Nepal Rastra Bank (NRB), the central bank of Nepal, predicted that Nepal was unlikely to enjoy 5 percent economic growth this year as targeted by the government, local Annapurna daily reported Tuesday.

"The NRB, however, forecast that the economy would grow 4-4.5 percent," the local daily reported quoting NRB report on national economy.

"The whole economy is destined to suffer this year as the paddy production, a main contributor to national economy, is likely to decrease due to bad weather condition," said Bijaya Nath Bhattarai, governor of the NRB.

However, he said that non-agriculture sector would perform well this year compared to previous years because of ongoing peace process.

Making public the economic situation of the country during the first two months of the current fiscal year 2006/07, the governor said, Nepal's export and import could only increase by 0.1 percent and 9.1 percent respectively compared to 16.9 percent and 24.7 per cent last year.

However, inflation has declined to 6.6 per cent this year from 8.2 per cent last year, according to the NRB.

Source: Xinhua