Although Nepal’s export of soybean oil and palm oil has been helping Nepal to increase the export, their contribution is very minimal in minimizing the growing volume of trade deficit.

Thriving for decades with high volume of remittance, Nepal’s economy has started to face huge difficulty since the eruption of coronavirus and declining of foreign currency reserves due to high demand for imports of various products.

At a time when the country’s trade deficit has reached Rs. 1,015.80 billion in the first seven months of the current fiscal year 2021/22. The increase of export of Soybean oil and Palm oil has little contribution in total gap. Produced from imported raw materials, soybean and palm used less than 5 percent of local materials.

However, soybean oil worth Rs. 36.85 billion has been exported in the first seven months of the current fiscal year. Similarly, palm oil is the second most exported commodity after soybean oil. Palm oil worth Rs. 34 billion has been exported during the review period

The country’s trade deficit has reached Rs. 1,015.80 billion in the first seven months of the current fiscal year 2021/22. This year's trade deficit is higher by 38.45 per cent than the deficit of the corresponding period last fiscal year, according to the Department of Customs.

Trade deficit during the same period last year was Rs. 733.72 billion.

Despite significant increase in export, the country’s trade deficit has widened significantly during the review period due to low volume of exports compared to the imports.

Foreign Trade Statistics of the Department of Customs says that export trade has increased by 88.30 per cent to Rs. 131.65 billion during the first seven months (mid-July 2021 to mid-February 2022) of the current fiscal year.

Nepal had exported goods worth Rs. 69.91 billion in the same period of the last fiscal year.

Meanwhile, import trade increased by 42.78 per cent to Rs. 1,147.46 billion during the review period.

In the same period of the last fiscal year, the country had imported goods worth Rs. 803.64 billion.

With the increase in exports, its contribution to total trade also increased from 8 per cent to 10.19 per cent during the review period. The share of export in the total trade has decreased to 89.71 per cent from 92 per cent last year.

According to the statistics, total foreign trade has also increased. The country’s foreign trade volume has reached Rs. 1,279.12 billion during the review period which is 46.43 per cent more than the previous year. Nepal Rastra Bank has already applied measures to tighten the import of luxurious and non-essential items in an attempt to control trade deficit.

Vaccines worth Rs. 26 billion imported

According to the statistics, the country imported vaccines worth Rs. 26.85 billion.

Around 240,185 kilograms of vaccines for human medicines were imported during the first seven months of the current fiscal year.

In the same period last fiscal year, a total of 39,785 kilograms of vaccination for human medicine worth Rs. 1.34 billion was imported.

Diesel import stands Rs. 72.96 billion

Diesel is the most imported commodity in the first seven months of the current fiscal year. Diesel worth Rs. 72.96 billion has been imported during the period.

Meanwhile, petrol worth Rs. 33.56 billion, liquefied petroleum gas (LPG) worth Rs. 34.69 billion, aviation fuel worth Rs. 6.40 billion, kerosene Rs. 744 million, lubricants worth Rs. 3.73 billion and petroleum bitumen worth Rs.4.30 billion have been imported.

The country imported crude soybean oil worth Rs. 36.54 billion, crude palm oil worth Rs. 29.22 billion and crude sunflower worth Rs. 12.37 billion during the review period.

Similarly, maize worth Rs. 12.14 billion, paddy and rice worth Rs. 32.34 billion and wheat worth Rs. 4.08 billion have been imported.

Meanwhile, soybean oil had the largest share in export during the review period. Soybean oil worth Rs. 36.85 billion has been exported in the first seven months of the current fiscal year.

Similarly, palm oil is the second most exported commodity after soybean oil. Palm oil worth Rs. 34 billion has been exported during the review period.

Cardamom worth Rs. 2.64 billion, yarns worth Rs. 5.7 billion, tea and coffee worth Rs. 2.37 billion, carpet worth Rs. 5.07 billion and felts worth Rs. 3 billion have been exported during the review period.

After eruption of new conflict in Ukraine, the prices of petroleum products continue to increase in the global market. This will further increase Nepal’s trade deficit.