Economy (Nepal)
===============


     Overview:
         Nepal is among the poorest and least developed countries in the world.
         Agriculture is the mainstay of the economy, providing a livelihood for over
         90% of the population and accounting for 60% of GDP. Industrial activity is
         limited, mainly involving the processing of agricultural produce (jute,
         sugarcane, tobacco, and grain). Production of textiles and carpets has
         expanded recently and accounted for 87% of foreign exchange earnings in
         FY89. Apart from agricultural land and forests, the only other exploitable
         natural resources are mica, hydropower, and tourism. Agricultural production
         in the late 1980s grew by about 5%, as compared with annual population
         growth of 2.6%. Forty percent or more of the population is undernourished
         partly because of poor distribution. Since May 1991, the government has been
         encouraging privatization and foreign investment. It has introduced policies
         to eliminate many business licenses and registration requirements in order
         to simplify domestic and foreign investment procedures. Economic prospects
         for the 1990s remain poor because the economy starts from such a low base.
     GDP:
         exchange rate conversion - $3.2 billion, per capita $165; real growth rate
         3.5% (FY91)
     Inflation rate (consumer prices):
         15.0% (December 1991)
     Unemployment rate:
         5%; underemployment estimated at 25-40% (1987)
     Budget:
         revenues $294.0 million; expenditures $624.0 million, including capital
         expenditures of $396 (FY92 est.)
     Exports:
         $180 million (f.o.b., FY91) but does not include unrecorded border trade
         with India
       commodities:
         clothing, carpets, leather goods, grain
       partners:
         US, India, Germany, UK
     Imports:
         $545 million (c.i.f., FY91 est.)
       commodities:
         petroleum products 20%, fertilizer 11%, machinery 10%
       partners:
         India, Singapore, Japan, Germany
     External debt:
         $2.5 billion (April 1990 est.)
     Industrial production:
         growth rate 6% (FY91 est.); accounts for 7% of GDP
     Electricity:
         280,000 kW capacity; 540 million kWh produced, 30 kWh per capita (1990)
     Industries:
         small rice, jute, sugar, and oilseed mills; cigarette, textile, carpet,
         cement, and brick production; tourism
     Agriculture:
         accounts for 60% of GDP and 90% of work force; farm products - rice, corn,
         wheat, sugarcane, root crops, milk, buffalo meat; not self-sufficient in
         food, particularly in drought years
     Illicit drugs:
         illicit producer of cannabis for the domestic and international drug markets
     Economic aid:
         US commitments, including Ex-Im (FY70-89), $304 million; Western (non-US)
         countries, ODA and OOF bilateral commitments (1980-89), $2,230 million; OPEC
         bilateral aid (1979-89), $30 million; Communist countries (1970-89), $286
         million