Nepal’s fuel import bill jumped 68 percent to Rs69.07 billion in the first four months of the current fiscal year, as a rising dollar, increased smuggling and rising crude oil prices took their toll. Considering the bill for the first quadrimester, this year’s fuel expenses are set to overtake last year’s record spending, officials said.

Oil imports in fiscal 2017-18 reached a record high of Rs172.88 billion, up a whopping 43 percent, according to the statistics of the Trade and Export Promotion Centre (TEPC). Fuel accounted for 14.3 percent of the country’s total import bill of Rs483.75 billion during the period mid-July to mid-November.

State-owned oil monopoly Nepal Oil Corporation (NOC) blamed fuel smuggling to India for the swelling import bill. Petrol is cheaper by Rs20.97 per litre and diesel costs Rs23.73 less per litre in Nepal compared to India, which smugglers find too good to pass up.

According to NOC, convoys of Indian motorists cross the border into Nepal to fill up their tanks, and they make several round trips a day. Two months ago, NOC wrote to its line ministry—Ministry of Industry, Commerce and Supplies—to take steps to control gasoline smuggling for fear its reserves would be drained.

The exchange rate of the US dollar rose to a record Rs118.73 during the period, and the price of crude oil hit a four-year high of $87 a barrel, sending Nepal’s import bill soaring.

NOC says it has been hit with a double whammy of costlier oil and soaring losses. Its projected loss in the first four months has hit Rs3.82 billion which it has been covering with the price stabilisation fund.

A stronger greenback and rising crude oil prices are the main reasons behind the jump in the import bill, NOC spokesperson Birendra Kumar Goit said. He added that cross-border gasoline smuggling had been cut to some extent with the joint efforts of the corporation and the police.

According to Goit, monthly fuel imports surged around 15 percent during the review period. NOC’s annual statistics show that Nepal imported an average of 40,300 kilolitres of petrol, 133,129 kilolitres of diesel and 30,880 tonnes of aviation fuel per month last year.