The rising graph of mobile imports has now shown a continuous low in recent months. The government decided not to issue a Letter of Credit (LC) for expensive phones and the effect is now visible in the Nepali market. Almost a million fewer mobile phones have been imported into Nepal in one year compared to the previous fiscal year 077/78. However, this has not yet helped the government conserve forex reserves as it hoped to.
The Customs Department has recently published the report till the end of Jestha. It shows that in the first 11 months of the current Fiscal Year 078/79, 55 lakh, 86 thousand, 5 hundred and 77 units of phones entered Nepal. The volume cost Nepal a total of over NPR 38.6 billion.
Back in April, the Government of Nepal announced its decision not to issue LC for high-end phones and other luxury goods. The list included phones that cost $600 and above. This has lessened the number of phones entering Nepal in recent months.
Imports lessen by almost 10 lakh
As per the report, Nepal imported less than 9 lakh and 70 thousand mobile phones in comparison. In the same period from the FY 077/78, Nepal imported 65 lakh, 54 thousand, 3 hundred, and 22 units of phones. For this, Nepali traders spent a total of NPR 34 billion 14 crores.
The yearly stats also translate to the low volume of imports by months. In Chaitra of FY 078/79, over 7.5 mobile phones entered Nepal. This decreased to over 3.64 lakh phones in Baishakh. Taking further slump, it tolled only over 2.18 lakh in Jestha.
The irony: Mobile imports are low, but the amount spent frustrates
But the low number of phone imports has not helped the government realize the purpose. The volume of phones entering Nepal has come crashing, but the outflow of the currency has leaped up.
By comparison between the two periods, Nepal spent over 4.46 billion. This again begs the question of whether the government’s policy of banning luxury phones has even proved effective.
The government decided to ban expensive phones in Nepal in the midst of the liquidity crisis. But by the looks of the amount spent, it doesn’t look to have been fruitful in conserving the dollar reserve, which was the underlying purpose. Meanwhile, the ban will last up to the end of Ashar till further notice.
Do you think the government needs to include even the midrange phones to achieve its purpose of saving forex reserve? Do offer your input in the comments below.