Rice and paddy imports bill surges to Rs25b

- Post Report, Kathmandu

Aug 30, 2015-

Rice and paddy imports jumped by a whopping 43.4 percent to Rs 24.75 billion in the last fiscal year largely due to disappointing summer harvests, the statistics of Nepal Rastra Bank showed.

All rice imports were made from India. Rice imports bill stood at Rs 13.14 billion in 2012-13 and surged to Rs 17.26 billion in 2013-14. Imports of vegetables from India stood at Rs 7.98 billion in 2014-15, up by 14.6 percent.

NRB said that increased imports of agricultural products have emerged as one of the major components for ballooning trade deficit with the southern neighbour. The central bank on its macroeconomic report said that imports from India increased primarily due to rise in imports of vehicle, its spare parts and rice.

Statistics show that Nepal imported goods worth Rs 491.65 billion from India. As a result of significant rise in imports, trade deficit with India surged to Rs 435.79 billion in the review period, from Rs 418.33 billion in the corresponding period.

Nara Bahadur Thapa, chief of research department at NRB, said due to migration of many Nepalis for foreign employment, their family members too migrated to urban areas, leaving behind their traditional agriculture work. “As a result domestic production has reduced,” he said. He added that the urban settled-families started to consume goods with the remittance they received, which contributed to the increase of imports in agriculture goods.

Late monsoon along with untimely rain had hit paddy yield last fiscal year. The Agriculture Ministry said that paddy output dropped 5.1 percent to 4.78 million tonnes. Nepal produced 258,435 tonnes less paddy worth Rs 5 billion compared to previous year.

Agro experts said that the drop in paddy production has put pressure on imports and would continue this fiscal year as well. “The country is also likely to see significant imports of rice this fiscal as droughts in most of the Tarai districts, the country’s food basket, have affected paddy transplantation,” said Bhola Man Singh Basnet, agro expert and scientist.

He estimates that rice imports bill could cross Rs 40 billion this year based on the current poor paddy transplantations.

The agriculture ministry has estimated that Nepal could lose Rs 25 billion paddy output this year. “The government has not accorded priority to the agriculture sector, particularly paddy production, whose contribution remains over Rs 100 billion in the country’s gross domestic product,” he said, adding that the government should come up with a long-term plan to boost output as drought has become a perennial problem.

According to him, in the last 20 years, Nepal has suffered droughts for 12 years in total. “Besides, the monsoon pattern is changing.” For example, Nepal gets heavy rain during monsoon, which starts from June 10 and ends around September 23.

But since the last few years, it has been a different case. “Monsoon arrival is delayed by at least a week, while rainfall activities have been seen after September 23,” said Basnet. “Heavy investment in irrigation could address such problems recurring in Nepal.”

The government has set an ambitious goal of offering round-the-year irrigation facility in the Tarai/Madhes region in the next five years. The budget for 2015-16 has laid emphasis on constructing mega irrigation projects to irrigate all of Tarai’s fertile land and promote deep tube-wells and other means of water resources. However, Basnet said that the commitment should be brought into action soon.

The agriculture ministry has planned to bring down the country’s paddy imports bill from Rs14 billion last fiscal year to Rs 6 billion by this fiscal through implementation of various programmes. However, agro experts said that the current agricultural scenario is likely to give rude shock to the ministry’s lofty ideas and plan.

Published: 30-08-2015 09:06

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