Findings
According to the Central Bureau of Statistics, Gross Domestic Product have decreased by 2.37% in 2019/20. Likewise, GDP as per industrial division based on constant price have grown by 4.25% and 5.84% in 2020/21 and 2021/22 respectively. The contribution of agricultural sector in GDP in 2019 and 2020 is 21.58% and 23.13% respectively. Similarly, the contribution of agriculture, industry, and the service sector to the GDP of the country was 25.8%, 13.1% and 61.1% respectively in 2020/21. The inflation rate for 2021 in Nepal is 3.6%. the inflation rate in first three months of fiscal year 2021/22 is 4.24%. The consumer price inflation stood at 5.97 percent in the seventh month of FY 2021/22 The annual average food and beverage inflation is 6% in 2021. The annual average non-food and services inflation is 5.96%. The intermediate consumption of at purchaser’s price have been increased by 6.75% in 2020/21 and by 16.79% in 2021/22. The gross value added by industrial division at current price have been increased by 10% in 2020/21 and by 13.42% in 2021/22. Likewise, GDP as per expenditure approach based on current price have grown by 6.90% and 11.53% in 2020/21 and 2021/22 respectively. GDP as per expenditure approach based on constant price have grown by 6.32% and 5.04% in 2020/21 and 2021/22 respectively.
Following are the summary of macroeconomic indicators below:
| Annual Change in percentage |
2019/20 |
2020/21 |
2021/22 |
| Annual Change in nominal percapita GDP |
(-0.20%) |
8.94% |
12.34% |
| Annual Change in nominal percapita GNI |
(-0.05%) |
8.25% |
12.44% |
| Annual Change in nominal percapita GNDI |
(-0.49%) |
8.20% |
9.73% |
| Annual Change in real percapita GDP |
(-3.31%) |
3.25% |
4.82% |
| Annual Change in real percapita GNI |
(-4.92%) |
5.21% |
5.82% |
| Annual Change in real percapita GNDI |
(-5.34%) |
5.17% |
3.26% |
| Final Consumption Expenditure as percentage of GDP |
94.28% |
92.29% |
90.73% |
| Gross Domestic Saving as percentage of GDP |
5.72% |
7.71% |
9.27% |
| Gross National Saving as percentage of GDP |
32.16% |
33.30% |
31.95% |
| Exports of goods and services as percentage of GDP |
6.81% |
5.21% |
6.61% |
| Imports of goods and services as percentage of GDP |
34.11% |
38.60% |
41.49% |
| Imports of goods and services as percentage of GDP |
34.11% |
38.60% |
41.49% |
| Gross Fixed Capital Formation as percentage of GDP |
30.47% |
29.85% |
29.37% |
| Resource Gap as percentage of GDP |
1.72% |
(-2.48%) |
(-5.30%) |
| Workers' Remittances as percentage of GDP |
22.50% |
22.47% |
19.81% |
| Product Tax as a percentage of GDP |
11.90% |
14.43% |
15.43% |
| Total Tax as a percentage of GDP |
18% |
20.3% |
20.8% |
The annual growth of GDP by economic activities as per timeframe is mentioned in the table below:
| Economic Activities |
2019/20 |
2020/21 |
2021/22 |
| Agriculture, forestry and fishing |
2.43% |
2.85% |
2.30% |
| Mining and quarrying |
(-2.23%) |
7.50% |
8.15% |
| Manufacturing sector |
(-9.03%) |
4.14% |
6.14% |
| Electricity, gas, steam and air conditioning supply |
19.51% |
2.57% |
36.67% |
| Water supply; sewerage, waste management and remediation activities |
2.15% |
1.49% |
0.72% |
| Construction |
(-4.39%) |
5.19% |
9.51% |
| The Wholesale and retail trade; repair of motor vehicles and motorcycles |
(-11.39%) |
5.74% |
9.12% |
| Transportation and storage |
(-11.79%) |
4.43% |
4.54% |
| Accommodation and food service activities |
(-36.78%) |
10.73% |
11.42% |
| Information and communication |
2.02% |
1.77% |
3.58% |
| Financial and insurance activities |
(-0.35%) |
4.05% |
6.06% |
| Real estate activities |
2.08% |
2.25% |
3.82% |
| Professional, scientific and technical activities |
1.52% |
2.37% |
3.78% |
| Administrative and support service activities |
2.19% |
2.30% |
4.40% |
| Public administration and defence; compulsory social security |
6.16% |
3.38% |
4.05% |
| Education sector |
3.20% |
3.92% |
4.08% |
| Human health and social work activities, Other Service |
5.20% |
6.60% |
6.91% |
| Arts, entertainment and recreation; Other service activities; and Activities of households as employers; undifferentiated goods- and services-producing activities of households for own use |
1.77% |
3.38% |
3.79% |
Following are the fluctuations of import and export as per GDP by expenditure approach at current price since 2020 to 2022:
| Particulars |
2020/21 |
2021/22 |
| Imports |
|
|
| Goods |
28.21% |
21.45% |
| Services |
(-3.42%) |
26.31% |
| Net Imports |
24.26% |
21.20% |
| Exports |
|
|
| Goods |
32.74% |
54.83% |
| Services |
(-49.42%) |
24.11% |
| Net Exports |
(-15.80%) |
43.93% |
Following are the fluctuations of import and export as per GDP by expenditure approach at constant price since 2020 to 2022:
| Particulars |
2020/21 |
2021/22 |
| Imports |
|
|
| Goods |
19.82% |
14.57% |
| Services |
(-9.74%) |
19.16% |
| Net Imports |
16.32% |
15% |
| Exports |
|
|
| Goods |
24.42% |
45.24% |
| Services |
(-52.6%) |
16.41% |
| Net Exports |
(-21.01%) |
35.01% |
The gross output by economic activities as per timeframe is mentioned in the table below:
| Economic Activities |
2020/21 |
2021/22 |
| Agriculture, forestry and fishing |
6.24% |
8.22% |
| Mining and quarrying |
5.33% |
11.27% |
| Manufacturing sector |
