Nepal has been suffering huge trade deficit due to an energy crisis, traditional agriculture system and higher remittances, according to a government study released on Tuesday.
The report prepared by Nepal's Ministry of Commerce and Supplies (MoCS) also concluded that the country recorded such a huge loss in foreign trade because the respective/line ministries did not promote their goods and services in the international market.
Nepal's trade deficit reached 3.96 billion U.S. dollars in the first eight months of the fiscal year.
"Other line ministries have been found instrumental for the trade deficit than the MoCS itself," reads the report.
Petroleum products, the largest import in the energy hunger country has played a crucial role in fostering the poor nation's trade deficit.
Previous report from the country's central bank has showed that Nepal's total export earnings are not enough to finance import of petroleum products alone. The country imported petroleum items worth 270 million U.S. dollars during the eighth month of the current fiscal year.
According to the report, the import of petroleum products and other energy generating items including battery, inverter and generators have made the largest contribution to the overall trade loss.
The report further said that due to the lack of capital and technology for the commercialization of agriculture, the country is forced to increase the import volume of food commodities, further aggravating the trade deficit.
Nepal has already imported agricultural items including rice, maize, edible oil and vegetables worth 380 million dollars during the eighth month of the current fiscal year.
According to the report, the growing inflow of remittance, which enhanced the lifestyle of Nepalis, has contributed to the imports of luxury goods including vehicles, cosmetics, jewelry, mobile and gadgets and other unproductive goods.
"The laxity in development of industrial infrastructure and failure to effectively utilize foreign aids in the country has also contributed in trade deficit," according to the report.
"The report proves that in a bid to bring down the amount of trade deficit, all concerned ministries needs to act together," Toya Narayan Gyanwali, a high level official at MoCS told Xinhua.