English economic survey 2016 17 20180715081938

Khảo sát kinh tế Nepal 2016 2017. Do các nhà nghiên cứu tiến hanh, đánh giá nền kinh tế nepal trong năm 2016 2017, những tác động ảnh hưởng tới nền kinh tế, dự báo kinh tế nepal trong năm tiếp theo. fdsfdsfdsfdsfdsfdsfds fdsfdsfdsfdsfsdf dsfdsfdsfdsfds dfdssfdsfdsfsdfdsfdsfds fdsfdsfdsfdsfdsfdsfds fdsfdsfdsfdsfsdf dsfdsfdsfdsfds dfdssfdsfdsfsdfdsfdsfds fdsfdsfdsfdsfdsfdsfds fdsfdsfdsfdsfsdf dsfdsfdsfdsfds dfdssfdsfdsfsdfdsfdsfds fdsfdsfdsfdsfdsfdsfds fdsfdsfdsfdsfsdf dsfdsfdsfdsfds dfdssfdsfdsfsdfdsfdsfdsfdsfdsfdsfdsfdsfdsfds fdsfdsfdsfdsfsdf dsfdsfdsfdsfds dfdssfdsfdsfsdfdsfdsfdsfdsfdsfdsfdsfdsfdsfds fdsfdsfdsfdsfsdf dsfdsfdsfdsfds dfdssfdsfdsfsdfdsfdsfds

Unofficial Translation Economic Survey

The government of Nepal aims to speed up socio-economic transformation through high, sustained and broad-based inclusive growth To achive this goal, federal system should be taken as a window of opportunity for economic prosperity and thus adequate provision of means and resources for investment should be made at federal, provincial and local levels In addition, national economic policy and sectoral policies need to be formulated and implemented in order to realize the goal of economic development with stability and build the basis for the mobilization of means and resources for federal fiscal management Such policies should focus on building exploitation free society by abolishing economic inequality through sustainable economic development and equitable distribution of development returns by optimally utilizing available means and resources as well as mobilization of capital in participation of government, private and cooperative sector

Nepalese economy suffered adversely from devastating earthquake and disruption in supply situation due to obstruction in boarder points In order to recover the economy by mitigating such adverse shocks, the governmnet of Nepal has implemented various policies and programs As a result, the economy is estimated to grow by 6.94 percent in 2016/17 This growth rate is the highest since fiscal year 1994/95 Hence, it would be easier to achive the goal of economic prosperity if the existing situation of high economic growth, low inflation, adequate foreign exchange reserve and resource availability could be sustained and employment could be generated through mobilization of investment.Thus, it is important to boost private sector investment by enhancing the capacity to execute budget and creating the investment friendly environment However, the means and resources in the federal structure is adequate Economic Survey for fiscal year 2016/17 has been prepared by making analytical review of various aspects of the economy and the achievements from the implementation of important policies and programs It has incorporated the important programs from socio-economic perspectives and their impact on the overall economy

I believe that the Economic Survey would be very useful for all those who are interested and have concern over the economic activities of Nepal including sector line agencies, intellectuals, researchers, employees, teachers, students, industrialists, businessmen, NGOs, common public, Nepal's development partners and foreign investors

Last but not the least, I would like to extend my thanks to the Economic Policy Analysis Division of Ministry of Finance including all officials who involved in the preparation

of the Survey and various Ministries, departments and other concerned entities who have extended their supports to this work by providing data, information and other details

Krishna Bahadur Mahara Deputy Prime Minister and Minister for Finance

Contents

Foreword

12 Good Governance, General Adminstration, Peace and Reconstruction 202

List of Tables

Table 1 (d) : Trend of CPI Inflation in China and South Asia (Percent) 3

Table 2 (a) : Public Finace and Ratio with GDP ( In Rs Ten Million) 20

Table 2 (c) : Service and Funtion-Wise Detail of Recurrent Expenditure (In

Table 2 (d) : Service and Function-Wise Details of Capital Expenditure (In

Table 2 (f) : Ratio of Income, Grants and Expenditure to Government’s Total

Table 2 (i) : Foreign Aid Commitment Situation ( In NRs 10 Million) 34 Table 2 (j) : Fiscal Deficit and Deficit Financing Detail ( In NRs 10 Million) 36 Table 2 (k) : Outstanding Public Debt, Principal Repayment and Interst

Table 2 (m) : Income and Expenditure Details of Local Bodies (In NRs 10

Table 2 (n) : Government Grant to Local Bodies (In NRs 10 Million) 42

Table 3 (b) : Change in National Consumer Price Index on Year-on-Year Basis 48 Table 3 (c) : Change in National Wholesale PricenIndex on Year-on-Year Basis 50 Table 3 (d) : Y-O-Y Based Change in Nationaal Wage Salary and Wage Rate

Table 3 (f) : Prices of Gold and Silver in Internatioonal Markets 51

Table 4 (a) : Bank Rate, Refinance Rate and Cash Reserve Ratio (In Percent) 56 Table 4 (b) : Factors Affecting Money Supply (In NRs 10 Million) 58 Table 4 (c) : Changes in Monetary Aggregates (on Y-o-Y Basis, In Percent) 58

Table 4 (g) : Deposit Mobilization and Credit Flow ( In Rs 10 Million) 62

Table 4 (i) : Number of BFIs (As of Mid-July) 64 Table 4 (j) : Share of BFIs to Total Deposits, Credit and Assets (Mid-March,

Table 4 (o) : Sources and Uses of Fund of Microfinance Institutions (In NRs

Table 4 (q) : Status of Rural Self-Reliance Fund (In NRs 10 Million) 72

Table 5 (e) : Source and Uses of life and non-life Insurance Companies 85

Table 6 (a) : International Trade Situation (First Eight Months, In Percent) 95

Table 6 (d) : Situation of International Investment Position (Mid-July, In Rs

Table 7 (b) : Amount Mobilized Through Community Organizations( In Rs

Table 7 (d) : Organizations Affiliated to Foreign Employment Inforation

Table 7 (g) : Details on Number of Deceased Nepali Migrant Workers and

Table 7 (h) : Details of Ailing and Maimed Nepali Migrant Workers 113 Table 7 (i) : Amount Collected in Social Security Fund(In Rs 10 Million) 114

Table 8 (e) :Production Details of Spice Crops 128

Table 8 (j) : Sales and Distribution Situation of Chemical Fertilizers ( MT) 132

Table 8 (l) : BFIs Disbursed Agricultural Credits ( In Rs Million) 133 Table 8 (m) : Foundation Seeds Production and Introduction of Crop Varieties 134 Table 8 (n): Member and Loan Investment Situation of Small Farmer

