GDP contracts by 3.5 percent

KATHMANDU, JANUARY 8: Nepal's Gross Domestic Product (GDP) growth contracted by 3.4% in the first quarter of the current fiscal year, according to a report released by the National Statistics Office. The primary reasons for this contraction are attributed to the devastating floods and landslides in Ashoj (mid-September to mid-October) and a negative in particularly the construction sector.

The government had an aim of 6% GDP growth for the current fiscal year, but the target fell short by 2.6 %. While 17 out of the 18 sectors contributing to the economy showed positive growth,  only construction contracted by 0.3% due to a decline in the import of construction materials

The electricity/ gas/ steam sector recorded the highest growth rate of 21.4% in the first quarter. The transportation and storage sector contributed 6.7% to the GDP. Other sectors, such as accommodation, food, financial, insurance, and professional, scientific, and technical services, also showed significant growth.

 

The agriculture sector, which contributes the largest share of the economy, is estimated to have grown by 3%. Factors like increased production of paddy and other monsoon crops, as well as growth in vegetables, cash crops, and livestock, contributed to this positive growth. However, floods and landslides hindered further growth in this sector.

The wholesale and retail trade sector, the second largest sector of the economy, is estimated to have grown by only 0.5% in the first quarter. This growth is attributed to a slight increase in the domestic production of agricultural and commercial goods and a moderate increase in the import of major commercial goods.

The manufacturing sector is estimated to have grown by 2.3%, while the education, health, and real estate sectors grew by 0.4%, 4.1%, and 3.1%, respectively.