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Government authorities claim that the economy is on a positive trajectory and gradually improving. They also argue that foreign trade is showing a favorable trend, citing a significant increase in exports. Likewise, Nepal Rastra Bank has expressed satisfaction over the rising foreign currency reserves. However, it remains silent on the excessive liquidity piling up in commercial banks. In fact, the central bank has been withdrawing surplus liquidity from the banking system almost every week.

A closer look at export figures reveals that much of the reported growth comes from vegetable ghee exports. The reality behind this figure is that the raw materials are imported from Singapore and then exported to India. In this process, Nepal imports crude oil by paying in US dollars but receives Indian currency when exporting the finished product to India, raising questions about the real benefit to the national economy.

Conditions on the ground tell a different story. Retailers report very poor business, while industries are operating at only about 50 percent of their production capacity.

The country’s large foreign currency reserves are primarily the result of remittance inflows. However, the government has failed to utilize these reserves effectively. It could have initiated development projects through public–private partnerships and spent foreign currency in productive sectors, creating employment opportunities for local youth. Instead, the so-called experienced finance minister has slashed budgets allocated to various development projects. When the government does not spend on development, money fails to circulate in the market, increasing the risk of recession.

Commercial banks are already facing a difficult period, yet Nepal Rastra Bank appears unable to address the challenges confronting the banking sector.

Of course, progress can be presented through statistical reports, but such figures must be realistic and their impact should be felt in everyday life. This present illusion of economic improvement, if allowed to continue, will only push the nation’s economy toward a deeper crisis.