Table 8 (p) : Basic Status of Cooperative Institutions(In Rs 000) 137

Table 8 (s) : Area of National Parks and Wildlife Reserve and Other Details 141

Table 8 (u) : Number of Tourist Visiting Protected Area and Revenue Earned 142

Table 8 (w) : Number of Tourist (Domestic/International) Visting National

Table 8 (x) : Total Revenue Earned through Forest Sector (In Rs 000) 144 Table 9 (a) : Licensed Industries for Operation in Last Ten Years 148

Table 9 (e) : Nepal’s Poistion in Doing Business among SAARC Nations 153 Table 9 (f) : Industrial Intellectual Property Registration (In Number) 154

Table 10 (a) : Energy Consumption Status (In ToE: Tons of Oil Equivalent) 173 Table 10 (b) : Electricity Demand, Consumption, Production, Import, and

Table 10 (e) : Hydroelectricity Generation License Status (Until Mid-March) 178

Table 10 (h) : Daily and Monthly Average Imports of Petroleum Products 182

Table 11 (b) : Road Facility Extended by Department of Road (In Km) 186

Table 11 (c) : Details of Road Network constructed under Local Bodies (In

Table 11 (e) : Local Road Network Details by Geographical Region (In Km) 189

Table 12 (a) : Number of Bhutanese Refugees Resettled in Third Countries 206

Table 12 (d) : Detail of Training Programs Conducted Through Nepal

Table 12 (e) : Number of Appeals, Complaints and Applications Filed

Table 12 (f) : Sector-Wise Applications, Complaints and Appeals Filed in FY

Table 13 (e) : Level-Wise/Area-Wise Detail of Community and Institutional

Table 13 (g) : Detail of Teachers Engaged in Community and Institutional

Table 13 (h) : Gender-Wise Detail of Teachers by Schools and by Levels (Basic

Table 13 (i) : Status of School Level Students’ Enrollment (In Number) 228 Table 13 (j) : Students’ Enrollment Status by Levels in Academic Year 2016 229

Table 13 (l) : Area-Wise detail of Approved Grade 11-12 Operating Secondary

Table 13 (m) : SEE (previously named SLC) Examination Detail (Academic

Table 13 (n) : Indicators related to Impacts rendered by Health Sector Program 234 Table 13 (o) : Details of Health Institutions, Beds and Human Resources 235 Table 13 (p) : Health Service Beneficiary Population by Development Regions 235

Table 13 (r) : Detail of Extended Vaccination and National Polio Vaccination

Table 13 (t) : Study Research Conducted Through Health Research Council

Table 13 (v) :Comparisonof Major Indicators among South Asian Countries 245 Table 13 (w) :Detail of Service Recipients from Rehabilitation Center 247 Table 13 (x) : Details on Protection, Relief and Reconciliation of Armed

Table 13 (y) : Identity Card Distribution to Persons with Disability 252

Table 13 (ac) : Distribution of Social Security Allowance (In Number) 262 Table 15 (a) : Private Housing Grants Beneficiaries and Grant Distribution 282

List of Charts

Chart 1 (h) : Ratios of Gross Domestic Savngs and Gross National Savings to GDP 16

Chart 2 (b) : Per Capita Revenue and Public Expenditure (In NRs.) 21

Chart 2 (f) : Ratio of Revenue, Grants and Loan to Government’s Total

Chart 2 (i) : Development Aid on Budgeted and Non-Budgeted Projects for FY2015/16 36

Chart 3 (c) :Inflation Rate by Geographical Regions(2015-2016 In Percent) 49

Chart3 (d) : Prices of Petroleum Products in Nepal 2001-2015 (In NRs.) 52

Chart 4 (a) : Broad money and narrow money supply growth (on Y-o-Y basis) 57

Chart 4 (b) : Diposite, Lending and Base Rate (Weighted Average, Percent) 61 Chart 4 (c) : Situation of Financial Access in Nepal as Compared to Other Countries 67

Chart 5 (d) : Source and Uses of life and non-life Insurance Companies 85

Chart 5 (f) : Growth Rate of Life and Non-Life Insurance Premiums 87

Chart 5 (g) : Insurance Premiums to GDP Ratio 87

Chart 6 (a) : Share of Import and Export in Total Trade ( In Percent) 92

Chart 6 (d) : Siutation of Foregin Exchange Reserve Adequacy Indicators 98

Chart 8 (a) : Production of Paddy, Maize and Wheat among Major Food Crops 121

Chart 8 (b) : Sale and Distribution Situation of Chemical Fertilzers 132

Chart 9 (d) : Foreign Investment on Industries in Last Ten Years 151

Chart 9 (h) : Countries with Most Number of Tourist Arrival in 2016 164

Chart 10 (b) : Growth Rate of Electricity, Gas and Water (In Percent) 175

Chart 13 (a) : Share of Education, Health and Social Security in Total Budget 215

Chart 13 (c) : Percentage of Children with Early Childhood Development

Chart 13 (d) : Level-Wise School’s Details by Geographical Sector 225

Chart 13 (f) : Number of Students studying at TU and other Universities 233

Chart 13 (g) : Missing, Found after missing and Found unattended Children 248

Chart 13 (h) : Children Details (First Eight months of Fiscal Year 2016/17) 249

Chart 13 (i) : Beneficiary Children from Child Toll-Free Helpline Telephone Number 1098 250

Chart 15 (a) : Grant Distribution in most earthquake affected 14 districts 282

ARV Anti Rabies Vaccination

ASBA Application Supported by Blocked Amount

ASV Anti Snake Venom

BIMSTEC Bay of Bengal Initiative for Multi-sectoral Technical and Economic Cooperation

