By Laxman Kafle

Kathmandu, Nov. 6: A visible fall in the country’s staggering trade deficit has been noticed since the beginning of the current fiscal year.
The country’s trade deficit has noticeably decreased by 12.02 per cent to Rs. 307.78 billion in the first three months of the current fiscal year compared to same period last year, thanks to the decline in the import.
The country faced a trade deficit of Rs. 349.84 billion in the first three months of the last fiscal year 2018/19.
According to the trade statistics of the Department of Customs, the export trade posted a double-digit growth of 14.41 per cent while import went down by 10.34 per cent during the review period.
The country exported goods worth Rs. 27.16 billion while it imported goods of Rs. 334.94 billion in the first three months of the current fiscal year.
During the review period, the foreign trade saw a decline of 8.86 per cent to Rs. 362.11 billion.
The export and import share to the total trade stood at 7.5 per cent and 92.5 per cent respectively during the review period.
A significant decline in the import of petroleum products, vehicular items and readymade clothes and gold contributed to the decline in trade deficit during the review period, said Shishir Ghimire, information officer of the Department of Customs.
He said that the import of petroleum products, especially cooking gas and diesel has decreased by 24 per cent to Rs. 20 billion in the review period.
The country imported petroleum products worth Rs. 25 billion in the corresponding period last fiscal year.
The import of readymade clothes decreased to Rs. 3.58 billion in the first three months while it was Rs. 6.35 billion in the same period last fiscal year.
At the meantime, the export of palm oil increased significantly to Rs. 5 billion in the review period while it was Rs. 380 million in same period last year. This also contributed to the increase in the export trade.
Economist Dr. Chandramani Adhikari said that the fall in the trade deficit was due to decline in import and increase in export, which was a positive sign for the national economy.
He, however, said an analysis of the factors which contributed to the decline in the import and the increase in the export should be urgently made. This will help us to maintain this situation in the days to come, he added.
According to him, a significant increase in the export of palm oil contributed to the increase of export trade during the review period. But palm oil is not our own products and therefore trade deficit decrease could not be sustained for long, he said adding sustainable sources are required for increasing export trade and to reduce trade deficit, he added.
He said that the country would have to pay attention to increase export of local products, including cardamom, ginger, readymade garments, carpets and other products to reduce the trade deficit.
Some existing tax and revenue policies of the government have discouraged the importers to import goods, including vehicles, which also contributed to the in decline in import trade, he said.
“It will be too early to say that the present situation of trade will remain stable, and we have to study the statistics of trade, at least, of additional two months,” he said.
Economist Dr. Dilli Raj Khanal said that the growth in export trade, though it was not significantly high, was a positive sign for national economy.
“The share of export to the total trade and Gross Domestic Products (GDP) has been declining for the last one decade. But now, a ray of hope is seen in export trade. The government should make further efforts to make the export growth sustainable by providing trade facilities,” he said.
Comparatively, decline in trade deficit would support for balance of payment and achieve the targeted economic growth, he said.