Nepal faces bankruptcy because of Indian embargo
Kathmandu (AsiaNews) - Due to the April earthquake and the persistent unofficial exports embargo imposed by India, the economic growth of Nepal is likely to stay below the subsistence level, with severe repercussions on the daily life of the population .
The detention of the goods that pass through the border between Nepal and India is causing severe shortages in the supply of food, gas and fuel. Pashupati Murarka, president of the Federation of Nepalese Chambers and Commerce Industries (Fncci), which represents the industry sector, told AsiaNews: "The public is on the verge of bankruptcy. If the government fails to fund our losses by removing taxes, we will have to reconsider the investment in the country".
Since Nepal passed the first constitution in its modern history, India has been implementing an undeclared embargo on goods in direct transit to the country. The flow of trade has fallen from about 90% of goods exported to less than 5% of the delivery of the goods. The population is at its lowest, also forced to replace gas cookers with firewood. Even industries are suffering a lack of access to raw materials and transport is blocked.
Murarka reports that investors are considering the opportunity of putting their investments towards more profitable use abroad. "You cannot imagine what situation we are forced to face – he says -. There is no fuel, and there are blackouts. How can our industries functoin? ".
Bishwambhar Pyakurel, professor and economics expert, said: "If the situation goes on like this, national growth will fall below 2%. All economic and business activities are stopped. There are serious losses. The government must immediately find a solution to the embargo".
The government had set a target of 6% growth, thanks to international aid ($ 4.4 billion) arrived to rebuild the country after the April earthquake. The World Bank had instead reduced growth to 3.7%, due to various difficulties already present: the slowdown in growth, the drop in tourism, the growing protests among the population. Last week, some experts told AsiaNews the real reasons of the block are due to Indian prime minister Narendra Modi’s ambitions of hegemonic control over the country, rather than the defense of minorities un represented in the new constitution.