CB PMTCT Community Based Pregnant Mother to Child Transmitted

CBEGRA Classroom Based Early Grade Reading Assessment

CBT Computer Based Test

CIRS Criminal Information Record System

EDLURS Electronic Driving License Vehicle Registration System

EGRA Early Grade Reading Assessment

EPS Employment Permit System

FEIMS Foreign Employment Information Management System

FMIS Fund Management Information System

FPO Further Public Offering

GFS Government Finance Statistic

GDP Gross Domestic Product

GIDC Government Information Data Center

GPA Gross Point Average

GST Goods & Service Tax

HIV Human Immunedeficiency Virus

HTC HIV Testing & Counseling

ICT Information & Communication Technology

ID Intra Dermal

IMF International Monetary Fund

LDC's Least Developed Countries

LRIMS Land Reform Information Management System

NASC Nepal Administrative Staff College

NIPS National Integrated Power System

ODA Official Development Assistance

ODF Open Defecation Free

OECD Organization for Economic Cooperation and Development

PDRF Post Disaster Reconstruction Framework

PMIS Population Management Information System

PMTCT Preventing Mother to Child Transmission

PPP Purchasing Power Parity

RCC Reinforced Cement Concrete

SAARC South Asian Association for Regional Cooperation

SAFTA South Asian Free Trade Area

SDG Sustainable Development Goals

SEE School Education Examination

SEZ Special Economic Zone

TABUCS Transaction Accounting and Budget Control System

TOE Tones of Oil Equivalent

UNDP United Nations Development Program

WTO World Trade Organization

WUPAP Western Uplands poverty Alleviation Project

Executive Summary

1 World economy is gaining momentum with a recovery in developed

economies International Monetary Fund projected that the world economy grows by 3.5 percent in 2017 Such growth rate stood at 3.1 percent in 2016 Likewise, India and China, two neighboring economies, are projected to grow by 7.2 percent and 6.6 percent respectively in 2017

2 Nepal’s overall economic activity has been encouraging in fiscal year

2016/17 Economic activities have expanded due to favorable monsoon, increase in capital expenditure, energy management, and improvement in investment environment including overall supply situation As a result, gross domestic product (GDP) at basic price is estimated to grow by 6.94 percent in the current fiscal year This growth rate is the highest since FY 1993/94 Such growth rate was 0.01 percent in the previous fiscal year The economy that contracted due to the earthquake and disruption in border points is in the stage of recovery and expansion

3 Agriculture and non-agriculture sectors are estimated to grow by 5.29

percent and 7.74 percent respectively in FY 2016/17 Such growth rates were 0.03 percent and 0.16 percent in the previous fiscal year Likewise, service sector and industrial sector are estimated to grow by 6.9 percent and 10.97 percent respectively in the current fiscal year

4 Nepalese economy is in the stage of structural transformation as the share

of service sector is increasing while that of agriculture sector is decreasing The share of agriculture and non-agriculture sectors to GDP are estimated to remain at 29.37 percent and 70.63 percent respectively in fiscal year 2016/17

5 The share of consumption in GDP has mostly remained high Its share in

GDP is estimated to remain 89.7 percent in the fiscal year 2016/17 Such share stood at 96.18 percent in the previous fiscal year

6 The share of gross domestic savings in GDP is estimated to grow by 6.43

percentage points in fiscal year 2016/17 as compared to the previous fiscal year Such share is estimated to be 10.25 percent in the current fiscal year Likewise, the ratio of gross national savings to GDP is estimated to remain at 43.78 percent Such ratio stood at 39.96 percent in the previous fiscal year

7 Gross capital formation is estimated to grow by 45.8 percent to Rs

114.96 billion in the fiscal year 2016/17 The share of gross capital

formation in GDP that stood at 33.7 percent in fiscal year 2015/16 is estimated to remain at 42.5 percent in current fiscal year 2016/17

8 In the fiscal year 2016/17, per capita GDP at constant prices is estimated

to grow by 6.1 percent to Rs 28,733 as compared to that of previous fiscal year Per capita gross national income has reached US Dollar 862

in fiscal year 2016/17 which was US Dollar 757 in the previous fiscal year

9 Inflation has remained low in fiscal year 2016/17 as compared to last few

years In the first eight months of the current fiscal year, consumer price inflation stood at 5.1 percent on average Such rate was 9.7 percent in the corresponding period of the previous fiscal year Growth in agricultural production and improvement in overall supply situation are attributable for such a low inflation rate in the current fiscal year

10 Food inflation has remained negative by 0.4 percent while non-food

inflation grew by 5.6 percent in the first eight months of the current fiscal year Such inflation rates were 10.3 percent and 10.2 percent respectively during the corresponding period of the previous fiscal year

On region-wise basis, consumer price inflation in Kathmandu has remained at 1.9 percent, 5.9 percent in hills, 3.7 percent in the mountains and 2.8 percent in Terai

11 Of the government budgetary allocation of Rs 1,048.92 billion for fiscal

year 2016/17, total expenditure in the first eight months has been Rs 400.16 billion Of this, recurrent expenditures stood at Rs 293.42 billion, capital expenditure at Rs 67.83 billion and financing at Rs.38.91 billion

Of the total expenditure, the share of recurrent expenditure stood at 73.32 percent, capital expenditure at 16.95 percent and financing at 9.73 percent The growth of recurrent expenditure and capital expenditure is 48.2 percent and 148.5 percent respectively in the first eight months of fiscal year 2016/17 as compared to the corresponding period of the previous year

12 Of the targeted gross revenue mobilization of Rs 565.90 billion in the

fiscal year 2016/17, Rs 353.91 billion has been mobilized in the first eight months This amount is 53.16 percent higher than that of the corresponding period of previous fiscal year Of the total revenue collection, the share of tax revenue is 93.18 percent while that of non-tax revenue is 6.82 percent The ratio of revenue to GDP stood at 21.45 percent in previous fiscal year 2015/16

13 Foreign aid commitment totals Rs 212.04 billion in the first eight

months of fiscal year 2016/17 This aid amount is higher by 35.76 percent as compared to that of corresponding period of the previous fiscal year Of the total foreign aid commitment, the share of grant stood

at 21.5 percent and that of loan is 78.5 percent

14 Total outstanding public debt has stood at Rs 627.79 billion in

mid-March 2017 Of the total debt, the share of domestic and foreign debt has remained at 38.1 percent and 61.9 percent respectively The ratio of outstanding public debt to GDP stood at 24.1 percent in mid- March

2017

15 Monetary aggregates have remained at the desired level in the current

fiscal year Broad money supply grew by 9.5 percent in the first eight month of the current fiscal year Such growh was 11.5 percent in the corresponding period of the previous fiscal year

16 With the expansion in economic activities, credit to the private sector

has increased by 16.2 percent to Rs 1966.19 billion in the first eight month of current fiscal year Such growth had stood at 11.6 percent in the corresponding period of the fiscal year Likewise, deposit of banks and financial institutions has increassed by 8.3 percent to Rs 2183.30 billion

in the first eight month of current fiscal year Such growth rate had stood

at 8.4 percent in the corresponding period of previous fiscal year As a result, credit deposit ratio has reached 84.80 percent in mid-March 2017

