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Economic growth only at 0.77 percent

Gorkha Post

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KATHMANDU — The nation’s economy is projected to grow at 0.77 per cent this fiscal, as retail and wholesale trade and construction and manufacturing sectors are likely to take a dip due to supply disruption triggered by blockade.

Releasing the gross domestic product estimate for the current fiscal year on Tuesday, The Central Bureau of Statistics (CBS) has projected the Gross Domestic Product (GDP) growth of 0.77 percent for fiscal year 2015-16.

The CBS said that the economy will grow by only 0.77 percent – which is a 14-year low – in the current fiscal year.

The GDP narrowly escaped the negative growth due to better performance by the service sector including health and education sectors, according to CBS director general Suman Raj Aryal.

In the fiscal year 2001/02, the nation had recorded economic growth of 0.16 percent.

The CBS has additionally revised last fiscal year’s economic growth downward to 2.32 percent from the estimation of 3.04 percent.

As per the CBS report, almost all the sectors of economy suffered this fiscal. The agriculture sector is estimated to grow at the rate of 1.14 percent whereas the non-agriculture sector will grow by 0.62 percent.

In the last fiscal, the agriculture sector and non-agriculture sector had expanded by 4.72 percent and 5.34 percent respectively.

The subpar monsoon that resulted in weak agricultural output, almost five months of economic blockade, and stalled reconstruction work in the aftermath of the last year’s devastating earthquakes have pulled the economic growth down to a 13-year low, Aryal said.

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The largest contributors to the economy are agriculture (31.19 percent); followed by wholesale and retail trade (14.23 percent); real estate (9.16 percent); transportation, communication and storage (8.42 percent); construction (6.88 percent); education (6.76 percent); and production (5.53 percent), according to the CBS.

Despite low economic growth, the CBS has projected an increment in per capita gross national income (GNI) to Rs 80,921 in the current fiscal year from last year’s Rs 77,079.

The increment of Rs 3,842 is 4.98 percent compared to the last fiscal year, the CBS said.

The tertiary sector which contributes 54.29 percent to the total GDP and includes service sectors like wholesale and retail trade, hotels and restaurants, storage and communications and financial intermediaries among others is expected to expand by 2.67 percent, the CBS said.

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Economy

NPC urges government to seek clarification from Chinese firm

Gorkha Post

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KATHMANDU — The National Planning Commission (NPC) has urged the government to seek clarification from China Three Gorges International Corporation (CTGC) over the construction of the Paschim (West) Seti Hydro Power Project.

The meeting of the NPC that began on Sunday, made the decision of seeking clarification from the company with a time period of 90 days regarding the construction of 750 MW hydropower project.

The hydropower project, which is expected to be completed in an investment of 1.60 billion rupees, will have 65 percent investments from the CTGC, 25 percent from the National Electricity Authority (NEA) and the 10 percent investments from the locals as share, as per the plans made before.

CTGC can sell off its 14 percent of its total 65 percent share to the Nepali investors. But the CTGC has been showing dissatisfaction over the rate of purchasing the electricity per unit (PPA). Previously it had asked the NEA to review the rate but got a negative response.

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“We have suggested the government to interrogate the company whether it will be able to complete the project or not. What has been the problem to expedite the construction along with the terms and conditions which the company wants to put forward,” NPC Vice President Swarnim Wagle said.

The CGTC, which has been delaying the construction over its dissatisfaction over the PPA, has been threatening to walk out of the construction.

The project, which covers the area of Doti, Dadeldhura, Baitadi, and Bajhang districts of Far Western Development Region of Nepal, can produce 3.33 billion units of electricity on yearly basis, accoridng to the probability study of the project.

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