The foreign exchange reserves have depleted in terms of both Nepali currency and US dollar. The central bank has stated that such reserves have currently come down by 1.8 percent to Rs 261.81 million during the review compared to mid-July 2010.They have decreased by 1.1 percent in dollar terms too to US $ 3.54 billion.The absence of budget has also dealt a blow to the inflow of foreign aid to Nepal.

The United Nation's body on trade, investment and development issues, UNCTAD's latest World Investment Report revealed that even among the least developed countries (LDCs), Nepal is at the bottom of the heap in attracting foreign capital.According to the World Investment Report 2010, foreign direct investment (FDI) to almost all the LDCs increased during the 1990-2008 period with the exception of Nepal, Burundi, Eritrea, Samoa and Timor-Leste.The growing militancy of trade unions, energy crisis, absence of the rule of law and apathy on the part of political parties towards the economy are some of the prime factors that are not only marring the business environment but even driving away domestic investors, say economic experts.

Similarly, the government agencies have failed to call tender due to the prolonged delay in bringing budget which has resulted in low expenditure in the development field.The government's spending is key to encourage the private sector to spend as well.Due to the steep downturn in key economic indicators, the finance ministry is also planning to trim down the overall economic growth of the country.

As the chronic political disorder continues to stultify the economy, Nepal's status as an investment friendly country has further relegated.The country slipped down by four notches to rest at 116th position in 2010 the Doing Business Report, recently unveiled by the International Finance Corporation, wing of World Bank, from 112th in 2009.According to the report, the position of Nepal in six indicators including business, protecting investors, paying taxes and trading across border has declined further.The report suggests that Nepal's economic health is going downhill at an escalating pace and needs urgent remedies.The persistent delay in bringing budget may also derail the achievements Nepal has so far made in the arena of human development.