17 Financial sector has remained stable The non-performing loan ratio of

banks and financial institutions stood at 2.13 percent in mid-March 2017 Monetary and financial instruments have been adopted in order to ensure

an adequate flow of credit to the private sector along with the increase in credit to deposit ratio of the banks and financial institutions However, the implementation of these intruments is temporary Likewise, the situation of the acess to finance is improving

18 Merchandise exports has increased by 12.8 percent to Rs 48.22 billion

in the first eight months of the fiscal year 2016/17 Likewise, merchandise imports has increased by 44.2 percent to Rs 628.56 billion The growth of both merchandise exports and imports was negative in the corresponding period of the previous year As a result, trade deficit rose

by 47.6 percent to Rs 580.34 billion in the first eight months of the current fiscal year Such a high growth of imports is the result of the

speed up in reconstruction work, increase in capital expenditure and the expansion of credit to the private sectors among others

19 The situation of external sector stability has remained satisfactory

Overall Balance of Payments (BoP) has been in surplus of Rs.50.06 billion in the first eight months of the fiscal year 2016/17 As a result, the gross foreign exchange reserves increased by 3.4 percent to Rs 1074.27 billion in mid-March 2017 as compared to mid-July 2016 On the basis of the imports of the first eight months, such level of reserve is sufficient to cover the imports of merchandise goods and services of about 12 months

20 The remittance inflow grew by 5.3 percent to Rs 450.00 billion in the

first eight months of the fiscal year 2016/17 The ratio of remittances to GDP was 29.6 percent in fiscal year 2015/16

21 Capital market has witnessed fluctuation and expansion due to the

reforms in securities market, capital hike plans of banks and financial institutions, and the expansion in overall economic activities NEPSE Index, which stood at 1,318.9 points in mid-March 2016 had reached 1,718.2 points in mid-July 2016 and slid back to 1,355.2 points in mid-March 2017 Likewise, market capitalization has reached Rs 1,537 billion in mid-March 2017 Thus, the ratio of market capitalization to GDP remained at 59.13 percent

22 Food production has increased as a result of favorable monsoon and easy

availability of agricultural inputs including chemical fertilizer It is estimated to grow by 13.0 percent to 9.74 million metic ton in fiscal year 2016/17 as compared to the previous fiscal year Of the food production, paddy/rice production recorded the highest growth of 21.6 percent reaching 5.23 million metric ton in the current fiscal year Likewise, production of other food crops, cash crops, industrial and spice crops have also increased Irrigation facility has been expanded to additional 9,775 hectares of land in the current fiscal year

23 Forests area has stood at 40 percent of Nepal’s total land In Forest and

Soil Conservation sector, there has been an improvement in forest area expansion as well as the protection of wildlife and environment as a result of the continuity in the various programs such as the restoration of forest land by evacuating encroached forest areas and the expansion of community based forest, lease hold forest and protected ares

24 Poor household identification program has been completed in 25

districts The program has been initiated in the remaining 50 districts too Population living below the poverty line has decreased due to the employment creation and implementation of self-employment oriented programs Likewise, internalization of programs and resource management work have been initiated in order to achive the goal of sustainable development

25 Employment is estimated to grow by more than 3 percent as a result of

the economic growth of the current fiscal year The number of individuls going for foreing employment by obtaining work permit is 186,166 in the first eight months of current fiscal year Of the labor force going for foreign employment, 24.5 percent have been trained workers

26 A total of 6,834 industries have been registered by first eight months of

the fiscal year 2016/17 thereby creating employment for about 536,000 individuals The share of energy oriented industries stood at 52.9 percent

in the total industry’s capital of Rs 1,274.19 billion Likewise, in the first eight months of the fiscal year 2016/17, a sum of Rs 10.15 billion equivalent of foreign investment has been approved for a total of 213 industries A total of 19,686 cottage and small scale industries have been registered in the review period

27 Tourism sector has expanded with the improvement in overall economic

activities in the current fiscal year In 2016, the number of tourist arrival has increased by 40 percent to 753,000 as compared to the previous year

2015 Such number had decreased by 32 percent in previous year

28 Overall energy supply situation has remained encouraging in the fiscal

year 2016/17 Of the total energy consumption of 8,257 Tons of Oil Equivalent (ToE) in the first eight months of the current fiscal year, the shares of traditional, commercial and renewable energy stood at 74.5 percent, 22.0 percent and 3.5 percent respectively During the same period, electricity generation has increased by 12.3 percent (105.3 Megawatts) reaching a total of 961.2 Megawatts Electricity leakage has decreased by 2.8 percentage points As a result, Kathmandu and Pokhara have been made load shedding free zones while load shedding hours have been reduced in other areas as well

29 Total road network reached to 29,157 Km with the construction of

additional 849 Km roads in the first eight months of the current fiscal year 2016/17 Of this, the share of black topped road is 42.2 percent

Likewise, the length of local level roads reached 57,632 Km with the additional construction of 4,332 Km roads in this category Of this road network, the share of earthen road stood at 74.2 percent Construction of railway transport and national pride projects have got priority Likewise, with a notable expansion in the telecommunication sector, telephone density has reached 130.35 percent with total number of telephone subscribers reaching 34,534,000

30 The situation of social sector including education, health, and drinking

water has been on progressive trend In academic year 2016, net enrolment rates at basic level (1-5), basic level (6-8) and secondary level education (9-12) stood at 96.9 percent, 80.9 percent and 59.8 percent respectively The total number of students at basic level education stood

at 5,995,000 while that of secondary level was 959,000 Similarly, the total number of teachers (including those of institutional schools) at basic level and secondary level has reached 252,000 and 40,200 respectively Student teacher ratios at basic and secondary levels have consequently reached 39 and 24 respectively

31 Demographic and health survey, 2016 has been completed As per this

survey, new-natal mortality rate (per thousand within 28 days) is 21, infant mortality rate (per thousand within 1 year) is 32, and child mortality rate (per thousand children below 5 years) is 39 Similarly, children receiving full immunization reached 78 percent while women receiving maternity services from skilled midwives reached 58 percent

A total of about 90,900 health workers have been delivering services through 4,600 health institutions in the first eight months of the current fiscal year 2016/17

