Three provinces' GDP growth to remain below national average

Kathmandu, May 16

Of the seven provinces in Nepal, three of them are projected to achieve poor economic growth rate, below the national average of 1.86 per cent, the National Statistics Office (NSO) informed on Tuesday. 

Bagmati Province is projected to witness only 1.4 per cent growth in the current Fiscal Year 2022/23 which is a massive slide from the last year's 6.3 per cent. 

Likewise, Madhes and Sudurpaschim will achieve 1.7 per cent and 1.8 per cent respectively against the last year's growth of 4.6 and 4.8 per cent. . 

Among the provinces, Gandaki's economic growth is estimated to be the highest with 3.3 per cent. However, the economy of Gandaki had expanded by 6.4 per cent last year. 

Similarly, Koshi is projected to achieve 2.0 per cent, Lumbini 2.1 per cent and Karnali 1.9 per cent, said Director of the NSO, Ishwori Bhandari at a programme organised at the office to publish the provincial GDP report.

Steep fall in Bagmati

Bhandari said that the steep fall in the growth of Bagmati is the result of decline in trade (wholesale and retail), construction and industrial activities here. According to the NSO, these three sectors are projected to witness negative growth rate in the current fiscal year.

These major components of the national economy – manufacturing, construction, and wholesale and retail trade - are estimated to witness a loss of more than 2 per cent in their value addition. The growth rate for manufacturing is projected at -2.04 per cent, construction -2.62 per cent and wholesale and retail trade -2.96 per cent.

Since most of the business, construction and other economic activities are concentrated in Bagmati province, and it has a share of 37 per cent in the national economy, poor GDP growth here pulls down the national growth prospective as well. 

Meanwhile, the statistics unveiled on Tuesday showed a massive gap in the regional economy in Nepal continues with Karnali Province contributing just 4 per cent to the national GDP and Bagmati about 37 per cent – more than nine times bigger than the former. Sudurpaschim province follows Karnali with 7 per cent. 

Similarly, Gandaki is estimated to contribute about 9 per cent to the national economy, Madhes 13 per cent, Lumbini 14 per cent and Koshi 16 per cent.

Likewise, the NSO data showed that agriculture will be the largest contributor to the provincial economies except in Bagmati where the wholesale and retail trade leads the growth. Other contributors include real estate, service and public administration. 

Per capita GDP

Bagmati province also leads in the per capital Gross Domestic Product with US$ 2455 which is almost three times higher than  province where average per capita GDP is just $ 875. 

Only Bagmati and Lumbini provinces have performed better than the national average per capita GDP of $1399. Lumbini's average per capita GDP is $1492. Karnali is another poor performer with $997 per capita GDP. Similarly, Sudurpaschim has $1036 per capita GDP, Lumbini $1126 and Koshi province $1299.

Published in Friday Supplement of The Rising Nepal Daily on 17 May 2023.