Nepal limits imports as foreign currency reserves slide

Nepal has restricted imports of non-essential goods including cars, cosmetics, and gold after its foreign currency reserves dropped. It comes as a fall in tourism spending and money sent home by Nepalis working abroad helped drive up government debt. According to the country's Central Bank, Nepal Rastra Bank, foreign currency reserves fell by more than 16 percent in the seven months to the middle of February. Deputy Spokesman at the Central Bank Narayan Prasad Pokharel said that the institution believed the country's foreign currency reserves were under pressure.
Meanwhile, Nepal's Finance Ministry has said that government debt in Nepal has risen to more than 43 percent of its Gross Domestic Product, as officials increased spending to help cushion the economic impact of a pandemic. Last week, Nepalese Government removed Central Bank Governor Maha Prasad Adhikari from his post.  On other hand, Nepal's Government has said that the country’s economy, marred by the global COVID-19 pandemic for over two years is returning to normalcy.

At a press conference, Finance Minister Janardan Sharma informed signs of improvements were observed in the registration of industries and direct foreign employment for Nepali migrant workers. Sharma has asserted that their economy will not nosedive like that of the island nation.The finanace ministry also said the indicators of the country’s economic health were “normal”. “However, due to some pressures in the external sector, some steps have already been taken to manage imports and increase foreign exchange reserves,” it said. Sharma said the country’s debt was lower than other countries in the region and elsewhere.