32 Post earthquake reconstruction work has gained momentum in the

current fiscal year Of the total 653,913 beneficiaries identified in earthquake most affected 14 districts, grant agreements have been signed with 554,614 house owners in the first eight months of current fiscal year 2016/17 Likewise, Rs 50,000 as first installment has been deposited at bank accounts of 533,691 beneficiaries A task of providing cash amount

as second and third installments to home owners has been initiated, who have started construction after meeting the criteria Likewise, reconstruction works are underway at damaged educational institutions, health institutions, archaeological heritages and government buildings

Per Capita National Income (At

Constant Price)

Annual % Change 4.63 3.25 3.65 2.12 3.72 3.18 5.84 1.73 -0.91 5.2

Gross National Disposable Income

(At Current Price)

Annual % Change 16.5 24.2 18.8 13.3 16.6 12.4 19.2 9.3 6.4 13.4

Indicators Fiscal Year

Per Capita Gross National Income

Income(In Current Price)

Rs in Billion 1006 1250 1485 1682 1962 2206 2629 2874 3060 3471

Per Capita GNDI (In Current

Gross Fixed Capital

Government Investment in Gross

Private Investment in Gross Fixed

Indicators Fiscal Year

Indicators Fiscal Year

Debt Service (Principal & Interest

Share of the Private Sector credit in

Indicators Fiscal Year

Change

Indicators Fiscal Year

Capacity of Reserves to cover

Capacity of Reserves to cover

and Selling Rates

Including the data of Development Banks and Finance Companies since mid-July, 2010

Based on GFS 2001 classification of IMF since FY 2011/12

Note: Ratio of GDP is calculated with GDP at the prevailing producers’ price

Note: Financial Management Expenditure prior to FY 2014/15 was included in Capital Expenditure

Major Challenges of Economy

1 It is a challenging task to graduate the country at the middle income

status by 2030 and achieve the sustainable development goals by ending poverty, inequality, unemployment and dependency through high, sustained and broad-based inclusive growth

2 It is a daunting challenge to develop a socialistic oriented economy as

envisoned in the constitution through formulation and implementation of economic policy including the optimum utilization and management of the means of production along with their distribution and redistribution for a robust and sustainedeconomic growth

3 There is a challenging task of economic development including

macroeconomic stability by creating the foundation for the mobilization

of resources as well as the availability, assurance and equitable distribution of the means and resources at the federal, provincial and local levels in line with federal governance system

4 There remains a challenge of increasing domestic production through

industrial infrastructure, decent labor relation, energy availability and the production of quality products Likewise, creating investment friendly environment for increasing the production of goods and services having competitive and comparative advantage as well as for increasing the domestic and foreign investment is also a daunting task

5 It is a challenging task to reduce dependency on foreign employment by

creating employment opportunities at home and reaping demographic dividend by developing human resources as per the national needs and demand

6 Ending load shedding permanently by building large hydro projects or

reservoir based hydroelectricity projects to reduce investment and production risks on hydroelectricity that may emanate from the climate change remains a challenge

7 It is a challenge to achieve high and sustained economic growth by

concentrating investment on the key drivers of growh agriculture, tourism, hydroelectricity and infrastructure

8 Modernization and commercialization of agriculture by increasing

production and productivity through an adequate arrangement of

agricultural inputs such as improved seeds, fertilizers, irrigation, agricultural credit, technology, and skilled human resource is a challenging task

9 Formulating strategies and work plans of scientific land-use policy and

managing land effectively by resolving problems of uncontrolled land use and encroachment of public land have been daunting tasks

10 There remains a challenge of developing infrastructure at federal,

provincial and local level as per the federal structure Likewise, Interlinking the centers of local level and linking these centers with provinces and federation is also a challenge

11 Timely completion of reconstruction works by ensuring budget for the

development of modern settlement and the reconstruction of earthquake damaged private buildings, schools, health post, public buildings, cultural heritages and, physical and social infrastructures has been a challenge

12 It is challenging to increase investment bearing capacity in line with

sustainable fiscal structure and resource mobilization for the implementation of state policies and fundamental rights envisoned in constitution

13 It is a challenging task to enhance federal finance by developing the

revenue sytem as per the federal structure and increasing the ratio of tax revenue to GDP through the development of a neutral and transparent tax system as well as voluntary compliance of tax

14 Reducing dependency on foreign aid for country’s development finance

by enhancing the development capacity and utilizing foreign aid for national benefit and priority sectors is a challenging task

15 There remains a challenge of containing inflation rate within desired

limit by effectively managing supply through market monitoring and price information system as well as managing of the storage and distribution system of all the goods including petroleum products

16 Tasks of carrying out social security programs in an integrated way,

mobilizing funds in line with investment plans in a coordinated way, and taking grant-based social security programs to the target groups are full

of challenges

17 Creating dynamism in the economy by expanding the size of formal

economy through enhancing the access to finance is also a challenging task Likewise, it is challenging to make a provision of at least a bank branch in 744 centers at local level established in the federal system and implement access to finance programs based on innovative financial technology and financial literacy

18 There is a challenge to achive balanced and inclusive development by

addressing geographically between village and towns, mountains, hills and terai as well as on the basis of castes, groups and genders

World economy is improving with the recovery of developed countries Inflationary pressure persists in developed, emerging and developing economiies owing to the increase in commodity prices including the energy in the global market In this context, overall economic activities of Nepal have expanded in fiscal year 2016/17 Thus, the economic gowth for current fiscal year is estimated 6.94 percent Favorable mansoon, increased capital expenditures, conducive investment climate, energy availability including improved supply situation are attributable to high economic growth This growth rate is the highest recorded since FY 1993/94 and more than the targeted growth rate of 6.5 percent for FY 2016/17 The economy, which had affected severely and contracted due to devastating earthquake and disruption

in border points has almost recovered Moreover, the situation of macroeconomic stability has remained satisfactory Inflation rate has remained low since last few years while Balance of Payment has remained in surplus However, it is a daunting task to achieve higher economic growth by making it more inclusive while managing the federal system in the coming years

1 Overall EconomicSituation

World Economy

Economic Growth

1.1 World Economic Outlook of International Monetary Fund (IMF)

published in April 2017 projects that the world economy grows by 3.5 percent in 2017 Such growth stood at 3.1 percent in 2016 The world economy is projected to expand marginally due to the expansion of economic activities in developed countries and high contribution of emerging and developing economies to global economic growth

