KATHMANDU: After the country's economic crisis worsened, the Nepalese government announced a comprehensive ban on the import of ten expensive products until mid-July 2022.
The decision was made to prevent the country's foreign exchange reserves from being depleted further. Cigarettes and tobacco-related products, diamonds, mobile phone sets, colour TVs with screens larger than 32 inches, automobiles except ambulances and hearses, motorcycles over 250cc, toys of all kinds, alcoholic beverages, and playing cards are among the goods whose import has been prohibited, according to a notice published in the Gazette on Wednesday.
Apart from this, the government has taken other measures to prevent the foreign reserve from decreasing further. In an effort to halt the outflow of the country's fast depleted foreign exchange reserves, Nepal's central bank issued an order to traders in the first week of this month to "discourage" them from issuing letters of credit (LC) to import non-essential products.
Imports have soared in recent months, causing significant outflows of foreign currency, putting the country's balance of payments in the red and heightening fears of a crisis. In addition to prohibiting the opening of letters of credit, the central bank has warned companies not to import 300 different commodities.
According to the central bank, a large amount of bank loans has gone toward paying for imports, leaving the government short of funds to finance the economic activity required to resurrect the Covid-19-devastated economy.
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