Trade analysts termed the transformation in import and export patterns ‘unusual’ because the government’s policy adjustments had little to do with the change. They said the government could have manipulated the macroeconomic data to improve the appearance of the country's trade performance.

The Current Macroeconomic Situation report published by the Nepal Rastra Bank shows that the country's export earnings during the period mid-July to mid-August totalled Rs8.83 billion, up 27.7 percent year-on-year. During the same period, Nepal imported goods worth Rs106.72 billion, down 11.5 percent year-on-year.

Dipendra Bahadur Chhetri, economist and former vice-chairman of the National Planning Commission, said the improved trade situation could be an outcome of the strategic measures implemented by the government. “The effect can be seen on the import of automobiles and oil, both of which dropped during the review period,” said Chhetri. Trade analysts pointed out that government policies discouraging the import of luxury four-wheelers could have led to a drop in the import of such vehicles. Last June, the government endorsed a national work plan that proposed to impose higher import duty on luxury goods and raise the country's production base.

The government has doubled the excise duty on imported vehicles through the budget statement for fiscal 2018-19. The down payment on auto loans has also been jacked up to 50 percent of the value of the vehicle.

“Due to these reasons, vehicle imports could have dropped, taking down the country’s overall import bill,” said Chhetri.

Nepal Rastra Bank's statistics show that imports of vehicles and spare parts during the review period fell 20.3 percent year-on-year to Rs6.56 billion.

At the same time, the government has taken several steps to improve exports. It hiked the cash incentive given to exporters to 5 percent from 3 percent of the value of the product last December.

“Exporters have also reported that they are receiving the incentive payment with fewer hassles than previously. This could have spurred exporters to expand their business abroad,” said trade analyst Bijendra Man Shakya.

But experts doubt the macroeconomic figures released by the government which paint a rosy picture of the trade situation.

“The government has not come up with any radical measures to improve the country’s trade position so fast, and imports could surge after the shipments currently stranded at the border points enter the country,” said Chhetri.

The reduction in the trade deficit has brought down the country’s current account deficit to Rs9.37 billion, down from Rs25.16 billion during the corresponding period in the previous year.

The balance of payments also recorded a surplus of Rs6.05 billion compared to a Rs24.77 billion deficit during the same period in the previous year.

Chhetri said the balance of payments position could have improved due to donor agencies making reimbursement payments to development projects, apart from a reduction in the trade deficit and a rise in remittance inflows.

The central bank's statistics show that remittance inflows during the review period inched up 2 percent, compared to the heady growth of 33.1 percent in the previous year. The country received Rs75.40 billion in remittance in the first month of the current fiscal year.