1.2 Developed economies that grew by 1.7 percent in 2016 is projected to

expand by 2.0 percent in 2017 Of the developed countries, the US economy that grew by 1.6 percent in 2016 is projected to grow by 2.3 percent in 2017 Likewise, Euro area that had expanded by 1.7 percent in

2016 is projected to grow at the same rate in 2017 Japanese economy that grew by 1.0 percent in 2016 is estimated to grow by 1.2 percent in

2017 due to increase in net exports

Table 1 (a) : World Economic Growth Rate (Percent)

Source: International Monetary Fund, April, 2017

1.3 Emerging and developing economies is projected to grow by 4.5 percent

in 2017 Such growth rate was 4.1 percent in 2016 Indian economy that grew by 6.8 percent in 2016 is estimated to expand by 7.2 percent in

2017 India is projected to expand at a high rate due to the introduction of economic reform programss, convenient supply situation and policy reforms Likewise, according to IMF, Chinaese economy that grew by 6.7 percent in 2016 is projected to grow by 6.6 percent in 2017

Table 1 (b) : Economic Growth in Neighboring Countries(Percent)

Source: International Monetary Fund, April, 2017

1.4 All South Asian countries except that of Bhutan and Bangladesh are

projected to grow in 2017 as compared to that of 2016 Likewise, all other south Asian counries except India, Sri Lanka and Nepal had expanded marginally in 2016 as compared to 2015

Price Situation

1.5 IMF has projected that the inflation in developed economies remains 2.0

percent in 2017 Such rate was 0.8 percent in 2016 Likewise, inflation in emerging and developing economies that stood at 4.4 percent in 2016 is projected to reach 4.7 percent in 2017 Inflation is projected to rise in

developed and developing economies due to the increased commodity prices including energy price in global markets

Table 1 (c) : CPI Based Global Inflation Rate (Percent)

International Monetary Fund, April, 2017

1.6 Of South Asian countries, inflation in Nepal, India and Bhutan is

projected to fall in 2017 as compared to that of 2016 Likewise, among the South Asian countries, the inflation rate of Nepal, Bangladesh, Sri Lanka and Afganistan had surged while that of other countries had declined marginally in 2016 as compared to 2015

Table 1 (d) : Trend of CPI Inflation in China and South Asia (Percent)

International Monetary Fund, April, 2017

1.7 The inflation rate of China that stood at 2.0 percent in 2016 is projected

to grow by 2.4 percent in 2017 due to slowdown in the industrial sector Likewise, Indian inflation, which stood at 4.9 percent in 2016 is projected to decline marginally to 4.8 percent in 2017

World Trade

1.8 As per IMF projection, the world trade of goods and services, which

grew by 2.2 percent in 2016, is projected to grow by 3.8 percent in 2017 World trade has recorded growth with the recovery of developed economies

Table 1 (e) : World Trade Situation (Annual Percentage Change)

Export Developed Economies 3.9 3.7 2.1 3.5 3.2

Emerging and Developing Economies 2.8 1.4 2.5 3.6 4.3

Import Developed Economies 3.9 4.4 2.4 4.0 4.0

Emerging and Developing Economies 4.0 -0.8 1.9 4.5 4.3

Terms of Trade Developed Economies 0.3 1.8 0.9 -0.5 0.1

Emerging and Developing Economies -0.6 -4.2 -1.2 1.3 -0.4

Source: International Monetary Fund, April 2017

1.9 Exports of developed economies that grew by 2.1 percent and that of

emerging and developing economies by 2.5 percent in 2016 are projected

to grow by 3.5 percent and 3.6 percent respectively in 2017 Likewise, imports of developed economies and those of emerging and developing economies are projected to grow by 4.0 percent and 4.5 percent respectively in 2017 Such growth rates were 2.4 percent and 1.9 percent respectively in 2016 Though both the exports and imports of goods and services had increased, imports have registered higher growth in 2017

National Economy

Economic Growth

1.10 Macroeconomic indicators related to national accounts such as GDP,

consumption, savings and investments are prepared by measuring various aspects of the economy for formulation of economic policies, and regular monitoring and evaluation of economic activities Such indices provide real picture of the current situation and guide a future course of action 1.11 From the perspective of economic growth, current fiscal year 2016/17

has been encouraging Economy has expanded as a result of increase in agricultural production due to favorable monsoon, speed up in reconstruction works and resolution of energy crisis Likewise, additional factors contributing in the expansion of economic activity inclue the commercialization of agriculture, stability oriented politics, reduction in closures and strikes, and reform in government policies and programs

Chart 1 (a) : Gross Domestic Product Trend

Source: Central Bureau of Statistics

1.12 GDP at base prices is estimated to grow by 6.94 percent in current fiscal

year 2016/17 Such growth rate remains 2.97 percent in FY 2014/15 and

at 0.01 percent in 2015/16

1.13 Economic growth rate has averaged 4.2 percent in the last ten years The

growth rate remained low in most of the fiscal year The growth rate of 6.94 percent in the current fiscal year is the highest recorded growth in the last ten years This growth rate is the highest since FY 1994/95 Likewise, agriculture and non-agriculture sector growth averaged 3.2 percent and 4.7 percent respectively in last ten years Similarly, industrial and service sector growth averaged 2.8 percent and 5.3 percent respectively in the last ten years In this period, the growth of agriculture and industrial sector was not achieved as expected However, the growth rate of the service sector remained satisfactory

Structure of GDP

1.14 In fiscal year 2016/17, the share of the agriculture sector in GDP stood

at 29.37 percent, while that of non-agriculture sector was 70.63 percent The share of the agriculture sector in GDP has been in declining trend in the last 15 years Such share was 34.3 percent on average during the period from FY 2002/03 to FY 2006/07 and declined to 34.1 percent in next consecutive five years (FY 2007/08-FY 2011/12) It was declined further to 31.4 percent in subsequent five years' period from FY 2012/13

to FY 20016/17 Likewise, the share of the non-agriculture sector

averaged 65.7 percent, 65.9 percent, and 68.6 percent respectively during the period FY 2002/03-FY 2006/07, FY 2007/08-FY 2011/12 and FY 2012/13-FY 2016/17 Nepales economy is in the stage of structural transformation as a result of decreasing share of agriculture sector against gradual increment in the share of non-agriculture sector in GDP The service sector has expanded at a high rate in the non-agriculture sector

Chart 1 (b) : Structure of Gross Domestic Product

Source: Central Bureau of Statistics

Table 1 (f) : Share in Gross Domestic Product

(Five Year’s Average, In Percent)

