Many countries’ economies have been crippled as a result of the coronavirus pandemic. Even countries with strong economic foundations are in turmoil at the moment, and it is not news that Nepal has been shaken as well.
The first coronavirus outbreak in Nepal paralyzed the country for months. The country’s economic growth was severely hampered at a time when people’s lives were at a standstill. Prohibition orders have been issued in most parts of the country following the second wave of coronavirus.
Non-essential services and products are no longer available for purchase or distribution. Economic activity is dwindling. The majority of factories are closed.
What is the country’s economic loss as a result of this? The government has not conducted any research. However, the private sector has estimated a daily loss of Rs. 8 billion.
Shekhar Golchha, President of the Federation of Nepalese Chambers of Commerce and Industry, stated that when Nepal is closed for one day, a loss of Rs. 8 billion is incurred.
“When it is closed for one day, the private sector suffers greatly,” he said. The tourism and transportation industries have been hit the hardest.”
Golchha expressed concern about how industries and businesses would recover after the lockdown, saying that some of the industries that were closed during the lockdown were not fully operational and had to be reopened.
“It’s been 50 days since the second wave of the coronavirus prompted the prohibition orders. A daily loss of Rs 8 billion is incurred. As a result, it appears that Rs 400 billion has been lost in 50 days.”
The prohibition orders, which went into effect on March 24, 2020, lasted about nine months. Despite the fact that the private sector has petitioned the government for relief, claiming that the ban has harmed industries and businesses, the government has only partially addressed the issue.
At this time, it is unknown when the prohibitory orders, which went into effect on April 29, 2021, will be lifted. The rate of coronavirus infection is gradually decreasing. A smart lockdown was recommended by CCMC and has been implemented.
Industry of Cement
Dhurba Thapa, chairman of the Cement Producers’ Association, said the cement industry was losing a lot of money because of the lockdown. “Currently, 30% of the cement industry is closed,” he said. The remaining 70% of the industry is only operating at 20-30% capacity.”
According to Thapa, if the cement industry is shut down for one day, it will lose Rs 500 million. The cement industry has suffered a loss of Rs 25 billion as a result of the current prohibitory orders.
During the lockdown, transportation is also the most affected area. All public transportation vehicles are prohibited from moving or providing services as a result of the prohibitory orders.
According to Yogendra Karmacharya, President of the National Federation of Nepali Transport Entrepreneurs, the transportation sector has been hit the hardest by the past and current lockdowns.
“There are about 300,000 buses, microbuses, and taxis in total,” he said. The daily loss for buses and other small vehicles is Rs 300 million if we calculate it at a rate of Rs 1,000 per day. As a result, it has suffered a Rs 15 billion loss in the last 50 days.”
Employees claim that even during the previous lockdown, there was a daily loss of Rs 300 million.
Many businesses are closed during the lockdown, with the exception of a few large construction projects. According to Ravi Singh, President of the Federation of Construction Entrepreneurs of Nepal, a daily loss of Rs 230 million is being incurred. He claimed that development work has slowed as a result of construction work not being completed, and that unemployment has also risen.
Hotel and Tourism
COVID-19 is causing the most damage to the hotel industry. The transportation and hotel industries have been the hardest hit.
According to Binayak Shah, Senior Vice-President of the Hotel Association of Nepal (HAN), the hotel industry is losing Rs 66.6 million per day.
“This time, the sector has suffered a loss of Rs 3.33 billion due to the prohibitory orders in place for 50 days,” he said.
Only 4,000 of Nepal’s tens of thousands of hotels are connected to HAN.