Karnali’s economy weak: Only 4.2 percent share in national production, 75 percent of roads unpaved
लगानी न्यूज
{{TAG_OPEN_div_126} Kathmandu. The economic growth rate of Karnali Province is lower than the national average. According to the data released by the Nepal Rastra Bank, the economic growth rate of Karnali Province in the last fiscal year 2082-83 is estimated to be 2.94 percent in consumer prices.
The growth rate of the national economy of the province is estimated to be 3.85 percent in this fiscal year. According to the report, the Gross Domestic Product (GDP) of Karnali Province is estimated to reach Rs 277.25 billion at current prices. This is only 4.20 percent of the national GDP of Rs 6.601 trillion. Compared to the inter-provinces, Bagmati Province contributes the highest to the national economy at 36.71 percent while Karnali’s contribution is the lowest.
The contribution of the service sector to the economy of Karnali Province is the highest. According to the NRB, the share of the service sector in the GDP of the province is estimated to be 58.41 percent, 31.52 percent of the agricultural sector and 10.07 percent of the industrial sector.
Karnali’s contribution to the national agricultural production is 5.51 percent. Similarly, the share of the province in the national industrial sector is 3.02 percent and in the service sector is 3.76 percent, according to the report.TAG_OPEN_div_120
The total value added rate of the industrial sector in the province is estimated to be 1.51 percent and the construction sector is estimated to be 2.72 percent. The low contribution of the industrial sector to the economy and the lack of expected expansion in industrial activities indicates that there is a challenge in the economic development of the province.TAG_OPEN_div_118
Similarly, the total area covered by food crops in Karnali Province has decreased by 0.54 percent till mid-July of the last fiscal year. Although the area covered by rice has decreased by 2.94 percent, its production has increased by 6.76 percent.TAG_OPEN_div_116
The production of maize, wheat, millet, buckwheat and barley has also increased. According to the report, maize production increased by 0.25 percent, wheat by 2.50 percent, millet by 0.34 percent, buckwheat by 2.51 percent and barley by 13.74 percent. The production of overall food, cash and other crops increased by 3.55 percent.TAG_OPEN_div_114
{{TAG_OPEN_div_112} Vegetable and fruit production declined. Vegetable production decreased by 3.76 percent and fruit production by 4.05 percent. Similarly, apple production decreased by 3.26 percent and orange production by 3.80 percent.
Milk production increased by 15.83 per cent, wool by 44.63 per cent and egg production by 4.01 per cent. However, meat production decreased by 23.16 per cent and leather production by 14.14 per cent.TAG_OPEN_div_110
Out of the total arable land of 203,144 hectares in the province, 132,733 hectares have been cultivated. However, only 55,630 hectares or 41.90 percent of the cultivated land has irrigation facilities.TAG_OPEN_div_108
With limited access to irrigation in agriculture, agricultural credit has also decreased. In the review year, agricultural credit issued by banks and financial institutions decreased by 1.56 percent to Rs 4.90 billion.
Similarly, the average capacity utilization of model industries operating in Karnali Province has decreased. The average capacity utilization of industries has come down to 30.98 percent in the review year from 39.12 percent in the previous year.
Among the industries, the Radipakhi production industry has the highest capacity utilization of 66.6 TAG_OPEN_div_102 7 percent. The capacity utilization of the processed milk industry is the lowest at 10.19 percent.
Although the production of chow mein, carpet, wood and electric bulbs increased in the last fiscal year, the production of processed milk, feed, paper and leather shoes has declined.TAG_OPEN_div_100
Although there is a weakness in industrial activities, credit flow has increased in this sector. Industrial credit in the state has increased by 25.63 percent to Rs 5.07 billion.
Out of the total industrial loans, the highest number of 56.51 percent has been disbursed in Surkhet district. The report states that the lowest 0.28 percent of the loans have been disbursed in Dolpa. Regionally, the highest number of loans have been disbursed to the construction industries at 35.99 percent.TAG_OPEN_div_96
Similarly, there has been a significant decline in the number of foreign tourists in the province, according to the report. The number of foreign tourists entering the province has decreased by 27.68 percent to 22,163 in the review year.
According to the report, tourist arrivals from India decreased by 46.39 percent, China by 67.60 percent and third countries by 39.39 percent.TAG_OPEN_div_92
The decrease in the number of non-governmental organizations (NGOs) and the increase in the price of aviation fuel and petroleum products have been cited as the main reasons for the decrease in tourist arrivals.TAG_OPEN_div_90
Despite the decline in the tourism sector, the real estate business has improved. The number of real estate registrations increased by 8.30 percent to 18,734 in the review year. The revenue from real estate registration increased by 72.04 percent to Rs 57.82 crore.
As of mid-July this year, there are 481 branches of banks and financial institutions in Karnali Province. Among them, there are 216 branches of commercial banks, 21 of development banks, three of finance companies and 241 branches of microfinance financial institutions.TAG_OPEN_div_86
Deposit collection in the province increased by 22.03 per cent to Rs 111.15 billion in the review period. Similarly, credit flow increased by 9.79 per cent to Rs 66.85 billion. The loan-deposit ratio of the province stood at 60.15 per cent.TAG_OPEN_div_84
{{TAG_OPEN_div_82} The highest number of loans disbursed in the service sector was 85.21 percent or Rs 57.52 billion. According to the report, Surkhet district accounts for 61.98 percent of the total loans disbursed in the service sector.
Similarly, despite the expansion of road infrastructure in Karnali Province, there is a need to improve the quality. The total length of roads constructed in the province so far has reached 4,392.05 km.
Out of the total roads, only 299.30 km or 6.81 per cent have been blacktopped. Similarly, 777.91 km or 17.71 per cent of the roads have been graveled. The remaining 3,314.84 km or 75.47 per cent of the roads are unpaved.TAG_OPEN_div_78
Out of nine airports in the province, only TAG_OPEN_div_76 six are operational. The limitations of air and road infrastructure are creating challenges in the expansion of tourism, trade and other economic activities in the province.
The physical progress of the Bheri-Babai diversion project, which is national pride, has reached 70 percent and financial progress has reached 68 percent. Similarly, the construction of 275 km of roads and bridges along the Karnali section of the Pushpalal Mid-Hill Highway is underway, according to the report.TAG_OPEN_div_74
The number of people going for foreign employment from Karnali Province is significant. In the review year, a total of 30,490 people have taken work permit to go for foreign employment with new and re-labor permit.
TAG_OPEN_div_70 Under the National Employment Promotion Programme, 4,067 people have got employment through 544 projects. They have got a total of 2,85,567 days of employment. According to the report, Kalikot district is at the forefront in employment generation under this program.
The number of people going for foreign employment and the status of employment creation programs at the local level show that there is a need to expand employment opportunities in the state.
In the fiscal year 2082÷83, the total budget expenditure of the Karnali Province government reached Rs 20.11 billion. Out of this, capital expenditure was Rs 11.13 billion and current expenditure was Rs 8.80 billion, according to the report.TAG_OPEN_div_66
In the review year, the total revenue collection of the province increased by 20.41 percent to Rs 10.88 billion. The share of tax revenue in the total revenue is 95.29 percent.TAG_OPEN_div_64
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