1.15 Primary sector incorporated activities of the agriculture and forests,

fishery, and mines and quarrying Contribution of the primary sector to GDP is estimated to remain at 30 percent in fiscal year 2016/17 Its contribution to GDP has been gradually declining for the last ten years and thus declined to 32.2 percent in the previous fiscal year 2015/16 Such contribution has averaged 33.7 percent in the last 10 years Growth

of gross value added of the primary sector is estimated to remain at 5.32 percent in the current fiscal year 2016/17 Such growth rate was negative

by 0.01 percent in the previous fiscal year Primary sector has expanded

in the current fiscal year 2016/17 due to favorable monsoon, commercialization of agriculture, increase in production of forest based materials for reconstruction, and quarrying

Chart 1 (c) : Sector-wise Economic Growth Rates

Source: Central Bureau of Statistics

Secondary Sector

1.16 The secondary sector includes the economic activities related to

construction, electricity, gas and water The contribution of the secondary sector to GDP has been declining for last ten years Its average contribution to GDP for last ten years stood at 14.6 percent, which declined to 14.0 percent in current fiscal year 2016/17 The growth rate

of this sector that remained negative by 6.45 percent in the previous fiscal year stood at 10.97 percent in the current fiscal year 2016/17 The secondary sector, which grew at an average rate of 2.8 percent in last ten years, has occupied the least share in the economy on the structural basis The gross value added of this sector increased as a result of the speed up

in reconstruction and other construction works, the expansion of energy sector and the increase in industrial production, among others

Tertiary Sector

1.17 Tertiary sector consists of economic activities of wholesale and retail

trades, hotel and restaurant, transport, communication and warehousing, financial intermediation, real estate and business services, public administration and defense, education, health, and other community, social and personal services The contribution of the services sector to

GDP has averaged 51.7 percent in the last ten years Its contribution to GDP is estimated to remain at 56.0 percent in the current fiscal year 2016/17 Economy is in the structural transformation due to the increase

in the share of service sector in GDP in recent years The growth rate of the services sector is averaged 5.3 percent in the last ten years Such growth rate is estimated at 6.9 percent in the current fiscal year 2016/17 Expansion in trade as a result of increased domestic production and rise

in import of goods, increase in the number of tourists arrival, increased economic activities of hotel, restaurant, transport and communication sectors due to conducive business environment, and expansion in social services including education and health are attributable to the growth of the services sector

Chart 1 (d) : Structure of Sector-wise Production

Source: Central Bureau of Statistics

Gross Value Added (GVA) as per Industrial Classification

Agriculture Sector

Agriculture and Forestry

1.18 Gross value added (GVA) of agriculture and forestry sector is estimated

to grow by 5.25 percent in the current fiscal year 2016/17, while such growth was negative by 0.19 percent in the previous fiscal year The growth rate of GVA has averaged 3.15 percent in last ten years The contribution of agriculture and forestry to GDP is estimated to remain at 28.89 percent in the current fiscal year Reasons for such higher growth rate of GVA are increased production of major food crops including rice,

wheat and maize, among others Rice, which occupies a high share in overall agricultural production, is estimated to have registered higher production growth of 21.7 percent due to favorable monsoon The share

of rice in the GVA of agriculture sector is estimated to stand at 20.7 percent Likewise, the production of agriculture and forestry sector is estimated to increase in the current fiscal year due to favorable monsoon, commercialization of agriculture, availability of seeds and fertilizers, and expansion of irrigation services

Fishery

1.19 The contribution of the fishery sector to GDP is estimated at 0.48 percent

in FY 2016/17 Growth rate of GVA of the fishery sector, which remained at 11.76 in the fiscal year 2015/16, is estimated to remain at 6.86 percent in current fiscal year 2016/17 The growth rate of this sector averaged 6.29 percent in last ten years Fish production is estimated to grow owing to the both government and non-government efforts

Industry Sector

Mining and Quarrying Sector

1.20 GVA of mining and quarrying sector is estimated to rise by 8.19 percent

in the current fiscal year 2016/17 as compared to previous fiscal year The share of this sector in GDP is estimated to remain at 0.63 percent The production of this sector registered a negative growth rate of 2.78 percent in previous fiscal year The average growth of this sector is 3.69 percent in last ten years Mining and quarrying sector is estimated to grow as a result of reconstruction works and quarrying of boulders, gravels, sand and soil in earquake affected and other districts for expeditious construction works

Manufacturing Industry

1.21 GVA of the industry sector is estimated to grow by 9.7 percent in the

current fiscal year 2016/17 as compared to preceding fiscal year Such a high growth results from an adequate supply of fuel and raw materials coupled with the decline in closures and strikes thereby creating favorable industrial environment The production of this sector decreased

by 8.0 percent in previous fiscal year owing to the adverse impacts of earthquake and disruption in border points The contribution of this sector to GDP that stood at 7.34 percent in FY 2007/08 fell ultimately shrinking to 5.67 percent in current fiscal year Growth rate of this sector

has averaged 2.08 percent for the last ten years The production of this sector did not remain satisfactory due to the lack of investment friendly environment, failure to maintain amicable industrial labor relations, unreliable and irregular supply of electricity, prolonged political transition, and debilitating industrial infrastructures, among others

1.22 The contribution of electricity, gas and water sector to GDP is estimated

to remain at 1.16 percent in current fiscal year 2016/17 The growth rate

of GVA of this sector, which was negative by 7.4 percent in previous fiscal year 2015/16, is expected to attain a higher growth rate of 12.97 percent in the current fiscal year 2016/17 GVA attained high growth as a result of notable rise in electricity production in current fiscal year The growth rate of this sector averaged 2.21 percent in the last decade

Construction Sector

1.23 GVA of the construction sector is estimated to grow by 11.66 percent in

the current fiscal year 2016/17 as compared to that of previous fiscal year The construction of large projects including Melamchi Drinking Water Project, and Upper Tamakoshi Hydroelectricity Project has lead to significant growth of this sector The share of construction sector to GDP is estimated to remain at 7.18 percent in the current fiscal year 2016/17

Service Sector

Wholesale and Retail Trade

1.24 GVA of wholesale and retail trade sector is estimated to grow by 9.76

percent in current fiscal year Such growth was negative by 2.54 percent

in the previous fiscal year 2015/16 The average growth rate of this sector stood at 4.88 percent in the past decade The growth of this sector

is estimated to remain high due to increased productions of tradable, agricultural, and industrial goods together with increase in import of goods This sub-sector, which is the highest contrubutor to GDP among the non-agriculture sector, is estimated to contribute 13.52 percent in the current fiscal year

