Is Nepal's economy really in trouble? For two years we have been analyzing the economy around this question. If we look at the data released by the government agencies at certain time intervals, it does not seem that there is much problem in the economy. Although there are problems, they seem to be very common in nature and can be solved quickly.

For example, let's look at the inflation data released by Nepal Rastra Bank for the first 6 months (July to December) of this financial year. During this period, the average inflation in Nepal has been 5.26 percent, which is lower than the 6.5 percent estimated by the central bank. In this way, it seems that the price increase which was out of control last year is now under control. If the price increase is brought under control, the internal situation of the country should be improved, the demand for goods and services should increase in the market. Since it is an import-oriented economy, the import of goods and services should also increase or if the import does not increase, there should be an increase in domestic production. During this period, imports decreased by 3.1 percent. Looking at the data of the first 6 months of the current financial year, the external sector of Nepal's economy is almost in a good condition. Analyzing on the basis of these data, it seems that the discussed economy is not in trouble. But the daily life of common people is not so easy. There is no data about the internal demand of the market, but if we analyze it based on the survey conducted with small and medium entrepreneurs, the situation of demand and price increase in the market is different from the official data.

The current state of our economy is one of stagflation caused by high inflation, high unemployment and low economic growth. However, looking at government data, there is no basis to confirm this. That is why there is always a difference of opinion between government agencies, markets and those interested in the economy. Lately, there is no credible basis in the data presented by the government agencies such as Ministry of Finance, National Bank, Statistics Office and Planning Commission of Nepal. Most of the data published by the government is published as 'estimated' data. It has been more than a decade since the official who published the data started to get the answer, 'This data is just an estimate' when asked about it. The policies and programs made by the government are based on these 'estimated' data. 

A few weeks ago, the Central Economics Department of Tribhuvan University published a report on the size of the informal economy in Nepal. In the research report written in collaboration with Nepal Rastra Bank, the size of the informal economy has been measured based on national accounts. From 2011 to 2021, the size of the informal economy has decreased from 49.1 percent to 38.6 percent. However, our informal economy is bigger than this in recent years due to increasing illegal hundi trade, decrease in government revenue, smuggling, liquidity crisis in the system, problems in cooperatives, etc. But these things are not seen in the data. This also raises questions about the credibility of government data. There are plenty of other examples of large differences in data even within government agencies. If the data is not correct, the policies and programs made by the state will not give correct results, it will also burden the state. Another example of non-uniformity in data among state agencies is seen in social security distribution in Nepal. More than 2 million elderly people in Nepal receive the old age allowance under social security, which is publicized by the Registration Department. On the other hand, if we look at the data of the national census, the population of the age group receiving old age allowance is only around 1.6 million. Such issues can be resolved even if these government agencies themselves rely on the data published by themselves. But the importance of data system and data is still not understood in Nepal.

Although the data of import, export, foreign exchange reserves, remittance etc. of the external sector of the economy kept by the central bank are periodic, the data other than that are not available in sufficient quantity with the government. The economic survey data published by the government every year looks like a collection of data published by various government offices, the National Bank and the National Statistics Office. However, the figures of these offices are not consistent.

The government does not have enough data in the fields of agriculture, small and medium industries, foreign employment, etc., which contribute to Nepal's economy. Even the latest census has not been able to tell what is the situation of Nepal in the data. What percentage of the population of Nepal is unemployed, what percentage of the population is based on agriculture, what is the state of agricultural production and productivity, industrial production, import and consumption of raw materials, skilled manpower, etc., lack of reliable data in Nepal. Therefore, it is difficult to estimate the size of Nepal's economy. There is a problem in Nepal's national accounting calculation method because the data of Nepal's gross domestic product, which is calculated based on the production method in the national accounting system, is not collected, managed and analyzed by a single agency. There is a great need for data to make public policies, plans and programs made by the government effective. Successful implementation of public policies that are not based on facts is difficult, such plans do not produce results, nor can their success and implementation be measured. An example of this is the periodic schemes of Nepal. The periodical plans made by Nepal are neither based on data, nor are data found for their monitoring and evaluation. 

Until two years ago, Nepal's data system was based on the 6-decade-old Data Act. Although the new Statistics Act, 2079 has been implemented in Nepal, it has not made a fundamental difference in the national statistics system. There are no skilled and sufficient human resources in the agencies that perform statistical activities, statistical activities have not been prioritized by government agencies. Due to the lack of a reliable national data system, Nepal's achievements in the economic and social fields have also been overshadowed.  It is also difficult to believe in public policies, plans and programs that are made without the basis of

reliable data. Most of the policies and plans made in Nepal are not done by analyzing data. Therefore, data collection and processing methods for fields such as agriculture, employment, literacy, social security, and infrastructure development have not been scientific. Data of the same nature produced by the National Statistics Office and the National Bank, Ministry of Finance, Office of the Auditor General and various ministries do not match. In the last 8 years of studies and research on public policy and economy in Nepal, rarely searched data has been easily found. Another reason behind this is that government agencies do not provide easy access to data to the public and researchers. The policy makers of Nepal seem to be ignorant about the importance of data in state policy making and modern economy.