August 21 ,2017 , 10:24 AM
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Economy in the doldrums

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WM Correspondent

Already marred by the devastating April 25 earthquake, the country's economy is suffering the pangs of the prolonged Terai banda coupled with Indian embargo.

It is estimated that over half of the population i.e 57.3, who earn less than US $ 2 a day, are on the brink of more deprivation.

The tremours, which caused damages amounting to Rs700 billion, have alone pushed 1 million people below the poverty line. 

In fact, some 15 million people are facing severe economic challenges owing to the blockade imposed by the southern neighbor for the last one and a half months.

The shortage of petroleum products as well as other things triggered by the embargo along with Terai unrest is casting blight on various economic areas. 

The Madhesi agitation going on for the last three months has already caused around 2,300 industries in Terai to close down, thus rendering 400 thousand people jobless.

Due to the fuel crisis and the resulting shortage of raw materials, industrial units operating in other regions are also on the verge of debacle.

As a direct impact of petroleum scarcity, more than 80 percent vehicles are off the road and some 900,000 transport sector workers are remaining idle.

The current national anomalies have indeed pushed the national unemployment figure to astronomical levels.

The fuel crisis is barring farmers from getting chemical fertilizers and pesticides and transporting their agriculture goods to the market.

This may well hamper the agriculture sector which is already projected to suffer this fiscal year due to the erratic monsoon.

The anemic economy was expected to get some relief with the start of reconstruction works after the quake and resultant rise in the overall capital expenditure. But, unfortunately, this is becoming just a distant dream.

The agenda of reconstruction and rehabilitation continues to be ignored even though as long as six months have already passed since the earthquake.

Likewise, works in major infrastructure projects such related to roads and irrigation have been negatively affected due to the fuel shortage.

The tourism sector, already hit hard by the earthquake, has again foundered because of the Tarai unrest and the Indian blockade. New bookings have largely dropped and hopes of a recovery have been almost shattered, bemoan tourism entrepreneurs. The number of foreign tourists visiting the country is likely to see a decline by half -- to around 400,000 in 2015 compared to 800,000 last year.

The damage caused by the earthquake was physically more visible but the effects of the blockade are more pervasive and lasting.

According to the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), the economy is losing a shocking Rs 2 billion every day.  

The World Bank has already forecast that the economic growth for this year will be a mere 3.4 percent due to the ongoing political turmoil.

Nepal, of course, is one of the most successful nations in the world in terms of improving its Human Development Index (HDI).

However, the earthquake followed by the Terai banda and Indian embargo could ruin the progress the country has made in such index.  


Thursday, Nov 05, 2015 1:28 pm


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