Hotel and Restaurants

1.25 The contribution of hotel and restaurant sector to GDP is estimated to

remain at 1.98 percent in the current fiscal year 2016/17 The growth rate of GVA of this sector, which was negative by 9.68 percent in fiscal

year 2015/16, is estimated to grow positivly by 7.09 percent in the current fiscal year Growth rate of this sector averaged 4.23 percent in the last decade The hotel and restaurant sector that contracted in the previous fiscal year has expanded as a result of increased number of tourists arrival, improved domestic tourism, regular supply of electricity and reduced closures and strikes, among others

Transport, Communication and Warehousing

1.26 The GVA growth rate of transport, communication and warehousing

sector that continuously declined since FY 2007/08 is estimated to grow

by 6.5 percent in the current fiscal year 2016/17 Such growth was 2.02 percent in the last fiscal year Average growth of this sector stood at 6.32 percent in the last decade Production of this sector increased in the current fiscal year due to reduction in obstructions like closures and strikes There is a positive impact on transport sector owing to vibrant economic activities in overall economy Moreover, GVA increased as a result of increased number of communication subscribers along with the expanded services in this sector The share of this sector to GDP is estimated to remain at 8.11 percent in current fiscal year

Financial Mediation

1.27 Financial mediation sector covers banking, insurance and social security

related activities The contribution of this sector to GDP is estimated to stand at 5.40 percent in the current fiscal year 2016/17 The GVA of this sector is expected to grow by 6.72 percent in the current fiscal year 2016/17 as compared to previous fiscal year GVA has increased due to increased number of saving and credit accounts and expanded branches

of financial institutions

Real Estate and Business Services

1.28 The contribution of real estate and business services sector to GDP is

estimated to remain at 9.9 percent in the current fiscal year 2016/17 As compared to its preceding fiscal year, GVA growth rate of this sector is expected to rise by 5.27 percent in current fiscal year Such growth was 0.77 percent in FY 2014/15 due to devastating earthquake Growth of this sector is estimated to grow in the current fiscal year due to the rise in transactions especially of real estate business and commercial activities Average growth rate of this sector is has been 3.92 percent in last ten years

Public Administration and Defense

1.29 GVA growth rate of public administration and defence sector is

estimated to stand at 9.64 in the current fiscal year 2016/17, while such growth rate was 2.52 percent in previous fiscal year Such a high growth

in the current fiscal year results from the increased cost of production of the public administration and defense sectors Speceficially, increase in number of civil service employees, distribution of salaries and allowances for election security service, and expenditure on the employees deputed for reconstruction works are attributable for such a high growth The contribution of this sector to GDP is estimated to remain at 3.0 percent in the current fiscal year

Education Sector

1.30 Education sector is estimated to contribute 7.23 percent to GDP in

current fiscal year GVA of this sector, which rose by 7.04 percent in FY 2015/16 is estimated to rise by 4.21 in current fiscal year Despite increment in GVA of private educational institutions due to low intermediate consumption and increased income, GVA of the education sector saw a normal growth as the number of students in community schools did not increase significantly

Health Sector

1.31 GVA of the health sector that registered a growth of 3.25 percent in FY

2015/16 is estimated to grow by 6.58 percent in current fiscal year GVA witnessed a normal growth in FY 2015/16 due to notable increment in intermediate expenditure made for the earthquake affected patients treatment GVA in current fiscal year has increased owing to expanded accessibility to health services; enhanced health related awareness and increased income of private health institutions The contribution of the health sector to GDP stands at 1.74 percent in current fiscal year

Other Community, Social and Personal Services

1.32 GVA of other community, social and personal services sector is

estimated to grow by 5.88 percent in current fiscal year 2016/17, while such growth was 3.67 percent in previous fiscal year The average growth of this sector remained at 7.91 percent in the last ten years GVA

of this sector in current fiscal year is estimated to grow due to the increase in expenditure on community and social sectors by central and local government, and expansion in entertainment service activities in the private sector such as FM Radios and televisions The contribution of this

sector to GDP is estimated to remain at 5.09 percent in current fiscal year

Consumption

1.33 Consumption expenditure had increased by 11.8 percent to Rs 2,161.51

billion in FY 2015/16 The consumption expenditure at current price is estimated to rise by 7.9 percent to Rs 2,332.74 billion in current fiscal year 2016/17 The average share of consumption in GDP stood at 89.86 percent in the last ten years The share of consumption in GDP at current price that stood at 90.2 percent in FY 2007/08 fell to 86.03 percent in FY 2010/11 Such share stood at 96.18 percent in FY 2016/17 recording highest in last ten years while this is estimated to reach 89.7 percent in

FY 2016/17

1.34 The share of private sector consumption in GDP that had remained at

78.6 percent in FY 2007/08 is estimated to stand at 76.2 percent in current fiscal year 2016/17 Such share remained at 82.8 percent in the last year Likewise, the share of government consumption in GDP that stood at 11.6 percent in FY 2015/16 is estimated to remain at 11.7 percent in the current fiscal year 2016/17

Chart 1 (e) : Structure of Total Consumption

Source: Central Bureau of Statistics

1.35 Of the total consumption, private sector consumption stood at 84.9

percent in the current fiscal year 2016/17 against such share of 86.1 percent that of previous fiscal year 2015/16 The share of government consumption in the total consumption remained at 13.1 percent and that

of not-for-profit organizations is 2.0 percent in current fiscal year

1.36 Of the private sector consumption, food items hold almost two-third

share than non-food items and services In current fiscal year 2016/17, the shares of food items, non-food items and services to the total private sector consumption are 65.0 percent, 25.1 percent and 9.9 percent respectively Expenditure on food items is on the rise as compared to that

of non-food items and services due to changing food habits and escalating prices of food items Ten years ago, consumption expenditures

on food items, non-food items and services stood at 60 percent, 28 percent and 12 percent respectively The share of household consumption expenditure at current price in GDP has reached 81.4 percent in current fiscal year

Chart 1 (f) : Strucutre of Private Consumption

Source: Central Bureau of Statistics

Investment

1.37 Gross capital formation that stood at Rs 831.98 billion in FY 2014/15

dropped by 8.9 percent to Rs 757.68 billion in its subsequent fiscal year 2015/16 This expenditure is estimated to grow by 45.8 percent and stand at Rs 1,104.96 billion in current fiscal year The share of gross