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The Economy of Nepal

Nepalese Economy

Nepal's map

Economy - overview: Nepal is among the poorest and least developed countries in the world with almost one-third of its population living below the poverty line. Agriculture is the mainstay of the economy, providing a livelihood for three-fourths of the population and accounting for 38% of GDP. Industrial activity mainly involves the processing of agricultural products, including pulses, jute, sugarcane, tobacco, and grain. Bumper crops, better security, improved transportation, and increased tourism pushed growth past 5% in 2008, after growth had hovered around 2.6% - barely above the rate of population growth - for the previous three years. The deteriorating world economy in 2009 will challenge tourism and remittance growth, a key source of foreign exchange. Nepal has considerable scope for exploiting its potential in hydropower and tourism, areas of recent foreign investment interest. Prospects for foreign trade or investment in other sectors will remain poor, however, because of the small size of the economy, its technological backwardness, its remoteness and landlocked geographic location, its civil strife and labor unrest, and its susceptibility to natural disaster.

GDP:

GDP - real growth rate: 5.6% (2008 est.) 3.2% (2007 est.) 3.7% (2006 est.)

GDP - per capita:

GDP - composition by sector: agriculture: 32.5% industry: 16.6% services: 50.9% (FY07 est.)

Population below poverty line:

Household income or consumption by percentage share: lowest 10%: 2.6% highest 10%: 40.6% (2006)

Distribution of family income - Gini index: 47.2 (2008)

Inflation rate (consumer prices):

Labor force: 14.6 million note: severe lack of skilled labor (2008 est.)

Labor force - by occupation: agriculture: 76% industry: 6% services: 18% (2004 est.)

Unemployment rate: 46% (2008 est.)

Budget: revenues: $1.7 billion expenditures: $2.3 billion (FY08)

Industries: tourism, carpets, textiles; small rice, jute, sugar, and oilseed mills; cigarettes, cement and brick production

Industrial production growth rate: 1.8% (FY08)

Electricity - production: 2.703 billion kWh (2007 est.)

Electricity - production by source:

Electricity - consumption: 2.276 billion kWh (2006 est.)

Electricity - exports: 165 million kWh (2007 est.)

Electricity - imports: 560 million kWh (2008 est.)

Oil - production: 0 bbl/day (2008 est.)

Oil - consumption: 12,500 bbl/day (2008 est.)

Oil - exports: 0 bbl/day (2008)

Oil - imports: 12,500 bbl/day (2008 est.)

Oil - proved reserves: 0 bbl (1 January 2006 est.)

Natural gas - production: 0 cu m (2008 est.)

Natural gas - consumption: 0 cu m (2008 est.)

Natural gas - exports: 0 cu m (2008 est.)

Natural gas - imports: 0 cu m (2008 est.)

Natural gas - proved reserves: 0 cu m (1 January 2008 est.)

Agriculture - products: pulses, rice, corn, wheat, sugarcane, jute, root crops; milk, water buffalo meat

Exports: $868 million f.o.b.; note - does not include unrecorded border trade with India (2008)

Exports - commodities: clothing, carpets, leather goods, jute goods, pulses, grain

Exports - partners: India 69.3%, US 8.8%, Germany 4.1% (2007)

Imports: $3.229 billion f.o.b. (2008)

Imports - commodities: petroleum products, machinery and equipment, electrical goods

Imports - partners: India 58.9%, China 13.6%, Japan 1.6% (2007)

Debt - external: $3.285 billion (2008)

Economic aid - recipient:

Currency:

Currency code:

Exchange rates: Nepalese rupees (NPR) per US dollar - 65.21 (2008), 70.35 (2007), 72.446 (2006), 72.16 (2005), 73.674 (2004)

Fiscal year: