Govt curtails fuel expenses by 20 percent

Nepal is running low on foreign reserves and it can finance imports of goods and services for just six months.

NL Today

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Kathmandu: The government has curtailed fuel expenditures for government offices by 20 percent. A meeting of the Council of Ministers held on April 13 had decided to curtail the expenses by 20 percent considering a decline in foreign exchange reserve.

“Various ministries, agencies, and public organizations associated with the government should slash the budget for fuel by 20 percent,” reads the statement issued by the Ministry of Finance.

The ministry has stated that the decision will not be applicable in the case of essential vehicles, vehicles deployed for local elections, and vehicles used by security bodies.

[Related: Is Nepal heading toward the worst economic crisis?]

The government said the decision will be implemented till the end of the current fiscal year.

Nepal is running low on foreign reserves. Import of petroleum products, vehicles and luxury items has put the country’s foreign exchange reserve under stress. According to the central bank, Nepal’s foreign exchange reserve is just enough to finance imports of goods and services for just six months. The gross foreign exchange reserves decreased by 18.5 percent to 9.58 billion in mid-March 2022 from 11.75 billion in mid-July 2021.