Impact of COVID-19 on Foreign Trade: A Case Study from Nepal

This study examines how COVID-19's impact on international trade over the period. The research makes analysis of data before and after happening of COVID-19 and based on this conclusion has been drawn. The research revealed that COVID-19 had an adverse influence on foreign trade due to significant negative effects. The heterogeneous impacts of COVID-19 on industries been observed in the data. The most affected exports commodities are Zinc Sheets, Rosin, Handicrafts Products, Readymade garments, Jewelry. Further analysis shows that some levels of imports were affected in the fiscal year 19/20 while in the fiscal year 20/21 the imports had increased. Import of Gold, MS-wires, MS-billets, Transportation equipment, electrical goods and readymade garments were affected due to COVID-19 in FY 2019/20 while in another fiscal year those imports were increased. The issue has recently resurged with the current global pandemic and the ancient discussion on the comparative benefits against resilience. The idea of a comparative advantage is that commerce would be favorable if each country is specialized in items for which they have a comparative advantage. In the context of global supply shocks, the idea is challenging trading particularly when nations rely on the global vital supply chain. Now focus need to be shifted to self-production than rely on others.