Nepal imported less of everything except gold and colza seeds in the first five months of the fiscal year. 

Gold imports soared 2.5 times to Rs6.36 billion while imports of colza used to make oil swelled 11.5 percent to Rs1.44 billion, according to the Trade and Export Promotion Centre (TEPC).

Meanwhile, silver imports fell the most with a drop of 71 percent. Imports plunged to Rs3.65 billion from Rs12.61 billion, according to the TEPC’s data. Oil imports suffered the second biggest fall of 64.7 percent to Rs17.83 billion. 

The sharp plunge in major imports dragged down the overall figure by 36 percent to Rs206.65 billion. Last year, Nepal’s imports totalled Rs784.58 billion. The ongoing trade embargo by India was the main reason for the plunge in import figures. The statistics show that shipments from the southern neighbour fell 42.5 percent to Rs119.15 billion.

The embargo also affected Nepal’s overall exports. Shipments dropped 30.7 percent to Rs26 billion during the review period. A fall in exports to India hit the overall export performance. According to the TEPC, exports to India plunged 40 percent to Rs13.75 billion. Nepal has been under extreme stress for the last four months due to shortages caused by the Indian trade embargo. According to Nepal Oil Corporation, petroleum imports were recorded at 30-40 percent of pre-embargo levels. The resultant fuel scarcity crippled transportation and ultimately exports and imports as cargo movement came to a virtual standstill.

In particular, Nepal’s exports of medicinal herbs were hit by the trade embargo as India is the largest buyer. According to the TEPC’s figures, exports of farm products fell sharply by 84.1 percent. Shipments of medicinal herbs totalled 843 tonnes worth Rs168.53 million.

However, exports of cardamom, ginger, handicraft, woollen carpet and readymade garment showed an increase during the review period. Cardamom exports almost doubled to Rs1.9 billion while ginger exports rose 12.7 percent to Rs198.36 million.

Suyash Khanal, director of the TEPC, said that gold imports could have swelled as a result of a fall in prices. “Imports had plunged during the same period last year when prices had risen,” he added. 

Khanal said that cardamom exports through the Biratnagar customs point had jumped in recent days. According to him, no trading took place through Birgunj, the country’s largest trade gateway, during the last four months.

Meanwhile, iron and steel products, which are one of Nepal’s main exportable products, also witnessed a fall. Shipments plummeted 60.5 percent to Rs2.04 billion during the review period.

Former commerce secretary Purushottam Ojha said a drop in the supply of raw materials and machinery parts adversely affected industrial production and exports,” he said. 

Ojha said the fall in imports and exports affected the production sector, employment, government revenue collection and people’s incomes. “Shortages have led to black marketing, and market prices have risen sky-high,” said Ojha, adding that the crisis had created a risk of stagflation in the country.