Nepal bans luxury item imports amid crisis

·2-min read

Nepal's government has reduced the number of weekly work days and banned the import of several luxury items as concerns about the country's depleting foreign reserves grow.

The ban covers all cars except essential vehicles like ambulances and hearses.

Also affected are expensive motorcycles, television and phone sets, an array of liquor and beverages, as well as playing cards and toys, according to a notice published in the government gazette.

Similarly, all processed tobacco and diamond products will also be hit by the ban, which will last until mid-July.

Information Minister Gyanendra Bahadur Karki said that the two-day weekly holiday rule will come into effect from May 15.

The daily work hours have been increased by one hour to a total of eight hours, he added.

Nepal has followed a work week comprising five and a half days with a full holiday only on Saturday.

Now it will be a five day work week.

Local media reported that the measures were aimed at saving the country's foreign reserves, which is under pressure due to rising imports and the impact of COVID-19 on tourism and foreign employment.

Nepal currently has a forex reserve worth $US9 billion ($A13 billion), which is barely enough to meet the country's imports for the next six months, according to Republica online.

Citing officials and experts, the online version of the state-owned Gorkhapatra newspaper reported that the reduced work days is likely to bring down Nepal's monthly trade deficit by about 10 per cent.

Nepal has been struggling with rising inflation which has been on the rise since the start of the Russian invasion of Ukraine.

The country's inflation averaged 7.14 per cent in March, which is the highest in the last 67 months.

Ram Prasad Gyawali, professor of economics at the Tribhuvan University, said Nepal was headed towards an economic crisis but the situation was not critical yet.

According to a recent World Bank report, higher commodity prices in Nepal were caused by the war in Ukraine.

Transportation prices, construction costs and other consumer prices are rising which will dampen overall demand, the report said.

with reporting from EFE

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting