought to them.
• A National literacy campaign shall be mobilized. The Government shall increase its budget to primary, informal, occupational and technical education. Fundamental education rights to secondary level shall be guaranteed.
• Primary and basic health shall be guaranteed as fundamental rights. The budget for drinking water, sanitation and rural infrastructures programs shall be increased.
• The construction of an east-west railway, international airport, irrigation, hulaki (post-office) highway, link roads to district headquarters, etc. shall be developed.
• Social security program for Dalits, disadvantaged classes and areas shall be created for inclusive development.
• Special programs and mechanisms shall be constructed, focusing to balanced development of Tarai (Madhes), hill, mountain, village and urban centers including Karnali areas and mid-and-far western Nepal.
• The country shall be declared free from untouchability.
• All kinds of discrimination such as rape, domestic violence and trafficking against women shall be ended.
• Special training and opportunity for employment or pension to disabled persons shall be managed.
• A High Level Youth Commission shall be formed to resolve their problems.
• Employment shall be guaranteed as a fundamental right to citizens. Security free loans shall be provided for business start ups. Foreign employment shall be managed to generalize equal access to commoners. Labor bank centers shall be established to record the numbers of unemployed.
• Discrimination against religion, dialect and culture shall be ended completely. A National Muslim Commission shall be established for their welfare and development.
• The demands put forward by the Non-Resident Nepalis (NRN) shall be fulfilled, and they will be encouraged to be involved more in Nepal’s development.
• All appropriate demands put forward by farmers, labors, students, teachers, women, journalists, industrialists, intellectuals, artists, doctors, engineers, lawyers, civil servants, professors, squatters, bonded labors, Badis, Muslims, disabled, etc. shall be fulfilled through dialog.
A desert doom town goes dust
what is this govt. have been doing for all those weeks?
..
…………………………………………………………………. the petrol price has not come down even after world price has halfed…………………………… …….. why is there not good anti-corruption laws, implimentations (even the dumb maoist can do this)…………… why the ugly daughter of girija not behind the bars for corruption………………………………
To increase capacity of hydro during winter:.
………………………………………………………………………………… are not there snow/ice/glaciers/lakes above the rivers being used by hydro projects…………………………….. ………………… is it not possible to use those solid form of water to get water during winter like by blowing up…………………………… or using atmospheric pressure to get water from lakes like we take out oil in the drum using pipe with the help of atmospheric pressure…………………………. ……..
Kaliyug, ghor kaliyug
Every time I visit this blog, I think I’ll never come back. The quality of comments just make me sick – poor both intellectually and grammatically. If you don’t know about the content and topic, don’t comment guys. Don’t comment under any topic just because you want to vent your anger towards any political party or anything else. I’ve commented a lot of times about the comment moderation on this site, but whoever doing the moderation, he’s doing a very poor job. At least don’t publish the irrational and out-of-context comments.
And by the way, I don’t know much about economy so no comments about the topic itself.
Implementation of good ideas does not depend on the philosopher himself.
What the brown bear understood about the bank crash while porcupine ate someones crops.
that is important.
Dear author,
Referring to an entity as ‘bad ass’ generally means pretty damn good. For instance, if someone were to say, ” Dude, my bro’s got a bad ass beamer.”, he/she means that his/her brother got himself a nice BMW car, not a sucky one.
Hi Guys,
Just few month ago Maoist are trying to introduce PPP in our nation economy. Do you have any idea how its going to work on our national industries ? I need some comments on this particular project. Would you make some contribution on this isssue please? If you would be able to make contribution relation with competition law that would be awsome !
Looking forward to receive your reply…
thanks
Hi I am a nepali student currently in the U.S . Everyday there are updates on how Nepal is doing and there I keep hearing the downfall of peoples judgement and unclear vision towards making PEACE an available word in the dictionary of nepalese people…Upto this day there is always talks about bringing reforms and peace ..but still the saying that always goes nepalese are always behind the time ..The situation today our country is facing is all due to the backwardness and orthodoxy behaviour of our so called govt. in power a.k.a (maoists) ….Instead of discussing whether to make a constitution full of false ideologies to follow certain philosophy which I am sure is never going to be followed anyways , the govt should instead think about the economy ..why are we still third world and we are still dependant on so many stuffs , its even shameful to think about the ” corruption ” process that is prevailed not only in the dirty politics also in public places..I would like to end my questions to question millions of people who are still getting troubled by the new changes.. changes can be made but adapting to it is the most important thing…
hello bloggers just want to clear some misconception on some of the loyal bloggers concept.
To Mr Change
i would say ur technically correct that inflation is due to change in demand and supply. but the main reason behind the drastic rise in inflation in nepal is due to cost push inflation. see how the oil and food cost have soared globally the oil trading to $147 HIGH A BARREL that is hughe price for a country like nepal to pay. nepal relying heavily on imports on this factors. it cannot help itself it just have to absorb the price till it cools off or rather a cyclical trend. hence its very obvious that third world economies would have their inflation hit hard due to this trend.
To Nayanepal news team.
i agree when the dow sneezes the rest of the world catches the cold. but from my pov. i wouldn’t say that the dow sneeze would catch NEPSE a cold. first of all nepal is country whose economy depends heavily on primary sector. i would say a bit yes if it had been depended on secondary sector. secondly the NEPSE dosent trade internationally. or has any multinational companies in its pocket. the rise and fall of the NEPSE rely’s mostly within the domestic situation. sad to say that the NEPSE doesn’t even catches the cold when the SENSEX sneezes. whom it relies so much. overall i would say the NEPSE doesn’t catch the cold. NEPSE is pretty safe from the outer world.
To Mr. Hang,
Nepal’s economy will be suffered indirectly as US and other major donor countries to Nepal will tighten their gratitude towards developing country and all third world country will be forgotten while they are trying to fix their Main Street and Wall street , it will trickle down to Nepal NGOs, INGOs and hence to NEPSE.
Next, when oil per barrel reached $147 Nepali sahuji were smart enough to sky rocket the commodities price, now the oil per barrel is at around $57, has the price come down any? Don’t think so… NEPSE will also be effected/influenced by Indian Share market which has a direct tie to US and Britain share market… wait and see.
Nayanepal news Team
TO naya nepal news team.
i do agree that nepal will be affected indirectly in relation to NGO’s and INGO’s. but NEPSE wdf. r u isane. i am having second thoughts. your whole concept on NEPSE being affected by by SENSEX and lack of donation to nepal by USA sounds ridiculous. can you tell me a very crystal clear reason. how on earth would NEPSE be affected by SENSEX and lack of donation to the NEPSE by USA which is wot u say???
And your concept on US donation to NGO’s and INGO’s. i agree. but NEPSE. you sound that each stock listed in the NEPSE is being funded by the US goverment. which i very clearly don’t think so.
About the oil. it is very natural for commodities price to shoot up. as gas electricity are by products of oil. we knoe that the oil price has plummeted. but whole sale market for gas and electricity hasn’t ease off. as well each are a market on their own. but i am sure commodities price around the globe nxt year is set to fall back.
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