Views of a Nepali Economist

According to recent report of Asian Development Bank (ADB), a 20 per cent food price inflation would cause the poverty ratio to rise by over four percentage points, increasing the poor population by more than one million. According to Central Statistic Bureau (CBS), a quarter of the total 26.62 million population is under the new poverty line meaning they earn less than Rs 54 per day on the basis of consumption. The rising inflation will pull one million more population under the poverty line from the current around 6.7 million to 7.7 million, thanks to the current trend of rising food prices that is above the average of developing Asia. Both India’s inflation and international oil prices have strong spillovers — one third of the impact — to Nepal. But imported inflation has a quick spillover effect, while the impact of international oil prices is slower but more persistent.

Hoarding and cartelling forces are active in market and monitoring agencies are silent at the time, he said, adding that it has hit hard the urban poor and working class people....According to Department of Commerce, rice (Jira Masino) price has jumped to Rs 70 kg from Rs 60 kg in last two months. Jira Masino is widely consumed by urban populace. Likewise, prices of pulses (Rahar and Mas) have also increased by 5.54 per cent during the period.

Chinese winter outfits entering Nepali market through Tatopani Customs Office have become expensive by up to 75 percent due to rise in customs valuation and appreciation of US dollar and Chinese yuan against Nepali rupee...Chinese apparel occupies almost 90 percent of Nepal´s clothing market.

Till December 2010, before IRD scooped down on fake VAT receipt racketeers, IRD was complaining of shortfall in VAT collection by Rs 700 million than the target. But after it launched a sweeping action, it recorded a sound growth in collection, leading to 22 percent growth in VAT collection in 2010/11 compared to a year ago....According to the Ministry of Finance, VAT collection grew by 32 percent in the first month (mid-July to mid-August) of 2010/11 and continued to grow by 39 percent, 31 percent and 32 percent in the second, third and fourth months respectively.

Nepal exported 279,762 kg of coffee during the fiscal year 2010 -11 from a fiscal year ago’s around 120,000 kg, according to National Tea and Coffee Development Board. “We have been able to double the export volume of Nepal Coffee in a year which is quite encouraging,” said acting director of the board Raman Prasad Pathak. Last fiscal year 2010-11, the country exported coffee worth Rs 93.08 million while it imported Rs 12.51 million worth coffee only.

Federation of Contractors’ Associations of Nepal (FCAN) urged the government to control and monitor the arbitrary price hike of construction materials. According to the association, in an interval of one month price of one kg of iron rod increased by 25 per cent to Rs 84 per kg.......The sector boosts of 11 per cent contribution to the GDP and direct employment of about 14,000.

The association of Nepali diaspora spreading over 57 countries has submitted a five-point suggestion that includes appointment of Honourary Counsel in Gulf countries Bahrain and Oman to the government. Likewise, the association has also suggested the government ease payment system in Department of Foreign Employment, proper management of labour desk at Tribhuvan International Airport (TIA) and starting of mass awareness campaign.

# posted by Mukesh Khanal @ 4:17 PM