Budget Analysis - 72/73

Published: Sunday - 2nd August, 2015
The Government of Nepal promulgated budget for the fiscal year 2072/2073 on 7/14/2015. This year the Government has allocated a total of Rs819.46 bn for the budget which is 33% more than the figure from FY71/72 and 58% more than the figure from FY70/71.The main reason behind such a huge jump on the figure this year is due to allocation for reconstruction and rehabilitation work – which is around Rs74 bn. If we take this component out of the budget for this year, the overall budget increment is around 20%.The Government has set aside an aggressive goal for economic growth of 6% which is the same goal which it had set last year. However, Nepalese economy grew only by 3.04% last year as it was severely impacted by the Gorkha earthquake and its subsequent aftershocks. Given the damage caused by the earthquakes, it will be seemingly impossible for the Government to meet the growth rate of 6%.
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Market Summary

2018-07-11 | Wed
Index NEPSE Sen. Index CB DB FIN INS HP M&P HO TRD OTH
Value 1205.64 253.98 1019.97 1420.69 608.23 6116.52 1458.82 2219.45 1811.42 195 709.17
Prev 1205.93 254.06 1021.85 1417.65 607.7 6115.72 1456.12 2219.92 1897.84 195 708.52
Change -0.29 -0.08 -1.88 3.04 0.53 0.8 2.7 -0.47 -86.42 0 0.65
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The benchmark index lost 27.59 points w-o-w as the trading closed on Thursday, 10/15. Though the mar...
 
 

Commodity & Currency Watch

Bullion

2015-11-02 | Mon
Gold, Hallmark* Rs 50,500.00
Gold, Tejabi* Rs 50,250.00
Silver* Rs 715.00

Source: FENEGOSIDA

* per 1 tola/11.66 gms

Forex

2015-11-03 | Tue
Currency Buy Sell
Indian Rupees (INR) 160.00 160.15
American Dollar (USD) 104.63 105.23
UK Pound Sterling (GBP) 161.68 162.61
Australian Dollar (AUD) 74.70 75.13
Euro (EUR) 115.39 116.06

Source: Nepal Rastra Bank

Gasolene

2015-09-07 | Mon
Petrol (per liter) Rs 104.00
Diesel (per liter) Rs 81.00
Kerosene (per liter) Rs 81.00
LPG (per cylinder) Rs 1,400.00
Airline Fuel (per liter) Rs 118.00

Source: Nepal Oil Corporation

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T-Bills & Financial Market Rates

TBill Rates

2015-07-22 | Wed
28 Day Rate 0.06%
91 Day Rate 0.00%
182 Day Rate 0.55%
364 Day Rate 0.61%

Source: Nepal Rastra Bank

Inter Bank & Policy Rates

Rates

2015-08-06| Thu
Cash Reserve Ratio 6.00%
Bank Rate 7.00%
SLF Rate 8.00%
Interbank Rate 0.44%
Repo Rate 9.25%
Reverse Repo Rate 0.38%

Source: Nepal Rastra Bank
 

Macroscopic Outlook

Indicators

2015-08-21 | Fri
GDP (at current price) in Bn. Rs 2,124.70
GDP Growth Rate 3.00%
Inflation Rate 7.20%
Per Capita Income Rs 69,919.00
Total Population 26,494,504
Population Below Poverty Line (<$1) 25.16%
Literacy Rate 65.90%
Balance of Payment (in Bn.) Rs 144.85
Import (in Bn.) Rs 774.68
Export (in Bn.) Rs 85.32
Remittance (in Bn.) Rs 617.28
Government Revenue (in Bn.) Rs 405.85
Government Expenditure (in Bn.) Rs 499.96

Source: Nepal Rastra Bank & CBS
 

Budget Highlights

Parameters

2015-07-17 | Fri
Budget Size Rs 819.46
Budget Nature Deficit
Applications of Fund  
Recurrent Expenditure Rs 484.26
Capital Expenditure Rs 208.87
Repayment of Loan Rs 126.33
Sources of Fund  
Internal Fund Rs 613.58
Foreign Grant Rs 110.92
Foreign Loan Rs 94.96

Source: Ministry of Finance

Nepalese Economic Overview

2015-02-10 | Tue

Nepal, with a total area of 147,181 km2 and population of around 27million (according to Central Bureau of Statistics, Nepal), sits between China and India. It is a landlocked nation that heavily depends on import and remittance to keep the country running. The latest report shows that GDP of Nepal stands at Rs 2124.70 while the GDP is expected to grow by 3.00% as per the Government of Nepal (GoN). The current inflation rate in Nepal is around 7.20%.

The GoN has set aside a budget of Rs 819.46 for the FY 2071/72. This year, the government is focusing mainly on agriculture, tourism and energy sectors. Ministry of Finance publishes budget for the new fiscal every year around middle of July. This is due to the fact that in Nepal FY starts in Shrawan and ends Ashad (i.e., mid-July). Along with the budget comes the fiscal policy for that year. Once the fiscal policy is out, Nepal Rastra Bank (NRB) publishes monetary policy for that fiscal year.

Structure of Nepalese Financial Market

NRB is the central bank of Nepal which is the sole body that regulates commercial banks, development banks and finance companies. In addition to taking up the role of regulatory body, it also publishes monetary policy and various economic reports at regular frequency. As per NRB’s website, “it was established in 1956 under the Nepal Rastra Bank Act, 1955 to discharge the central banking responsibilities including guiding the development of the embryonic domestic financial sector. Since inception, there has been a significant growth in both the number and the activities of the domestic financial institutions.”

Structure of Nepalese Capital Market

The securities market in Nepal started in 1985 and it was only in 1994 that the first and only stock exchange of Nepal – Nepal Stock Exchange (NEPSE) - was established. NEPSE was established under the Securities Exchange Act, 1983 and it officially started trading since 1/13/1994. It started the automated screen based trading since 8/24/2007. Of late, it is working toward fully automating the trading system which will allow buyers and sellers from all over Nepal to start trading online. For this purpose, it has already opened Central Depository and Settlement services (CDS) in 2010. The CDS will allow buyers and sellers to buy and sell securities in dematerialized form.

The bourse is regulated by Securities Board of Nepal (SEBON) which was established on 1/7/1993. It has been closely monitoring and regulating the stock market under the Securities Act, 2006. All the listed companies at the NEPSE must submit their audited financial reports to SEBON every quarter and at the end of fiscal year.

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