11.69% |
19.92% |
| Electricity, gas, steam and air conditioning supply |
5.71% |
26.07% |
| Water supply; sewerage, waste management and remediation activities |
1.05% |
2.51% |
| Construction |
1.22% |
11.83% |
| The Wholesale and retail trade; repair of motor vehicles and motorcycles |
12.20% |
16.86% |
| Transportation and storage |
7.49% |
32.59% |
| Accommodation and food service activities |
8.22% |
25.54% |
| Information and communication |
5.90% |
4.98% |
| Financial and insurance activities |
6.45% |
11.08% |
| Real estate activities |
3.32% |
7% |
| Professional, scientific and technical activities |
5.90% |
9.10% |
| Administrative and support service activities |
4.17% |
10.74% |
| Public administration and defence; compulsory social security |
6.09% |
13.68% |
| Education sector |
2.77% |
10.67% |
| Human health and social work activities, Other Service |
12% |
15.47% |
| Arts, entertainment and recreation; Other service activities; and Activities of households as employers; undifferentiated goods- and services-producing activities of households for own use |
5.96% |
2.72% |
Key Source:
https://cbs.gov.np/national-accounts-statistics-of-nepal-2021-22-annual-estimates/
Key Terms:
• (-) represents deduction or decrease
• Key economic activities
• Contribution of economic activities
• Gross Domestic Product
• Gross National Income
• Gross Output
• GDP deflators, GDP by expenditure approach, GDP by industrial division, annual growth rate of GDP
• Gross National Disposable Income
• Macroeconomic indicators
• Annual change in nominal per capita, real per capita
Analysis
As per the data facts and figures on statistical data of Central Bureau of Statistics, it is the emphasis for the business and industries to select and prosper in selective economic sectors. The increasing ratio of import and export has a huge gap which has created a vast amount of gap in balance of payment which is the major reason for trade deficit. The need to outgrow agricultural sector is a must to contribute in the economy as the pandemic impact is still on the line. The business flow is directed more towards service sector than that of production sector. Recently, Electricity, gas, steam and air conditioning supply has been contributing to GDP by 36.67% which is comparatively more than any sector on the line. The water supply, sewage and waste management are a huge problem in Nepalese economy causing several negative impacts on human life. Currently, financial and insurance have been facing some problems like Lack of attractive collection schemes by providing discounts, and incentives to the policyholder for encourage paying premium in time. Poverty is also main problem due to which Nepalese people do not have faith on insurance.
The Real Estate Market in Nepal is flourishing despite the unsuitable monetary policy announced by Nepal Rastra Bank. Real estate value will increase as the demand of real estate market is very high in Nepal due to the rapid growth of physical infrastructures, road expansions etc. Real estate can generate a passive source of income and is a good investment for a long term. However, there are certain factors that has affected the real estate sector such as COVID-19, economic renewal, capital market risk, public and private indebtedness, technology and workflow etc.
Factors such as poverty, cuts in mental health services, a fragmented system of care and a lack of affordable or suitable long-term housing solutions are major issues that have affected human health and social work activities. Nepal is going through a period of transition, and social work can play a crucial role in rebuilding lives and communities that have been affected due to the series of conflicts and natural calamities. Professional social work education is essential for the development of the profession.
There are some of the sectors which are highly affected, semi-affected and least affected by pandemic in Nepal. Highly affected sectors are tourism industry which includes hotels, restaurants, trekking/travel agencies, homestays, and resorts, aviation and transportation, entertainment hubs, poultry farming, bee-keeping and livestock farming, and foreign employment recruiting agencies. Similarly, semi- affected sectors are Plastic and home appliances manufacturers/traders, educational institutions and child-care centres, beauty parlours and hair salons, consultancy service providers, hospitals and clinics, construction sector, pharmaceutical producers, under-construction hydropower, and renewable energy projects. Moreover, least affected sectors are Hydro projects that are already connected to the national electricity grid, e-commerce businesses, essential goods producers, importing trade, petroleum industry, advertising services, internet and telecommunication service providers, liquor and tobacco business, and gold and other jewellery business.
The factors such as consumption, government expenditure, investments and foreign balance of trade are very essential for contribution in the economy. The consumption pattern varies as per the situation such as the consumption pattern of luxurious goods fell during the pandemic as people avoided unessential goods as per their income factor.
